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 811-08743
Van Kampen Senior Income Trust
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(Exact name of registrant as specified in charter)
1221 Avenue of the Americas, New York, New York 10020
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(Address of principal executive offices) (Zip code)
Ronald Robison
1221 Avenue of the Americas, New York, New York 10020
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(Name and address of agent for service)
Registrant's telephone number, including area code: 212-762-4000
Date of fiscal year end: 7/31
Date of reporting period: 1/31/05
Item 1. Reports to Shareholders.
The Trust's semi-annual report transmitted to shareholders pursuant to Rule
30e-1 under the Investment Company Act of 1940 is as follows:
Welcome, Shareholder
In this report, you'll learn about how your investment in Van Kampen
Senior Income Trust performed during the semiannual period. The portfolio
management team will provide an overview of the market conditions and
discuss some of the factors that affected investment performance during
the reporting period. In addition, this report includes the trust's
financial statements and a list of trust investments as of January 31,
2005.
MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO
PASS. THERE IS NO ASSURANCE THAT THE TRUST WILL ACHIEVE ITS INVESTMENT
OBJECTIVE. THE TRUST IS SUBJECT TO MARKET RISK, WHICH IS THE POSSIBILITY
THAT THE MARKET VALUES OF SECURITIES OWNED BY THE TRUST WILL DECLINE AND
THAT THE VALUE OF THE TRUST SHARES MAY THEREFORE BE LESS THAN WHAT YOU
PAID FOR THEM. ACCORDINGLY, YOU CAN LOSE MONEY INVESTING IN THIS TRUST.
AN INVESTMENT IN SENIOR LOANS IS SUBJECT TO CERTAIN RISKS SUCH AS LOAN
DEFAULTS AND ILLIQUIDITY DUE TO INSUFFICIENT COLLATERAL BACKING.
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NOT FDIC INSURED OFFER NO BANK GUARANTEE MAY LOSE VALUE
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NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY NOT A DEPOSIT
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Performance Summary as of 1/31/05
SENIOR INCOME TRUST
SYMBOL: VVR
------------------------------------------------------------
AVERAGE ANNUAL BASED ON BASED ON
TOTAL RETURNS NAV MARKET PRICE
Since Inception (6/24/98) 5.27% 5.15%
5-year 4.72 7.80
1-year 6.40 3.72
6-month 3.05 -0.21
------------------------------------------------------------
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. FOR THE MOST RECENT MONTH-END PERFORMANCE FIGURES, PLEASE VISIT
VANKAMPEN.COM OR SPEAK WITH YOUR FINANCIAL ADVISOR. INVESTMENT RETURNS AND
PRINCIPAL VALUE WILL FLUCTUATE AND TRUST SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.
The NAV per share is determined by dividing the value of the trust's portfolio
securities, cash and other assets, less all liabilities, by the total number of
common shares outstanding. The common share market price is the price the market
is willing to pay for shares of the trust at a given time. Common share market
price is influenced by a range of factors, including supply and demand and
market conditions. Total return assumes an investment at the beginning of the
period, reinvestment of all distributions for the period in accordance with the
trust's dividend reinvestment plan, and sale of all shares at the end of the
period.
1
Trust Report
FOR THE SIX-MONTH PERIOD ENDED JANUARY 31, 2005
Van Kampen Senior Income Trust is managed by the Adviser's Senior Loans team,
led by Howard Tiffen, Managing Director of the Adviser.(1)
MARKET OVERVIEW
The semiannual period ended January 31, 2005 saw a continuation of the favorable
backdrop for the senior-loan market that has prevailed for much of the last two
years. The economy maintained a path of healthy growth, inflation remained
modest, and the long-awaited increase in long-term interest rates failed to
materialize. All of these factors continued to support corporate financial
performance, which has been further aided by the strides in efficiency many
companies made over the past several years in response to an increasingly
competitive environment. The significant decline of the U.S. dollar over the
last two-plus years has provided an additional boost to the competitiveness of
many of the companies that underlie the senior loan market, as a weaker dollar
makes foreign goods more expensive to U.S. consumers and U.S. exports of
manufactured goods more competitive. The end result of strong corporate
profitability has been improving credit quality, which has supported the senior-
loan market's performance.
Yield spreads in the senior-loan market began the semiannual period near
historical lows and remained there throughout the period. These narrow spreads
continued to allow a greater range of companies to access the senior-loan market
at very favorable terms. At the same time, an expanding array of institutional
investors has been attracted to the asset class in view of its improved credit
quality, which has been reflected in significantly lower default rates. In fact,
while senior loans have traditionally been considered somewhat speculative,
there is growing appreciation of the asset class' defensive characteristics. As
a result, demand for and inflows into senior loans remained strong, and
investors readily absorbed the healthy supply of new issues that came to market
during the period. In both the primary and secondary markets, demand has
continued to outstrip supply, which has supported the continued narrowing of
spreads.
(1)Team members may change without notice at any time.
2
PERFORMANCE ANALYSIS
A closed-end fund's return can be calculated either upon the market price or the
net asset value (NAV) of its shares. NAV per share is determined by dividing the
value of the trust's portfolio securities, cash and other assets, less all
liabilities, by the total number of shares outstanding, while market price
reflects the supply and demand for the shares. As a result, the two returns can
differ significantly, as they did during the reporting period.
For the six months ended January 31, 2005, the trust returned -0.21 percent on a
market price basis, and 3.05 percent on an NAV basis.
TOTAL RETURN FOR THE SIX-MONTH PERIOD ENDED JANUARY 31, 2005
------------------------------------------------
BASED ON NAV BASED ON MARKET PRICE
3.05% -0.21%
------------------------------------------------
We believe that the trust's performance over the period reflects the resources
we have dedicated to performing fundamental research and analysis on the
companies held in the portfolio. We continue to focus on identifying those
companies that exhibit strong management, solid and predictable cash flows, and
collateral that is sufficient to provide a healthy backstop in the event of
default.
In addition to a strong focus on fundamental company analysis, we continued to
maintain a high level of diversification in the trust's portfolio during the
period in order to minimize the risk of over-concentration in any one sector or
security. We follow a bottom-up security-selection process and generally do not
practice sector rotation. However, we will move to limit the portfolio's
exposure to certain industries facing ongoing challenges. For example, we
continued to minimize the trust's exposure to the auto industry during the
period. We believe that as that industry continues the process of sorting out
the winners from the losers, the risks to auto manufacturers and their suppliers
dictate a cautious approach. We have followed a similar path in
telecommunications, which is experiencing ongoing problems with overcapacity. In
addition, within the healthcare sector, we have avoided exposure to companies
which rely on Medicare reimbursement rates for revenues. Federal budget
constraints put at risk the maintenance of existing reimbursement rates.
The trust also continued to benefit during the period from our use of leverage.
This strategy involves borrowing at a short-term lending rate such as LIBOR and
reinvesting the proceeds at a spread above that rate. We use leverage on an
ongoing basis in an effort to enhance the trust's dividend, as it did during the
reporting period. Unlike with other fixed-income asset classes, using this
strategy in conjunction with a portfolio of senior loans does not involve risk
from rising short-term interest rates, since the income from senior loans
adjusts in tandem with rates that determine our borrowing costs. We are likely
to reduce leverage in periods of weaker credit quality conditions to prevent
magnifying erosion of the trust's net asset value.
3
Looking ahead, while growth in corporate profits is showing signs of slowing, we
believe profitability and pricing power for the borrowers that underlie the
senior loan market may remain strong. As a result, we expect these companies
will potentially be able to continue to generate free cash-flow and that credit
quality will not deteriorate in any meaningful way. For these reasons, we
believe the environment for senior loans may continue to be quite favorable in
the coming months. We will continue to pursue a disciplined investment approach,
that seeks to balance attractive yields with a relatively stable net asset value
for the trust.
There is no guarantee that any securities will continue to perform well or be
held by the trust in the future.
4
SUMMARY OF INVESTMENTS BY INDUSTRY CLASSIFICATION AS OF 1/31/05
Printing & Publishing 9.8%
Beverage, Food & Tobacco 7.4
Chemicals, Plastics & Rubber 6.5
Entertainment & Leisure 6.5
Hotels, Motels, Inns & Gaming 6.4
Broadcasting--Cable 5.9
Healthcare 4.5
Containers, Packaging & Glass 4.3
Medical Products & Services 4.0
Electronics 3.4
Automotive 3.2
Buildings & Real Estate 3.2
Aerospace/Defense 3.0
Utilities 2.4
Telecommunications-Wireless 2.4
Ecological 2.2
Insurance 1.9
Retail--Stores 1.7
Construction Material 1.6
Healthcare & Beauty 1.4
Finance 1.3
Retail--Specialty 1.3
Telecommunications--Local Exchange Carriers 1.2
Personal & Miscellaneous Services 1.2
Home & Office Furnishings, Housewares & Durable Consumer
Products 1.2
Natural Resources 1.1
Paper & Forest Products 1.1
Non-Durable Consumer Products 1.0
Retail--Oil & Gas 0.9
Broadcasting--Diversified 0.9
Transportation--Personal 0.8
Diversified Manufacturing 0.5
Pharmaceuticals 0.5
Business Equipment 0.5
Restaurants & Food Service 0.5
Mining, Steel, Iron & Non-Precious Metals 0.5
Broadcasting--Television 0.5
Broadcasting--Radio 0.5
Farming & Agriculture 0.5
Transportation--Cargo 0.4
Machinery 0.4
Education & Child Care 0.1
Transportation-Rail Manufacturing 0.1
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Total Long Term Investments 98.7%
Short-Term Investments 1.3
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Total Investments 100.0%
Subject to change daily. Provided for informational purposes only and should not
be deemed as a recommendation to buy or sell the securities mentioned or
securities in the sectors shown above. Summary of investments by industry
classification percentages are as a percentage of total investments. Securities
are classified by sectors that represent broad groupings of related industries.
Van Kampen is a wholly owned subsidiary of a global securities firm which is
engaged in a wide range of financial services including, for example, securities
trading and brokerage activities, investment banking, research and analysis,
financing and financial advisory services.
5
FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS
Each Van Kampen trust provides a complete schedule of portfolio holdings
in its semiannual and annual reports within 60 days of the end of the
trust's second and fourth fiscal quarters by filing the schedule
electronically with the Securities and Exchange Commission (SEC). The
semiannual reports are filed on Form N-CSRS and the annual reports are
filed on Form N-CSR. Van Kampen also delivers the semiannual and annual
reports to trust shareholders, and makes these reports available on its
public web site, www.vankampen.com. In addition to the semiannual and
annual reports that Van Kampen delivers to shareholders and makes
available through the Van Kampen public web site, each trust files a
complete schedule of portfolio holdings with the SEC for the trust's
first and third fiscal quarters on Form N-Q. Van Kampen does not deliver
the reports for the first and third fiscal quarters to shareholders, nor
are the reports posted to the Van Kampen public web site. You may,
however, obtain the Form N-Q filings (as well as the Form N-CSR and
N-CSRS filings) by accessing the SEC's web site, http://www.sec.gov. You
may also review and copy them at the SEC's Public Reference Room in
Washington, DC. Information on the operation of the SEC's Public
Reference Room may be obtained by calling the SEC at 1-800-SEC-0330. You
can also request copies of these materials, upon payment of a duplicating
fee, by electronic request at the SEC's e-mail address
(publicinfo@sec.gov) or by writing the Public Reference section of the
SEC, Washington, DC 20549-0102.
In addition to filing a complete schedule of portfolio holdings with the
SEC each fiscal quarter, each Van Kampen trust makes portfolio holdings
information available by periodically providing the information on its
public web site, www.vankampen.com. Each Van Kampen trust provides a
complete schedule of portfolio holdings on the public web site on a
calendar-quarter basis approximately 30 days after the close of the
calendar quarter. Van Kampen closed-end funds do not presently provide
partial lists of their portfolio holdings on a monthly basis, but may do
so in the future.
