Call 1-800-710-0935 or visit www.amundipioneer.com/us for the most recent month-end performance results. Current performance may be lower or higher than the performance data
quoted.
Performance data shown represents past performance. Past performance is no guarantee of future results. Investment return and market price will fluctuate, and your shares may trade
below NAV, due to such factors as interest rate changes, and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions. All performance is for shares of the Trust.
Shares of closed-end funds, unlike open-end funds, are not continuously offered. There is a one-time public offering and, once issued, shares of closed-end funds are bought and sold in the open
market through a stock exchange and frequently trade at prices lower than their NAV. NAV per share is total assets less total liabilities, which include preferred shares, or borrowings, as applicable, divided by the number of shares outstanding.
When NAV is lower than market price, dividends are assumed to be reinvested at the greater of NAV or 95% of the market price. When NAV is higher, dividends are assumed to be reinvested at prices
obtained through open-market purchases under the Trust’s dividend reinvestment plan.
The performance table and graph do not reflect the deduction of fees and taxes that a shareowner would pay on Trust distributions or the sale of Trust shares. Had these fees and taxes been reflected,
performance would have been lower.
Index returns are calculated monthly, assume reinvestment of dividends and, unlike Trust returns, do not reflect any fees, expenses or sales charges. The index does
not use leverage. You cannot invest directly in an index.
Principal amounts are denominated in U.S. dollars (“USD”) unless otherwise noted.
Purchases and sales of securities (excluding temporary cash investments) for the six months ended May 31, 2020 were as follows:
The Trust is permitted to engage in purchase and sale transactions (“cross trades”) with certain funds and accounts for which Amundi Pioneer Asset Management, Inc. (the “Adviser”) serves as the
Trust’s investment adviser, as set forth in Rule 17a-7 under the Investment Company Act of 1940, pursuant to procedures adopted by the Board of Trustees. Under these procedures, cross trades are effected at current market prices. During the six
months ended May 31, 2020, the Trust did not engage in any cross trade activity.
At May 31, 2020, the net unrealized depreciation on investments based on cost for federal tax purposes of $390,124,862 was as follows:
Various inputs are used in determining the value of the Trust’s investments. These inputs are summarized in the three broad levels below.
Level 2 – other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risks, etc.). See Notes
to Financial Statements — Note 1A.
Level 3 – significant unobservable inputs (including the Trust’s own assumptions in determining fair value of investments). See Notes to Financial Statements —
Note 1A.
The following is a summary of the inputs used as of May 31, 2020, in valuing the Trust’s investments:
|
|
ASSETS:
|
|
|
|
Investments in unaffiliated issuers, at value (cost $388,781,674)
|
|
$
|
354,682,022
|
|
|
|
|
|
|
Cash
|
|
|
2,163,943
|
|
Receivables —
|
|
|
|
|
Investment securities sold
|
|
|
15,179,921
|
|
Interest
|
|
|
2,132,596
|
|
Dividends
|
|
|
33,525
|
|
Other assets
|
|
|
33
|
|
Total assets
|
|
$
|
374,192,040
|
|
LIABILITIES:
|
|
|
|
|
Payables —
|
|
|
|
|
Credit agreement
|
|
$
|
103,450,000
|
|
Investment securities purchased
|
|
|
17,951,159
|
|
Trustees’ fees
|
|
|
8,611
|
|
Interest expense
|
|
|
16,508
|
|
Unrealized depreciation on unfunded loan commitments
|
|
|
144,191
|
|
Due to affiliates
|
|
|
24,897
|
|
Accrued expenses
|
|
|
193,495
|
|
Total liabilities
|
|
$
|
121,788,861
|
|
NET ASSETS:
|
|
|
|
|
Paid-in capital
|
|
$
|
344,939,989
|
|
Distributable earnings (loss)
|
|
|
(92,536,810
|
)
|
Net assets
|
|
$
|
252,403,179
|
|
NET ASSET VALUE PER SHARE:
|
|
|
|
|
No par value
|
|
|
|
|
based on $252,403,179/24,738,174 shares
|
|
$
|
10.20
|
|
The accompanying notes are an integral part of these financial statements.
36 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
|
Statement of Operations (unaudited)
|
FOR THE SIX MONTHS ENDED 5/31/20
|
|
|
INVESTMENT INCOME:
|
|
|
|
|
|
|
Interest from unaffiliated issuers
|
|
$
|
11,505,189
|
|
|
|
|
Dividends from unaffiliated issuers
|
|
|
168,704
|
|
|
|
|
Total investment income
|
|
|
|
|
|
$
|
11,673,893
|
|
EXPENSES:
|
|
|
|
|
|
|
|
|
Management fees
|
|
$
|
1,386,146
|
|
|
|
|
|
Administrative expense
|
|
|
92,591
|
|
|
|
|
|
Transfer agent fees
|
|
|
5,143
|
|
|
|
|
|
Custodian fees
|
|
|
62,887
|
|
|
|
|
|
Professional fees
|
|
|
85,549
|
|
|
|
|
|
Printing expense
|
|
|
14,420
|
|
|
|
|
|
Pricing fees
|
|
|
21,137
|
|
|
|
|
|
Trustees’ fees
|
|
|
10,415
|
|
|
|
|
|
Interest expense
|
|
|
1,359,600
|
|
|
|
|
|
Miscellaneous
|
|
|
129,148
|
|
|
|
|
|
Total expenses
|
|
|
|
|
|
$
|
3,167,036
|
|
Net investment income
|
|
|
|
|
|
$
|
8,506,857
|
|
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
|
|
|
|
|
|
|
|
|
Net realized gain (loss) on:
|
|
|
|
|
|
|
|
|
Investments in unaffiliated issuers
|
|
$
|
(8,335,948
|
)
|
|
|
|
|
Swap contracts
|
|
|
(2,327,585
|
)
|
|
|
|
|
Other assets and liabilities denominated in
|
|
|
|
|
|
|
|
|
foreign currencies
|
|
|
(3,831
|
)
|
|
$
|
(10,667,364
|
)
|
Change in net unrealized appreciation (depreciation) on:
|
|
|
|
|
|
|
|
|
Investments in unaffiliated issuers
|
|
$
|
(28,553,469
|
)
|
Swap contracts
|
|
|
(261,360
|
)
|
|
|
|
|
Unfunded loan commitments
|
|
|
(139,788
|
)
|
|
|
|
|
Other assets and liabilities denominated in foreign currencies
|
|
|
2,989
|
|
|
|
(28,951,628
|
)
|
Net realized and unrealized gain (loss) on investments
|
|
|
|
|
|
$
|
(39,618,992
|
)
|
Net decrease in net assets resulting from operations
|
|
|
|
|
|
$
|
(31,112,135
|
)
|
The accompanying notes are an integral part of these financial statements.
