As filed with the Securities and Exchange Commission on July 7, 2023
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF
REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-22396
NEUBERGER BERMAN HIGH YIELD STRATEGIES FUND INC.
(Exact name of registrant as specified in charter)
c/o Neuberger Berman Investment Advisers LLC
1290 Avenue of the Americas
New York, New York 10104-0002
(Address of principal executive offices – Zip Code)
Joseph V. Amato
Chief Executive Officer and President
Neuberger Berman High Yield Strategies Fund Inc.
c/o Neuberger Berman Investment Advisers LLC
1290 Avenue of the Americas
New York, New York 10104-0002
Lori L. Schneider, Esq.
K&L Gates LLP
1601 K Street, N.W.
Washington, D.C. 20006-1600
(Names and addresses of agents for service)
Registrant's telephone number, including area code: (212) 476-8800
Date of fiscal year end: October 31
Date of reporting period: April 30, 2023
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that
is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940, as amended (“Act”) (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the
collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and
any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.
Item 1. Report to Stockholders.
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Following is a copy of the semi-annual report transmitted to stockholders pursuant to Rule 30e-1 under the Act.
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Neuberger Berman
High Yield Strategies
Fund Inc.
Semi-Annual Report
April 30, 2023
The "Neuberger Berman" name and logo and "Neuberger Berman Investment Advisers LLC" name are registered service
marks of Neuberger Berman Group LLC. The individual Fund name in this piece is either a service mark or registered service mark of Neuberger Berman Investment Advisers LLC. ©2023 Neuberger Berman Investment Advisers
LLC. All rights reserved.
President’s Letter
Dear Stockholder,
I am pleased to present this semi-annual report for Neuberger Berman High Yield Strategies Fund Inc. (the Fund)
for the six months ended April 30, 2023 (the reporting period). The report includes a portfolio commentary, a listing of the Fund’s investments and its unaudited financial statements for the reporting period.
The Fund seeks high total return (income plus capital appreciation). To pursue that objective, we have assembled
a portfolio that consists primarily of high yield debt securities.
The Fund commenced a transferable rights offering (Offer) on May 23, 2023 (Record Date), whereby the Fund issued
one transferable right (Right) for each share of common stock of the Fund held by stockholders of record as of the Record Date. Holders of Rights were entitled to purchase shares of common stock by submitting three Rights and the
subscription price per share for each share purchased. The final subscription price of $7.42 per share of common stock was equal to 89% of the Fund’s net asset value per share of common stock at the close of trading on the NYSE American
on June 21, 2023, the expiration date of the Offer. The Offer, which was over-subscribed, resulted in the issuance of 6,482,227 shares of common stock and the gross proceeds of the Offer were approximately $48.1 million.
Thank you for your confidence in the Fund. We will continue to do our best to retain your trust in the years to
come.
Sincerely,
Joseph V. Amato
President and CEO
Neuberger Berman High Yield Strategies Fund Inc.
Neuberger Berman High Yield Strategies Fund Inc.
Portfolio Commentary (Unaudited)
Neuberger Berman High Yield Strategies Fund Inc. (the Fund) generated a 5.09% total return on a net asset value (NAV) basis for the six-month period ended April 30, 2023 (the
reporting period), underperforming its benchmark, the ICE BofA U.S. High Yield Constrained Index (the Index), which provided a 5.88% total return for the same period. (Fund performance on a market price basis is provided in the table
immediately following this commentary.) The use of leverage (typically a performance enhancer in up markets and a detractor during market retreats) contributed to the Fund’s performance during the reporting period.
The high yield market, as measured by the Index, generated solid results during the reporting period. The market
experienced periods of heightened volatility, partly driven by uncertainties regarding future U.S. Federal Reserve Board (Fed) actions, moderating but still elevated inflation and turmoil in U.S. regional and European banking. The mini
banking crisis triggered bouts of investor risk aversion; however, government actions quelled concerns over widespread contagion. All told, during the reporting period, yields moved lower as high-yield bond prices rose and high yield
credit spreads tightened. Issuer credit metrics of interest coverage, earnings growth, and leverage remained in favorable ranges, with high-yield issuers broadly well-positioned to navigate the current environment.
From a sector perspective on a relative basis, security selection within and an overweight to telecommunications
versus the Index, security selection within and an underweight to health care, and an overweight to and security selection within gas distribution were the worst performers. In contrast, relative to the Index, security selection within
and overweights to building materials and diversified financial services, along with an underweight to and security selection within media-broadcast, were the best performers.
In terms of the Fund's portfolio credit quality, security selection within and an overweight to issuers rated
CCC and below versus the Index, security selection within and an underweight to BB and security selection within BBB and above were the worst performers. Conversely, security selection within and an overweight to B relative to the Index
and an overweight BBB and above rated issuers were the best performers.
Looking ahead, we believe U.S. high-yield valuations may compensate investors for the relatively benign default
outlook. Although slowing demand has helped inflation come down from last year’s peak, it is still higher than the Fed’s target range. We believe changes in consumer behavior, rising inventories and central banks needing to balance
financial and price stability are likely to continue to push inflation in a downward trend. Our analysts remain focused on the fundamentals of individual issuers, assessing the base and downside cases in the event of a soft economic
landing or recession. Relatively healthy consumer and business balance sheets and positive economic growth should remain supportive of fundamentals, in our view. While the macroeconomic data can move the high-yield market day-to-day, we
remain focused on industry-specific trends and idiosyncratic risks to individual issuers. Despite the potential for short-term volatility, we believe our bottom-up, fundamental credit research that focuses on security selection,
avoiding credit deterioration, and putting only our "best ideas" into the Fund, will position us well to take advantage of any volatility.
Sincerely,
Joe Lind and Chris Kocinski
Portfolio Co-Managers
The portfolio composition, industries and holdings of the Fund are subject to change without notice.
The opinions expressed are those of the Fund's portfolio managers. The opinions are as of the date of this
report and are subject to change without notice.
The value of securities owned by the Fund, as well as the market value of shares of the Fund’s common stock,
may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Fund; conditions affecting the general economy; overall market changes; local, regional, national or global
political, social or economic instability; regulatory or legislative developments; price, currency and interest rate fluctuations, including those resulting from changes in central bank policies; and changes in investor sentiment.
The performance of certain rated bonds within the Index, as noted above, represent issues that are rated Baa1/BBB+ through
Baa3/BBB- and above, Ba1/BB+ through Ba3/BB-, B1/B+ through B3/B- and Caa1/CCC+ or lower, based on an average of Moody’s, S&P Global and Fitch, as calculated by ICE BofA.
High Yield Strategies Fund Inc. (Unaudited)
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High Yield Strategies Fund Inc.
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PORTFOLIO BY MATURITY DISTRIBUTION
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(as a % of Total Investments*)
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One to less than Five Years
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Five to less than Ten Years
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Does not include Short-Term Investments or
the impact of the Fund’s open positions in
derivatives, if any.
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Six Month
Period
Ended
04/30/2023
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Average Annual Total Return
Ended 04/30/2023
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High Yield
Strategies
Fund Inc.
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High Yield
Strategies
Fund Inc.
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ICE BofA
U.S. High
Yield
Constrained
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Listed closed-end funds, unlike open-end funds, are not continually offered. Generally, there is an initial public
offering and, once issued, shares of common stock of closed-end funds are sold in the secondary market on a stock exchange.
The performance data quoted represent past performance and do not indicate future results.
Current performance may be lower or higher than the performance data quoted. For current performance data, please visit www. nb.com/cef-performance.
The results shown in the table reflect the reinvestment of income dividends and other
distributions, if any. The results do not reflect the effect of taxes a stockholder would pay on Fund distributions or on the sale of shares of the Fund’s common stock.
The investment return and market price will fluctuate and shares of the Fund’s common stock
may trade at prices above or below NAV. Shares of the Fund’s common stock, when sold, may be worth more or less than their original cost.
Returns would have been lower if Neuberger Berman Investment Advisers LLC ("NBIA") had not waived certain
expenses during certain of the periods shown. The waived fees are from prior years that are no longer disclosed in the Financial Highlights.
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The performance information for periods prior to August 6, 2010 is that of a predecessor fund
(Neuberger
Berman High Yield Strategies Fund).
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Returns based on the NAV of the Fund.
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Returns based on the market price of shares of the Fund’s common stock on the NYSE American.
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The ICE BofA U.S. High Yield Constrained Index tracks the performance of U.S.
dollar-denominated, below
investment grade corporate debt publicly issued in the U.S. domestic market. In addition to
meeting other
criteria, qualifying securities must have a below investment grade rating (based on an average
of Moody’s,
S&P and Fitch ratings) and have risk exposure to countries that are members of the FX-G10,
Western
Europe or territories of the U.S. and Western Europe. Securities in legal default are excluded
from the
index. Index constituents are capitalization-weighted, provided the total allocation to an
individual issuer
does not exceed 2%. Transaction costs are incorporated into the calculation of total return for
ICE fixed
income indices beginning in July 2022. Please note that the index does not take into account
any fees and
expenses or any tax consequences of investing in the individual securities that it tracks and
that individuals
cannot invest directly in any index. Data about the performance of this index are prepared or
obtained by
NBIA and include reinvestment of all income dividends and other distributions, if any. The Fund
may invest
in securities not included in the index and generally does not invest in all securities included
in the index.
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For more complete information on Neuberger Berman High Yield Strategies Fund Inc., call Neuberger Berman
Investment Advisers LLC at (877) 461-1899, or visit our website at www.nb.com.
Legend April 30, 2023 (Unaudited)
Neuberger Berman High Yield Strategies Fund Inc.
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= London Interbank Offered Rate
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= Secured Overnight Financing Rate
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Index Periods/Payment Frequencies:
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= Neuberger Berman Investment Advisers LLC
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Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited)
April 30, 2023
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Asset-Backed Securities 7.9%
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AGL Core CLO 4 Ltd., Series 2020-4A, Class A1R, (3 mo. USD LIBOR + 1.07%),
6.32%, due
4/20/2033
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Ares LIV CLO Ltd., Series 2019-54A, Class E, (3 mo. USD LIBOR + 7.34%),
12.60%, due 10/15/2032
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Balboa Bay Loan Funding Ltd., Series 2021-1A, Class A, (3 mo. USD LIBOR +
1.20%), 6.45%, due
7/20/2034
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Barings CLO Ltd., Series 2017-1A, Class E, (3 mo. USD LIBOR + 6.00%),
11.26%, due 7/18/2029
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Benefit Street Partners CLO XXX Ltd., Series 2023-30A, Class D, (3 mo. USD
Term SOFR + 5.60%),
10.31%, due 4/25/2036
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Canyon Capital CLO Ltd., Series 2021-2A, Class D, (3 mo. USD LIBOR + 3.35%),
8.61%, due
4/15/2034
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Cedar Funding X CLO Ltd., Series 2019-10A, Class ER, (3 mo. USD LIBOR +
6.50%), 11.75%, due
10/20/2032
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Crown City CLO II, Series 2020-2A, Class DR, (3 mo. USD Term SOFR + 7.11%),
12.16%, due
4/20/2035
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Galaxy XXII CLO Ltd., Series 2016-22A, Class DRR, (3 mo. USD LIBOR + 3.35%),
8.61%, due
4/16/2034
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Gulf Stream Meridian 7 Ltd., Series 2022-7A, Class A1, (3 mo. USD Term SOFR
+ 1.36%), 6.35%,
due 7/15/2035
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KKR CLO Ltd., Series 23, Class D, (3 mo. USD LIBOR + 3.10%), 8.35%, due
10/20/2031
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Madison Park Funding XXIX Ltd., Series 2018-29A, Class D, (3 mo. USD LIBOR +
3.00%), 8.26%, due
10/18/2030
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Morgan Stanley Eaton Vance CLO Ltd., Series 2022-17A, Class D, (3 mo. USD
Term SOFR + 4.95%),
10.00%, due 7/20/2035
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Octagon Investment Partners 39 Ltd., Series 2018-3A, Class D, (3 mo. USD
LIBOR + 2.95%), 8.20%,
due 10/20/2030
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Trestles CLO IV Ltd., Series 2021-4A, Class A, (3 mo. USD LIBOR + 1.17%),
6.43%, due 7/21/2034
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TSTAT Ltd., Series 2022-1A, Class E, (3 mo. USD Term SOFR + 8.50%), 13.55%,
due 7/20/2031
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Voya CLO Ltd., Series 2019-2A, Class E, (3 mo. USD LIBOR + 6.60%), 11.85%,
due 7/20/2032
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Total Asset-Backed Securities (Cost $13,191,098)
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Summer BC Bidco B LLC, 5.50%, due 10/31/2026
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Darling Ingredients, Inc., 6.00%, due 6/15/2030
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Air Canada, 3.88%, due 8/15/2026
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American Airlines, Inc., 7.25%, due 2/15/2028
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American Airlines, Inc./AAdvantage Loyalty IP Ltd.