You may obtain copies of a trust's fiscal quarter filings, or its monthly
or calendar-quarter web site postings, by contacting Van Kampen Client
Relations at 1-800-847-2424.
6
PROXY VOTING POLICIES AND PROCEDURES AND PROXY VOTING RECORD
The trust's policies and procedures with respect to the voting of proxies
relating to the trust's portfolio securities and information on how the
trust voted proxies relating to portfolio securities during the most
recent twelve-month period ended June 30 is available without charge,
upon request, by calling 1-800-847-2424 or by visiting our web site at
www.vankampen.com. This information is also available on the Securities
and Exchange Commission's web site at http://www.sec.gov.
7
INVESTMENT POLICY CHANGES
At a meeting held March 2 and March 3, 2005 the Board of Trustees
approved a change to the Trust's respective investment policies regarding
the current investment requirements for senior notes. The changes modify
the current limitation on senior notes. Such modification allows
investments in senior notes provided that senior notes represent the only
form of senior debt financing in the borrower's capital structure or
enjoy a pair passu position with other senior loans in the borrower's
capital structure with respect to collateral only and not with respect to
the other covenants and terms.
8
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED)
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
VARIABLE RATE** SENIOR LOAN INTERESTS 172.3%
AEROSPACE/DEFENSE 5.4%
$ 4,309 Alion Science and
Technology Corp., Term 4.92 to
Loan....................... B1 B+ 5.22% 8/2/2009 $ 4,341,519
4,500 AM General, LLC, Term Loan 6.99 to
(i)........................ NR NR 8.75 11/1/2011 4,629,375
2,970 Anteon International Corp.,
Term Loan (i).............. Ba3 BB 4.31 12/31/2010 3,009,968
5.73 to
5,900 Apptis, Inc., Term Loan.... B2 B+ 7.50 1/5/2010 5,966,375
4.56 to
4,963 ARINC, Inc., Term Loan..... Ba3 BB 4.78 3/10/2011 5,036,937
6,948 CACI International, Inc.,
Term Loan (i).............. Ba2 BB 3.95 5/3/2011 7,038,686
5,436 Ceradyne, Inc., Term 3.94 to
Loan....................... Ba3 BB- 4.50 8/18/2011 5,514,523
5,300 DRS Technologies, Inc., 3.74 to
Term Loan.................. Ba3 BB- 4.39 11/4/2010 5,354,664
3,959 ILC Industries, Inc., Term
Loan....................... NR NR 5.40 8/5/2010 4,019,886
8,775 K & F Industries, Inc., 4.95 to
Term Loan.................. B2 B+ 6.75 11/16/2012 8,926,737
15,515 The Titan Corp., Term 5.37 to
Loan....................... Ba3 BB- 6.75 6/30/2009 15,738,402
1,937 The Titan Corp., Revolving 5.24 to
Credit Agreement........... Ba3 BB- 6.75 5/23/2008 1,926,410
6,944 Transdigm, Inc., Term
Loan....................... B1 B+ 4.67 7/22/2010 7,045,768
5,453 United Defense Industries, 4.56 to
Inc., Term Loan............ Ba2 BB+ 4.58 8/13/2009 5,523,432
--------------
84,072,682
--------------
AUTOMOTIVE 5.8%
3,600 Affina Group, Inc., Term
Loan (i)................... B2 BB- 5.44 11/30/2011 3,661,200
14,021 Federal-Mogul Corp., Term
Loan (c)................... NR NR 6.09 12/9/2005 14,108,540
15,300 Federal-Mogul Corp.,
Revolving Credit Agreement
(c)........................ NR NR 6.09 12/9/2005 15,338,575
11,618 Goodyear Tire & Rubber Co.,
Term Loan.................. B1 BB 6.56 3/31/2006 11,832,334
8,605 MetoKote Corp., Term 5.73 to
Loan....................... B1 B+ 5.98 8/13/2010 8,755,211
6,866 Polypore, Inc., Term
Loan....................... B1 B 4.83 11/12/2011 6,968,482
12,687 Safelite Glass Corp., Term 6.06 to
Loan....................... NR NR 7.56 9/30/2007 10,879,425
4,284 Tenneco Automotive, Inc.,
Term Loan.................. B1 B+ 5.35 12/12/2010 4,368,378
See Notes to Financial Statements 9
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
AUTOMOTIVE (CONTINUED)
$11,900 TRW Automotive, Inc., Term 3.88 to 10/29/10 to
Loan....................... Ba2 BB+ 4.38% 06/30/12 $ 11,948,442
1,933 United Components, Inc.,
Term Loan.................. B1 BB- 4.78 6/30/2010 1,961,730
--------------
89,822,317
--------------
BEVERAGE, FOOD & TOBACCO 13.1%
8,978 Acosta Sales Co., Inc., 4.82 to
Term Loan (i).............. NR NR 5.46 8/10/2010 9,120,583
4,684 Atkins Nutritionals, Inc., 7.89 to
Term Loan.................. NR NR 8.19 10/29/2009 4,238,776
13,192 Birds Eye Foods, Inc., Term
Loan (i)................... B1 B+ 5.31 6/30/2008 13,376,698
4,868 Commonwealth Brands, Inc.,
Term Loan (i).............. NR NR 5.88 8/28/2007 4,935,058
27,000 Constellation Brands, Inc., 4.25 to
Term Loan (i).............. Ba2 BB 6.00 11/30/2011 27,371,250
500 Culligan International Co.,
Term Loan (i).............. B1 B+ 4.92 9/30/2011 507,604
7,180 Del Monte Corp., Term Loan
(i)........................ Ba3 BB- 4.96 12/20/2010 7,224,973
5,985 Doane Pet Care Co., Term 6.37 to
Loan....................... B2 B+ 6.56 11/5/2009 6,089,737
14,323 Dole Food Co., Inc., Term 4.44 to 09/28/08 to
Loan....................... Ba3 BB 8.00 07/21/10 14,634,775
20,182 DS Waters Enterprises, LP, 6.37 to
Term Loan.................. B3 B- 6.67 11/7/2009 18,939,334
17,770 Land O' Lakes, Inc., Term
Loan....................... B1 B+ 5.71 10/10/2008 18,051,485
7,148 Luigino's, Inc., Term 5.44 to
Loan....................... B1 B+ 5.63 4/2/2011 7,184,185
5,516 Michael Foods, Inc., Term 4.63 to
Loan....................... B1 B+ 6.50 11/21/2010 5,612,284
1,995 OSI Foods GMBH & Co. KG,
Term Loan.................. NR NR 4.81 9/2/2011 2,024,510
4,489 OSI Group, LLC, Term
Loan....................... NR NR 4.81 9/2/2011 4,555,148
2,494 OSI-Holland Finance B.V.,
Term Loan.................. NR NR 4.81 9/2/2011 2,530,638
8,736 Pierre Foods, Inc.,
Term Loan.................. B1 B+ 4.48 6/30/2010 8,834,280
31,525 Pinnacle Foods, Inc., Term 5.81 to
Loan....................... B1 B+ 6.37 11/25/2010 31,584,109
7,428 Southern Wine & Spirits of
America, Inc., Term Loan... NR NR 4.81 7/2/2008 7,538,374
10 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
BEVERAGE, FOOD & TOBACCO (CONTINUED)
$ 4,950 Sunny Delight Beverage Co., 6.59 to
Term Loan.................. B2 B+ 10.04% 8/20/2010 $ 4,711,125
4.90 to
5,075 Swift & Co., Term Loan..... Ba2 BB 5.05 9/19/2008 5,163,958
--------------
204,228,884
--------------
BROADCASTING--CABLE 10.4%
2,233 Cebridge Connections, Inc., 5.24 to
Term Loan.................. NR NR 7.50 2/23/2009 2,241,499
3,300 Century Cable Holdings,
LLC, Term Loan (c)......... NR NR 7.25 6/30/2009 3,281,437
61,687 Charter Communications
Operating, LLC, 5.73 to 04/27/10 to
Term Loan (i).............. B2 B 5.98 04/27/11 61,516,752
9,593 Frontiervision Operating
Partners, LP, 6.65 to 09/30/05 to
Term Loan (c).............. NR NR 6.78 03/31/06 9,636,609
2,354 Frontiervision Operating
Partners, LP, Revolving
Credit Agreement (c)....... NR NR 6.65 10/31/2005 2,364,527
4,676 Hilton Head Communications,
LP, Term Loan (c).......... NR NR 6.50 3/31/2008 4,615,460
7,300 Hilton Head Communications,
LP, Revolving Credit
Agreement (c).............. NR NR 5.25 9/30/2007 7,186,850
18,315 Insight Midwest Holdings,
LLC, Term Loan............. Ba3 BB 5.44 12/31/2009 18,624,066
4.89 to
5,025 MCC Iowa, LLC, Term Loan... Ba3 BB+ 5.29 9/30/2010 5,092,901
33,045 Olympus Cable Holdings,
LLC, 6.50 to 06/30/10 to
Term Loan (c).............. NR NR 7.25 09/30/10 32,800,612
10,871 Parnassos, LP,
Term Loan (c).............. NR NR 5.25 6/30/2007 10,857,198
4,753 Parnassos, LP, Revolving
Credit Agreement (c)....... NR NR 5.25 6/30/2007 4,742,115
--------------
162,960,026
--------------
BROADCASTING--DIVERSIFIED 1.5%
8,259 DirecTV Holdings, LLC, Term 4.45 to
Loan....................... Ba1 BB 4.48 3/6/2010 8,384,104
10,000 Emmis Operating Co., Term
Loan....................... Ba2 B+ 4.17 11/10/2011 10,117,360
3,900 Entravision Communications
Corp., Term Loan........... B1 B+ 4.31 2/24/2012 3,930,876
1,786 PanAmSat Holding Corp.,
Term Loan.................. B1 BB+ 5.25 8/20/2011 1,802,334
--------------
24,234,674
--------------
See Notes to Financial Statements 11
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
BROADCASTING--RADIO 0.8%
$ 9,034 Spanish Broadcasting
Systems, Inc., Term Loan... B1 B+ 5.73% 10/30/2009 $ 9,169,256
3,500 Susquehanna Media Co., Term 4.07 to
Loan....................... Ba2 BB- 4.58 3/31/2012 3,553,595
--------------
12,722,851
--------------
BROADCASTING--TELEVISION 0.8%
7,500 Gray Communications 4.30 to
Systems, Inc., Term Loan... Ba2 B+ 4.31 6/30/2011 7,603,125
5,382 NEP Supershooters, LP, Term
Loan....................... B1 B 6.56 2/3/2011 5,469,457
--------------
13,072,582
--------------
BUILDINGS & REAL ESTATE 5.6%
4,200 AIMCO Properties, LP, Term
Loan (i)................... NR NR 4.18 11/2/2009 4,281,375
7,814 CB Richard Ellis Services, 3.92 to
Inc., Term Loan (i)........ B1 B+ 6.25 3/31/2010 7,891,857
2,329 Central Parking Corp., Term 4.92 to
Loan....................... Ba3 BB- 5.06 3/31/2010 2,371,209
6,053 Corrections Corp. of 4.53 to
America, Term Loan (i)..... Ba3 BB- 4.95 3/31/2008 6,155,236
4,606 Crescent Real Estate
Equities Co., Term Loan
(i)........................ NR NR 4.64 1/12/2006 4,650,562
44,948 General Growth, LLC, Term 11/12/07 to
Loan....................... Ba2 BB+ 4.64 11/12/08 45,245,157
1,521 GEO Group, Inc., Term 4.63 to
Loan....................... Ba3 BB- 5.00 7/9/2009 1,547,603
6,000 Landsource Communities
Development, LLC, Term
Loan....................... NR NR 5.06 3/31/2010 6,095,628
4,500 South Edge, LLC, 4.44 to 10/31/07 to
Term Loan.................. NR NR 4.69 10/31/09 4,531,721
5,000 WFP Tower Co., LP, Term
Loan (i)................... NR NR 4.13 3/31/2006 5,004,690
--------------
87,775,038
--------------
BUSINESS EQUIPMENT 0.9%