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 37
|
Statements of Changes in Net Assets
|
|
|
|
|
|
Six Months
|
|
|
|
|
|
|
Ended
|
|
|
Year
|
|
|
|
5/31/20
|
|
|
Ended
|
|
|
|
(unaudited)
|
|
|
11/30/19
|
|
FROM OPERATIONS:
|
|
|
|
|
|
|
Net investment income (loss)
|
|
$
|
8,506,857
|
|
|
$
|
17,994,475
|
|
Net realized gain (loss) on investments
|
|
|
(10,667,364
|
)
|
|
|
(9,886,339
|
)
|
Change in net unrealized appreciation (depreciation)
|
|
|
|
|
|
|
|
|
on investments
|
|
|
(28,951,628
|
)
|
|
|
4,901,558
|
|
Net increase (decrease) in net assets resulting
|
|
|
|
|
|
|
|
|
from operations
|
|
$
|
(31,112,135
|
)
|
|
$
|
13,009,724
|
|
DISTRIBUTIONS TO SHAREOWNERS:
|
|
|
|
|
|
|
|
|
($0.37 and $0.74 per share, respectively)
|
|
$
|
(9,214,970
|
)
|
|
$
|
(18,182,558
|
)
|
Total distributions to shareowners
|
|
$
|
(9,214,970
|
)
|
|
$
|
(18,182,558
|
)
|
Net decrease in net assets
|
|
$
|
(40,327,105
|
)
|
|
$
|
(5,172,834
|
)
|
NET ASSETS:
|
|
|
|
|
|
|
|
|
Beginning of period
|
|
$
|
292,730,284
|
|
|
$
|
297,903,118
|
|
End of period
|
|
$
|
252,403,179
|
|
|
$
|
292,730,284
|
|
The accompanying notes are an integral part of these financial statements.
38 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
|
|
Statement of Cash Flows (unaudited)
|
|
FOR THE SIX MONTHS ENDED 5/31/20
|
|
|
|
Cash Flows From Operating Activities:
|
|
|
|
Net decrease in net assets resulting from operations
|
|
$
|
(31,112,135
|
)
|
Adjustments to reconcile net decrease in net assets resulting from operations
|
|
|
|
|
to net cash, restricted cash and foreign currencies from operating activities:
|
|
|
|
|
Purchases of investment securities
|
|
$
|
(227,559,145
|
)
|
Proceeds from disposition and maturity of investment securities
|
|
|
259,247,885
|
|
Net sales of temporary cash investments
|
|
|
5,770,000
|
|
Net accretion and amortization of discount/premium on investment securities
|
|
|
(739,767
|
)
|
Change in unrealized depreciation on investments in unaffiliated issuers
|
|
|
28,553,469
|
|
Change in unrealized depreciation on unfunded loan commitments
|
|
|
139,788
|
|
Change in unrealized appreciation on swap contracts
|
|
|
261,360
|
|
Change in unrealized depreciation on other assets and liabilities denominated
|
|
|
|
|
in foreign currencies
|
|
|
(2,990
|
)
|
Net realized loss on investments in unaffiliated issuers
|
|
|
8,335,948
|
|
Net premiums received on swap contracts
|
|
|
877,234
|
|
Increase in interest receivable
|
|
|
(799,807
|
)
|
Decrease in due to affiliates
|
|
|
(33,130
|
)
|
Increase in trustees’ fees payable
|
|
|
1,811
|
|
Decrease in accrued expenses payable
|
|
|
(31,139
|
)
|
Decrease in interest expense payable
|
|
|
(98,105
|
)
|
Decrease in cash due to broker
|
|
|
(1,133,779
|
)
|
Decrease in variation margin for swap contracts
|
|
|
(1,464
|
)
|
Net cash, restricted cash and foreign currencies provided by operating activities
|
|
$
|
41,676,034
|
|
Cash Flows Used in Financing Activities:
|
|
|
|
|
Borrowings received
|
|
$
|
6,000,000
|
|
Borrowings repaid
|
|
|
(42,000,000
|
)
|
Distributions to shareowners
|
|
|
(9,214,970
|
)
|
Net cash, restricted cash and foreign currencies used in financing activities
|
|
$
|
(45,214,970
|
)
|
Effect of Foreign Exchange Fluctuations on Cash:
|
|
|
|
|
Effect of foreign exchange fluctuations on cash
|
|
$
|
2,990
|
|
Cash, Restricted Cash and Foreign Currencies:
|
|
|
|
|
Beginning of period*
|
|
$
|
5,699,889
|
|
End of period*
|
|
$
|
2,163,943
|
|
Cash Flow Information:
|
|
|
|
|
Cash paid for interest
|
|
$
|
1,457,705
|
|
* The following table provides a reconciliation of cash, restricted cash and foreign currencies reported within statement of financial position that sum to the
total of the same such amounts shown in the Statement of Cash Flows:
|
|
|
|
|
|
|
|
|
Six Months
|
|
|
|
|
|
|
Ended
|
|
|
|
|
|
|
5/31/20
|
|
|
Year Ended
|
|
|
|
(unaudited)
|
|
|
11/30/19
|
|
Cash
|
|
$
|
2,163,943
|
|
|
$
|
4,920,837
|
|
Foreign currencies, at value
|
|
|
—
|
|
|
|
31,145
|
|
Swaps collateral
|
|
|
—
|
|
|
|
747,907
|
|
Total cash, restricted cash and foreign currencies
|
|
|
|
|
|
|
|
|
shown in the Statement of Cash Flows
|
|
$
|
2,163,943
|
|
|
$
|
5,699,889
|
|
The accompanying notes are an integral part of these financial statements.