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Delta Air Lines, Inc., 7.38%, due 1/15/2026
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See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
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Wolverine World Wide, Inc., 4.00%, due 8/15/2029
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Ford Motor Credit Co. LLC
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(Secured Overnight Financing Rate + 2.95%), 7.73%, due 3/6/2026
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Jaguar Land Rover Automotive PLC, 5.88%, due 1/15/2028
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Nissan Motor Acceptance Co. LLC, 2.00%, due 3/9/2026
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Nissan Motor Co. Ltd., 4.35%, due 9/17/2027
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Auto Parts & Equipment 2.1%
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Adient Global Holdings Ltd., 4.88%, due 8/15/2026
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Dealer Tire LLC/DT Issuer LLC, 8.00%, due 2/1/2028
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Goodyear Tire & Rubber Co., 5.00%, due 7/15/2029
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ZF North America Capital, Inc.
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Bank of America Corp., Series TT, 6.13%, due 4/27/2027
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Bank of New York Mellon Corp., Series H, 3.70%, due 3/20/2026
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JPMorgan Chase & Co., Series HH, 4.60%, due 2/1/2025
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PNC Financial Services Group, Inc., Series T, 3.40%, due 9/15/2026
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See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
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Amgen, Inc., 3.38%, due 2/21/2050
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Builders FirstSource, Inc., 6.38%, due 6/15/2032
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Camelot Return Merger Sub, Inc., 8.75%, due 8/1/2028
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Cornerstone Building Brands, Inc., 6.13%, due 1/15/2029
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Jeld-Wen, Inc., 4.88%, due 12/15/2027
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Knife River Holding Co., 7.75%, due 5/1/2031
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Masonite International Corp.
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MIWD Holdco II LLC/MIWD Finance Corp., 5.50%, due 2/1/2030
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Standard Industries, Inc., 4.38%, due 7/15/2030
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Avient Corp., 7.13%, due 8/1/2030
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INEOS Finance PLC, 6.75%, due 5/15/2028
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Olympus Water U.S. Holding Corp., 4.25%, due 10/1/2028
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SCIH Salt Holdings, Inc., 4.88%, due 5/1/2028
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SCIL IV LLC/SCIL USA Holdings LLC, 5.38%, due 11/1/2026
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SPCM SA, 3.13%, due 3/15/2027
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Tronox, Inc., 4.63%, due 3/15/2029
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Vibrantz Technologies, Inc., 9.00%, due 2/15/2030
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WR Grace Holdings LLC, 5.63%, due 8/15/2029
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Allied Universal Holdco LLC/Allied Universal Finance Corp., 6.00%, due
6/1/2029
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ASGN, Inc., 4.63%, due 5/15/2028
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Garda World Security Corp.
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Korn Ferry, 4.63%, due 12/15/2027
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Legends Hospitality Holding Co. LLC/Legends Hospitality Co.-Issuer, Inc.,
5.00%, due 2/1/2026
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MPH Acquisition Holdings LLC
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Neptune Bidco U.S., Inc., 9.29%, due 4/15/2029
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PECF USS Intermediate Holding III Corp., 8.00%, due 11/15/2029
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Prime Security Services Borrower LLC/Prime Finance, Inc.
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See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
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Commercial Services – cont'd
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United Rentals North America, Inc.
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Ahead DB Holdings LLC, 6.63%, due 5/1/2028
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McAfee Corp., 7.38%, due 2/15/2030
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Presidio Holdings, Inc., 8.25%, due 2/1/2028
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Cosmetics - Personal Care 0.4%
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Coty, Inc., 5.00%, due 4/15/2026
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Distribution - Wholesale 2.0%
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BCPE Empire Holdings, Inc., 7.63%, due 5/1/2027
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Resideo Funding, Inc., 4.00%, due 9/1/2029
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Ritchie Bros Holdings, Inc.
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Univar Solutions USA, Inc., 5.13%, due 12/1/2027
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Diversified Financial Services 4.1%
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Ally Financial, Inc., 5.75%, due 11/20/2025
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Avolon Holdings Funding Ltd., 5.25%, due 5/15/2024
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Global Aircraft Leasing Co. Ltd., 6.50% Cash/7.25% PIK, due 9/15/2024
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LPL Holdings, Inc., 4.00%, due 3/15/2029
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VistaJet Malta Finance PLC/XO Management Holding, Inc.
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Clearway Energy Operating LLC, 3.75%, due 1/15/2032
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Duke Energy Corp., 3.75%, due 9/1/2046
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Leeward Renewable Energy Operations LLC, 4.25%, due 7/1/2029
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Talen Energy Supply LLC, 8.63%, due 6/1/2030
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TransAlta Corp., 7.75%, due 11/15/2029
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See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
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Vistra Corp., 7.00%, due 12/15/2026
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Vistra Operations Co. LLC
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Electrical Components & Equipment 0.7%
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Imola Merger Corp., 4.75%, due 5/15/2029
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Sensata Technologies BV, 5.88%, due 9/1/2030
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Energy - Alternate Sources 1.1%
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Sunnova Energy Corp., 5.88%, due 9/1/2026
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Engineering & Construction 1.2%
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Global Infrastructure Solutions, Inc., 7.50%, due 4/15/2032
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VM Consolidated, Inc., 5.50%, due 4/15/2029
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|
|
|
|
|
Allwyn Entertainment Financing U.K. PLC, 7.88%, due 4/30/2029
|
|
|
|
Caesars Entertainment, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
Cedar Fair LP/Canada's Wonderland Co./Magnum Management Corp./Millennium Op
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Everi Holdings, Inc., 5.00%, due 7/15/2029
|
|
|
|
Lions Gate Capital Holdings LLC, 5.50%, due 4/15/2029
|
|
|
|
Live Nation Entertainment, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Midwest Gaming Borrower LLC/Midwest Gaming Finance Corp., 4.88%, due
5/1/2029
|
|
|
|
Raptor Acquisition Corp./Raptor Co.-Issuer LLC, 4.88%, due 11/1/2026
|
|
|
|
Scientific Games Holdings LP/Scientific Games U.S. FinCo, Inc., 6.63%, due
3/1/2030
|
|
|
|
Scientific Games International, Inc., 7.00%, due 5/15/2028
|
|
|
|
Warnermedia Holdings, Inc., 5.14%, due 3/15/2052
|
|
|
|
WMG Acquisition Corp., 3.75%, due 12/1/2029
|
|
|
|
Wynn Resorts Finance LLC/Wynn Resorts Capital Corp., 5.13%, due 10/1/2029
|
|
|
|
|
Environmental Control 0.5%
|
|
|
Clean Harbors, Inc., 5.13%, due 7/15/2029
|
|
|
|
GFL Environmental, Inc., 4.38%, due 8/15/2029
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
Environmental Control – cont'd
|
|
|
Harsco Corp., 5.75%, due 7/31/2027
|
|
|
|
|
|
|
|
|
Albertsons Cos., Inc./Safeway, Inc./New Albertsons LP/Albertsons LLC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Performance Food Group, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TreeHouse Foods, Inc., 4.00%, due 9/1/2028
|
|
|
|
U.S. Foods, Inc., 4.75%, due 2/15/2029
|
|
|
|
|
Forest Products & Paper 0.3%
|
|
|
Ahlstrom Holding 3 Oy, 4.88%, due 2/4/2028
|
|
Healthcare - Products 0.8%
|
|
|
Hologic, Inc., 4.63%, due 2/1/2028
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Healthcare - Services 3.5%
|
|
|
CHS/Community Health Systems, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Envision Healthcare Corp., 8.75%, due 10/15/2026
|
|
|
|
HealthEquity, Inc., 4.50%, due 10/1/2029
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Acute Care Solutions LLC, 6.38%, due 3/1/2026
|
|
|
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
Holding Companies - Diversified 0.4%
|
|
|
Benteler International AG, 10.50%, due 5/15/2028
|
|
|
|
|
|
KB Home, 7.25%, due 7/15/2030
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Meritage Homes Corp., 5.13%, due 6/6/2027
|
|
|
|
Shea Homes LP/Shea Homes Funding Corp.
|
|
|
|
|
|
|
|
|
|
|
|
Taylor Morrison Communities, Inc./Taylor Morrison Holdings II, Inc., 5.63%,
due 3/1/2024
|
|
|
|
|
|
|
|
|
Alliant Holdings Intermediate LLC/Alliant Holdings Co.-Issuer
|
|
|
|
|
|
|
|
|
|
|
|
AmWINS Group, Inc., 4.88%, due 6/30/2029
|
|
|
|
AssuredPartners, Inc., 5.63%, due 1/15/2029
|
|
|
|
BroadStreet Partners, Inc., 5.88%, due 4/15/2029
|
|
|
|
GTCR AP Finance, Inc., 8.00%, due 5/15/2027
|
|
|
|
HUB International Ltd., 7.00%, due 5/1/2026
|
|
|
|
Ryan Specialty Group LLC, 4.38%, due 2/1/2030
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Newfold Digital Holdings Group, Inc., 6.00%, due 2/15/2029
|
|
|
|
Northwest Fiber LLC/Northwest Fiber Finance Sub, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carpenter Technology Corp.
|
|
|
|
|
|
|
|
|
|
|
|
TMS International Corp., 6.25%, due 4/15/2029
|
|
|
|
|
|
|
|
|
Carnival Corp., 9.88%, due 8/1/2027
|
|
|
|
Carnival Holdings Bermuda Ltd., 10.38%, due 5/1/2028
|
|
|
|
Lindblad Expeditions Holdings, Inc., 9.00%, due 5/15/2028
|
|
|
|
Lindblad Expeditions LLC, 6.75%, due 2/15/2027
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NCL Finance Ltd., 6.13%, due 3/15/2028
|
|
|
|
Royal Caribbean Cruises Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wynn Las Vegas LLC/Wynn Las Vegas Capital Corp., 5.50%, due 3/1/2025
|
|
Machinery - Construction & Mining 0.5%
|
|
|
Manitowoc Co., Inc., 9.00%, due 4/1/2026
|
|
|
|
Terex Corp., 5.00%, due 5/15/2029
|
|
|
|
|
Machinery - Diversified 1.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SPX FLOW, Inc., 8.75%, due 4/1/2030
|
|
|
|
TK Elevator U.S. Newco, Inc., 5.25%, due 7/15/2027
|
|
|
|
|
|
|
|
|
CCO Holdings LLC/CCO Holdings Capital Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DISH DBS Corp., 5.13%, due 6/1/2029
|
|
|
|
DISH Network Corp., 11.75%, due 11/15/2027
|
|
|
|
McGraw-Hill Education, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
Radiate Holdco LLC/Radiate Finance, Inc., 6.50%, due 9/15/2028
|
|
|
|
Sirius XM Radio, Inc., 3.88%, due 9/1/2031
|
|
|
|
Virgin Media Finance PLC, 5.00%, due 7/15/2030
|
|
|
|
Virgin Media Vendor Financing Notes IV DAC, 5.00%, due 7/15/2028
|
|
|
|
|
Metal Fabricate - Hardware 0.3%
|
|
|
Advanced Drainage Systems, Inc., 6.38%, due 6/15/2030
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
|
|
|
|
Century Aluminum Co., 7.50%, due 4/1/2028
|
|
|
|
First Quantum Minerals Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FMG Resources August 2006 Pty Ltd.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Miscellaneous Manufacturer 0.1%
|
|
|
Amsted Industries, Inc., 5.63%, due 7/1/2027
|
|
|
|
|
|
Ascent Resources Utica Holdings LLC/ARU Finance Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Callon Petroleum Co., 7.50%, due 6/15/2030
|
|
|
|
Chesapeake Energy Corp., 6.75%, due 4/15/2029
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Crescent Energy Finance LLC, 9.25%, due 2/15/2028
|
|
|
|
Hilcorp Energy I LP/Hilcorp Finance Co.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nabors Industries Ltd., 7.50%, due 1/15/2028
|
|
|
|
Nabors Industries, Inc., 7.38%, due 5/15/2027
|
|
|
|
Noble Finance II LLC, 8.00%, due 4/15/2030
|
|
|
|
Northern Oil & Gas, Inc., 8.13%, due 3/1/2028
|
|
|
|
Occidental Petroleum Corp., 4.63%, due 6/15/2045
|
|
|
|
PDC Energy, Inc., 5.75%, due 5/15/2026
|
|
|
|
Permian Resources Operating LLC
|
|
|
|
|
|
|
|
|
|
|
|
Rockcliff Energy II LLC, 5.50%, due 10/15/2029
|
|
|
|
Valaris Ltd., 8.38%, due 4/30/2030
|
|
|
|
|
Packaging & Containers 5.6%
|
|
|
Ardagh Metal Packaging Finance USA LLC/Ardagh Metal Packaging Finance PLC
|
|
|
|
|
|
|
|
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
Packaging & Containers – cont'd
|
|
|
Ardagh Packaging Finance PLC/Ardagh Holdings USA, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
Berry Global, Inc., 5.63%, due 7/15/2027
|
|
|
|
Crown Americas LLC/Crown Americas Capital Corp. VI, 4.75%, due 2/1/2026
|
|
|
|
Intelligent Packaging Ltd. Finco, Inc./Intelligent Packaging Ltd. Co.-Issuer
LLC, 6.00%, due 9/15/2028
|
|
|
|
Mauser Packaging Solutions Holding Co.