6.81 to
4,875 Katun Corp., Term Loan..... NR B+ 8.25 6/30/2009 4,887,187
9,272 Verifone, Inc., Term 5.23 to 06/30/11 to
Loan....................... B1 B+ 8.73 12/31/11 9,471,322
--------------
14,358,509
--------------
CHEMICALS, PLASTICS & RUBBER 11.2%
1,797 Becker-Underwood, Inc., 6.45 to 09/30/11 to
Term Loan.................. NR NR 9.20 03/31/12 1,797,300
6,500 Brenntag AG, (Germany) Term
Loan (i)................... B1 BB- 4.73 2/27/2012 6,564,350
12 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
CHEMICALS, PLASTICS & RUBBER (CONTINUED)
$ 6,583 Celenase AG, (Germany) Term
Loan (i)................... B1 B+ 4.81% 4/6/2011 $ 6,608,188
4,474 Hercules, Inc., Term 3.97 to
Loan....................... Ba1 BB 4.31 10/8/2010 4,526,140
40,201 Huntsman Corp.,
Term Loan.................. B2 B 6.05 3/31/2010 40,913,550
21,532 Huntsman ICI Chemicals,
LLC, Term Loan............. B1 B 5.00 12/31/2010 21,871,199
600 IMC Global, Inc., Revolving 6.25 to
Credit Agreement........... Ba3 BB+ 7.50 5/17/2006 591,000
10,992 ISP Chemco, Inc., 4.25 to
Term Loan.................. Ba2 BB+ 4.50 3/27/2011 11,127,050
16,307 KOSA B.V., (Netherlands)
Term Loan.................. Ba3 BB 5.31 4/29/2011 16,603,310
5,860 Kraton Polymers, LLC, Term 4.88 to
Loan....................... B1 B+ 5.56 12/23/2010 5,913,373
4.52 to 11/04/09 to
25,913 Nalco Co., Term Loan....... B1 BB- 6.75 11/04/10 26,297,781
5.61 to
6,678 Rhodia, Inc., Term Loan.... B2 NR 7.06 6/18/2006 6,630,207
22,800 Rockwood Specialties Group,
Inc., Term Loan............ B1 B+ 4.95 7/30/2012 23,082,971
1,950 Unifrax Corp., Term Loan... B1 B+ 6.13 5/19/2010 1,986,544
--------------
174,512,963
--------------
CONSTRUCTION MATERIAL 2.9%
10,421 Builders FirstSource, Inc.,
Term Loan (i).............. NR B+ 5.58 2/25/2010 10,460,330
1,970 Building Materials Holding
Corp., Term Loan (i)....... Ba2 BB- 5.31 8/21/2010 1,984,775
6,953 Compression Polymers Corp.,
Term Loan.................. B1 B 5.04 3/12/2010 7,027,009
4,200 Contech Construction
Products, Inc.,
Term Loan (i).............. Ba3 BB- 4.94 12/7/2010 4,270,875
3,750 Interline Brands, Inc.,
Term Loan.................. B1 BB- 4.81 12/31/2010 3,796,875
4.75 to
811 Itron, Inc., Term Loan..... Ba3 BB- 6.50 6/28/2011 820,004
2,638 Juno Lighting, Inc., Term 4.89 to
Loan....................... B1 B+ 6.75 11/21/2010 2,684,119
1,714 National Waterworks, Inc.,
Term Loan.................. B1 B+ 5.06 11/22/2009 1,744,286
2,370 Professional Paint, Inc., 5.50 to
Term Loan.................. NR NR 6.06 9/30/2011 2,402,587
See Notes to Financial Statements 13
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
CONSTRUCTION MATERIAL (CONTINUED)
$ 978 Sensus Metering Systems, 4.42 to
Inc., Term Loan............ B2 B+ 5.40% 12/17/2010 $ 983,857
8,740 Werner Holding Co., Inc., 5.94 to
Term Loan.................. B1 CCC+ 6.34 6/11/2009 8,499,920
--------------
44,674,637
--------------
CONTAINERS, PACKAGING & GLASS 7.6%
3,125 BWAY Corp., Term Loan
(i)........................ B1 B+ 4.75 6/30/2011 3,178,181
1,791 Consolidated Container
Company, LLC, Term Loan.... B2 B- 5.13 12/15/2008 1,814,507
21,726 Dr. Pepper/Seven Up
Bottling Group, Inc., Term 4.47 to
Loan....................... B1 NR 4.75 12/19/2010 22,095,159
7,200 Graham Packaging Co., Term 5.00 to
Loan....................... B2 B 5.13 10/7/2011 7,307,359
16,161 Graphic Packaging
International Corp., Term 5.06 to
Loan....................... B1 B+ 5.44 6/30/2010 16,453,481
978 Graphic Packaging
International Corp.,
Revolving Credit 5.68 to
Agreement.................. B1 B+ 8.25 8/8/2009 950,739
4,276 Impress Metal Packaging
Holding B.V., (Netherlands)
Term Loan.................. NR B+ 6.03 12/31/2006 4,297,283
2,786 Kranson Industries, Inc.,
Term Loan.................. NR NR 5.31 7/30/2011 2,827,790
15,235 Owens-Illinois, Inc., Term 4.95 to 04/01/07 to
Loan....................... B1 BB- 7.25 04/01/08 15,516,299
7,284 Packaging Dynamics, Term 09/29/08 to
Loan....................... NR NR 5.56 09/29/09 7,300,367
4,868 Ranpak Corp., Term Loan.... NR NR 6.20 3/15/2010 4,874,233
15,650 Smurfit-Stone Container 4.44 to
Corp., Term Loan........... Ba3 BB- 4.69 11/1/2011 15,899,993
1,988 Smurfit-Stone Container
Corp., Revolving Credit 4.75 to
Agreement.................. Ba3 BB- 6.50 11/1/2009 1,938,300
7,444 Solo Cup, Inc., Term 4.62 to
Loan....................... B1 B+ 5.06 2/27/2011 7,585,650
646 Tekni-Plex, Inc., Revolving 6.40 to
Credit Agreement........... B3 B- 8.25 6/21/2006 639,831
5,955 U.S. Can Corp., Term
Loan....................... B2 B 6.40 1/10/2010 5,943,834
--------------
118,623,006
--------------
14 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
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PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
DIVERSIFIED MANUFACTURING 1.0%
$ 2,613 Chart Industries, Inc, Term 5.63 to
Loan....................... NR NR 5.68% 9/15/2009 $ 2,629,511
12,284 Mueller Group, Inc., Term 5.15 to
Loan....................... B2 B+ 6.75 4/23/2011 12,430,281
--------------
15,059,792
--------------
ECOLOGICAL 4.0%
35,509 Allied Waste North America, 4.90 to
Inc., Term Loan (i)........ B1 BB 5.27 1/15/2010 36,073,005
1,470 Casella Waste Systems, 4.69 to
Inc., Term Loan (i)........ B1 BB- 5.31 5/11/2007 1,488,835
5.94 to
6,467 Duratek, Inc., Term Loan... B1 BB- 6.13 12/16/2009 6,477,500
2,738 Environmental Systems
Products Holdings, Term 5.63 to 12/12/08 to
Loan....................... B2 NR 12.56 12/12/10 2,800,552
6,813 Great Lakes Dredge & Dock 5.36 to
Corp., Term Loan........... B2 B- 6.60 12/22/2010 6,812,604
3,573 Waste Services, Inc., Term 6.70 to
Loan....................... Caa1 B- 7.50 3/31/2011 3,584,166
700 Waste Services, Inc.,
Revolving Credit 6.98 to
Agreement.................. Caa1 B- 7.11 4/29/2009 682,500
4,000 Wastequip, Inc., Term 6.25 to
Loan....................... NR NR 6.50 12/31/2010 4,010,000
--------------
61,929,162
--------------
EDUCATION & CHILD CARE 0.2%
2,936 Educate Operating Co., LLC,
Term Loan.................. B1 B+ 5.06 3/31/2011 2,973,014
219 TEC Worldwide, Inc., Term
Loan....................... NR NR 4.31 2/28/2005 217,830
--------------
3,190,844
--------------
ELECTRONICS 6.0%
1,975 AMI Semiconductor, Inc.,
Term Loan.................. B1 BB- 5.08 9/26/2008 1,999,687
8,872 Audio Visual Services
Corp., Term Loan........... NR NR 6.50 3/4/2006 9,359,848
4,178 Automata, Inc., Term Loan 02/28/03 to
(a) (c) (j)................ NR NR 7.75 02/28/04 0
2,400 Fairchild Semiconductor
Corp., Term Loan........... Ba3 BB- 4.25% 12/31/2010 2,427,000
10,929 Knowles Electronics, Inc.,
Term Loan.................. B3 NR 7.19 6/29/2007 11,015,055
4,620 Memec Group Ltd., (England) 5.06 to 04/30/09 to
Term Loan.................. B2 B 10.50 06/15/10 4,639,830
22,200 Semiconductor Components
Industries, LLC. Term
Loan....................... B3 B 5.56 12/15/2011 22,338,750
See Notes to Financial Statements 15
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
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PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
ELECTRONICS (CONTINUED)
4.78 to
$16,135 Rayovac Corp., Term Loan... B1 B+ 6.75% 9/30/2009 $ 16,320,284
11,700 Seagate Technologies, Inc.,
Term Loan.................. Ba1 BB+ 4.56 5/13/2007 11,902,925
7,313 UGS Corp., Term Loan....... B1 B+ 4.83 5/27/2011 7,427,519
5,400 Viasystems, Inc., 6.49 to
Term Loan.................. B2 NR 6.69 9/30/2009 5,455,123
--------------
92,886,021
--------------
ENTERTAINMENT & LEISURE 11.5%
3,000 Alliance Atlantis
Communications, Inc., Term 4.29 to
Loan (i)................... Ba2 BB 6.00 12/20/2011 3,037,500
4,555 Detroit Red Wings, Inc.,
Term Loan.................. NR NR 5.39 8/30/2006 4,582,975
4,432 Festival Fun Parks, LLC, 7.25 to 06/30/07 to
Term Loan.................. NR NR 7.75 12/31/07 4,413,939
3,034 GT Brands Holdings, LLC,
Term Loan.................. NR NR 10.25 9/30/2007 1,668,750
61,479 Metro-Goldwyn-Mayer, Inc.,
Term Loan.................. NR NR 5.06 4/30/2011 61,640,633
10,158 Mets II, LLC, Term Loan.... NR NR 5.77 8/23/2005 10,310,708
4,200 New Jersey Basketball, LLC,
Term Loan.................. NR NR 6.06 8/16/2008 4,200,000
5.55 to
4,714 Pure Fishing, Term Loan.... B1 BB- 5.85 9/30/2010 4,796,877
28,968 Regal Cinemas, Inc., Term
Loan....................... Ba3 BB- 4.56 11/10/2010 29,342,566
8,742 Six Flags Theme Parks,
Inc., Term Loan............ B1 B- 4.90 6/30/2009 8,895,085
247 Six Flags Theme
Parks, Inc., Revolving 4.95 to
Credit Agreement........... B1 B- 5.08 6/30/2008 241,097
5,816 Tigers Ballpark, LLC, Term 4.88 to
Loan....................... NR NR 5.19 12/1/2006 5,826,639
10,259 True Temper, Inc., 5.07 to
Term Loan.................. B2 B 7.00 3/15/2011 10,220,223
6,000 Universal City Development 4.48 to
Partners, LP, Term Loan.... Ba3 NR 4.66 6/9/2011 6,097,500
12,406 Warner Music Group, Term 4.97 to
Loan....................... B1 B+ 5.38 2/28/2011 12,575,546
4,548 Worldwide Sports &
Recreation, Inc., Term 5.66 to
Loan....................... NR NR 6.06 12/31/2006 4,559,008
16 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
ENTERTAINMENT & LEISURE (CONTINUED)
$ 4,937 YankeesNets, LLC, Term 4.85 to
Loan....................... NR NR 5.03% 6/25/2007 $ 5,023,542
2,263 Yankees Holdings, LP, Term 4.49 to
Loan....................... NR NR 4.90 6/25/2007 2,302,457
--------------
179,735,045
--------------
FARMING & AGRICULTURE 0.8%
2,216 Central Garden & Pet Co.,
Term Loan.................. Ba2 BB+ 4.33 5/15/2009 2,232,872
10,236 United Industries Corp., 6.75 to 04/29/11 to
Term Loan.................. B1 B+ 8.75 10/31/11 10,261,902
--------------
12,494,774