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 39
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ended
|
|
|
Year
|
|
|
Year
|
|
|
Year
|
|
|
Year
|
|
|
Year
|
|
|
|
5/31/20
|
|
|
Ended
|
|
|
Ended
|
|
|
Ended
|
|
|
Ended
|
|
|
Ended
|
|
|
|
(unaudited)
|
|
|
11/30/19
|
|
|
11/30/18
|
|
|
11/30/17
|
|
|
11/30/16*
|
|
|
11/30/15*
|
|
Per Share Operating Performance
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, beginning of period
|
|
$
|
11.83
|
|
|
$
|
12.04
|
|
|
$
|
12.42
|
|
|
$
|
12.50
|
|
|
$
|
12.30
|
|
|
$
|
12.82
|
|
Increase (decrease) from investment operations: (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
$
|
0.34
|
|
|
$
|
0.73
|
|
|
$
|
0.74
|
|
|
$
|
0.71
|
|
|
$
|
0.77
|
|
|
$
|
0.76
|
|
Net realized and unrealized gain (loss) on investments
|
|
|
(1.60
|
)
|
|
|
(0.20
|
)
|
|
|
(0.40
|
)
|
|
|
(0.06
|
)
|
|
|
0.15
|
|
|
|
(0.58
|
)
|
Net increase (decrease) from investment operations
|
|
$
|
(1.26
|
)
|
|
$
|
0.53
|
|
|
$
|
0.34
|
|
|
$
|
0.65
|
|
|
$
|
0.92
|
|
|
$
|
0.18
|
|
Distributions to shareowners from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income and previously undistributed net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
investment income
|
|
$
|
(0.37
|
)(b)
|
|
$
|
(0.74
|
)(b)
|
|
$
|
(0.72
|
)
|
|
$
|
(0.73
|
)(b)
|
|
$
|
(0.72
|
)
|
|
$
|
(0.70
|
)
|
Net increase (decrease) in net asset value
|
|
$
|
(1.63
|
)
|
|
$
|
(0.21
|
)
|
|
$
|
(0.38
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
0.20
|
|
|
$
|
(0.52
|
)
|
Net asset value, end of period
|
|
$
|
10.20
|
|
|
$
|
11.83
|
|
|
$
|
12.04
|
|
|
$
|
12.42
|
|
|
$
|
12.50
|
|
|
$
|
12.30
|
|
Market value, end of period
|
|
$
|
8.97
|
|
|
$
|
10.53
|
|
|
$
|
10.40
|
|
|
$
|
11.47
|
|
|
$
|
11.78
|
|
|
$
|
10.83
|
|
Total return at net asset value (c)
|
|
|
(10.29
|
)%(d)
|
|
|
5.38
|
%
|
|
|
3.34
|
%
|
|
|
5.55
|
%
|
|
|
8.31
|
%
|
|
|
1.96
|
%
|
Total return at market value (c)
|
|
|
(11.37
|
)%(d)
|
|
|
8.59
|
%
|
|
|
(3.34
|
)%
|
|
|
3.43
|
%
|
|
|
15.92
|
%
|
|
|
1.31
|
%
|
Ratios to average net assets of shareowners:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses plus interest expense (e)(f)
|
|
|
2.34
|
%(g)
|
|
|
2.90
|
%
|
|
|
2.56
|
%
|
|
|
2.21
|
%
|
|
|
1.96
|
%
|
|
|
1.81
|
%
|
Net investment income before preferred share distributions
|
|
|
6.29
|
%(g)
|
|
|
6.08
|
%
|
|
|
5.98
|
%
|
|
|
5.62
|
%
|
|
|
6.32
|
%
|
|
|
6.00
|
%
|
Net investment income available to shareowners
|
|
|
6.29
|
%(g)
|
|
|
6.08
|
%
|
|
|
5.98
|
%
|
|
|
5.62
|
%
|
|
|
6.32
|
%
|
|
|
6.00
|
%
|
Portfolio turnover rate
|
|
|
45
|
%(d)
|
|
|
48
|
%
|
|
|
34
|
%
|
|
|
75
|
%
|
|
|
52
|
%
|
|
|
38
|
%
|
Net assets, end of period (in thousands)
|
|
$
|
252,403
|
|
|
$
|
292,730
|
|
|
$
|
297,903
|
|
|
$
|
307,195
|
|
|
$
|
309,308
|
|
|
$
|
304,357
|
|
The accompanying notes are an integral part of these financial statements.
40 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ended
|
|
|
Year
|
|
|
Year
|
|
|
Year
|
|
|
Year
|
|
|
Year
|
|
|
|
5/31/20
|
|
|
Ended
|
|
|
Ended
|
|
|
Ended
|
|
|
Ended
|
|
|
Ended
|
|
|
|
(unaudited)
|
|
|
11/30/19
|
|
|
11/30/18
|
|
|
11/30/17
|
|
|
11/30/16*
|
|
|
11/30/15*
|
|
Total amount of debt outstanding (in thousands)
|
|
$
|
103,450
|
|
|
$
|
139,450
|
|
|
$
|
143,450
|
|
|
$
|
143,450
|
|
|
$
|
143,450
|
|
|
$
|
143,450
|
|
Asset coverage per $1,000 of indebtedness
|
|
$
|
3,440
|
|
|
$
|
3,099
|
|
|
$
|
3,077
|
|
|
$
|
3,141
|
|
|
$
|
3,156
|
|
|
$
|
3,023
|
|
* The Trust was audited by an independent registered public accounting firm other than Ernst & Young LLP.
(a) The per common share data presented above is based upon the average common shares outstanding for the periods presented.
(b) The amount of distributions made to shareowners during the period was in excess of the net investment income earned by the Trust during the period. The
Trust has accumulated undistributed net investment income which is the part of the Trust’s net asset value (“NAV”). A portion of this accumulated net investment income was distributed to shareowners during the period.
(c) Total investment return is calculated assuming a purchase of common shares at the current net asset value or market value on the first day and a sale at
the current net asset value or market value on the last day of the periods reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at prices obtained under the Trust’s dividend reinvestment plan.
Total investment return does not reflect brokerage commissions. Past performance is not a guarantee of future results.
(d) Not annualized.
(e) Expense ratios do not reflect the effect of distribution payments to preferred shareowners.
(f) Includes interest expense of 1.01%, 1.60%, 1.35%, 0.95%, 0.63% and 0.51%, respectively.
(g) Annualized.
The accompanying notes are an integral part of these financial statements.
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 41
Notes to Financial Statements |
5/31/20
1. Organization and Significant Accounting Policies
Pioneer Floating Rate Trust (the “Trust”) was organized as a Delaware statutory trust on October 6, 2004. Prior to commencing operations on December 28, 2004, the Trust had no operations other than
matters relating to its organization and registration as a closed-end management investment company under the Investment Company Act of 1940, as amended. The Trust is a diversified fund. The investment objective of the Trust is to provide a high
level of current income and the Trust may, as a secondary objective, also seek preservation of capital to the extent consistent with its investment objective of high current income.
Amundi Pioneer Asset Management, Inc., an indirect, wholly owned subsidiary of Amundi and Amundi's wholly owned subsidiary, Amundi USA, Inc., serves as the Trust’s investment adviser (the “Adviser”).