|
|
|
|
|
|
|
|
|
|
|
|
Pactiv Evergreen Group Issuer LLC/Pactiv Evergreen Group Issuer, Inc.,
4.38%, due 10/15/2028
|
|
|
|
Pactiv Evergreen Group Issuer, Inc./Pactiv Evergreen Group Issuer LLC,
4.00%, due 10/15/2027
|
|
|
|
Sealed Air Corp., 4.00%, due 12/1/2027
|
|
|
|
Sealed Air Corp./Sealed Air Corp. U.S., 6.13%, due 2/1/2028
|
|
|
|
Trident TPI Holdings, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
Trivium Packaging Finance BV
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
180 Medical, Inc., 3.88%, due 10/15/2029
|
|
|
|
Organon & Co./Organon Foreign Debt Co.-Issuer BV, 5.13%, due 4/30/2031
|
|
|
|
Teva Pharmaceutical Finance Netherlands III BV, 7.88%, due 9/15/2029
|
|
|
|
|
|
|
|
|
Antero Midstream Partners LP/Antero Midstream Finance Corp., 7.88%, due
5/15/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CQP Holdco LP/BIP-V Chinook Holdco LLC, 5.50%, due 6/15/2031
|
|
|
|
Crestwood Midstream Partners LP/Crestwood Midstream Finance Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DCP Midstream Operating LP
|
|
|
|
|
|
|
|
|
|
|
|
DT Midstream, Inc., 4.13%, due 6/15/2029
|
|
|
|
EnLink Midstream LLC, 6.50%, due 9/1/2030
|
|
|
|
EnLink Midstream Partners LP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
|
|
|
|
EQM Midstream Partners LP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Genesis Energy LP/Genesis Energy Finance Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Harvest Midstream I LP, 7.50%, due 9/1/2028
|
|
|
|
Howard Midstream Energy Partners LLC, 6.75%, due 1/15/2027
|
|
|
|
ITT Holdings LLC, 6.50%, due 8/1/2029
|
|
|
|
Kinetik Holdings LP, 5.88%, due 6/15/2030
|
|
|
|
New Fortress Energy, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
NuStar Logistics LP, 5.75%, due 10/1/2025
|
|
|
|
Summit Midstream Holdings LLC/Summit Midstream Finance Corp., 8.50%, due
10/15/2026
|
|
|
|
Tallgrass Energy Partners LP/Tallgrass Energy Finance Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Western Midstream Operating LP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realogy Group LLC/Realogy Co.-Issuer Corp.
|
|
|
|
|
|
|
|
|
|
|
|
|
Real Estate Investment Trusts 5.9%
|
|
|
American Tower Corp., 2.95%, due 1/15/2051
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
Real Estate Investment Trusts – cont'd
|
|
|
MPT Operating Partnership LP/MPT Finance Corp.
|
|
|
|
|
|
|
|
|
|
|
|
Necessity Retail REIT, Inc./American Finance Operating Partner LP, 4.50%,
due 9/30/2028
|
|
|
|
Park Intermediate Holdings LLC/PK Domestic Property LLC/PK Finance
Co-Issuer, 7.50%, due
6/1/2025
|
|
|
|
RHP Hotel Properties LP/RHP Finance Corp., 4.75%, due 10/15/2027
|
|
|
|
RLJ Lodging Trust LP, 4.00%, due 9/15/2029
|
|
|
|
Service Properties Trust, 3.95%, due 1/15/2028
|
|
|
|
Uniti Group LP/Uniti Group Finance, Inc./CSL Capital LLC, 10.50%, due
2/15/2028
|
|
|
|
VICI Properties LP/VICI Note Co., Inc., 4.25%, due 12/1/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1011778 BC ULC/New Red Finance, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Abercrombie & Fitch Management Co., 8.75%, due 7/15/2025
|
|
|
|
Asbury Automotive Group, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GYP Holdings III Corp., 4.63%, due 5/1/2029
|
|
|
|
Macy's Retail Holdings LLC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NMG Holding Co., Inc./Neiman Marcus Group LLC, 7.13%, due 4/1/2026
|
|
|
|
PetSmart, Inc./PetSmart Finance Corp., 7.75%, due 2/15/2029
|
|
|
|
SRS Distribution, Inc., 6.13%, due 7/1/2029
|
|
|
|
Victoria's Secret & Co., 4.63%, due 7/15/2029
|
|
|
|
White Cap Parent LLC, 8.25% Cash/9.00% PIK, due 3/15/2026
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Central Parent, Inc./CDK Global, Inc., 7.25%, due 6/15/2029
|
|
|
|
Consensus Cloud Solutions, Inc., 6.50%, due 10/15/2028
|
|
|
|
MSCI, Inc., 4.00%, due 11/15/2029
|
|
|
|
Open Text Corp., 3.88%, due 12/1/2029
|
|
|
|
Oracle Corp., 3.60%, due 4/1/2050
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
|
|
|
|
Rackspace Technology Global, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ciena Corp., 4.00%, due 1/31/2030
|
|
|
|
CommScope Technologies LLC, 5.00%, due 3/15/2027
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Frontier Communications Holdings LLC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lumen Technologies, Inc., 4.00%, due 2/15/2027
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sprint LLC, 7.13%, due 6/15/2024
|
|
|
|
|
|
|
|
|
AerCap Global Aviation Trust, 6.50%, due 6/15/2045
|
|
|
|
|
|
Solaris Midstream Holdings LLC, 7.63%, due 4/1/2026
|
|
Total Corporate Bonds (Cost $262,654,542)
|
|
|
Loan Assignments(b) 12.2%
|
|
|
|
|
Peraton Corp., Term Loan B, (1 mo. USD Term SOFR + 3.75%), 8.83%, due
2/1/2028
|
|
|
|
TransDigm, Inc., Term Loan I, (3 mo. USD Term SOFR + 3.25%), 8.15%, due
8/24/2028
|
|
|
|
|
|
|
|
|
First Brands Group LLC, Term Loan, (6 mo. USD Term SOFR + 5.00%), 10.25%,
due 3/30/2027
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
|
|
|
|
Standard Industries, Inc., Term Loan B, (1 mo. USD Term SOFR + 2.25%),
7.33%, due 9/22/2028
|
|
Business Equipment & Services 0.5%
|
|
|
AppLovin Corp., Term Loan B, (3 mo. USD Term SOFR + 3.10%), due 10/25/2028
|
|
|
|
Tempo Acquisition LLC, Term Loan B, (1 mo. USD Term SOFR + 3.00%), 7.98%,
due 8/31/2028
|
|
|
|
|
Chemicals & Plastics 0.7%
|
|
|
Diamond BC BV, Term Loan B, (1 mo. USD Term SOFR + 2.75%, 3 mo. USD Term
SOFR + 2.75%),
7.85% – 8.06%, due 9/29/2028
|
|
|
|
Ineos U.S. Finance LLC, Term Loan B, (3 mo. USD Term SOFR + 3.50%), due
2/18/2030
|
|
|
|
Starfruit Finco BV, Term Loan B, (3 mo. USD Term SOFR + 2.75%), 7.90%, due
10/1/2025
|
|
|
|
|
Containers & Glass Products 0.2%
|
|
|
Trident TPI Holdings, Inc., Term Loan, (1 mo. USD Term SOFR), due 9/15/2028
|
|
Distribution - Wholesale 0.4%
|
|
|
Dealer Tire Financial LLC, Term Loan B2, (1 mo. USD Term SOFR + 4.50%),
9.48%, due 12/14/2027
|
|
Diversified Insurance 0.5%
|
|
|
Gainwell Acquisition Corp., Term Loan B, (3 mo. USD Term SOFR + 4.00%),
9.00%, due 10/1/2027
|
|
|
|
Hub International Ltd., Term Loan B, (3 mo. USD LIBOR + 3.25%), 8.41% –
8.51%, due 4/25/2025
|
|
|
|
|
|
|
|
|
Formula One Holdings Ltd., Term Loan B, (1 mo. USD Term SOFR + 3.25%),
8.23%, due 1/15/2030
|
|
|
|
Great Canadian Gaming Corp., Term Loan, (3 mo. USD LIBOR + 4.00%), 8.95%,
due 11/1/2026
|
|
|
|
|
Financial Intermediaries 1.1%
|
|
|
Asurion LLC, Second Lien Term Loan B4, (1 mo. USD LIBOR + 5.25%), 10.27%,
due 1/20/2029
|
|
|
|
Starwood Property Trust, Inc.
|
|
|
|
Term Loan B2, (1 mo. USD LIBOR + 3.25%), 8.33%, due 7/26/2026
|
|
|
|
Term Loan B, (1 mo. USD Term SOFR + 3.25%), 8.23%, due 11/18/2027
|
|
|
|
|
|
|
|
|
Aramark Services, Inc., Term Loan B, (1 mo. USD LIBOR + 2.50%), 7.52%, due
4/6/2028
|
|
|
|
|
|
Medline Borrower LP, Term Loan B, (1 mo. USD LIBOR + 3.25%), 8.27%, due
10/23/2028
|
|
|
|
RegionalCare Hospital Partners Holdings, Inc., Term Loan B, (3 mo. USD LIBOR
+ 3.75%), 9.02%, due
11/16/2025
|
|
|
|
Team Health Holdings, Inc., Term Loan B, (1 mo. USD Term SOFR + 5.25%),
10.23%, due 3/2/2027
|
|
|
|
|
Industrial Equipment 0.2%
|
|
|
Gates Global LLC, Term Loan B3, (1 mo. USD LIBOR + 2.50%), 7.58%, due
3/31/2027
|
|
Leisure Goods - Activities - Movies 0.2%
|
|
|
UFC Holdings LLC, Term Loan B, (3 mo. USD LIBOR + 2.75%), 8.05%, due
4/29/2026
|
|
|
|
|
|
GVC Holdings (Gibraltar) Ltd., Term Loan B2, (6 mo. USD Term SOFR + 3.50%),
8.44%, due
10/31/2029
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
|
|
|
|
Ascent Resources - Utica, Second Lien Term Loan, (3 mo. USD LIBOR + 9.00%),
14.21%, due
11/1/2025
|
|
|
|
GIP III Stetson I LP, Term Loan B, (1 mo. USD Term SOFR + 4.25%), 9.33%, due
7/18/2025
|
|
|
|
Prairie ECI Acquiror LP, Term Loan B, (1 mo. USD LIBOR + 4.75%), 9.77%, due
3/11/2026
|
|
|
|
Waterbridge Midstream Operating LLC, Term Loan B, (3 mo. USD LIBOR + 5.75%),
11.01%, due
6/22/2026
|
|
|
|
|
Retailers (except food & drug) 1.0%
|
|
|
Great Outdoors Group LLC, Term Loan B1, (1 mo. USD LIBOR + 3.75%), 8.77%,
due 3/6/2028
|
|
|
|
Petco Health & Wellness Co., Inc., Term Loan B, (3 mo. USD Term SOFR +
3.25%), 8.41%, due
3/3/2028
|
|
|
|
|
|
|
|
|
Frontier Communications Corp., First Lien Term Loan, (1 mo. USD LIBOR +
3.75%), 8.81%, due
5/1/2028
|
|
Textiles, Apparel & Luxury Goods 0.4%
|
|
|
Crocs, Inc., Term Loan B, (1 mo. USD Term SOFR + 3.50%), 8.58%, due
2/20/2029
|
|
|
|
|
|
|
|
|
|
Term Loan B, (1 mo. USD Term SOFR + 5.75%), 10.73%, due 1/29/2027
|
|
|
|
Term Loan C, (1 mo. USD Term SOFR + 5.75%), 10.73%, due 1/29/2027
|
|
|
|
Lonestar II Generation Holdings LLC
|
|
|
|
Term Loan B, (1 mo. USD LIBOR + 5.00%), 10.02%, due 4/20/2026
|
|
|
|
Term Loan C, (1 mo. USD LIBOR + 5.00%), 10.02%, due 4/20/2026
|
|
|
|
|
Total Loan Assignments (Cost $21,029,977)
|
|
|
|
|
|
|
|
|
DISH Network Corp., 3.38%, due 8/15/2026 (Cost $1,421,217)
|
|
|
|
|
|
|
|
Short-Term Investments 7.0%
|
Investment Companies 7.0%
|
|
|
State Street Institutional U.S. Government Money Market Fund Premier Class,
4.76%(k)
(Cost $11,666,329)
|
|
Total Investments 174.6% (Cost $309,963,163)
|
|
Liabilities Less Other Assets (28.9)%
|
|
Liquidation Preference of Mandatory Redeemable Preferred Shares (45.7%)
|
|
Net Assets Applicable to Common Stockholders 100.0%
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
Securities were purchased under Rule 144A of the Securities Act of 1933, as amended, or are
otherwise
restricted and, unless registered under the Securities Act of 1933 or exempted from
registration, may only
be sold to qualified institutional investors or may have other restrictions on resale. At
April 30, 2023, these
securities amounted to $214,487,826, which represents 129.1% of net assets applicable to
common
stockholders of the Fund.
|
|
|
Variable or floating rate security. The interest rate shown was the current rate as of April
30, 2023 and
changes periodically.
|
|
|
Security issued at a fixed coupon rate, which converts to a variable rate at a future date.