--------------
FINANCE 2.1%
3,180 DCS Business Services, 6.40 to 12/31/08 to
Inc., Term Loan............ NR NR 6.90 12/31/09 3,186,712
4,392 Outsourcing Solutions, Term
Loan....................... NR NR 7.40 12/9/2008 4,408,749
7,012 Rent-A-Center, Inc., Term
Loan....................... Ba2 BB+ 4.21 6/30/2010 7,108,156
8,114 Risk Management Assurance
Co., Term Loan............. NR NR 6.63 12/21/2006 7,708,469
10,770 Transfirst Holdings, Inc., 6.56 to 03/31/10 to
Term Loan.................. NR NR 10.06 03/31/11 10,823,044
--------------
33,235,130
--------------
HEALTHCARE 7.2%
7,861 Ameripath, Inc., Term
Loan....................... B2 B+ 5.83 3/27/2010 7,929,672
7,090 AMN Healthcare Services,
Inc., Term Loan............ Ba2 BB- 5.56 10/2/2008 7,156,574
8,379 Ardent Health Services,
Term Loan (i).............. B1 B+ 4.80 8/12/2011 8,449,702
41,520 Community Health Systems,
Inc., Term Loan (i)........ Ba3 BB- 4.15 8/19/2011 41,895,420
6,261 Concentra Operating Corp., 4.88 to
Term Loan (i).............. B1 B+ 5.10 6/30/2010 6,341,930
6,219 FHC Health Systems, Inc., 8.40 to
Term Loan.................. B2 B 10.40 12/18/2009 6,312,575
6,772 Genesis Healthcare Corp.,
Term Loan.................. Ba3 BB- 4.67 12/1/2010 6,868,094
7,279 InteliStaf Group, Inc., 5.80 to 10/31/05 to
Term Loan.................. NR NR 7.25 10/31/07 7,223,626
3,582 Medcath Holdings Corp., 5.11 to
Term Loan.................. B2 B+ 6.50 6/30/2011 3,620,059
3,111 Multiplan, Inc., Term
Loan....................... Ba3 B+ 5.31 3/4/2009 3,146,111
4,800 PacifiCare Health Systems, 4.06 to
Inc., Term Loan............ Ba2 BBB- 4.25 12/13/2010 4,821,998
See Notes to Financial Statements 17
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
HEALTHCARE (CONTINUED)
$ 2,985 Sterigenics International,
Inc., Term Loan............ B2 B+ 5.53% 6/14/2011 $ 3,022,312
4,910 Triad Hospitals, Inc., Term
Loan....................... Ba2 BB 4.83 9/30/2008 4,992,722
--------------
111,780,795
--------------
HEALTHCARE & BEAUTY 2.5%
5,921 American Safety Razor Co., 5.64 to
Term Loan.................. B2 B 5.98 4/29/2011 5,950,679
3,600 CEI Holdings, Inc., Term 5.24 to 12/03/10 to
Loan....................... NR NR 9.19 12/03/11 3,645,000
4,800 Del Laboratories, Inc.,
Term Loan.................. B1 B 6.50 7/27/2011 4,800,000
3,000 Marietta Intermediate 7.50 to
Holding Corp., Term Loan... NR NR 11.50 12/17/2010 3,038,250
22,125 Prestige Brands Holdings, 5.29 to 04/06/11 to
Inc., Term Loan............ B1 B 9.00 10/06/11 22,498,303
--------------
39,932,232
--------------
HOME & OFFICE FURNISHINGS, HOUSEWARES & DURABLE
CONSUMER PRODUCTS 2.0%
7.55 to
6,125 Formica Corp., Term Loan... NR NR 8.50 6/10/2010 6,155,964
2,790 Hunter Fan Co., Term 6.25 to
Loan....................... NR NR 7.75 4/30/2010 2,837,081
1,422 Imperial Home Decor Group,
Inc., Term Loan (a) (d)
(j)........................ NR NR 8.75 4/4/2006 35,557
8,761 National Bedding Co., Term 4.65 to
Loan....................... Ba3 BB- 5.13 12/31/2010 8,889,270
13,848 Sealy Mattress Co., Term 4.45 to
Loan....................... B2 B+ 4.65 4/6/2012 14,055,937
--------------
31,973,809
--------------
HOTELS, MOTELS, INNS & GAMING 11.3%
10,946 Alliance Gaming Corp., Term
Loan (i)................... Ba3 BB- 4.90 9/4/2009 11,021,677
4,276 Ameristar Casinos, Inc.,
Term Loan.................. Ba3 BB- 4.63 12/20/2006 4,342,291
4,975 Boyd Gaming Corp., Term 3.92 to
Loan (i)................... Ba2 BB 4.53 6/30/2011 5,044,963
10,800 CNL Hospitality Partners,
LP, Term Loan (i).......... NR NR 4.90 10/13/2006 10,975,500
3,087 Global Cash Access, LLC,
Term Loan.................. B2 B+ 5.17 3/10/2010 3,139,504
6,652 Greektown Casino, LLC, Term 5.69 to
Loan....................... NR NR 5.92 12/31/2005 6,718,241
4,963 Green Valley Ranch Gaming,
LLC, Term Loan............. B1 NR 4.50 12/24/2010 5,030,734
18 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
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AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
HOTELS, MOTELS, INNS & GAMING (CONTINUED)
$ 3,600 Herbst Gaming, Inc., Term
Loan....................... NR B+ 4.64% 1/31/2011 $ 3,657,377
6,000 Interstate Operating Co., 8.06 to
LP, Term Loan.............. B2 B 8.75 1/14/2008 6,015,000
2,467 Isle of Capri Casinos, 4.45 to
Inc., Term Loan............ Ba2 BB- 4.66 4/26/2008 2,478,912
8,906 Kuilima Resort Co., Term 5.10 to 06/29/07 to
Loan....................... NR NR 6.75 09/29/07 8,884,213
10,129 Mandalay Resort Group, Term
Loan....................... NR NR 5.48 6/30/2008 10,154,715
2,400 Marina District Finance
Co., Term Loan............. NR NR 3.93 10/20/2011 2,424,499
2,570 Penn National Gaming, Inc., 5.06 to
Term Loan.................. Ba3 BB- 5.08 9/1/2007 2,582,188
37,944 Planet Hollywood
International, Inc.,
Term Loan.................. NR B- 5.56 9/1/2010 37,564,687
90 Planet Hollywood
International, Inc., Term
Loan (k)................... NR B- 6.56 9/1/2010 88,563
7,200 Ruffin Gaming, LLC, Term
Loan....................... NR NR 5.94 7/14/2007 7,308,000
6,900 Scientific Games Corp.,
Term Loan.................. Ba2 BB 4.26 12/23/2009 6,974,748
4,200 Seminol Tribe of Florida,
Inc., Term Loan............ NR BB 6.50 9/30/2011 4,242,000
4,100 United Auburn Indian
Community, Term Loan....... Ba3 BB+ 6.48 1/24/2009 4,120,888
10,364 Venetian Casino Resorts,
LLC, Term Loan............. B1 B+ 4.90 6/15/2011 10,547,156
19,436 Wyndham International, 7.19 to 04/01/06 to
Inc., Term Loan............ NR NR 8.19 06/30/06 19,544,928
2,596 Wyndham International,
Inc., Revolving Credit 8.19 to
Agreement.................. NR NR 8.38 4/1/2006 2,589,803
838 Wynn Las Vegas, LLC, Term
Loan....................... B2 B+ 4.69 12/14/2011 850,199
--------------
176,300,786
--------------
INSURANCE 3.5%
8,955 Alliant Resources Group, 5.67 to
Inc., Term Loan............ B2 B 8.75 8/31/2011 8,966,194
4,963 Bristol West Holdings,
Inc., Term Loan............ Ba1 BB+ 4.56 2/18/2011 4,987,312
2,867 CCC Information Services
Group, Inc., Term Loan..... B1 B+ 5.56 8/20/2010 2,902,524
See Notes to Financial Statements 19
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
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AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
INSURANCE (CONTINUED)
$11,520 Conseco, Inc.,
Term Loan (i).............. B2 BB- 6.08% 6/22/2010 $ 11,764,800
6,980 Hilb, Rogal & Hamilton Co.,
Term Loan.................. Ba3 BB 4.81 12/15/2011 7,086,529
1,701 Mitchell International,
Inc., Term Loan............ B1 B+ 5.55 8/15/2011 1,728,342
4,043 Universal American
Financial Corp., Term
Loan....................... NR BBB- 4.81 3/31/2009 4,052,606
6,745 USI Holdings Corp., Term
Loan....................... B1 BB- 5.23 8/11/2008 6,780,998
5,400 Vertafore, Inc., Term 5.27 to 12/22/10 to
Loan....................... NR NR 8.52 12/22/11 5,464,500
--------------
53,733,805
--------------
MACHINERY 0.7%
2,400 Douglas Dynamics, LLC, Term
Loan....................... B1 BB- 4.51 12/16/2010 2,418,000
734 Flowserve Corp., 5.15 to
Term Loan.................. Ba3 BB- 5.44 6/30/2009 747,660
4,800 Goodman Global Holdings,
Inc., Term Loan............ B2 B+ 4.81 12/23/2011 4,878,000
2,481 United Rentals (North
America), Inc., Term
Loan....................... Ba3 BB 4.81 2/14/2011 2,519,632
--------------
10,563,292
--------------
MEDICAL PRODUCTS & SERVICES 6.2%
2,328 Advanced Medical Optics, 4.49 to
Inc., Term Loan (i)........ B1 BB- 4.74 6/25/2009 2,353,373
5,400 American Medical
Instruments Holdings, Inc., 5.58 to
Term Loan.................. B2 B+ 5.94 12/9/2010 5,447,250
2,093 Colgate Medical, Ltd., 4.55 to
(England) Term Loan........ Ba2 BB- 4.56 12/30/2008 2,119,347
6,269 CONMED Corp., Term Loan 4.75 to
(i)........................ Ba3 BB- 5.01 12/15/2009 6,344,110
6,900 Center For Diagnostic 5.90 to
Imaging, Term Loan......... B2 NR 7.75 12/31/2010 6,917,250
1,318 Dade Behring, Inc., Term
Loan (i)................... B2 BBB- 4.31 10/3/2008 1,328,223
35,690 DaVita, Inc., Term Loan 4.13 to 03/31/07 to
(i)........................ Ba2 BB 4.78 06/30/10 35,827,590
10,945 Fisher Scientific
International, Inc.,
Term Loan.................. Ba2 BBB 3.92 8/2/2011 11,040,769
10,042 Insight Health, Term
Loan....................... B1 B 6.31 10/17/2008 10,132,614
3,120 Insight Health, Revolving
Credit Agreement........... B1 B 6.56 10/17/2008 3,129,750
20 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
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PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
MEDICAL PRODUCTS & SERVICES (CONTINUED)
$ 4,557 Kinetics Concepts, Inc.,
Term Loan.................. Ba3 BB- 4.31% 8/11/2010 $ 4,594,978
569 Rotech Healthcare, Inc.,
Term Loan.................. Ba2 BB 5.56 3/31/2008 576,651
3,600 The Cooper Companies, Inc.,
Term Loan (i).............. Ba3 BB 4.19 1/6/2012 3,651,750
3,204 VWR International, Inc.,
Term Loan.................. B2 B+ 5.17 4/7/2011 3,262,134
--------------
96,725,789
--------------
MINING, STEEL, IRON & NON-PRECIOUS METALS 0.9%
5,294 CII Carbon, LLC,
Term Loan.................. NR NR 5.30 6/25/2008 5,227,772
5,700 New Enterprise Stone & Lime 5.65 to
Co., Inc., Term Loan....... NR NR 7.25 7/30/2010 5,770,780
2,406 Techs Industries, Inc.,
Term Loan.................. NR NR 4.81 1/14/2010 2,412,266
--------------
13,410,818
--------------
NATURAL RESOURCES 2.0%
21,462 El Paso Corp., Term Loan... B3 B- 5.19 11/23/2009 21,708,215
2,949 Foundation PA Coal Co., 4.56 to
Term Loan.................. Ba3 BB- 4.78 7/30/2011 2,994,276
6,567 LYONDELL-CITGO Refining, 4.38 to
LP, Term Loan.............. NR NR 4.59 5/21/2007 6,640,879
--------------