Amundi Pioneer Distributor, Inc., an affiliate of Amundi Pioneer Asset Management, Inc., serves as the Trust’s distributor (the “Distributor”).
In November 2016, the Financial Account Standard Board (FASB) issued Accounting Standards Update 2016-18, Statement of Cash Flows (Topic 230) Restricted Cash (“ASU 2016-18”), which is effective for
fiscal years beginning after December 15, 2017 and interim periods within those fiscal years. The Trust adopted ASU 2016-18 effective with the beginning of the current reporting period, which resulted in changes to the presentation of restricted
cash in the Trust’s Statement of Cash Flows and additional disclosures regarding the nature of the restrictions on cash and restricted cash.
In August 2018, the Securities and Exchange Commission (“SEC”) released a Disclosure Update and Simplification Final Rule. The Final Rule amends Regulation S-X disclosures requirements to conform
them to U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) for investment companies. The Trust's financial statements were prepared in compliance with the new amendments to Regulation S-X.
During March 2017, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standard Update, ASU 2017-08, Receivables-Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium
Amortization on Purchased Callable Debt Securities (“ASU 2017-08”), which shortens the amortization period for purchased non-contingently callable debt securities held at a premium. ASU 2017-08 specifies that the premium amortization period ends at
the earliest call date, for certain purchased non-contingently callable debt securities. ASU 2017-08 is effective for fiscal years, and interim periods within
42 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
those fiscal years, beginning after December 15, 2018. The Trust has adopted ASU 2017-08 as of May 31, 2020. The implementation of ASU 2017-08 did not have a material impact on the Trust's Financial
Statements.
The Trust is an investment company and follows investment company accounting and reporting guidance under U.S. GAAP. U.S. GAAP requires the management of the Trust to make estimates and assumptions
that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income, expenses and gain or loss on investments during the
reporting period. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the Trust in the preparation of its financial statements:
A. Security Valuation
The net asset value of the Trust is computed once daily, on each day the New York Stock Exchange (“NYSE”) is open, as of the close of regular trading on the NYSE.
Loan interests are valued in accordance with guidelines established by the Board of Trustees at the mean between the last available bid and asked prices from one or more brokers or
dealers as obtained from Loan Pricing Corporation, an independent third party pricing service. If price information is not available from Loan Pricing Corporation, or if the price information is deemed to be unreliable, price information will be
obtained from an alternative loan interest pricing service. If no reliable price quotes are available from either the primary or alternative pricing service, broker quotes will be solicited.
Fixed-income securities are valued by using prices supplied by independent pricing services, which consider such factors as market prices, market events, quotations from one or
more brokers, Treasury spreads, yields, maturities and ratings, or may use a pricing matrix or other fair value methods or techniques to provide an estimated value of the security or instrument. A pricing matrix is a means of valuing a debt
security on the basis of current market prices for other debt securities, historical trading patterns in the market for fixed-income securities and/or other factors. Non-U.S. debt securities that are listed on an exchange will be valued at the bid
price obtained from an independent third party pricing service. When independent third party pricing services are unable to supply prices, or when prices or market quotations are considered to be unreliable, the value of that security may be
determined using quotations from one or more broker-dealers.
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 43
Event-linked bonds are valued at the bid price obtained from an independent third party pricing service. Other insurance-linked securities (including reinsurance sidecars,
collateralized reinsurance and industry loss warranties) may be valued at the bid price obtained from an independent pricing service, or through a third party using a pricing matrix, insurance industry valuation models, or other fair value methods
or techniques to provide an estimated value of the instrument.
Equity securities that have traded on an exchange are valued by using the last sale price on the principal exchange where they are traded. Equity securities that have not traded on
the date of valuation, or securities for which sale prices are not available, generally are valued using the mean between the last bid and asked prices or, if both last bid and asked prices are not available, at the last quoted bid price. Last sale
and bid and asked prices are provided by independent third party pricing services. In the case of equity securities not traded on an exchange, prices are typically determined by independent third party pricing services using a variety of techniques
and methods.
The value of foreign securities is translated into U.S. dollars based on foreign currency exchange rate quotations supplied by a third party pricing source. Trading in non-U.S.
equity securities is substantially completed each day at various times prior to the close of the NYSE. The values of such securities used in computing the net asset value of the Trust’s shares are determined as of such times. The Trust may use a
fair value model developed by an independent pricing service to value non-U.S. equity securities.
Swap contracts, including interest rate swaps, caps and floors (other than centrally cleared swap contracts), are valued at the dealer quotations obtained from reputable
International Swap Dealers Association members. Centrally cleared swaps are valued at the daily settlement price provided by the central clearing counterparty.
Shares of open-end registered investment companies (including money market mutual funds) are valued at such funds’ net asset value. Shares of exchange-listed closed-end funds are
valued by using the last sale price on the principal exchange where they are traded.
Repurchase agreements are valued at par. Cash may include overnight time deposits at approved financial institutions.
Securities or loan interests for which independent pricing services or broker-dealers are unable to supply prices or for which market prices and/or quotations are not readily
available or are considered to be unreliable are valued by a fair valuation team comprised of certain personnel of the Adviser pursuant to procedures adopted by the Trust’s Board of Trustees. The Adviser’s fair valuation team uses fair value
methods approved by the
44 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
Valuation Committee of the Board of Trustees. The Adviser’s fair valuation team is responsible for monitoring developments that may impact fair valued securities and for discussing
and assessing fair values on an ongoing basis, and at least quarterly, with the Valuation Committee of the Board of Trustees.
Inputs used when applying fair value methods to value a security may include credit ratings, the financial condition of the company, current market conditions and comparable
securities. The Trust may use fair value methods if it is determined that a significant event has occurred after the close of the exchange or market on which the security trades and prior to the determination of the Trust’s net asset value.
Examples of a significant event might include political or economic news, corporate restructurings, natural disasters, terrorist activity or trading halts. Thus, the valuation of the Trust’s securities may differ significantly from exchange prices,
and such differences could be material.
At May 31, 2020, one security was valued using fair value methods (in addition to securities valued using prices supplied by independent pricing services, broker-dealers or using a
third party insurance pricing model) representing 0.04% of net assets. The value of this fair valued security was $108,702.
B. Investment Income and Transactions
Dividend income is recorded on the ex-dividend date, except that certain dividends from foreign securities where the ex-dividend date may have passed are recorded as soon as the
Trust becomes aware of the ex-dividend data in the exercise of reasonable diligence.