Rate shown is the
rate in effect as of period end.
|
|
|
Perpetual security. Perpetual securities have no stated maturity date, but they may be
called/redeemed by
the issuer. The date shown reflects the next call date.
|
|
|
Payment-in-kind (PIK) security.
|
|
|
When-issued security. Total value of all such securities at April 30, 2023 amounted to
$2,494,456, which
represents 1.5% of net assets applicable to common stockholders of the Fund.
|
|
|
Step Bond. Coupon rate is a fixed rate for an initial period that either resets at a specific
date or may reset in
the future contingent upon a predetermined trigger. The interest rate shown was the current
rate as of
April 30, 2023.
|
|
|
All or a portion of this security was purchased on a delayed delivery basis.
|
|
|
All or a portion of this security had not settled as of April 30, 2023 and thus may not have
an interest rate in
effect. Interest rates do not take effect until settlement.
|
|
|
The stated interest rates represent the range of rates at April 30, 2023 of the underlying
contracts within the
Loan Assignment.
|
|
|
Represents 7-day effective yield as of April 30, 2023.
|
|
|
Includes the impact of the Fund's open positions in derivatives at April 30, 2023.
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
|
|
|
|
|
Percentage of Net
Assets Applicable
to Common
Stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation Preference of Mandatory Redeemable Preferred Shares
|
|
|
Short-Term Investments and Other Liabilities—Net
|
|
|
|
|
|
|
See Notes to Financial Statements
Schedule of Investments High Yield Strategies Fund Inc.^ (Unaudited) (cont’d)
Derivative Instruments
Interest rate swap contracts ("interest rate swaps")
At April 30, 2023, the Fund had outstanding interest rate swaps as follows:
Centrally cleared interest rate swaps
|
|
|
Fund
Receives/
Pays
Floating
Rate
|
|
|
Frequency
of Fund
Receipt/
Payment
|
|
Unrealized
Appreciation/
(Depreciation)
|
Accrued
Net
Interest
Receivable/
(Payable)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the six months ended April 30, 2023, the average notional value for the months where the Fund had interest
rate swaps outstanding was $45,000,000 when the Fund paid the fixed rate.
The following is a summary, categorized by Level (see Note A of the Notes to Financial Statements), of inputs used
to value the Fund’s investments as of April 30, 2023:
|
|
The Schedule of Investments provides information on the industry or sector categorization as
well as a
Positions by Country summary.
|
The following is a summary, categorized by Level (see Note A of the Notes to Financial Statements), of inputs used
to value the Fund’s derivatives as of April 30, 2023:
Other Financial Instruments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
^
A balance indicated with a "—", reflects either a zero balance or an amount that
rounds to less than 1.
See Notes to Financial Statements
Statement of Assets and Liabilities (Unaudited)
Neuberger Berman
|
|
High Yield
Strategies
Fund Inc.
|
|
|
|
|
|
|
Investments in securities, at value* (Note
A)—see Schedule of Investments:
|
|
|
|
|
|
|
|
|
|
|
Receivable for securities sold
|
|
Receivable for accumulated variation margin on centrally cleared swap contracts (Note A)
|
|
Prepaid expenses and other assets
|
|
|
|
|
|
|
|
Notes payable (net of unamortized deferred issuance costs of $39,840) (Note A)
|
|
Mandatory Redeemable Preferred Shares, Series C ($12.50 liquidation preference per share;
6,080,000 shares issued
and outstanding) (Note A)
|
|
Distributions payable—preferred shares
|
|
Distributions payable—common stock
|
|
Cash collateral segregated for centrally cleared swap contracts due to broker (Note A)
|
|
Payable to investment manager (Note B)
|
|
Payable for securities purchased
|
|
Payable to administrator (Note B)
|
|
|
|
|
Interest payable (Note A)
|
|
Other accrued expenses and payables
|
|
|
|
|
Net Assets applicable to Common Stockholders
|
|
Net Assets applicable to Common Stockholders consist of:
|
|
Paid-in capital—common stock
|
|
Total distributable earnings/(losses)
|
|
Net Assets applicable to Common Stockholders
|
|
Shares of Common Stock Outstanding ($0.0001 par value; 992,397,100 shares
authorized)
|
|
Net Asset Value Per Share of Common Stock Outstanding
|
|
|
|
|
|
|
|
See Notes to Financial Statements
Statement of Operations (Unaudited)
Neuberger Berman
|
|
High Yield
Strategies
Fund Inc.
|
|
|
For the Six
Months Ended
April 30,
2023
|
|
|
|
|
|
|
Interest and other income—unaffiliated issuers
|
|
|
|
|
|
|
|
|
|
|
Investment management fees (Note B)
|
|
Administration fees (Note B)
|
|
|
|
|
Basic maintenance (Note A)
|
|
Custodian and accounting fees
|
|
|
|
|
|
|
|
|
|
|
Stock exchange listing fees
|
|
Stock transfer agent fees
|
|
Distributions to mandatory redeemable preferred shareholders (Note A)
|
|
Directors' fees and expenses
|
|
|
|
|
Miscellaneous and other fees
|
|
|
|
|
Net investment income/(loss)
|
|
Realized and Unrealized Gain/(Loss) on Investments (Note A):
|
|
Net realized gain/(loss) on:
|
|
Transactions in investment securities of unaffiliated issuers
|
|
Expiration or closing of swap contracts
|
|
Change in net unrealized appreciation/(depreciation) in value of:
|
|
Investment securities of unaffiliated issuers
|
|
|
|
|
Net gain/(loss) on investments
|
|
Net increase/(decrease) in net assets applicable to Common Stockholders resulting from
operations
|
|
See Notes to Financial Statements
Statements of Changes in Net Assets
Neuberger Berman
|
|
High Yield
Strategies Fund Inc.
|
|
|
|
|
|
|
April 30, 2023
(Unaudited)
|
|
Increase/(Decrease) in Net Assets Applicable to Common Stockholders:
|
|
|
From Operations (Note A):
|
|
|
Net investment income/(loss)
|
|
|
Net realized gain/(loss) on investments
|
|
|
Change in net unrealized appreciation/(depreciation) of investments
|
|
|
Net increase/(decrease) in net assets applicable to Common Stockholders resulting from
operations
|
|
|
Distributions to Common Stockholders From (Note A):
|
|
|
|
|
|
|
|
|
|
|
Total distributions to Common Stockholders
|
|
|
From Capital Share Transactions (Note D):
|
|
|
Proceeds from the rights offering resulting in the issuance of 4,763,981 shares of common
stock (Note E)(a)
|
|
|
Proceeds from reinvestment of dividends and distributions
|
|
|
Total net proceeds from capital share transactions
|
|
|
Net Increase/(Decrease) in Net Assets Applicable to Common Stockholders
|
|
|
Net Assets Applicable to Common Stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net of offering costs and related expenses of $2,277,351.
|
See Notes to Financial Statements
Statement of Cash Flows (Unaudited)
Neuberger Berman
|
|
High Yield
Strategies
Fund Inc.
|
|
|
For the
Six Months Ended
April 30, 2023
|
Increase/(Decrease) in cash:
|
|
Cash flows from operating activities:
|
|
Net increase in net assets applicable to Common Stockholders resulting from operations
|
|
Adjustments to reconcile net increase in net assets applicable to Common Stockholders
resulting from
operations to net cash provided by operating activities:
|
|
Changes in assets and liabilities:
|
|
Purchase of investment securities
|
|
Proceeds from disposition of investment securities
|
|
Purchase/sale of short-term investment securities, net
|
|
Increase/decrease in receivable/payable for accumulated variation margin on centrally cleared
swap contracts
|
|
Decrease in interest receivable
|
|
Decrease in unamortized deferred issuance cost
|
|
Decrease in prepaid expenses and other assets
|
|
Increase in receivable for securities sold
|
|
Increase in distributions payable on preferred shares
|
|
Increase in payable for securities purchased
|
|
Increase in interest payable
|
|
Net amortization/(accretion) of premium/(discount) on investments
|
|
Decrease in payable to investment manager
|
|
Decrease in payable to directors
|
|
Decrease in payable to administrator
|
|
Decrease in other accrued expenses and payables
|
|
Unrealized appreciation on investment securities of unaffiliated issuers
|
|
Net realized loss from transactions in investment securities of unaffiliated issuers
|
|
Net cash provided by (used in) operating activities
|
|
Cash flows from financing activities:
|
|
Cash distributions paid on common stock
|
|
Net increase/(decrease) in cash and restricted cash
|
|
|
|
|
Cash and restricted cash at beginning of period
|
|
Cash and restricted cash at end of period
|
|
|
|
|
|
|
|
The following table provides a reconciliation of cash and restricted cash, if any, reported within the Statement
of Assets and Liabilities that sum to the total of such amounts shown on the Statement of Cash Flows.
|
|
|
|
|
|
|
|
Deposit for derivative collateral
|
|
|
Cash collateral segregated for centrally cleared swap contracts due from/(to) broker
|
|
|
Total cash and restricted cash as shown in the Statement of Cash Flows
|
|
|
See Notes to Financial Statements
Notes to Financial Statements High Yield Strategies Fund Inc. (Unaudited)
Note A—Summary of Significant Accounting Policies:
1
General: Neuberger Berman High Yield Strategies Fund Inc. (the "Fund") was organized as a Maryland corporation on March 18, 2010, and registered under the Investment Company Act of
1940, as amended (the "1940 Act"), as a non-diversified, closed-end management investment company. Under the 1940 Act, the status of a fund that was registered as non-diversified may, under certain circumstances, change to that of a
diversified fund. The Fund is currently a diversified fund. The Fund’s Board of Directors (the "Board") may classify or re-classify any unissued shares of capital stock into one or more classes of preferred stock without the
approval of stockholders.
A balance indicated with a "—", reflects either a zero balance or a balance that rounds to less
than 1.
The Fund is an investment company and accordingly follows the investment company accounting and
reporting guidance of the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic 946 "Financial Services—Investment Companies."
The preparation of financial statements in accordance with U.S. generally accepted accounting
principles ("GAAP") requires Management to make estimates and assumptions at the date of the financial statements. Actual results could differ from those estimates.
2
Portfolio valuation: In accordance with ASC 820 "Fair Value Measurement" ("ASC 820"), all investments held by the Fund are carried at the value that Management believes the Fund would receive upon
selling an investment in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment under current market conditions. Various inputs, including the volume and level of activity for
the asset or liability in the market, are considered in valuing the Fund's investments, some of which are discussed below. At times, Management may need to apply significant judgment to value investments in accordance with ASC 820.
ASC 820 established a three-tier hierarchy of inputs to create a classification of value
measurements for disclosure purposes. The three-tier hierarchy of inputs is summarized in the three broad Levels listed below.
•
Level 1 – unadjusted quoted prices in active markets for identical investments
•
Level 2 – other observable inputs (including quoted prices for similar
investments, interest rates, prepayment speeds, credit risk, amortized cost, etc.)
•
Level 3 – unobservable inputs (including the Fund's own assumptions in determining
the fair value of investments)
The inputs or methodology used for valuing an investment are not necessarily an indication of the
risk associated with investing in those securities.