31,343,370
--------------
NON-DURABLE CONSUMER PRODUCTS 1.7%
1,872 Aero Products
International, Inc., Term 5.83 to
Loan....................... NR NR 7.06 12/19/2008 1,847,402
4,975 Amscan Holdings, Inc., Term 5.29 to
Loan (i)................... B1 B+ 7.00 4/30/2012 5,006,094
3,721 Boyds Collection, Ltd., 3.38 to
Term Loan (i).............. B1 B- 3.44 4/21/2005 3,715,961
4,762 Church & Dwight Co., Inc.,
Term Loan (i).............. Ba2 BB 4.31 5/30/2011 4,828,802
7,392 General Binding Corp., Term 6.71 to
Loan....................... B2 B+ 7.39 1/15/2008 7,419,720
3,856 JohnsonDiversey, Inc., Term 4.43 to
Loan....................... Ba3 BB- 4.64 11/3/2009 3,925,624
--------------
26,743,603
--------------
PAPER & FOREST PRODUCTS 1.9%
30,000 Boise Cascade, LLC, Term 10/28/10 to
Loan (i)................... Ba3 BB 4.84 10/29/11 30,126,866
--------------
See Notes to Financial Statements 21
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
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PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
PERSONAL & MISCELLANEOUS SERVICES 2.1%
$ 3,539 Alderwoods Group, Inc., 3.94 to
Term Loan (i).............. B1 BB- 4.54% 9/29/2009 $ 3,594,008
8,750 Coinmach Laundry Corp., 5.44 to
Term Loan (i).............. B2 B 5.63 7/25/2009 8,856,438
2,494 Coinstar, Inc., Term Loan
(i)........................ Ba3 BB- 4.84 7/7/2011 2,537,882
4,478 Global Imaging Systems, 4.28 to
Inc., Term Loan............ Ba3 BB- 4.71 5/10/2010 4,533,469
2,100 InfoUSA, Inc., Term Loan... Ba3 BB 5.06 3/25/2009 2,121,000
5,876 Iron Mountain, Inc., Term 4.19 to
Loan....................... B2 BB- 4.22 4/2/2011 5,926,607
2,962 Stewart Enterprises, Inc.,
Term Loan.................. Ba3 BB+ 4.47 11/19/2011 3,004,325
1,800 United Online, Inc., Term 5.63 to
Loan....................... B1 B+ 6.13 12/13/2008 1,824,750
--------------
32,398,479
--------------
PHARMACEUTICALS 0.9%
2,985 Accredo Health, Inc., Term
Loan (i)................... Ba2 BB 4.23 4/30/2011 3,010,187
11,614 MedPointe, Inc., Term 6.70 to 09/30/07 to
Loan....................... B1 B 7.45 09/30/08 11,669,095
--------------
14,679,282
--------------
PRINTING & PUBLISHING 17.5%
10,451 Adams Outdoor Advertising, 4.92 to 10/15/11 to
LP, Term Loan (i).......... B1 B+ 6.17 04/15/12 10,604,768
431 Advanstar Communications,
Inc., Term Loan (i)........ B2 B 7.08 10/11/2007 433,812
27,300 Advertising Directory
Solutions, Inc., (Canada) 4.48 to 11/09/11 to
Term Loan (i).............. B1 BB- 6.23 05/09/12 27,764,254
7,013 American Media Operations,
Inc., Term Loan (i)........ Ba3 B+ 5.31 4/1/2007 7,125,754
7,110 American Reprographics Co.,
Term Loan (i).............. B1 BB- 5.26 6/18/2009 7,198,875
999 CanWest Media, Inc.,
(Canada) Term Loan (i)..... Ba2 B+ 4.70 8/15/2009 1,013,433
9,975 Cygnus Business Media,
Inc., Term Loan............ B3 B 6.42 7/13/2009 9,950,062
4,213 Day International Group, 6.06 to
Inc., Term Loan............ B1 B 6.08 9/16/2009 4,252,810
8,207 Dex Media East, LLC, Term 3.96 to 11/08/08 to
Loan....................... Ba2 BB- 6.00 05/08/09 8,308,569
30,462 Dex Media West, LLC, Term 4.15 to 09/09/09 to
Loan....................... Ba2 BB- 6.25 03/09/10 30,867,189
1,800 Enterprise NewsMedia, LLC,
Term Loan.................. NR NR 5.68 6/30/2012 1,830,375
22 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
PRINTING & PUBLISHING (CONTINUED)
$ 9,739 F&W Publications, Inc.,
Term Loan.................. NR NR 5.96% 12/31/2009 $ 9,854,867
7,500 Freedom Communications, 4.14 to
Term Loan.................. Ba3 BB 4.15 5/18/2012 7,618,125
9,125 Haights Cross
Communications, LLC, Term 5.96 to
Loan....................... B3 B- 6.78 8/20/2008 9,353,545
8,674 Herald Media, Inc., Term 5.03 to 07/22/11 to
Loan....................... NR NR 8.03 01/22/12 8,811,943
15,080 Journal Register Co., Term 3.42 to
Loan....................... Ba2 BB+ 4.23 8/12/2012 15,178,970
6,933 Lamar Media Corp., Term
Loan....................... Ba2 BB- 4.06 6/30/2010 7,020,000
2,973 Liberty Group Operating, 6.00 to
Inc., Term Loan............ B1 B 6.06 3/31/2007 2,991,101
3,000 MC Communications, LLC, 6.44 to
Term Loan.................. NR NR 7.01 12/31/2010 3,022,500
2,488 MediaNews Group, Inc., Term
Loan....................... NR NR 4.08 12/30/2010 2,503,047
9,162 Merrill Communications, 5.06 to
LLC, Term Loan............. B1 B 7.00 7/30/2009 9,290,660
8,950 Morris Publishing Group,
LLC, Term Loan............. Ba1 BB 4.31 3/31/2011 9,064,676
7,808 Primedia, Inc., Term 4.56 to 06/30/08 to
Loan....................... B3 B 5.38 06/30/09 7,713,257
25,998 R.H. Donnelley, Inc., Term 4.13 to 12/31/09 to
Loan....................... Ba3 BB 4.56 06/30/11 26,273,098
4,800 Source Media, Inc., Term 4.69 to 11/08/11 to
Loan....................... B1 NR 7.94 08/30/12 4,879,500
16,393 Transwestern Publishing 3.94 to 02/25/11 to
Co., LLC, Term Loan........ B1 B+ 7.08 02/25/12 16,631,396
3,510 Vutek, Inc., Term Loan..... B1 NR 7.75 6/25/2010 3,518,775
14,000 Xerox Corp., Term Loan..... NR BB- 4.33 9/30/2008 14,149,842
5,882 Ziff-Davis Media, Inc.,
Term Loan.................. B3 CCC 7.08 3/31/2007 5,830,396
--------------
273,055,599
--------------
RESTAURANTS & FOOD SERVICE 0.9%
2,100 Captain D's, LLC,
Term Loan.................. NR NR 6.33 12/27/2010 2,105,250
3,600 Carrols Holding Corp., Term 5.06 to
Loan (i)................... B1 B+ 6.75 12/31/2010 3,663,000
See Notes to Financial Statements 23
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
RESTAURANTS & FOOD SERVICE (CONTINUED)
$ 4,800 Denny's Corp., 5.59 to 09/30/09 to
Term Loan (i).............. B3 B 7.89% 09/30/10 $ 4,935,751
3,000 Landry's Restaurants, Inc., 4.33 to
Term Loan.................. Ba2 BB- 4.53 12/28/2010 3,033,750
--------------
13,737,751
--------------
RETAIL--OIL & GAS 1.7%
1,515 Alimentation Couche-Tard, 4.25 to
Inc., Term Loan (i)........ Ba2 BB 4.38 12/17/2010 1,537,720
1,194 Barjan Products, LLC, Term 7.75 to
Loan....................... NR NR 10.25 4/30/2007 623,181
798 Barjan Products, LLC,
Revolving Credit 7.25 to
Agreement.................. NR NR 7.75 4/30/2007 797,529
7,250 Getty Petroleum Marketing,
Inc., Term Loan............ B1 B+ 5.80 5/19/2010 7,390,469
13,609 The Pantry, Inc., Term 4.83 to
Loan....................... B1 B+ 6.00 3/12/2011 13,838,342
1,800 Travelcenters of America, 4.15 to
Inc., Term Loan............ Ba3 BB 6.75 12/1/2011 1,821,375
--------------
26,008,616
--------------
RETAIL--SPECIALTY 2.3%
3,161 DRL Acquisition, Inc., Term 6.73 to
Loan....................... NR NR 8.00 4/30/2009 3,149,762
1,953 Home Interiors & Gifts,
Inc., Term Loan............ B3 B- 7.17 3/31/2011 1,893,555
4.81 to 10/04/10 to
16,800 Jostens, Inc., Term Loan... B1 B+ 5.06 10/04/11 16,990,924
13,304 Nebraska Book Co., Inc.,
Term Loan.................. B2 B 4.67 3/4/2011 13,495,234
--------------
35,529,475
--------------
RETAIL--STORES 3.1%
2,700 Advance Stores Co., Inc., 4.13 to
Term Loan (i).............. Ba2 BB+ 4.31 9/30/2010 2,735,969
7,680 CSK Auto, Inc., Term Loan
(i)........................ Ba2 B+ 4.85 6/19/2009 7,766,362
3,600 Dollarama Group, LP, Term 4.78 to
Loan....................... NR NR 6.50 11/18/2011 3,633,750
2,295 Murray's Discount Auto 6.87 to
Stores, Inc., Term Loan.... NR NR 8.25 8/8/2009 2,297,599
31,125 Rite Aid Corp., Term 4.17 to
Loan....................... NR B+ 4.31 8/31/2009 31,387,633
--------------
47,821,313
--------------
24 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
TELECOMMUNICATIONS--LOCAL EXCHANGE CARRIERS 2.2%
$ 8,174 Cincinnati Bell, Inc., Term 4.98 to
Loan (i)................... B1 B+ 5.08% 6/30/2008 $ 8,256,926
3,000 Fairpoint Communications,
Inc., Term Loan............ B1 BB- 6.44 3/31/2007 3,011,250
4,962 McLeod USA, Inc.,
Term Loan.................. Caa3 NR 6.42 5/30/2008 2,574,150
1,632 Orius Corp., LLC, 6.51 to 01/23/09 to
Term Loan.................. NR NR 7.43 01/23/10 347,204
1,127 Orius Corp., LLC, Revolving
Credit Agreement........... NR NR 5.33 1/31/2006 873,119
14,581 Qwest Corp., Term Loan..... Ba3 BB- 7.39 6/30/2007 15,225,372
3,491 Valor Telecommunications, 5.98 to
LLC, Term Loan............. B2 B+ 6.08 11/10/2011 3,510,525
7,500 WCI Capital Corp., Term
Loan (a) (c) (j)........... NR NR 8.75 9/30/2007 112,500
1,216 WCI Capital Corp.,
Revolving Credit Agreement
(a) (c) (j)................ NR NR 8.25 12/31/2004 50,103
--------------
33,961,149
--------------
TELECOMMUNICATIONS--LONG DISTANCE 0.3%
4,784 Williams Communications, 5.90 to
LLC, Term Loan............. B2 NR 6.06 10/1/2009 4,829,063
--------------
TELECOMMUNICATIONS--WIRELESS 3.0%
2,388 American Tower, LP, Term
Loan (i)................... Ba3 B 4.23 8/31/2011 2,417,850
2,388 Cellular South, Inc., Term 3.88 to
Loan (i)................... NR NR 6.00 5/4/2011 2,422,327
12,903 Centennial Cellular, Inc., 4.92 to
Term Loan (i).............. B2 B- 5.38 2/9/2011 13,018,416
12,165 Nextel Partners, Inc., Term
Loan....................... Ba3 B+ 4.94 5/31/2011 12,344,215
3,600 Spectrasite Communications,
Inc., Term Loan............ Ba3 BB- 4.03 5/19/2012 3,630,751
1,004 Syniverse Holding, LLC., 5.40 to
Term Loan.................. Ba3 BB- 5.56 9/30/2010 1,013,239
11,940 Western Wireless Corp., 5.40 to
Term Loan.................. B2 B- 5.71 5/31/2011 12,039,496
--------------
46,886,294
--------------
TEXTILES & LEATHER 0.0%
1,995 Malden Mills Industries, 6.75 to
Inc., Term Loan (a)........ NR NR 7.00 10/1/2008 445,093
--------------
See Notes to Financial Statements 25
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BANK LOAN
PRINCIPAL RATINGS+
AMOUNT -------------- STATED
(000) BORROWER MOODY'S S&P COUPON MATURITY* VALUE