Interest income, including interest on income-bearing cash accounts, is recorded on the accrual basis. Dividend and interest income are reported net of unrecoverable foreign taxes
withheld at the applicable country rates and net of income accrued on defaulted securities.
Interest and dividend income payable by delivery of additional shares is reclassified as PIK (payment-in-kind) income upon receipt and is included in interest and dividend income,
respectively.
Principal amounts of mortgage-backed securities are adjusted for monthly paydowns. Premiums and discounts related to certain mortgage-backed securities are amortized or accreted in
proportion to the monthly paydowns. All discounts/premiums on purchase prices of debt securities
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 45
are accreted/amortized for financial reporting purposes over the life of the respective securities, and such accretion/amortization is included in interest income.
Security transactions are recorded as of trade date. Gains and losses on sales of investments are calculated on the identified cost method for both financial reporting and federal
income tax purposes.
C. Foreign Currency Translation
The books and records of the Trust are maintained in U.S. dollars. Amounts denominated in foreign currencies are translated into U.S. dollars using current exchange rates.
Net realized gains and losses on foreign currency transactions, if any, represent, among other things, the net realized gains and losses on foreign currency exchange contracts,
disposition of foreign currencies and the difference between the amount of income accrued and the U.S. dollars actually received. Further, the effects of changes in foreign currency exchange rates on investments are not segregated on the Statement
of Operations from the effects of changes in the market prices of those securities, but are included with the net realized and unrealized gain or loss on investments.
D. Federal Income Taxes
It is the Trust’s policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its net taxable income
and net realized capital gains, if any, to its shareowners. Therefore, no provision for federal income taxes is required. As of November 30, 2019, the Trust did not accrue any interest or penalties with respect to uncertain tax positions, which, if
applicable, would be recorded as an income tax expense on the Statement of Operations. Tax returns filed within the prior three years remain subject to examination by federal and state tax authorities.
The amount and character of income and capital gain distributions to shareowners are determined in accordance with federal income tax rules, which may differ from U.S. GAAP.
Distributions in excess of net investment income or net realized gains are temporary over distributions for financial statement purposes resulting from differences in the recognition or classification of income or distributions for financial
statement and tax purposes. Capital accounts within the financial statements are adjusted for permanent book/tax differences to reflect tax character, but are not adjusted for temporary differences.
46 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
The tax character of current year distributions payable will be determined at the end of the current taxable year. The tax character of distributions paid during the year ended
November 30, 2019 was as follows:
|
|
|
|
|
|
2019
|
|
Distributions paid from:
|
|
|
|
Ordinary income
|
|
$
|
18,182,558
|
|
Total
|
|
$
|
18,182,558
|
|
The following shows the components of distributable earnings (losses) on a federal income tax basis at November 30, 2019:
|
|
|
|
|
|
2019
|
|
Distributable earnings:
|
|
|
|
Undistributed ordinary income
|
|
$
|
693,150
|
|
Capital loss carryforward
|
|
|
(47,144,686
|
)
|
Unrealized depreciation
|
|
|
(5,758,169
|
)
|
Total
|
|
$
|
(52,209,705
|
)
|
The difference between book basis and tax basis unrealized depreciation is attributable to the tax treatment of premium and amortization, adjustments relating to insurance linked
securities, the tax adjustments relating to credit default swaps and partnerships.
E. Risks
At times, the Trust’s investments may represent industries or industry sectors that are interrelated or have common risks, making the Trust more susceptible to any economic,
political, or regulatory developments or other risks affecting those industries and sectors. The Trust’s investments in foreign markets and countries with limited developing markets may subject the Trust to a greater degree of risk than investments
in a developed market. These risks include disruptive political or economic conditions and the imposition of adverse governmental laws or currency exchange restrictions.
The value of securities held by the Trust may go up or down, sometimes rapidly or unpredictably, due to general market conditions, such as real or perceived adverse economic,
political or regulatory conditions, recessions, the spread of infectious illness or other public health issues, inflation, changes in interest rates, lack of liquidity in the bond markets or adverse investor sentiment. In the past several years,
financial markets have experienced increased volatility, depressed valuations, decreased liquidity and heightened uncertainty. These conditions may continue, recur, worsen or spread. A general rise in interest rates could adversely affect the price
and liquidity of fixed-income securities and could also result in increased redemptions from the Trust.
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 47
The Trust invests in below-investment-grade (high-yield) debt securities and preferred stocks. Some of these high-yield securities may be convertible into equity securities of the
issuer. Debt securities rated below-investment-grade are commonly referred to as “junk bonds” and are considered speculative. These securities involve greater risk of loss, are subject to greater price volatility, and are less liquid, especially
during periods of economic uncertainty or change, than higher rated debt securities.
Certain instruments held by the Trust pay an interest rate based on the London Interbank Offered Rate (“LIBOR”), which is the average offered rate for various maturities of
short-term loans between certain major international banks. LIBOR is expected to be phased out by the end of 2021. While the effect of the phase out cannot yet be determined, it may result in, among other things, increased volatility or illiquidity
in markets for instruments based on LIBOR and changes in the value of such instruments.
Under normal market conditions, the Trust seeks to achieve its investment objectives by investing at least 80% of its assets (net assets plus borrowings for investment purposes) in
senior floating rate loans. For purposes of the Trust’s investment policies, senior floating rate loans include funds that invest primarily in senior floating rate loans. Floating rate loans and similar investments may be illiquid or less liquid
than other investments and difficult to value. Market quotations for these securities may be volatile and/or subject to large spreads between bid and ask prices.
Certain securities in which the Trust invests, including floating rate loans, once sold, may not settle for an extended period (for example, several weeks or even longer). The
Trust will not receive its sale proceeds until that time, which may constrain the Trust’s ability to meet its obligations. The Trust may invest in securities of issuers that are in default or that are in bankruptcy. The value of collateral, if any,
securing a floating rate loan can decline or may be insufficient to meet the issuer’s obligations or may be difficult to liquidate. No active trading market may exist for many floating rate loans, and many loans are subject to restrictions on
resale. Any secondary market may be subject to irregular trading activity and extended settlement periods. There is less readily available, reliable information about most floating rate loans than is the case for many other types of securities.
Normally, the Adviser will seek to avoid receiving material, non-public information about the issuer of a loan either held by, or considered for investment by, the Trust, and this decision could adversely affect the Trust’s investment performance.
Loans may not be considered “securities,” and purchasers, such as the Trust, therefore may not be entitled to rely on the anti-fraud protections afforded by federal securities laws. The Trust’s investments in certain foreign markets or countries
with limited developing markets may subject the Trust to a greater degree of risk
48 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
than in a developed market. These risks include disruptive political or economic conditions and the possible imposition of adverse governmental laws or currency exchange
restrictions.