The value of the Fund’s investments in debt securities is determined by Management primarily by
obtaining valuations from independent pricing services based on bid quotations, or if quotations are not available, by methods which include various considerations based on security type (generally Level 2 inputs). In addition to the
consideration of yields or prices of securities of comparable quality, coupon, maturity and type, indications as to values from dealers, and general market conditions, the following is a description of other Level 2 inputs and related
valuation techniques used by independent pricing services to value certain types of debt securities held by the Fund:
Corporate Bonds. Inputs used to value corporate debt securities generally include relevant credit information, observed market movements, sector news, U.S. Treasury yield curve or relevant
benchmark curve, and other market information, which may include benchmark yield curves, reported trades, broker-dealer quotes, issuer spreads, comparable securities, and reference data, such as market research publications, when
available ("Other Market Information").
Convertible Bonds. Inputs
used to value convertible bonds generally include underlying stock data, conversion rates, credit specific details, relevant listed bond and preferred stock prices and Other Market Information.
Collateralized Loan Obligations (CLOs). The value of collateralized loan obligations is primarily determined by cash flow data, relevant loan pricing data and market color, and research from market participants and
trading desks (Level 2 or 3 inputs).
Asset-Backed Securities. Inputs used to value asset-backed securities generally include models that consider a number of factors, which may include the following: prepayment speeds, cash flows, spread
adjustments and Other Market Information.
High Yield Securities. Inputs used to value high yield securities generally include a number of observations of equity and credit default swap curves related to the issuer and Other Market Information.
The value of loan assignments is determined by Management primarily by obtaining valuations from
independent pricing services based on broker quotes (generally Level 2 or Level 3 inputs depending on the number of quotes available).
The value of interest rate swaps is determined by Management primarily by obtaining valuations
from independent pricing services based on references to the underlying rates including the local overnight index swap rate and the respective interbank offered forward rate to produce the daily price. The present value is calculated
based off of expected cash flows based on swap parameters along with reference to the underlying yield curve and reference rate (Level 2 inputs).
Management has developed a process to periodically review information provided by independent
pricing services for all types of securities.
Investments in non-exchange traded investment companies are valued using the respective fund’s
daily calculated net asset value ("NAV") per share (Level 2 inputs), when available.
If a valuation is not available from an independent pricing service, or if Management has reason
to believe that the valuation received does not represent the amount the Fund might reasonably expect to receive on a current sale in an orderly transaction, Management seeks to obtain quotations from brokers or dealers (generally
considered Level 2 or Level 3 inputs depending on the number of quotes available). If such quotations are not available, the security is valued using methods Management has approved in the good-faith belief that the resulting valuation
will reflect the fair value of the security. Pursuant to Rule 2a-5 under the 1940 Act, the Board designated Management as the Fund's valuation designee. As the Fund's valuation designee, Management is responsible for determining fair
value in good faith for any and all Fund investments. Inputs and assumptions considered in determining the fair value of a security based on Level 2 or Level 3 inputs may include, but are not limited to, the type of the security; the
initial cost of the security; the existence of any contractual restrictions on the security’s disposition; the price and extent of public trading in similar securities of the issuer or of comparable companies; quotations or evaluated
prices from broker-dealers and/or pricing services; information obtained from the issuer and/or analysts; an analysis of the company’s or issuer’s financial statements; an evaluation of the inputs that influence the issuer and the
market(s) in which the security is purchased and sold.
Fair value prices are necessarily estimates, and there is no assurance that such a price will be
at or close to the price at which the security is next quoted or next trades.
3
Securities transactions and investment income: Securities transactions are recorded on trade date for financial reporting purposes. Dividend income is recorded on the ex-dividend date. Interest income, including accretion
of discount (adjusted for original issue discount, where applicable) and amortization of premium, where applicable, is recorded on the accrual basis. Realized gains and losses from securities transactions are recorded on the basis
of identified cost and stated separately in the Statement of Operations.
4
Income tax information: It is the policy of the Fund to continue to qualify for treatment as a regulated investment company ("RIC") by complying with the requirements of the U.S. Internal Revenue
Code applicable to RICs and to distribute substantially all of its net investment income and net realized capital gains to its stockholders. To the extent the Fund distributes substantially all of its net investment income and net
realized capital gains to stockholders, no federal income or excise tax provision is required.
ASC 740 "Income Taxes" sets forth a minimum threshold for financial statement recognition of a
tax position taken, or expected to be taken, in a tax return. The Fund recognizes interest and penalties, if any, related to unrecognized tax positions as an income tax expense in the Statement of Operations. The Fund is subject to
examination by U.S. federal and state tax authorities for returns filed for the tax years for which the applicable statutes of limitations have not yet expired. Management has analyzed the Fund's tax positions taken or expected to be
taken on federal and state income tax returns for all open tax years (the current and the prior three tax years) and has concluded that no provision for income tax is required in the Fund's financial statements.
For federal income tax purposes, the estimated cost of investments held at April 30, 2023 was
$310,446,741. The estimated gross unrealized appreciation was $2,285,337 and estimated gross unrealized depreciation was $22,235,060 resulting in net unrealized depreciation in value of investments of $19,949,723 based on cost for U.S.
federal income tax purposes.
Income distributions and capital gain distributions are determined in accordance with income tax
regulations, which may differ from GAAP. These differences are primarily due to differing treatments of income and gains on various investment securities held by the Fund, timing differences and differing characterization of
distributions made by the Fund.
Any permanent differences resulting from different book and tax treatment are reclassified at
year-end and have no impact on net income, NAV or NAV per share of common stock of the Fund. For the year ended October 31, 2022, the Fund recorded permanent reclassifications primarily related to nondeductible restructuring costs. For
the year ended October 31, 2022, the Fund recorded the following permanent reclassifications:
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|
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Total Distributable
Earnings/(Losses)
|
|
|
|
The tax character of distributions paid during the years ended October 31, 2022, and October 31,
2021, was as follows:
As of October 31, 2022, the components of distributable earnings (accumulated losses) on a U.S.
federal income tax basis were as follows:
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|
Undistributed
Ordinary
Income
|
Undistributed
Long-Term
Capital Gain
|
Unrealized
Appreciation/
(Depreciation)
|
Loss
Carryforwards
and Deferrals
|
Other
Temporary
Differences
|
|
|
|
|
|
|
|
|
The temporary differences between book basis and tax basis distributable earnings are primarily
due to: losses disallowed and recognized on wash sales, timing differences of fund level distributions, tax adjustments related to swap contracts and amortization of bond premium.
To the extent the Fund's net realized capital gains, if any, can be offset by capital loss carryforwards, it is
the policy of the Fund not to distribute such gains. Capital loss carryforward rules allow for RICs to carry forward capital losses indefinitely and to retain the character of capital loss carryforwards as short-term or long-term. As
determined at October 31, 2022, the Fund had unused capital loss carryforwards available for federal income tax purposes to offset future net realized capital gains, if any, as follows:
Capital Loss Carryforwards
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5
Foreign taxes: Foreign taxes withheld, if any, represent amounts withheld by foreign tax authorities, net of refunds recoverable.
6
Distributions to common stockholders: The Fund earns income, net of expenses, daily on its investments. It is the policy of the Fund to declare and pay monthly distributions to common stockholders. The Fund has
adopted a policy to pay common stockholders a stable monthly distribution. The Fund’s ability to satisfy its policy will depend on a number of factors, including the amount and stability of income received from its investments, the
availability of capital gains, distributions paid on any preferred shares, interest paid on any notes and the level of other Fund fees and expenses. In an effort to maintain a stable monthly distribution amount, the Fund may pay
distributions consisting of net investment income, net realized gains and paid-in capital. There is no assurance that the Fund will always be able to pay distributions of a particular size, or that distributions will consist solely
of net investment income and net realized capital gains. The composition of the Fund’s distributions for the calendar year 2023 will be reported to Fund stockholders on IRS Form 1099-DIV. The Fund may pay distributions in excess of
those required by its stable distribution policy to avoid excise tax or to satisfy the requirements of Subchapter M of the U.S. Internal Revenue Code. Distributions to common stockholders are recorded on the ex-date. Net realized
capital gains, if any, will be offset to the extent of any available capital loss carryforwards. Any such offset will not reduce the level of the stable distribution paid by the Fund. Distributions to preferred stockholders are
accrued and determined as described in Note A-8.
On April 28, 2023, the Fund declared a monthly distribution to common stockholders in the
amount of $0.0905 per share, payable on May 31, 2023 to stockholders of record on May 15, 2023, with an ex-date of May 12, 2023. Subsequent to April 30, 2023, the Fund declared a monthly distribution on May 11, 2023 to common
stockholders in the amount of $0.0905 per share, payable on June 30, 2023 to stockholders of record on June 5, 2023, with an ex-date of June 2, 2023.
7
Expense allocation: Certain expenses are applicable to multiple funds within the complex of related investment companies, which includes open-end and closed-end investment companies for which
NBIA serves as investment manager. Expenses directly attributable to the Fund are charged to the Fund. Expenses borne by the complex of related investment companies that are not directly attributable to a particular investment
company (e.g., the Fund) are allocated among the Fund and the other investment companies or series thereof in the complex on the basis of relative net assets, except where a more appropriate allocation of expenses to each of the
investment companies or series thereof in the complex can otherwise be made fairly.
8
Financial leverage: In September 2013, the Fund issued privately placed notes ("2013 PNs") with an aggregate principal value of $90,000,000 and Mandatory Redeemable Preferred Shares, Series B
with an aggregate liquidation preference of $35,000,000. In August 2020, the Fund issued Mandatory Redeemable Preferred Shares, Series C ("MRPS") with an aggregate liquidation preference of $95,000,000. The Fund used the proceeds
from the issuance of the MRPS to repurchase the outstanding Mandatory Redeemable Preferred Shares, Series B and to prepay $60,000,000 of the aggregate principal balance of the 2013 PNs. In December 2020, in connection with the
reduction in the Fund's asset level following the tender offer, the Fund prepaid $10,500,000 of the outstanding 2013 PNs and redeemed $19,000,000 of the MRPS, reducing the 2013 PNs aggregate principal value to $19,500,000 and the
MRPS aggregate liquidation preference to $76,000,000. In June 2022, in connection with the increase in the Fund’s asset level following the rights offering (Note E), the Fund issued a privately placed note with a principal value of
$26,500,000 ("2022 PN"
and together with the 2013 PNs, "PNs"). The PNs have a maturity date of September 18, 2023 and the MRPS have a
maturity date of August 3, 2023. The interest on the PNs is accrued daily and paid quarterly. The MRPS have a liquidation preference of $12.50 per share plus any accumulated unpaid distributions, whether or not earned or declared by the
Fund, but excluding interest thereon ("Liquidation Value"). Distributions on the MRPS are accrued daily and paid quarterly. For financial reporting purposes only, the liquidation preference of the MRPS is recognized as a liability in
the Statement of Assets and Liabilities.
During the six months ended April 30, 2023, the average principal balance outstanding and average
annualized interest rate of the PNs were $46,000,000 and 5.74%, respectively. During the six months ended April 30, 2023, the average aggregate liquidation preference outstanding and average annualized distribution rate of the MRPS were
$76,000,000 and 6.85%, respectively.
The table below sets forth key terms of the MRPS.
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Mandatory
Redemption Date
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Aggregate
Liquidation
Preference
|
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Current floating rate as of April 30, 2023.
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The Fund has paid organizational expenses which are being amortized over the life of the 2013 PNs
and MRPS. The expenses are included in the Interest expense that is reflected in the Statement of Operations.
The Fund may redeem the MRPS or prepay the PNs, in whole or in part, at its option after giving
notice to the relevant holders of the MRPS and the PNs (together, the "Private Securities") but may incur additional expenses if it chooses to do so. The Fund is also subject to certain restrictions relating to the Private Securities.
Failure to comply with these restrictions could preclude the Fund from declaring any distributions to common stockholders or repurchasing shares of common stock and/or could trigger the mandatory redemption of the MRPS at Liquidation
Value and certain expenses and/or mandatory prepayment of the PNs at par plus accrued but unpaid interest and certain expenses. The holders of the MRPS are entitled to one vote per share and will vote with holders of shares of common
stock as a single class, except that the holders of the MRPS will vote separately as a class on certain matters, as required by law or the Fund’s organizational documents. The holders of the MRPS, voting as a separate class, are
entitled at all times to elect two Directors of the Fund, and to elect a majority of the Directors of the Fund if the Fund fails to pay distributions on the MRPS for two consecutive years.
9
Concentration of credit risk: The Fund will normally invest at least 80% of its total assets in high yield debt securities of U.S. and foreign issuers, which include securities that are rated below
investment grade by a rating agency or are unrated debt securities determined to be of comparable quality by the Fund’s investment manager.