-----------------------------------------------------------------------------------------------
TRANSPORTATION--CARGO 0.7%
$ 670 Kansas City Southern 3.88 to
Railway Co., Term Loan..... Ba3 BB+ 4.28% 3/30/2008 $ 679,548
4,529 Pacer International, Inc., 4.06 to
Term Loan.................. B1 BB- 5.06 6/10/2010 4,594,523
3,004 Quality Distribution, Inc., 5.58 to
Term Loan.................. Caa1 B- 7.25 11/13/2009 3,004,034
900 Quality Distribution, Inc.,
Revolving Credit 5.64 to
Agreement.................. Caa1 B- 5.58 11/13/2009 875,625
2,077 Transport Industries, LP,
Term Loan.................. B2 B+ 6.56 6/13/2010 2,080,665
--------------
11,234,395
--------------
TRANSPORTATION--PERSONAL 1.5%
21,748 Laidlaw Investments Ltd.,
Term Loan.................. Ba3 BB+ 6.33 6/19/2009 21,853,166
934 Neoplan USA Corp.,
Revolving Credit Agreement
(d)........................ NR NR 6.56 6/30/2006 933,750
--------------
22,786,916
--------------
TRANSPORTATION--RAIL MANUFACTURING 0.2%
5.56 to
2,993 Helm, Inc., Term Loan...... NR NR 5.62 7/2/2010 3,031,777
--------------
UTILITIES 4.4%
17,500 Allegheny Energy, Inc., 5.01 to
Term Loan (i).............. B1 B+ 5.16 3/8/2011 17,847,650
867 CenterPoint Energy,
Inc., Revolving 5.39 to
Credit Agreement (i)....... Ba1 BBB- 7.25 10/7/2006 865,583
4,188 Coleto Creek WLE, LP, Term 4.83 to 06/30/11 to
Loan (i)................... Ba2 BB 6.23 06/30/12 4,270,780
3,922 Midwest Generation, LLC, 5.38 to
Term Loan.................. Ba3 B+ 5.81 4/27/2011 3,983,630
1,200 NorthWestern Corp., Term
Loan....................... Ba1 BB 4.03 11/1/2011 1,219,000
7,160 Pike Electric, Inc., 4.69 to 07/01/12 to
Term Loan.................. NR NR 4.75 12/10/12 7,280,977
12,000 Reliant Energy Resources 4.90 to
Corp., Term Loan........... B1 B+ 5.07 4/30/2010 12,095,352
19,957 Texas Genco, LLC,
Term Loan.................. Ba2 BB 4.48 12/14/2011 20,231,331
--------------
67,794,303
--------------
TOTAL VARIABLE RATE** SENIOR LOAN INTERESTS 172.3%........................... 2,686,423,607
--------------
26 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BORROWER VALUE
----------------------------------------------------------------------------------------------
NOTES 1.5%
Barjan Products, LLC ($1,122,526 par, 5.00% coupon, maturing 04/30/07) (k)... $ 0
Commonwealth Brands, Inc. ($1,500,000 par, 9.71% coupon, maturing 08/28/07)
(h)........................................................................ 1,563,750
Dade Behring, Inc. ($4,897,905 par, 11.91% coupon, maturing 10/03/10)........ 5,461,164
Pioneer Cos., Inc. ($832,205 par, 6.05% coupon, maturing 12/31/06) (h)....... 877,976
Rogers Wireless Communications, Inc. ($9,000,000 par, 5.53% coupon, maturing
12/15/10) (h) (Canada)..................................................... 9,517,500
Satelites Mexicanos, 144A-Private Placement ($6,007,000 par, 6.92% coupon,
maturing 06/30/04), (b) (g) (h) (Mexico)................................... 5,075,915
US Unwired, Inc. ($1,200,000 par, 6.13% coupon, maturing 06/15/10) (h)....... 1,245,000
--------------
TOTAL NOTES.................................................................. 23,741,305
--------------
EQUITIES 2.0%
Aladdin Gaming Holdings, LLC (7.84% Ownership Interest, Acquired 09/03/04,
Cost $470,400) (e) (f)..................................................... 254,702
Barjan Products, LLC (2,201,571 preferred shares, Acquired 06/21/04, Cost
$3,104,488) (e) (f)........................................................ 0
Dade Behring Holdings, Inc. (166,320 common shares) (e)...................... 9,505,188
Environmental Systems Products Holdings, Inc. (3,275 common shares, Acquired
06/22/04, Cost $0) (e) (f)................................................. 33,143
Gentek, Inc. (111,796 common shares)......................................... 5,002,871
Gentek, Inc. (Warrants for 271 common shares) (e)............................ 0
Holmes Group, Inc. (Warrants for 1,851 common shares, Acquired 05/24/04, Cost
$0) (e) (f)................................................................ 5,183
IDT Corp. (22,898 common shares) (e)......................................... 335,227
Imperial Home Decor Group, Inc. (512,023 common shares, Acquired 04/26/01,
Cost $522,263) (d) (e) (f) (j)............................................. 0
London Clubs International (Warrants for 141,982 common shares, Acquired
10/15/04, Cost $260,912) (e) (f)........................................... 312,752
Malden Mills Industries (263,436 common shares, Acquired 10/29/03, Cost $0)
(e) (f).................................................................... 0
Malden Mills Industries (860,902 preferred shares, Acquired 10/29/03, Cost
$0) (e) (f)................................................................ 0
NeighborCare, Inc. (405,693 common shares) (e)............................... 11,898,976
Neoplan USA Corp. (2,262 preferred shares, Acquired 09/04/03, Cost
$1,074,522) (d) (e) (f).................................................... 2,262
Neoplan USA Corp. (8,517 common shares, Acquired 09/04/03, Cost $85) (d) (e)
(f)........................................................................ 85
Orius Corp. (315,080 common shares, Acquired 02/03/03, Cost $0) (e) (f)...... 0
Outsourcing Solutions (74,835 common shares, Acquired 01/30/04, Cost
$3,399,503) (e) (f)........................................................ 3,592,080
Planet Hollywood International, Inc. (Warrants for 76,677 common shares,
Acquired 09/03/04, Cost $0) (e) (f)........................................ 0
Railworks Corp. (186 preferred shares, Acquired 02/10/03, Cost $2,135,664)
(e) (f).................................................................... 0
See Notes to Financial Statements 27
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
BORROWER VALUE
----------------------------------------------------------------------------------------------
EQUITIES (CONTINUED)
Railworks Corp. (Warrants for 3,282 common shares, Acquired 02/10/03, Cost
$0) (e) (f)................................................................ $ 0
Rotech Medical Corp. (48,485 common shares, Acquired 06/12/02, Cost $193,940)
(e) (f).................................................................... 0
Safelite Glass Corp. (421,447 common shares, Acquired 10/20/00, Cost
$1,714,995) (e) (f)........................................................ 0
Safelite Realty (28,448 common shares, Acquired 10/26/00, Cost $0) (e) (f)... 0
Targus Group International (Warrants for 28,689 common shares, Acquired
01/30/04, Cost $0) (e) (f)................................................. 8,607
--------------
TOTAL EQUITIES 2.0%......................................................... 30,951,076
--------------
TOTAL LONG TERM INVESTMENTS 175.8%
(Cost $2,733,575,669)...................................................... 2,741,115,988
--------------
SHORT-TERM INVESTMENTS 2.3%
REPURCHASE AGREEMENT 2.1%
State Street Bank & Trust Corp. ($33,000,000 par collateralized by U.S.
Government obligations in a pooled cash account, interest rate of 2.42%,
dated 01/31/05, to be sold on 02/01/05 at $33,002,218) (i)................. 33,000,000
TIME DEPOSIT 0.2%
State Street Bank & Trust Corp. ($3,160,342 par, 0.85% coupon, dated
01/31/05, to be sold on 02/01/05 at $3,160,417) (i)........................ 3,160,342
--------------
TOTAL SHORT-TERM INVESTMENTS
(Cost $36,160,342)......................................................... 36,160,342
--------------
TOTAL INVESTMENTS 178.1%
(Cost $2,769,736,011)...................................................... 2,777,276,330
BORROWINGS (32.4)%.......................................................... (505,000,000)
PREFERRED SHARES (INCLUDING ACCRUED DISTRIBUTIONS) (44.9)%.................. (700,218,776)
LIABILITIES IN EXCESS OF OTHER ASSETS (0.8)%................................ (12,644,420)
--------------
NET ASSETS APPLICABLE TO COMMON SHARES 100.0%............................... $1,559,413,134
==============
NR--Not rated
+ Bank Loans rated below Baa by Moody's Investor Service, Inc. or BBB by
Standard & Poor's Group are considered to be below investment grade.
Industry percentages are calculated as a percentage of net assets.
(a) This Senior Loan interest is non-income producing.
28 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
PORTFOLIO OF INVESTMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
(b) 144A Securities are those which are exempt from registration under Rule 144A
of the Securities Act of 1933, as amended. These securities may only be
resold in transactions exempt from registration which are normally
transactions with qualified institutional buyers.
(c) This borrower has filed for protection in federal bankruptcy court.
(d) Affiliated company. See Notes to Financial Statements.
(e) Non-income producing security as this stock or warrant currently does not
declare dividends.
(f) Restricted Security. Securities were acquired through the restructuring of
senior loans. These securities are restricted as they are not allowed to be
deposited via the Depository Trust Company. If at a later point in time, the
company wishes to register, the issuer will bear the costs associated with
registration. The aggregate value of restricted securities represents 0.27%
of the net assets applicable to common shares of the Trust.
(g) The borrower is in the process of restructuring or amending the terms of
this loan.
(h) Variable rate security. Interest rate shown is that in effect at January 31,
2005.
(i) All or a portion of this security is designated in connection with unfunded
loan commitments.
(j) This borrower is currently in liquidation.