The Trust is not limited in the percentage of its assets that may be invested in illiquid securities. Illiquid securities are securities that the Trust reasonably expects cannot be
sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the securities.
With the increased use of technologies such as the Internet to conduct business, the Trust is susceptible to operational, information security and related risks. While the Trust’s
Adviser has established business continuity plans in the event of, and risk management systems to prevent, limit or mitigate, such cyber-attacks, there are inherent limitations in such plans and systems, including the possibility that certain risks
have not been identified. Furthermore, the Trust cannot control the cybersecurity plans and systems put in place by service providers to the Trust such as Brown Brothers Harriman & Co., the Trust’s custodian and accounting agent, and American
Stock & Trust Company (“AST”), the Trust’s transfer agent. In addition, many beneficial owners of Trust shares hold them through accounts at broker-dealers, retirement platforms and other financial market participants over which neither the
Trust nor Amundi Pioneer exercises control. Each of these may in turn rely on service providers to them, which are also subject to the risk of cyber-attacks. Cybersecurity failures or breaches at Amundi Pioneer or the Trust’s service providers or
intermediaries have the ability to cause disruptions and impact business operations, potentially resulting in financial losses, interference with the Trust’s ability to calculate its net asset value, impediments to trading, the inability of Trust
shareowners to effect share purchases or redemptions or receive distributions, loss of or unauthorized access to private shareowner information and violations of applicable privacy and other laws, regulatory fines, penalties, reputational damage,
or additional compliance costs. Such costs and losses may not be covered under any insurance. In addition, maintaining vigilance against cyber-attacks may involve substantial costs over time, and system enhancements may themselves be subject to
cyber-attacks.
COVID-19
The respiratory illness COVID-19 caused by a novel coronavirus has resulted in a global pandemic and major disruption to economies and markets around the world, including the
United States. Global financial markets have experienced extreme volatility and severe losses, and trading in many instruments has been disrupted. Liquidity for many instruments has been greatly reduced for periods of time. Some interest rates are
very low and in
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 49
some cases yields are negative. Some sectors of the economy and individual issuers have experienced particularly large losses. These circumstances may continue for an extended
period of time, and may continue to affect adversely the value and liquidity of the Trust's investments. The ultimate economic fallout from the pandemic, and the long-term impact on economies, markets, industries and individual issuers, are not
known. Governments and central banks, including the Federal Reserve in the U.S., have taken extraordinary and unprecedented actions to support local and global economies and the financial markets. These actions have resulted in significant
expansion of public debt, including in the U.S. The impact of these measures, and whether they will be effective to mitigate the economic and market disruption, will not be known for some time. The consequences of high public debt, including its
future impact on the economy and securities markets, likewise may not be known for some time.
F. Insurance-Linked Securities (“ILS”)
The Trust invests in ILS. The Trust could lose a portion or all of the principal it has invested in an ILS, and the right to additional interest or dividend payments with respect
to the security, upon the occurrence of one or more trigger events, as defined within the terms of an insurance-linked security. Trigger events, generally, are hurricanes, earthquakes, or other natural events of a specific size or magnitude that
occur in a designated geographic region during a specified time period, and/or that involve losses or other metrics that exceed a specific amount. There is no way to accurately predict whether a trigger event will occur, and accordingly, ILS carry
significant risk. The Trust is entitled to receive principal, and interest and/or dividend payments so long as no trigger event occurs of the description and magnitude specified by the instrument. In addition to the specified trigger events, ILS
may expose the Trust to other risks, including but not limited to issuer (credit) default, adverse regulatory or jurisdictional interpretations and adverse tax consequences.
The Trust’s investments in ILS may include event-linked bonds. ILS also may include special purpose vehicles (“SPVs”) or similar instruments structured to comprise a portion of a
reinsurer’s catastrophe-oriented business, known as quota share instruments (sometimes referred to as reinsurance sidecars), or to provide reinsurance relating to specific risks to insurance or reinsurance companies through a collateralized
instrument, known as collateralized reinsurance. Structured reinsurance investments also may include industry loss warranties (“ILWs”). A traditional ILW takes the form of a bilateral reinsurance contract, but there are also products that take the
form of derivatives, collateralized structures, or exchange-traded instruments.
50 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
Where the ILS are based on the performance of underlying reinsurance contracts, the Trust has limited transparency into the individual underlying contracts, and therefore must rely
upon the risk assessment and sound underwriting practices of the issuer. Accordingly, it may be more difficult for the Adviser to fully evaluate the underlying risk profile of the Trust’s structured reinsurance investments, and therefore the
Trust’s assets are placed at greater risk of loss than if the Adviser had more complete information. Structured reinsurance instruments generally will be considered illiquid securities by the Trust. These securities may be difficult to purchase,
sell or unwind. Illiquid securities also may be difficult to value. If the Trust is forced to sell an illiquid asset, the Trust may be forced to sell at a loss.
G. Repurchase Agreements
Repurchase agreements are arrangements under which the Trust purchases securities from a broker-dealer or a bank, called the counterparty, upon the agreement of the counterparty to
repurchase the securities from the Trust at a later date, and at a specific price, which is typically higher than the purchase price paid by the Trust. The securities purchased serve as the Trust’s collateral for the obligation of the counterparty
to repurchase the securities. The value of the collateral, including accrued interest, is required to be equal to or in excess of the repurchase price. The collateral for all repurchase agreements is held in safekeeping in the customer-only account
of the Trust’s custodian or a sub-custodian of the Trust. The Adviser is responsible for determining that the value of the collateral remains at least equal to the repurchase price. In the event of a default by the counterparty, the Trust is
entitled to sell the securities, but the Trust may not be able to sell them for the price at which they were purchased, thus causing a loss to the Trust. Additionally, if the counterparty becomes insolvent, there is some risk that the Trust will
not have a right to the securities, or the immediate right to sell the securities.
Open repurchase agreements at May 31, 2020, are disclosed in the Schedule of Investments.
H. Credit Default Swap Contracts
A credit default swap is a contract between a buyer of protection and a seller of protection against a pre-defined credit event or an underlying reference obligation, which may be
a single security or a basket or index of securities. The Trust may buy or sell credit default swap contracts to seek to increase the Trust’s income, or to attempt to hedge the risk of default on portfolio securities. A credit default swap index is
used to hedge risk or take a position on a basket of credit entities or indices.