Due to the likelihood of volatility and potential illiquidity of the high yield securities in
which the Fund invests and the real or perceived difficulty of issuers of those high yield securities to meet their payment obligations during economic downturns or because of negative business developments relating to the issuer or its
industry in general, the value and/or price of the Fund’s shares of common stock may fluctuate more than would be the case if the Fund did not concentrate in high yield securities.
10
Derivative instruments: The Fund's use of derivatives during the six months ended April 30, 2023, is described below. Please see the Schedule of Investments for the Fund's open positions in
derivatives, if any, at April 30, 2023. The disclosure requirements of ASC 815 "Derivatives and Hedging" ("ASC 815") distinguish between derivatives that qualify for hedge accounting and those that do not. Because investment
companies value their derivatives at fair value and recognize changes in fair value through the Statement of Operations, they do not qualify for hedge accounting. Accordingly, even though the Fund's investments in derivatives may
represent economic hedges, they are considered non-hedge transactions for purposes of this disclosure.
Rule 18f-4 under the 1940 Act which became effective August 19, 2022, regulates the use of derivatives for
certain funds registered under the 1940 Act ("Rule 18f-4"). The Fund has adopted a Rule 18f-4 Policy which provides, among other things, that unless the Fund qualifies as a "limited derivatives user" as defined in Rule 18f-4, the Fund
is subject to a comprehensive derivatives risk management program, is required to comply with certain value-at-risk based leverage limits and is required to provide additional disclosure both publicly and to the SEC regarding its
derivatives positions. If the Fund qualifies as a limited derivatives user, Rule 18f-4 requires the Fund to have policies and procedures to manage its aggregate derivatives risk.
Interest rate swap contracts: During the six months ended April 30, 2023, the Fund used interest rate swaps to reduce the risk that an increase in short-term interest rates could reduce common share net
earnings as a result of leverage. Under the terms of the interest rate swaps, the Fund agrees to pay the swap counterparty a fixed-rate payment in exchange for the counterparty’s paying the Fund a variable-rate payment that is intended
to approximate all or a portion of the Fund’s variable-rate payment obligations on the Fund’s Private Securities. The fixed-rate and variable rate payment flows are paid by one party to the other on a periodic basis and netted against
each other when applicable. There is no guarantee that these interest rate swap transactions will be successful in reducing or limiting risk.
Risks may arise if the counterparty to a swap contract fails to comply with the terms of its
contract. The loss incurred by the failure of a counterparty is generally limited to the net interest payment to be received by the Fund and/or the termination value at the end of the contract. Additionally, risks may arise if there is
no liquid market for these agreements or from movements in interest rates unanticipated by Management.
Periodic expected interim net interest payments or receipts on the swaps are recorded as an
adjustment to unrealized gains/losses, along with the fair value of the future periodic payment or receivable streams on the swaps. The unrealized gains/losses associated with the periodic interim net interest payments or receipts are
reclassified to realized gains/ losses in conjunction with the actual net receipt or payment of such amounts. The reclassifications do not impact the Fund’s total net assets applicable to common stockholders or its total net increase
(decrease) in net assets applicable to common stockholders resulting from operations.
Certain clearinghouses currently offer clearing for limited types of derivative transactions. In
a cleared derivative transaction, the Fund typically enters into the transaction with a financial institution counterparty that is then cleared through a central clearinghouse. Upon acceptance of a swap by a central clearinghouse, the
original swap is extinguished and replaced with a swap with the clearinghouse, thereby reducing or eliminating the Fund's exposure to the credit risk of the original counterparty. The Fund typically will be required to post specified
levels of both initial and variation margin with the clearinghouse or at the instruction of the clearinghouse. The daily change in valuation is recorded as a receivable or payable for variation margin and settled in cash with the
central clearing party. For financial reporting purposes, unamortized upfront payments, if any, are netted with unrealized appreciation or depreciation and net interest receivable or payable on swap contracts to determine the fair value
of swaps.
At April 30, 2023, the Fund had the following derivatives (which did not qualify as hedging
instruments under ASC 815), grouped by primary risk exposure:
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Statement of
Assets and Liabilities
Location
|
|
Statement of
Assets and Liabilities
Location
|
|
|
|
|
|
|
|
|
|
Receivable/Payable for accumulated
variation margin on centrally cleared
swap contracts(a)
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Receivable/Payable for accumulated
variation margin on centrally cleared
swap contracts(a)
|
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|
|
"Centrally cleared swaps" reflect the cumulative unrealized appreciation/(depreciation) of the
centrally
cleared swap contracts plus accrued interest as of April 30, 2023.
|
The impact of the use of these derivative instruments on the Statement of Operations during the six months ended
April 30, 2023, was as follows:
|
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Change in Net Unrealized
Appreciation/
(Depreciation) on
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Net realized gain/(loss) on derivatives is located in the Statement of Operations each under
the caption,
"Net realized gain/(loss) on:"
|
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|
Expiration or closing of swap contracts
|
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|
Change in net unrealized appreciation/(depreciation) is located in the Statement of Operations
each under
the caption, "Change in net unrealized appreciation/(depreciation) in value of:"
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11
Securities lending: The Fund, using State Street Bank and Trust Company ("State Street") as its lending agent, may loan securities to qualified brokers and dealers in exchange for negotiated
lender’s fees. These fees, if any, would be disclosed within the Statement of Operations under the caption "Income from securities loaned-net" and are net of expenses retained by State Street as compensation for its services as
lending agent.
The initial collateral received by the Fund at the beginning of each transaction shall have a
value equal to at least 102% of the prior day’s market value of the loaned securities (105% in the case of international securities). Collateral in the form of cash and/or securities issued or guaranteed by the U.S. government or its
agencies, equivalent to at least 100% of the market value of securities, is maintained at all times. Thereafter, the value of the collateral is monitored on a daily basis, and collateral is moved daily between a counterparty and the
Fund until the close of the transaction. Cash collateral is generally invested in a money market fund registered under the 1940 Act that is managed by an affiliate of State Street and is included in the Statement of Assets and
Liabilities under the caption "Investments in securities, at value-Unaffiliated issuers". The total value of securities received as collateral for securities on loan is included in a footnote following the Schedule of Investments, but
is not included within the Statement of Assets and Liabilities because the receiving Fund does not have the right to sell or repledge the securities received as collateral. The risks associated with lending portfolio securities include,
but are not limited to, possible delays in receiving additional collateral or in the recovery of the loaned securities. Any increase or decrease in the fair value of the securities loaned and any interest earned or dividends paid or
owed on those securities during the term of the loan would accrue to the Fund.
During the six months ended April 30, 2023, the Fund did not participate in securities lending.
12
When-issued/delayed delivery securities: The Fund may purchase securities with delivery or payment to occur at a later date beyond the normal settlement period. At the time the Fund enters into a commitment to
purchase a security, the transaction is recorded and the value of the security is reflected in the NAV. The price of such security and the date when the security will be delivered and paid for are fixed at the time the transaction
is negotiated. The value of the security may vary with market fluctuations. No interest accrues to the Fund until payment takes place. When-issued and delayed delivery transactions can have a leverage-like effect on the Fund, which
can increase fluctuations in the Fund’s NAV. Certain risks may arise upon entering into when-issued or delayed delivery securities transactions from the potential inability of counterparties to meet the terms of their contracts or
if the issuer does not issue the securities due to political, economic, or other factors. Additionally, losses may arise due to changes in the value of the underlying securities.
13
Indemnifications: Like many other companies, the Fund’s organizational documents provide that its officers ("Officers") and directors ("Directors") are indemnified against certain liabilities
arising out of the performance of their duties to the Fund. In addition, both in some of its principal service contracts and in the normal course of its business, the Fund enters into contracts that provide indemnifications to other
parties for certain types of losses or liabilities. The Fund’s maximum exposure under these arrangements is unknown as this could involve future claims against the Fund.
14
Arrangements with certain non-affiliated service providers: In order to satisfy rating agency requirements and the terms of the Private Securities, the Fund is required to provide the rating agency and holders of Private Securities a
report on a monthly basis verifying that the Fund is maintaining eligible assets having a discounted value equal to or greater than the basic maintenance amount, which is the minimum level set by the rating agency as one of the
conditions to maintain the rating on the PNs and the MRPS. "Discounted value" refers to the fact that the rating agency requires the Fund, in performing this calculation, to discount portfolio securities below their face value, at
rates determined by the rating agency. The Fund pays State Street for the preparation of this report, which is reflected in the Statement of Operations under the caption "Basic maintenance (Note A)."
15
Unfunded loan commitments: The Fund may enter into certain credit agreements all or a portion of which may be unfunded. The Fund is obligated to fund these commitments at the borrower’s discretion. As of
April 30, 2023, the Fund had no outstanding unfunded loan commitments.
Note B—Investment Management Fees, Administration Fees, and Other Transactions with Affiliates:
The Fund retains NBIA as its investment manager under a Management Agreement. For such investment
management services, the Fund pays NBIA an investment management fee computed at an annual rate of 0.60% of the Fund’s average daily Managed Assets. Managed Assets equal the total assets of the Fund, less liabilities other than the
aggregate indebtedness entered into for purposes of leverage. For purposes of calculating Managed Assets, the liquidation preference of any MRPS outstanding and principal amount of the PNs are not considered liabilities.
The Fund retains NBIA as its administrator under an Administration Agreement. The Fund pays NBIA
an administration fee at an annual rate of 0.05% of its average daily Managed Assets under this agreement. Additionally, NBIA retains State Street as its sub-administrator under a Sub-Administration Agreement. NBIA pays State Street a
fee for all services received under the Sub-Administration Agreement.
Note C—Securities Transactions:
During the six months ended April 30, 2023, there were purchase and sale transactions of
long-term securities (excluding swap contracts) of $128,867,310 and $110,662,661, respectively.
Note D—Capital:
Transactions in shares of common stock for the six months ended April 30, 2023 and for the year
ended October 31, 2022 were as follows:
For the Six Months Ended April 30, 2023
|
For the Year Ended October 31, 2022
|
Stock Issued on
Reinvestment of
Dividends
and Distributions
|
Net Increase/
(Decrease)
in Common Stock
Outstanding
|
Stock Issued on
Reinvestment of
Dividends
and Distributions
|
Stock Issued in
connection with
Rights Offering (Note E)
|
Net Increase/
(Decrease)
in Common Stock
Outstanding
|
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Note E—2022 Common Stock Rights Offering:
On April 19, 2022 (the "Record Date"), the Fund commenced a transferable rights offering (the
"Offer") whereby the Fund issued one transferable right (a "Right") for each share of common stock of the Fund held by stockholders of record as of the Record Date. Pursuant to the Offer, holders of Rights were entitled to purchase
shares of common stock by submitting three Rights and the subscription price per share for each share purchased. The Offer expired at 5:00 p.m. Eastern Time on May 17, 2022 (the "Expiration Date"). The final subscription price of $8.60
per share of common stock was equal to 87% of the Fund’s NAV per share of common stock at the close of trading on the NYSE American on the Expiration Date. The Offer resulted in the issuance of 4,763,981 shares of common stock and the
gross proceeds of the Offer were approximately $40.9 million.
Note F—Recent Accounting Pronouncement:
In December 2022, the FASB issued Accounting Standards Update No. 2022-06, "Reference Rate Reform
(Topic 848)" ("ASU 2022-06"), which is an update to Accounting Standards Update No. 2021-01, "Reference Rate Reform (Topic 848)" ("ASU 2021-01") and defers the sunset date for applying the reference rate reform relief in Topic 848. ASU
2021-01 is an update of ASU 2020-04, which is in response to concerns about structural risks of interbank offered rates, and particularly the risk of cessation of LIBOR. Regulators have undertaken reference rate reform initiatives to
identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. ASU 2020-04 provides optional guidance for a limited period of time to ease the potential burden in accounting for
(or recognizing the effects of) reference rate reform on financial reporting. ASU 2020-04 is elective and applies to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions
that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The ASU 2021-01 update clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and
hedge accounting apply to derivatives that are affected by the discounting transition. The amendments in this update are effective immediately through December 31, 2024, for all entities. Management is currently evaluating the
implications, if any, of the additional requirements and its impact on the Fund's financial statements.