(k) Payment-in-kind security.
* Senior Loans in the Trust's portfolio generally are subject to mandatory
and/or optional prepayment. Because of these mandatory prepayment conditions
and because there may be significant economic incentives for a Borrower to
prepay, prepayments of Senior Loans in the Trust's portfolio may occur. As a
result, the actual remaining maturity of Senior Loans held in the Trust's
portfolio may be substantially less than the stated maturities shown.
Although the Trust is unable to accurately estimate the actual remaining
maturity of individual Senior Loans, the Trust estimates that the actual
average maturity of the Senior Loans held in its portfolio will be
approximately 18-24 months.
** Senior Loans in which the Trust invests generally pay interest at rates
which are periodically redetermined by reference to a base lending rate plus
a premium. These base lending rates are generally (i) the lending rate
offered by one or more major European banks, such as the London Inter-Bank
Offered Rate ("LIBOR"), (ii) the prime rate offered by one or more major
United States banks and (iii) the certificate of deposit rate. The interest
rates shown are those in effect on January 31, 2005. Senior Loans are
generally considered to be restricted in that the Trust ordinarily is
contractually obligated to receive approval from the Agent Bank and/or
Borrower prior to the disposition of a Senior Loan.
See Notes to Financial Statements 29
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
January 31, 2005 (Unaudited)
ASSETS:
Total Investments in unaffiliated securities (Cost
$2,765,837,559)........................................... $2,776,304,676
Total Investments in affiliated securities (Cost
$3,898,453)............................................... 971,654
Cash........................................................ 3,520,926
Receivables:
Interest and Fees......................................... 11,812,564
Investments Sold.......................................... 3,862,323
Other....................................................... 220,444
--------------
Total Assets............................................ 2,796,692,587
--------------
LIABILITIES:
Payables:
Borrowings................................................ 505,000,000
Investments Purchased..................................... 26,940,167
Investment Advisory Fee................................... 2,016,802
Administrative Fee........................................ 474,541
Distributor and Other Affiliates.......................... 331,360
Income Distributions--Common Shares....................... 91,516
Accrued Interest Expense.................................... 1,092,995
Accrued Expenses............................................ 696,466
Trustees' Deferred Compensation and Retirement Plans........ 416,830
--------------
Total Liabilities....................................... 537,060,677
Preferred Shares (including accrued distributions).......... 700,218,776
--------------
NET ASSETS APPLICABLE TO COMMON SHARES...................... $1,559,413,134
==============
NET ASSET VALUE PER COMMON SHARE ($1,559,413,134 divided by
180,010,000 shares outstanding)........................... $ 8.66
==============
NET ASSETS CONSIST OF:
Common Shares ($.01 par value with an unlimited number of
shares authorized, 180,010,000 shares issued and
outstanding).............................................. $ 1,800,100
Paid in Surplus............................................. 1,788,748,292
Net Unrealized Appreciation................................. 7,540,319
Accumulated Undistributed Net Investment Income............. 1,543,721
Accumulated Net Realized Loss............................... (240,219,298)
--------------
NET ASSETS APPLICABLE TO COMMON SHARES...................... $1,559,413,134
==============
PREFERRED SHARES ($.01 par value, authorized 28,000 shares,
28,000 issued with liquidation preference of $25,000 per
share).................................................... $ 700,000,000
==============
NET ASSETS INCLUDING PREFERRED SHARES....................... $2,259,413,134
==============
30 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL STATEMENTS continued
Statement of Operations
For the Six Months Ended January 31, 2005 (Unaudited)
INVESTMENT INCOME:
Interest from unaffiliated securities....................... $ 68,241,313
Interest from affiliated securities......................... 30,297
Dividends................................................... 1,084,205
Other....................................................... 2,580,710
------------
Total Income............................................ 71,936,525
------------
EXPENSES:
Investment Advisory Fee..................................... 11,765,088
Administrative Fee.......................................... 2,768,256
Credit Line................................................. 1,067,528
Preferred Share Maintenance................................. 916,101
Custody..................................................... 337,131
Legal....................................................... 326,827
Trustees' Fees and Related Expenses......................... 74,144
Other....................................................... 425,149
------------
Total Operating Expenses................................ 17,680,224
------------
Interest Expense........................................ 4,872,491
------------
NET INVESTMENT INCOME....................................... $ 49,383,810
============
REALIZED AND UNREALIZED GAIN/LOSS:
Net Realized Loss........................................... $(11,207,799)
------------
Unrealized Appreciation/Depreciation:
Beginning of the Period................................... (7,968,504)
End of the Period......................................... 7,540,319
------------
Net Unrealized Appreciation During the Period............... 15,508,823
------------
NET REALIZED AND UNREALIZED GAIN............................ $ 4,301,024
============
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS..................... $ (7,012,488)
============
NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
OPERATIONS................................................ $ 46,672,346
============
See Notes to Financial Statements 31
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL STATEMENTS continued
Statements of Changes in Net Assets (Unaudited)
FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED
JANUARY 31, 2005 JULY 31, 2004
---------------------------------
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income.................................... $ 49,383,810 $ 76,868,483
Net Realized Gain/Loss................................... (11,207,799) 21,290,086
Net Unrealized Appreciation During the Period............ 15,508,823 79,993,874
Distributions to Preferred Shareholders:
Net Investment Income.................................... (7,012,488) (3,970,944)
-------------- --------------
Change in Net Assets Applicable to Common Shares from
Operations............................................. 46,672,346 174,181,499
Distributions to Common Shareholders:
Net Investment Income.................................... (41,366,215) (71,823,861)
-------------- --------------
NET CHANGE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
INVESTMENT ACTIVITIES.................................. 5,306,131 102,357,638
FROM CAPITAL TRANSACTIONS:
Offering Costs on Preferred Shares....................... (1,764) (6,835,194)
-------------- --------------
TOTAL INCREASE IN NET ASSETS APPLICABLE TO COMMON
SHARES................................................. 5,304,367 95,522,444
NET ASSETS APPLICABLE TO COMMON SHARES:
Beginning of the Period.................................. 1,554,108,767 1,458,586,323
-------------- --------------
End of the Period (Including accumulated undistributed
net investment income of $1,543,721 and $538,614,
respectively).......................................... $1,559,413,134 $1,554,108,767
============== ==============
32 See Notes to Financial Statements
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL STATEMENTS continued
Statement of Cash Flows
For the Six Months Ended January 31, 2005 (Unaudited)
CHANGE IN NET ASSETS FROM OPERATIONS (EXCLUDING PREFERRED
SHARE DISTRIBUTIONS)...................................... $ 53,684,834
------------
Adjustments to Reconcile the Change in Net Assets from
Operations to Net Cash provided by Operating Activities:
Increase in Investments at Value.......................... (33,286,829)
Increase in Interest and Fees Receivables................. (2,345,314)
Decrease in Receivable for Investments Sold............... 1,353,890
Increase in Other Assets.................................. (56,715)
Increase in Investment Advisory Fee Payable............... 86,666
Increase in Administrative Fee Payable.................... 20,391
Increase in Distributor and Affiliates Payable............ 26,772
Decrease in Payable for Investments Purchased............. (23,489,435)
Increase in Accrued Expenses.............................. 165,648
Increase in Trustees' Deferred Compensation and Retirement
Plans................................................... 57,097
Change in Accrued Interest Expense........................ 598,588
------------
Total Adjustments....................................... (56,869,241)
------------
NET CASH PROVIDED BY OPERATING ACTIVITIES................... (3,184,407)
------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Change in Bank Borrowings................................... 55,000,000
Change in Offering Costs on Preferred Shares................ (1,764)
Cash Distributions Paid..................................... (48,292,909)
------------
Net Cash Used for Financing Activities.................. 6,705,327
------------
NET INCREASE IN CASH........................................ 3,520,920
Cash at Beginning of the Period............................. 6
------------
CASH AT THE END OF THE PERIOD............................... $ 3,520,926
============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for Interest...................... $ 4,273,903
============
See Notes to Financial Statements 33
VAN KAMPEN SENIOR INCOME TRUST
FINANCIAL HIGHLIGHTS (UNAUDITED)
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE
TRUST OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
SIX MONTHS
ENDED
JANUARY 31, -------------------
2005 2004 2003
---------------------------------
NET ASSET VALUE, BEGINNING OF THE PERIOD (a)................ $ 8.63 $ 8.10 $ 7.94
-------- -------- --------
Net Investment Income...................................... .28 .42 .46
Net Realized and Unrealized Gain/Loss...................... .02 .57 .14
Common Share Equivalent of Distributions Paid to Preferred
Shareholders:
Net Investment Income...................................... (.04) (.02) -0-
-------- -------- --------
Total from Investment Operations............................ .26 .97 .60
-------- -------- --------
Distributions To Common Shareholders:
Net Investment Income...................................... (.23) (.40) (.44)
Net Realized Gain.......................................... -0- -0- -0-
Dilutive impact from the offering of Money Market Cumulative
Preferred Shares........................................... -0- (.04) -0-
-------- -------- --------
NET ASSET VALUE, END OF THE PERIOD.......................... $ 8.66 $ 8.63 $ 8.10
======== ======== ========
Common Share Market Price at End of the Period.............. $ 8.59 $ 8.84 $ 7.84
Total Return* (b)........................................... -0.21%** 18.13% 25.06%
Net Assets Applicable to Common Shares at End of the Period
(In millions).............................................. $1,559.4 $1,554.1 $1,458.6
Ratios to Average Net Assets applicable to Common Shares
excluding Borrowings:
Operating Expense* (f)..................................... 2.26% 1.91% 1.59%
Interest Expense (f)....................................... .62% .31% .62%
Gross Expense* (f)......................................... 2.88% 2.22% 2.21%
Net Investment Income* (f)................................. 6.30% 5.06% 5.98%
Net Investment Income* (g)................................. 5.41% 4.80% N/A
Portfolio Turnover (c)...................................... 50%** 84% 78%
Supplemental Ratios:
Ratios to Average Net Assets including Preferred Shares and
Borrowings:
Operating Expense* (f)..................................... 1.28% 1.30% 1.19%
Interest Expense (f)....................................... .35% .21% .46%
Gross Expense* (f)......................................... 1.63% 1.51% 1.65%
Net Investment Income* (f)................................. 3.57% 3.44% 4.47%
Net Investment Income* (g)................................. 3.06% 3.26% N/A
Senior Indebtedness:
Total Preferred Shares Outstanding....................... 28,000 28,000 N/A
Asset Coverage Per Preferred Share (h)................... $ 80,701 $ 80,509 N/A
Involuntary Liquidating Preference Per Preferred Share... $ 25,000 $ 25,000 N/A
Average Market Value Per Preferred Share................. $ 25,000 $ 25,000 N/A
Total Borrowing Outstanding (In thousands)............... $505,000 $450,000 $401,000
Asset Coverage Per $1,000 Unit of Senior Indebtedness
(d).................................................... 5,475 6,009 4,637
* If certain expenses had not been voluntarily assumed by Van Kampen, total return would have
been lower and the Ratio of Operating Expenses to Average Net Assets, Ratio of Gross
Expenses to Average Net Assets and the Ratio of Net Investment Income to Average Net Assets
would have been 1.21%, 1.49% and 6.90% for the period ended July 31, 1998.
** Non-Annualized
(a)Net asset value on June 24, 1998 of $10.00 is adjusted for common share
offering costs of $.013.
(b)Total return based on common share market price assumes an investment at the
common share market price at the beginning of the period indicated,
reinvestment of all distributions for the period in accordance with the
Trust's dividend reinvestment plan, and sale of all shares at the closing
common share market price at the end of the period indicated.
(c)Calculation includes the proceeds from principal repayments and sales of
variable rate senior loan interests.
(d)Calculated by subtracting the Trust's total liabilities (not including the
Borrowings) from the Trust's total assets and dividing by the total number of
senior indebtedness units, where one unit equals $1,000 of senior
indebtedness.