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 51
As a seller of protection, the Trust would be required to pay the notional (or other agreed-upon) value of the referenced debt obligation to the counterparty in the event of a
default by a U.S. or foreign corporate issuer of a debt obligation, which would likely result in a loss to the Trust. In return, the Trust would receive from the counterparty a periodic stream of payments during the term of the contract, provided
that no event of default occurred. The maximum exposure of loss to the seller would be the notional value of the credit default swaps outstanding. If no default occurs, the Trust would keep the stream of payments and would have no payment
obligation. The Trust may also buy credit default swap contracts in order to hedge against the risk of default of debt securities, in which case the Trust would function as the counterparty referenced above.
As a buyer of protection, the Trust makes an upfront or periodic payment to the protection seller in exchange for the right to receive a contingent payment. An upfront payment made
by the Trust, as the protection buyer, is recorded within the “Swap contracts, at value” line item on the Statement of Assets and Liabilities. Periodic payments received or paid by the Trust are recorded as realized gains or losses on the Statement
of Operations.
Credit default swap contracts are marked-to-market daily using valuations supplied by independent sources, and the change in value, if any, is recorded within the “Swap contracts,
at value” line item on the Statement of Assets and Liabilities. Payments received or made as a result of a credit event or upon termination of the contract are recognized, net of the appropriate amount of the upfront payment, as realized gains or
losses on the Statement of Operations.
Credit default swap contracts involving the sale of protection may involve greater risks than if the Trust had invested in the referenced debt instrument directly. Credit default
swap contracts are subject to general market risk, liquidity risk, counterparty risk and credit risk. If the Trust is a protection buyer and no credit event occurs, it will lose its investment. If the Trust is a protection seller and a credit event
occurs, the value of the referenced debt instrument received by the Trust, together with the periodic payments received, may be less than the amount the Trust pays to the protection buyer, resulting in a loss to the Trust. In addition, obligations
under sell protection credit default swaps may be partially offset by net amounts received from settlement of buy protection credit default swaps entered into by the Trust for the same reference obligation with the same counterparty.
Certain swap contracts that are cleared through a central clearinghouse are referred to as centrally cleared swaps. All payments made or received by the Trust are pursuant to a
centrally cleared swap contract with the central clearing party rather than the original counterparty. Upon entering into a
52 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
centrally cleared swap contract, the Trust is required to make an initial margin deposit, either in cash or in securities. The daily change in value on open centrally cleared
contracts is recorded as “Variation margin for centrally cleared swap contracts” on the Statement of Assets and Liabilities. Cash received from or paid to the broker related to previous margin movement is held in a segregated account at the broker
and is recorded as either “Due from broker for swaps” or “Due to broker for swaps” on the Statement of Assets and Liabilities. The amount of cash deposited with a broker as collateral at May 31, 2020, is recorded as “Swaps collateral” on the
Statement of Assets and Liabilities.
The average market value of credit default swap contracts open during the six months ended May 31, 2020, was $605,107. There were no open credit default swap contracts at May 31,
2020.
I. Automatic Dividend Reinvestment Plan
All shareowners whose shares are registered in their own names automatically participate in the Automatic Dividend Reinvestment Plan (the “Plan”), under which participants receive
all dividends and capital gain distributions (collectively, dividends) in full and fractional shares of the Trust in lieu of cash. Shareowners may elect not to participate in the Plan. Shareowners not participating in the Plan receive all dividends
and capital gain distributions in cash. Participation in the Plan is completely voluntary and may be terminated or resumed at any time without penalty by notifying American Stock Transfer & Trust Company, the agent for shareowners in
administering the Plan (the “Plan Agent”), in writing prior to any dividend record date; otherwise such termination or resumption will be effective with respect to any subsequently declared dividend or other distribution.
If a shareowner’s shares are held in the name of a brokerage firm, bank or other nominee, the shareowner can ask the firm or nominee to participate in the Plan on the shareowner’s
behalf. If the firm or nominee does not offer the Plan, dividends will be paid in cash to the shareowner of record. A firm or nominee may reinvest a shareowner’s cash dividends in shares of the Trust on terms that differ from the terms of the Plan.
Whenever the Trust declares a dividend on shares payable in cash, participants in the Plan will receive the equivalent in shares acquired by the Plan Agent either (i) through
receipt of additional unissued but authorized shares from the Trust or (ii) by purchase of outstanding shares on the NYSE or elsewhere. If, on the payment date for any dividend, the net asset value per share is equal to or less than the market
price per share plus estimated brokerage trading fees (market premium), the Plan Agent will invest the dividend amount in newly issued shares. The number of newly issued shares
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 53
to be credited to each account will be determined by dividing the dollar amount of the dividend by the net asset value per share on the date the shares are issued, provided that
the maximum discount from the then current market price per share on the date of issuance does not exceed 5%. If, on the payment date for any dividend, the net asset value per share is greater than the market value (market discount), the Plan Agent
will invest the dividend amount in shares acquired in open-market purchases. There are no brokerage charges with respect to newly issued shares. However, each participant will pay a pro rata share of brokerage trading fees incurred with respect to
the Plan Agent’s open-market purchases. Participating in the Plan does not relieve shareowners from any federal, state or local taxes which may be due on dividends paid in any taxable year. Shareowners holding Plan shares in a brokerage account may
be able to transfer the shares to another broker and continue to participate in the Plan.
J. Statement of Cash Flows
Information on financial transactions which have been settled through the receipt or disbursement of cash or restricted cash is presented in the Statement of Cash Flows. Cash as
presented in the Trust’s Statement of Assets and Liabilities includes cash on hand at the Trust’s custodian bank and does not include any short-term investments. As of and for the six months ended May 31, 2020, the Trust had no restricted cash
presented on the Statement of Assets and Liabilities.
2. Management Agreement
The Adviser manages the Trust’s portfolio. Management fees are paid monthly under the Trust’s Advisory Agreement with the Adviser are calculated daily at the annual rate of 0.70% of the Trust’s
average daily managed assets. “Managed assets” means (a) the total assets of the Trust, including any form of investment leverage, minus (b) all accrued liabilities incurred in the normal course of operations, which shall not include any
liabilities or obligations attributable to investment leverage obtained through (i) indebtedness of any type (including, without limitation, borrowing through a credit facility or the issuance of debt securities), (ii) the issuance of preferred
stock or other similar preference securities, and/or (iii) any other means. For the six months ended May 31, 2020, the net management fee was 0.70% (annualized) of the Trust’s average daily managed assets, which was equivalent to 1.03% (annualized)
of the Trust’s average daily net assets.
In addition, under the management and administration agreements, certain other services and costs, including accounting, regulatory reporting and insurance premiums, are paid by the Trust as
administrative reimbursements.