Note G—Subsequent Events:
Pursuant to a registration statement filed with the SEC, which became effective with the SEC
subsequent to April 30, 2023, the Fund is authorized to issue up to an aggregate of $109,000,000 of shares of its common stock through an equity shelf offering program (the "Shelf Offering"). Under the Shelf Offering, the Fund, subject
to market conditions, may raise additional capital from time to time and in varying amounts and offering methods at a net price at or above the Fund's net asset value per share of common stock. Subsequent to April 30, 2023, the Fund
sold 7,300 shares of common stock and received net proceeds of $64,458 through its Shelf Offering. Offering costs (other than the applicable sales commissions) incurred in connection with the Shelf Offering were borne directly by the
Fund. Neuberger Berman BD LLC ("NBBD"), an affiliate of NBIA, is the distributor of the Fund's shares and is entitled to receive a sales commission from the Fund of 1.00% of the gross sales price per share, a portion of which is
re-allowed to sales agents. The Fund was informed that the sales commissions retained by NBBD was $130.
On May 23, 2023 (the "Record Date"), the Fund commenced a transferable rights offering (the
"Offer") whereby the Fund issued one transferable right (a "Right") for each share of common stock of the Fund held by stockholders of record as of the Record Date. Pursuant to the Offer, holders of Rights were entitled to purchase
shares of common stock by submitting three Rights and the subscription price per share for each share purchased. The Offer expired at 5:00 p.m. Eastern Time on June 21, 2023 (the "Expiration Date"). The final subscription price of $7.42
per share of common stock was equal to 89% of the Fund’s NAV per share of common stock at the close of trading on the NYSE American on the Expiration Date. The Offer, which was over-subscribed, resulted in the issuance of 6,482,227
shares of common stock and the gross proceeds of the Offer were approximately $48.1 million.
Note H—Unaudited Financial Information:
The financial information included in this interim report is taken from the records of the Fund
without audit by an independent registered public accounting firm. Annual reports contain audited financial statements.
High Yield Strategies Fund Inc.
The following table includes selected data for a common share outstanding throughout each period and other
performance information derived from the Financial Statements. Amounts that do not round to $0.01 or $(0.01) per share are presented as $0.00 or $(0.00), respectively. Ratios that do not round to 0.01% or (0.01)% are presented as 0.00%
or (0.00)%, respectively. A "—" indicates that the line item was not applicable in the corresponding period.
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Six Months
Ended April 30,
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Common Stock Net Asset Value, Beginning
of Period
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Income/(Loss) From Investment Operations
Applicable to Common Stockholders:
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Net Investment Income/(Loss)a
|
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|
Net Gains or (Losses) on Securities (both
realized and unrealized)
|
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Total From Investment Operations
Applicable to Common Stockholders
|
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|
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Less Distributions to Common
Stockholders From:
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Total Distributions to Common
Stockholders
|
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|
Accretive Effect of Common Stock Tender
Offers
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Dilutive Effect of Rights Offering
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Common Stock Net Asset Value, End of
Period
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Common Stock Market Value, End of
Period
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Total Return, Common Stock Net Asset Valued
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Total Return, Common Stock Market Valued
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Net Assets Applicable to Common
Stockholders, End of Period (in millions)
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Preferred Stock Outstanding, End of Period (in
millions)g
|
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Preferred Stock Liquidation Value Per Shareg
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Ratios are Calculated Using Average Net
Assets Applicable to Common Stockholders
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Ratio of Net Investment Income/(Loss)
Excluding Preferred Stock Distributions
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Asset Coverage Per Share of Preferred
Stock, End of Periodj
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Notes Payable (in millions)k
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Asset Coverage Per $1,000 of
Notes Payablel
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See Notes to Financial Highlights
Notes to Financial Highlights High Yield Strategies Fund Inc. (Unaudited)
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Calculated based on the average number of shares of common stock outstanding during each
fiscal period.
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During the year ended October 31, 2021, the Fund conducted a tender offer and repurchased 25%
of
its outstanding shares of common stock at a price equal to 96% of the Fund’s NAV per share.
The final
payment for the tender offer was made at $12.03 per share representing 96% of the Fund's NAV
per
share on December 10, 2020.
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|
During the year ended October 31, 2022, the Fund conducted a rights offering and issued
4,763,981 shares
of common stock. The final subscription price for the rights offering was $8.60 per share
representing 87%
of the Fund's NAV per share on May 17, 2022.
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|
Total return based on per share NAV reflects the effects of changes in NAV on the performance
of the Fund
during each fiscal period. Total return based on per share market value assumes the purchase
of shares of
common stock at the market price on the first day and sale of common stock at the market price
on the last
day of the period indicated. Distributions, if any, are assumed to be reinvested at prices
obtained under the
Fund's distribution reinvestment plan. Results represent past performance and do not indicate
future results.
Current returns may be lower or higher than the performance data quoted. Investment returns
will
fluctuate and shares of common stock, when sold, may be worth more or less than original cost.
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The class action proceeds received in 2021 and 2018 had no impact on the Fund’s total returns
for the
years ended October 31, 2021 or 2018, respectively.
|
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From September 18, 2013 to August 4, 2020, the Fund had 1,400 Mandatory Redeemable Preferred
Shares, Series B outstanding. From August 5, 2020 to December 13, 2020, the Fund had 7,600,000
MRPS
outstanding. Effective December 14, 2020, the Fund has 6,080,000 MRPS outstanding (see Note A
of Notes
to Financial Statements).
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Distributions to mandatory redeemable preferred stockholders and interest expense is included
in expense
ratios. The annualized ratios of distributions to mandatory redeemable preferred stockholders
and interest
expense to average net assets applicable to common stockholders were:
|
|
|
Six Months Ended April 30,
|
|
|
|
|
|
|
|
|
|
Distributions to mandatory
redeemable
preferred stockholders
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculated by subtracting the Fund's total liabilities (excluding the liquidation preference
of mandatory
redeemable preferred shares and accumulated unpaid distributions on mandatory redeemable
preferred
shares) from the Fund's total assets and dividing by the number of mandatory redeemable
preferred shares
outstanding.
|
|
|
Net of unamortized deferred issuance costs. The unamortized deferred issuance costs were:
|
Six Months Ended April 30,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Calculated by subtracting the Fund’s total liabilities (excluding the liquidation preference
of mandatory
redeemable preferred shares, the outstanding principal of the PNs and accumulated unpaid
liabilities on the
PNs and the mandatory redeemable preferred shares) from the Fund’s total assets and dividing
by the
outstanding Notes Payable balance.
|
Distribution Reinvestment Plan for the Fund
American Stock Transfer & Trust Company, LLC (the "Plan Agent") will act as Plan Agent for stockholders who
have not elected in writing to receive dividends and distributions in cash (each a "Participant"), will open an account for each Participant under the Distribution Reinvestment Plan ("Plan") in the same name as their then-current shares
of the Fund’s common stock ("Shares") are registered, and will put the Plan into effect for each Participant as of the first record date for a dividend or capital gains distribution.
Whenever the Fund declares a dividend or distribution with respect to the Shares, each Participant will receive
such dividends and distributions in additional Shares, including fractional Shares acquired by the Plan Agent and credited to each Participant’s account. If on the payment date for a cash dividend or distribution, the net asset value is
equal to or less than the market price per Share plus estimated brokerage commissions, the Plan Agent shall automatically receive such Shares, including fractions, for each Participant’s account. Except in the circumstances described in
the next paragraph, the number of additional Shares to be credited to each Participant’s account shall be determined by dividing the dollar amount of the dividend or distribution payable on their Shares by the greater of the net asset
value per Share determined as of the date of purchase or 95% of the then-current market price per Share on the payment date.
Should the net asset value per Share exceed the market price per Share plus estimated brokerage commissions on
the payment date for a cash dividend or distribution, the Plan Agent or a broker-dealer selected by the Plan Agent shall endeavor, for a purchase period lasting until the last business day before the next date on which the Shares trade
on an "ex-dividend" basis, but in no event, except as provided below, more than 30 days after the payment date, to apply the amount of such dividend or distribution on each Participant’s Shares (less their pro rata share of brokerage
commissions incurred with respect to the Plan Agent’s open-market purchases in connection with the reinvestment of such dividend or distribution) to purchase Shares on the open market for each Participant’s account. No such purchases
may be made more than 30 days after the payment date for such dividend or distribution except where temporary curtailment or suspension of purchase is necessary to comply with applicable provisions of federal securities laws. If, at the
close of business on any day during the purchase period the net asset value per Share equals or is less than the market price per Share plus estimated brokerage commissions, the Plan Agent will not make any further open-market purchases
in connection with the reinvestment of such dividend or distribution. If the Plan Agent is unable to invest the full dividend or distribution amount through open-market purchases during the purchase period, the Plan Agent shall request
that, with respect to the uninvested portion of such dividend or distribution amount, the Fund issue new Shares at the close of business on the earlier of the last day of the purchase period or the first day during the purchase period
on which the net asset value per Share equals or is less than the market price per Share, plus estimated brokerage commissions, such Shares to be issued in accordance with the terms specified in the third paragraph hereof. These newly
issued Shares will be valued at the then-current market price per Share at the time such Shares are to be issued.
For purposes of making the reinvestment purchase comparison under the Plan, (a) the market price of the Shares
on a particular date shall be the last sales price on the New York Stock Exchange (or if the Shares are not listed on the New York Stock Exchange, such other exchange on which the Shares are principally traded) on that date, or, if
there is no sale on such Exchange (or if not so listed, in the over-the-counter market) on that date, then the mean between the closing bid and asked quotations for such Shares on such Exchange on such date and (b) the net asset value
per Share on a particular date shall be the net asset value per Share most recently calculated by or on behalf of the Fund. All dividends, distributions and other payments (whether made in cash or Shares) shall be made net of any
applicable withholding tax.
Open-market purchases provided for above may be made on any securities exchange where the Fund’s Shares are
traded, in the over-the-counter market or in negotiated transactions and may be on such terms as to price, delivery and otherwise as the Plan Agent shall determine. Each Participant’s uninvested funds held by the Plan Agent will not
bear interest, and it is understood that, in any event, the Plan Agent shall have no liability in
connection with any inability to purchase Shares within 30 days after the initial date of such purchase as herein provided, or
with the timing of any purchases effected. The Plan Agent shall have no responsibility as to the value of the Shares acquired for each Participant’s account. For the purpose of cash investments, the Plan Agent may commingle each
Participant’s funds with those of other stockholders of the Fund for whom the Plan Agent similarly acts as agent, and the average price (including brokerage commissions) of all Shares purchased by the Plan Agent as Plan Agent shall be
the price per Share allocable to each Participant in connection therewith.
The Plan Agent may hold each Participant’s Shares acquired pursuant to the Plan together with the Shares of
other stockholders of the Fund acquired pursuant to the Plan in noncertificated form in the Plan Agent’s name or that of the Plan Agent’s nominee. The Plan Agent will forward to each Participant any proxy solicitation material and will
vote any Shares so held for each Participant only in accordance with the instructions set forth on proxies returned by the Participant to the Fund.
The Plan Agent will confirm to each Participant each acquisition made for their account as soon as practicable
but not later than 60 days after the date thereof. Although each Participant may from time to time have an undivided fractional interest (computed to three decimal places) in a Share, no certificates for a fractional Share will be
issued. However, dividends and distributions on fractional Shares will be credited to each Participant’s account. In the event of termination of a Participant’s account under the Plan, the Plan Agent will adjust for any such undivided
fractional interest in cash at the market value of the Shares at the time of termination, less the pro rata expense of any sale required to make such an adjustment.
Any Share dividends or split Shares distributed by the Fund on Shares held by the Plan Agent for Participants
will be credited to their accounts. In the event that the Fund makes available to its stockholders rights to purchase additional Shares or other securities, the Shares held for each Participant under the Plan will be added to other
Shares held by the Participant in calculating the number of rights to be issued to each Participant.
The Plan Agent’s service fee for handling capital gains and other distributions or income dividends will be paid
by the Fund. Participants will be charged their pro rata share of brokerage commissions on all open-market purchases.
Each Participant may terminate their account under the Plan by notifying the Plan Agent in writing. Such
termination will be effective immediately if the Participant’s notice is received by the Plan Agent not less than ten days prior to any dividend or distribution record date, otherwise such termination will be effective the first trading
day after the payment date for such dividend or distribution with respect to any subsequent dividend or distribution. The Plan may be terminated by the Plan Agent or the Fund upon notice in writing mailed to each Participant at least 30
days prior to any record date for the payment of any dividend or distribution by the Fund.
These terms and conditions may be amended or supplemented by the Plan Agent or the Fund at any time or times
but, except when necessary or appropriate to comply with applicable law or the rules or policies of the Securities and Exchange Commission or any other regulatory authority, only by mailing to each Participant appropriate written notice
at least 30 days prior to the effective date thereof. The amendment or supplement shall be deemed to be accepted by each Participant unless, prior to the effective date thereof, the Plan Agent receives written notice of the termination
of their account under the Plan. Any such amendment may include an appointment by the Plan Agent in its place and stead of a successor Plan Agent under these terms and conditions, with full power and authority to perform all or any of
the acts to be performed by the Plan Agent under these terms and conditions. Upon any such appointment of any Plan Agent for the purpose of receiving dividends and distributions, the Fund will be authorized to pay to such successor Plan
Agent, for each Participant’s account, all dividends and distributions payable on Shares held in their name or under the Plan for retention or application by such successor Plan Agent as provided in these terms and conditions.
The Plan Agent shall at all times act in good faith and agrees to use its best efforts within reasonable limits
to ensure the accuracy of all services performed under this Agreement and to comply with applicable law, but assumes no responsibility and shall not be liable for loss or damage due to errors unless such error is caused by
the Plan Agent’s negligence, bad faith, or willful misconduct or that of its employees. These terms and conditions are governed
by the laws of the State of Maryland.
Reinvested dividends and distributions are taxed in the same manner as cash dividends and distributions — i.e.,
reinvestment in additional Shares does not relieve stockholders of, or defer the need to pay, any income tax that may be payable (or that is required to be withheld) on Fund dividends and distributions. Participants should contact their
tax professionals for information on how the Plan impacts their personal tax situation. For additional information about the Plan, please contact the Plan Agent by telephone at 1-866-227-2136 or by mail at 6201 15th Avenue, Brooklyn,
NY, 11219 or online at www.astfinancial.com.
Investment Manager and Administrator
Neuberger Berman Investment Advisers LLC
1290 Avenue of the Americas
New York, NY 10104-0002
877.461.1899
Custodian
State Street Bank and Trust Company
One Congress Street, Suite 1
Boston, MA 02114-2016
Transfer Agent
American Stock Transfer & Trust Company, LLC
6201 15th Avenue
Brooklyn, NY 11219
Shareholder Services 866.227.2136
Plan Agent
American Stock Transfer & Trust Company, LLC
Plan Administration Department
P.O. Box 922
Wall Street Station
New York, NY 10269-0560
Overnight correspondence should be sent to:
American Stock Transfer & Trust Company, LLC
6201 15th Avenue
Brooklyn, NY 11219
Legal Counsel
K&L Gates LLP
1601 K Street, NW
Washington, DC 20006-1600
Independent Registered Public Accounting Firm
Ernst & Young LLP
200 Clarendon Street
Boston, MA 02116
Proxy Voting Policies and Procedures
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to
portfolio securities is available, without charge, by calling 800-877-9700 (toll-free) and on the SEC’s website at www.sec.gov. Information regarding how the Fund voted proxies relating to portfolio securities during the most recent
12-month period ended June 30 is also available, without charge upon request, by calling 800-877-9700 (toll-free), on the SEC’s website at www.sec.gov, and on Neuberger Berman’s website at www.nb.com.
Quarterly Portfolio Schedule
The Fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each
fiscal year as an exhibit to its report on Form N-PORT. The Fund’s Forms N-PORT are available on the SEC’s website at www.sec.gov. The portfolio holdings information on Forms N-PORT are available upon request, without charge, by calling
800-877-9700 (toll-free).
|
|
WHAT DOES NEUBERGER BERMAN
DO WITH YOUR PERSONAL INFORMATION?
|
|
|
Financial companies choose how they share your personal information.
Federal law
gives consumers the right to limit some but not all sharing. Federal law
also requires
us to tell you how we collect, share, and protect your personal
information. Please
read this notice carefully to understand what we do.
|
|
|
The types of personal information we collect and share depend on the
product or
service you have with us. This information can include:
◾ Social Security numbers, dates of birth and other numerical identifiers
◾ Names and addresses
◾ Driver’s licenses, passports and other identification documents
◾ Usernames and passwords
◾ Internet protocol addresses and other network activity information
◾ Income, credit history, credit scores, assets, transaction history and other
financial information
When you are no longer our customer, we continue to share
your information as
described in this notice.
|
|
|
All financial companies need to share customers’ personal information to
run their
everyday business. In the section below, we list the reasons financial
companies can
share their customers’ personal information; the reasons Neuberger Berman
chooses to share; and whether you can limit this sharing.
|
Reasons we can share your personal information
|
Does Neuberger
Berman share?
|
Can you limit this sharing?
|
For our everyday business purposes—
such as to process your transactions, maintain your
account(s), respond to court orders and legal
investigations, or report to credit bureaus
|
|
|
For our marketing purposes—
to offer our products and services to you
|
|
|
For joint marketing with other financial
companies
|
|
|
For our affiliates’ everyday business purposes—
information about your transactions and
experiences
|
|
|
For our affiliates’ everyday business purposes—
information about your creditworthiness
|
|
|
For nonaffiliates to market to you
|
|
|
|
|
Call 646.497.4003 or 866.483.1046 (toll-free)
Email NBPrivacyOfficer@nb.com
|
This is not part of the Fund's stockholder Report.
|
|
|
Who is providing this notice?
|
Entities within the Neuberger Berman family of companies,
mutual funds, and private investment funds.
|
|
|
|
How does Neuberger Berman
protect my personal information?
|
To protect your personal information from unauthorized access
and use, we use security measures that comply with federal law.
These measures include physical, electronic and procedural
safeguards, including secured files and buildings.
We restrict access to customer information to those employees
who need to know such information in order to perform their job
responsibilities.
|
How does Neuberger Berman
collect my personal information?
|
We collect your personal information directly from you or your
representatives, for example, when you
◾ seek advice about your investments
◾ give us your contact or income information
◾ provide account information or open an account
◾ direct us to buy or sell securities, or complete other
transactions
◾ visit one of our websites, portals or other online locations
We may also collect your personal information from others, such
as credit bureaus, affiliates, or other companies.
|
Why can’t I limit all sharing?
|
Federal law gives you the right to limit only
◾ sharing for affiliates’ everyday business
purposes—information about your creditworthiness
◾ affiliates from using your information to market to you
◾ sharing for nonaffiliates to market to you
State laws and individual companies may give you additional
rights to limit sharing.
|
|
|
|
|
|
Companies related by common ownership or control. They can
be financial and nonfinancial companies.
◾ Our affiliates include companies with a Neuberger Berman
name; financial companies, such as investment
advisers or
broker dealers; mutual funds, and private investment
funds.
|
|
|
Companies not related by common ownership or control. They
can be financial and nonfinancial companies.
◾ Nonaffiliates we share with can include companies that
perform administrative services on our behalf (such
as
vendors that provide data processing, transaction
processing,
and printing services) or other companies such as
brokers,
dealers, or counterparties in connection with
servicing your
account.
|
|
|
A formal agreement between nonaffiliated financial companies
that together market financial products or services to you.
◾ Neuberger Berman doesn’t jointly market.
|
This is not part of the Fund's stockholder Report.
Neuberger Berman Investment Advisers LLC
1290 Avenue of the Americas
New York, NY 10104-0002
Internal Sales & Services
877.461.1899
www.nb.com
Statistics and projections in this report are derived from sources deemed to be reliable
but cannot be regarded as a representation of future results of the Fund. This report is prepared for the general information of stockholders and is not an offer for shares of
the Fund.
H0547 06/23
| (b) |
Not applicable to the Registrant.
|
Item 2. Code of Ethics.
The Board of Directors (“Board”) of Neuberger Berman High Yield Strategies Fund Inc. (“Registrant” or “Fund”) has adopted a code of ethics that applies to
the Registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions (“Code of Ethics”). During the period covered by this Form N-CSR, there were no
substantive amendments to the Code of Ethics and there were no waivers from the Code of Ethics granted to the Registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing
similar functions.
Item 3. Audit Committee Financial Expert.
Not applicable to semi-annual reports on Form N-CSR.
Item 4. Principal Accountant Fees and Services.
Not applicable to semi-annual reports on Form N-CSR.
Item 5. Audit Committee of Listed Registrants.
Not applicable to semi-annual reports on Form N-CSR.
Item 6. Investments.
|
(a)
|
The complete schedule of investments for the Registrant is disclosed in the Registrant’s semi-annual report, which is included in Item 1 of this
Form N-CSR.
|
|
(b)
|
Not applicable to the Registrant.
|
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable to semi-annual reports on Form N-CSR.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
|
(a)
|
Not applicable to semi-annual reports on Form N-CSR.
|
|
(b)
|
There have been no changes in any of the Portfolio Managers since the Registrant’s most recent annual report on Form N-CSR.
|
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
No reportable purchases for the period covered by this report.
Item 10. Submission of Matters to a Vote of Security Holders.
There were no material changes to the procedures by which stockholders may recommend nominees to the Board.
Item 11. Controls and Procedures.
| (a) |
Based on an evaluation of the disclosure controls and procedures (as defined in Rule 30a-3(c) under the Act) as of a date within 90 days of the filing date of this report, the Chief Executive
Officer and President and the Treasurer and Principal Financial and Accounting Officer of the Registrant have concluded that such disclosure controls and procedures are effectively designed to ensure that information required to be
disclosed by the Registrant on Form N-CSR is accumulated and communicated to the Registrant’s management to allow timely decisions regarding required disclosure.
|
| (b) |
There were no significant changes in the Registrant’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred during the period covered by this
report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.
|
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.
| (a) |
The Fund engaged in securities lending activity during the fiscal year ended October 31, 2022.
|
|
Gross income from securities lending activities
|
$88,727
|
|
Fees and/or compensation paid by the Fund for securities lending activities and related services
|
|
Fees paid to securities lending agent from a revenue split
|
$8,562
|
|
Fees paid for any cash collateral management service (including fees deducted from a pooled cash collateral reinvestment vehicle) that are not
included in the revenue split
|
$2,984
|
|
Administrative fees not included in revenue split
|
$0
|
|
Indemnification fees not included in revenue split
|
$0
|
|
Rebate (paid to borrower)
|
$0
|
|
Other fees relating to the securities lending program that are not included in the revenue split
|
$0
|
|
Aggregate fees/compensation for securities lending activities
|
$11,546
|
|
Net income from securities lending activities
|
$77,181
|
| (b) |
The Fund engaged in securities lending activity during the fiscal year ended October 31, 2022. State Street Bank and Trust Company, as the Fund’s securities lending
agent, effected loans of available securities of the Fund to qualified brokers and dealers in exchange for negotiated lender’s fees.
|
Item 13. Exhibits.
| (a)(3) |
Not applicable to the Registrant.
|
| (a)(4) |
Not applicable to the Registrant.
|
The certification furnished pursuant to Rule 30a-2(b) under the Act and Section 906 of the Sarbanes-Oxley Act will not be deemed “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (“Exchange Act”), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as
amended, or the Exchange Act, except to the extent that the Registrant specifically incorporates it by reference.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
Neuberger Berman High Yield Strategies Fund Inc.
By:
|
/s/ Joseph V. Amato |
|
|
|
Joseph V. Amato |
|
|
|
Chief Executive Officer and President |
|
|
|
|
|
Date: July 7, 2023
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf
of the Registrant and in the capacities and on the dates indicated.
By:
|
/s/ Joseph V. Amato |
|
|
|
Joseph V. Amato |
|
|
|
Chief Executive Officer and President |
|
|
|
|
|
Date: July 7, 2023
By:
|
/s/ John M. McGovern |
|
|
|
John M. McGovern |
|
|
|
Treasurer and Principal Financial |
|
|
|
and Accounting Officer |
|
| |
|
|
CERTIFICATIONS
I, Joseph V. Amato, certify that:
1. I have reviewed this report on Form N-CSR of Neuberger Berman High Yield Strategies Fund Inc. (“Registrant”);
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows
(if the financial statements are required to include a statement of cash flows) of the Registrant as of, and for, the periods presented in this report;
4. The Registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over
financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the Registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to
the filing date of this report based on such evaluation; and
d) Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the
Registrant’s internal control over financial reporting; and
5. The Registrant’s other certifying officer(s) and I have disclosed to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize, and
report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
Date: July 7, 2023
By:
|
/s/ Joseph V. Amato |
|
|
|
Joseph V. Amato |
|
|
|
Chief Executive Officer and President |
|
|
|
|
|
I, John M. McGovern, certify that:
1. I
have reviewed this report on Form N-CSR of Neuberger Berman High Yield Strategies Fund Inc. (“Registrant”);
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows
(if the financial statements are required to include a statement of cash flows) of the Registrant as of, and for, the periods presented in this report;
4. The Registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over
financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the Registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to
the filing date of this report based on such evaluation; and
d) Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the
Registrant’s internal control over financial reporting; and
5. The Registrant’s other certifying officer(s) and I have disclosed to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize, and
report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
Date: July 7, 2023
By:
|
/s/ John M. McGovern |
|
|
|
John M. McGovern |
|
|
|
Treasurer and Principal Financial and Accounting Officer |
|
|
|
|