54 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
Included in “Due to affiliates” reflected on the Statement of Assets and Liabilities is $24,897 in management fees, administrative costs and certain other reimbursements payable to the Adviser at May
31, 2020.
3. Transfer Agent
AST serves as the transfer agent with respect to the Trust’s common shares. The Trust pays AST an annual fee, as is agreed to from time to time by the Trust and AST, for providing such services.
In addition, the Trust reimbursed the transfer agent for out-of-pocket expenses incurred by the transfer agent related to shareowner communications activities such as proxy and statement mailings and
outgoing phone calls.
4. Additional Disclosures about Derivative Instruments and Hedging Activities
The Trust’s use of derivatives may enhance or mitigate the Trust’s exposure to the following risks:
Interest rate risk relates to the fluctuations in the value of interest-bearing securities due to changes in the prevailing levels of market interest rates.
Credit risk relates to the ability of the issuer of a financial instrument to make further principal or interest payments on an obligation or commitment that it has to the Trust.
Foreign exchange rate risk relates to fluctuations in the value of an asset or liability due to changes in currency exchange rates.
Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange rate risk),
whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment.
Commodity risk relates to the risk that the value of a commodity or commodity index will fluctuate based on increases or decreases in the commodities market and factors specific to a particular
industry or commodity.
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 55
The effect of derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) on the Statement of Operations by risk exposure at May 31, 2020, was as follows:
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Statement of Operations
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|
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|
|
|
|
|
|
|
|
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|
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Foreign
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|
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|
|
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Interest
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Credit
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Exchange
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Equity
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Commodity
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Rate Risk
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Risk
|
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|
Rate Risk
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Risk
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Risk
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Net realized
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gain (loss) on:
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|
|
|
|
|
|
|
|
|
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Swap contracts
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|
$
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—
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|
|
$
|
(2,327,585
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)
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|
$
|
—
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|
|
$
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—
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|
|
$
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—
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Total Value
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|
$
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—
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|
|
$
|
(2,327,585
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)
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|
$
|
—
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|
|
$
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—
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|
|
$
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—
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Change in net
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unrealized
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|
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appreciation
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|
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|
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(depreciation) on:
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Swap contracts
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|
$
|
—
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|
|
$
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(261,360
|
)
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|
$
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—
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|
|
$
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—
|
|
|
$
|
—
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|
Total Value
|
|
$
|
—
|
|
|
$
|
(261,360
|
)
|
|
$
|
—
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|
|
$
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—
|
|
|
$
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—
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5. Unfunded Loan Commitments
The Trust may enter into unfunded loan commitments. Unfunded loan commitments may be partially or wholly unfunded. During the contractual period, the Trust is obliged to provide funding to the
borrower upon demand. A fee is earned by the Trust on the unfunded loan commitment and is recorded as interest income on the Statement of Operations. Unfunded loan commitments are fair valued in accordance with the valuation policy described in
Footnote 1A and unrealized appreciation or depreciation, if any, is recorded on the Statement of Assets and Liabilities.
As of May 31, 2020, the Trust had the following unfunded loan commitments outstanding:
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Unrealized
|
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|
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Appreciation
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Loan
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Principal
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Cost
|
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Value
|
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(Depreciation)
|
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Gbt US LLC
|
|
$
|
957,080
|
|
|
$
|
938,563
|
|
|
$
|
832,659
|
|
|
$
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(105,904
|
)
|
NMN Holdings III Corp.
|
|
|
439,183
|
|
|
|
435,524
|
|
|
|
412,832
|
|
|
|
(22,692
|
)
|
Spectacle Gary Holdings LLC
|
|
|
142,857
|
|
|
|
144,881
|
|
|
|
129,286
|
|
|
|
(15,595
|
)
|
Total Value
|
|
$
|
1,539,120
|
|
|
$
|
1,518,968
|
|
|
$
|
1,374,777
|
|
|
$
|
(144,191
|
)
|
56 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20
6. Trust Shares
There are an unlimited number of shares of beneficial interest authorized.
Transactions in shares of beneficial interest for the six months ended May 31, 2020 and the year ended November 30, 2019, were as follows:
|
|
|
|
5/31/20
|
11/30/19
|
Shares outstanding at beginning of period
|
24,738,174
|
24,738,174
|
Shares outstanding at end of period
|
24,738,174
|
24,738,174
|
7. Credit Agreement
Effective November 26, 2013, the Trust entered into a Revolving Credit Facility (the “Credit Agreement”) with the Bank of Nova Scotia in the amount of $160,000,000. The Credit Agreement was
established in conjunction with the redemption of all the Trust’s auction market preferred shares. Effective November 22, 2019, the amount of the credit agreement was reduced to $150,000,000 and was also amended to make it an “evergreen” facility.
More specifically the credit agreement renews on a daily basis in perpetuity. The Bank of Nova Scotia may, at any time, elect to terminate its commitment under the Credit Agreement upon 179 days’ written notice to the Trust. As of period end, the
Trust has not received a notice of termination.
At May 31, 2020, the Trust had a borrowing outstanding under the Credit Agreement totaling $103,450,000. The interest rate charged at May 31, 2020 was 1.06%. During the six months ended May 31, 2020,
the average daily balance was $125,116,667 at an average interest rate of 1.99%. Interest expense of $1,359,600 in connection with the Credit Agreement is included on the Statement of Operations.
The Trust is required to maintain 300% asset coverage with respect to amounts outstanding under the Credit Agreement. Asset coverage is calculated by subtracting the Trust’s total liabilities not
including any bank loans and senior securities, from the Trust’s total assets and dividing such amount by the principal amount of the borrowing outstanding.
8. Subsequent Events
A monthly dividend was declared on June 4, 2020 from undistributed and accumulated net investment income of $0.0600 per share payable June 30, 2020 to shareowners of record on June 17, 2020.
Pioneer Floating Rate Trust | Semiannual Report | 5/31/20 57
ADDITIONAL INFORMATION (unaudited)
During the period, there have been no material changes in the Trust’s investment objective or fundamental policies that have not been approved by the shareowners. There have been no changes in the
Trust’s charter or By-Laws that would delay or prevent a change in control of the Trust which has not been approved by the shareowners. During the period, there have been no changes in the principal risk factors associated with investment in the
Trust. There were no changes in the persons who are primarily responsible for the day-to-day management of the Trust’s portfolio.
Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940 that the Trust may purchase, from time to time, its shares in the open market.
58 Pioneer Floating Rate Trust | Semiannual Report | 5/31/20