(e)As required, effective August 1, 2001, the Trust has adopted the provisions
of the AICPA Audit and Accounting Guide for Investment Companies and began
amortizing premium on fixed income securities. The effect of this change for
the year ended July 31, 2002 was to decrease the ratio of net investment
income to average net asset applicable to common shares by .01%. Net
investment income per share and net realized and unrealized gains and losses
per share were unaffected by the adjustments. Per share, ratios and
supplemental data for the periods prior to July 31, 2002 have not been
restated to reflect this change in presentation.
(f)Ratios do not reflect the effect of distributions to preferred shareholders.
(g)Ratios reflect the effect of distributions to preferred shareholders.
(h)Calculated by subtracting the Trust's total liabilities (not including the
preferred shares) from the Trust's total assets and dividing this by the
number of preferred shares outstanding.
N/A=Not Applicable
34
JUNE 24, 1998
YEAR ENDED JULY 31, (COMMENCEMENT
---------------------------------------------- OF OPERATIONS) TO
2002 (e) 2001 2000 1999 JULY 31, 1998
------------------------------------------------------------------
$ 8.51 $ 9.65 $ 10.08 $ 10.07 $ 9.99
-------- -------- -------- -------- --------
.49 .79 .81 .77 .07
(.55) (1.10) (.42) -0- .01
-0- -0- -0- -0- -0-
-------- -------- -------- -------- --------
(.06) (.31) .39 .77 .08
-------- -------- -------- -------- --------
(.51) (.83) (.81) (.76) -0-
-0- -0- (.01) -0- -0-
-0- -0- -0- -0- -0-
-------- -------- -------- -------- --------
$ 7.94 $ 8.51 $ 9.65 $ 10.08 $ 10.07
======== ======== ======== ======== ========
$ 6.67 $ 7.79 $ 8.75 $ 9.5625 $10.0625
-8.05% -1.42% .61% 2.98% .63%**
$1,430.0 $1,532.7 $1,736.5 $1,815.1 $1,812.1
1.48% 1.63% 1.75% 1.66% 1.18%
.53% 2.15% 2.49% 2.37% .28%
2.01% 3.78% 4.24% 4.03% 1.46%
6.02% 8.90% 8.19% 7.72% 6.94%
N/A N/A N/A N/A N/A
65% 55% 57% 28% 3%**
1.22% 1.20% 1.24% 1.18% N/A
.44% 1.58% 1.77% 1.67% N/A
1.66% 2.78% 3.01% 2.85% N/A
4.95% 6.55% 5.83% 5.46% N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
N/A N/A N/A N/A N/A
$370,159 $375,000 $700,000 $800,000 $400,000
4,863 5,087 3,481 3,269 5,530
See Notes to Financial Statements 35
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen Senior Income Trust (the "Trust") is registered as a non-diversified,
closed-end management investment company under the Investment Company Act of
1940, as amended. The Trust's investment objective is to provide a high level of
current income, consistent with preservation of capital. The Trust seeks to
achieve its objective by investing primarily in a portfolio of interests in
floating or variable rate senior loans to corporations, partnerships and other
entities which operate in a variety of industries and geographical regions. The
Trust borrows money for investment purposes which will create the opportunity
for enhanced return, but also should be considered a speculative technique and
may increase the Trust's volatility. The Trust commenced investment operations
on June 24, 1998.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
A. SECURITY VALUATION The Trust's Senior Loans are valued by the Trust following
valuation guidelines established and periodically reviewed by the Trust's Board
of Trustees. Under the valuation guidelines, Senior Loans for which reliable
market quotes are readily available are valued at the mean of such bid and ask
quotes. Where reliable market quotes are not readily available, Senior Loans are
valued, where possible, using independent market indicators provided by
independent pricing sources approved by the Board of Trustees. Other Senior
Loans are valued by independent pricing sources approved by the Board of
Trustees based upon pricing models developed, maintained and operated by those
pricing sources or valued by Van Kampen Asset Management (the "Adviser") by
considering a number of factors including consideration of market indicators,
transactions in instruments which the Adviser believes may be comparable
(including comparable credit quality, interest rate, interest rate
redetermination period and maturity), the credit worthiness of the Borrower, the
current interest rate, the period until next interest rate redetermination and
the maturity of such Senior Loan. Consideration of comparable instruments may
include commercial paper, negotiable certificates of deposit and short-term
variable rate securities which have adjustment periods comparable to the Senior
Loans in the Trust's portfolio. The fair value of Senior Loans are reviewed and
approved by the Trust's Valuation Committee and the Board of Trustees.
Equity securities are valued on the basis of prices furnished by pricing
services or as determined in good faith by the Adviser under the direction of
the Board of Trustees.
Short-term securities with remaining maturities of 60 days or less are
valued at amortized cost, which approximates market value. Short-term loan
participations are valued at cost in the absence of any indication of
impairment.
The Trust may invest in repurchase agreements, which are short-term
investments in which the Trust acquires ownership of a debt security and the
seller agrees to repurchase the security at a future time and specified price.
Repurchase agreements are fully collateralized by the underlying debt security.
The Trust will make payment for such securities only upon physical delivery or
evidence of book entry transfer to the account of the custodian bank.
36
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
The seller is required to maintain the value of the underlying security at not
less than the repurchase proceeds due the Trust.
B. SECURITY TRANSACTIONS Investment transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis.
Legal expenditures that are expected to result in the restructuring of or a plan
of reorganization for an investment are recorded as realized losses.
C. INVESTMENT INCOME Dividend income is recorded on the ex-dividend date and
interest income is recorded on an accrual basis. Facility fees received are
treated as market discounts. Market premiums are amortized and discounts are
accreted over the stated life of each applicable senior loan, note, or other
fixed income security. Other income is comprised primarily of amendment fees
which are recorded when received. Amendment fees are earned as compensation for
agreeing to changes in loan agreements.
D. FEDERAL INCOME TAXES It is the Trust's policy to comply with the requirements
of Subchapter M of the Internal Revenue Code applicable to regulated investment
companies and to distribute substantially all of its taxable income to its
shareholders. Therefore, no provision for federal income taxes is required.
The Trust intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset such losses against any future realized capital
gains. At July 31, 2004, the Trust had an accumulated capital loss carryforward
for tax purposes of $209,217,198, which will expire according to the following
schedule.
AMOUNT EXPIRATION
$ 4,851,995................................................ July 31, 2009
122,716,095................................................ July 31, 2010
52,014,750................................................ July 31, 2011
29,634,358................................................ July 31, 2012
At January 31, 2005, the cost and related gross unrealized appreciation and
depreciation are as follows:
Cost of investments for tax purposes........................ $2,784,943,950
==============
Gross tax unrealized appreciation........................... $ 54,941,542
Gross tax unrealized depreciation........................... (62,609,162)
--------------
Net tax unrealized depreciation on investments.............. $ ( 7,667,620)
==============
E. DISTRIBUTION OF INCOME AND GAINS The Trust intends to declare and pay monthly
dividends from net investment income to common shareholders. Net realized gains,
if any, are to be distributed at least annually to common shareholders.
Distributions from net realized gains for book purposes may include short term
capital gains, which are included as ordinary income for tax purposes.
37
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
The tax character of distributions paid for the year ended July 31, 2004 was
as follows:
Distributions paid from:
Ordinary income........................................... $75,570,307
Long-term capital gain.................................... -0-
-----------
$75,570,307
===========
As of July 31, 2004, the components of distributable earnings on a tax basis
were as follows:
Undistributed ordinary income............................... $1,498,215
Net realized gains and losses may differ for financial and tax reporting
purposes primarily as a result of the deferral of losses resulting from wash
sale transactions.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Trust's Investment Advisory Agreement, the Adviser will
provide investment advice and facilities to the Trust for an annual fee of .85%
of the average daily managed assets. Managed assets are defined as the gross
asset value of the Trust minus the sum of accrued liabilities, other than the
aggregate amount of borrowings undertaken by the Trust. In addition, the Trust
will pay a monthly administrative fee to Van Kampen Investments Inc., the
Trust's Administrator, at an annual rate of .20% of the average daily managed
assets of the Trust. The administrative services provided by the Administrator
include monitoring the provisions of the loan agreements and any agreements with
respect to participations and assignments, record keeping responsibilities with
respect to interests in Variable Rate Senior Loans in the Trust's portfolio and
providing certain services to the holders of the Trust's securities.
For the six months ended January 31, 2005, the Trust recognized expenses of
approximately $52,600 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom LLP, counsel to the Trust, of which a trustee of the Trust
is a partner of such firm and he and his law firm provide legal services as
legal counsel to the Trust.
Under a Legal Services agreement, the Adviser provides legal services to the
Trust. The Adviser allocates the cost of such services to each Trust. For the
six months ended January 31, 2005, the Trust recognized expenses of
approximately $47,700 representing Van Kampen Investments Inc.'s or its
affiliates' (collectively "Van Kampen") cost of providing legal services to the
Trust, which are reported as "Legal" expenses in the Statement of Operations.
Certain officers and trustees of the Trust are also officers and directors
of Van Kampen. The Trust does not compensate its officers or trustees who are
also officers of Van Kampen.
The Trust provides deferred compensation and retirement plans for its
trustees who are not officers of Van Kampen. Under the deferred compensation
plan, trustees may elect to defer all or a portion of their compensation to a
later date. Benefits under the retirement plan are payable for a ten-year period
and are based upon each trustee's years of service to the Trust. The maximum
annual benefit per trustee under the plan is $2,500.
38
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
During the period, the Trust owned shares of the following affiliated
companies. Affiliated companies are defined by the Investment Company Act of
1940 as those companies in which a fund holds 5% or more of the outstanding
voting securities.
INTEREST/ MARKET
PAR/ REALIZED DIVIDEND VALUE
NAME SHARES* GAIN/(LOSS) INCOME 1/31/05 COST
Imperial Home Decor Group, Inc.,
Term Loan...................... 1,422,288 -0- -0- $ 35,557 $1,367,833
Imperial Home Decor Group, Inc.,
Common Stock................... 512,023 -0- -0- -0- 522,263
Neoplan USA Corp., Revolving
Credit Agreement............... 933,750 -0- 30,297 933,750 933,750
Neoplan USA Corp., Common
Stock.......................... 8,517 -0- -0- 85 85
Neoplan USA Corp., Preferred
Stock C........................ 532 -0- -0- 532 532
Neoplan USA Corp., Preferred
Stock D........................ 1,730 -0- -0- 1,730 1,073,990
--- ------
-0- 30,297
--- ------
* Shares were acquired through the restructuring of Senior loan interests.
SHARES AS SHARES AS REALIZED
OF GROSS GROSS OF GAIN/
NAME 7/31/04 ADDITIONS REDUCTIONS 1/31/05 (LOSS)
Neoplan USA Corp., Revolving Credit
Agreement......................... 911,250 56,250 33,750 933,750 -0-
3. INVESTMENT TRANSACTIONS
During the period, the costs of purchases and proceeds from investments sold and
repaid, excluding short-term investments, were $1,413,699,787 and
$1,352,461,403, respectively.
4. COMMITMENTS
Pursuant to the terms of certain of the Variable Rate Senior Loan agreements,
the Trust had unfunded loan commitments of approximately $175,644,025 as of
January 31, 2005. The Trust intends to reserve against such contingent
obligations by segregating cash, liquid securities and liquid Senior Loans as a
reserve.
5. SENIOR LOAN PARTICIPATION COMMITMENTS
The Trust invests primarily in participations, assignments, or acts as a party
to the primary lending syndicate of a Variable Rate Senior Loan interest to
United States and foreign corporations, partnerships, and other entities. When
the Trust purchases a participation of a Senior Loan interest, the Trust
typically enters into a contractual agreement with the lender or other third
party selling the participation, but not with the borrower directly. As such,
the Trust assumes the credit risk of the borrower, selling participant or other
persons interpositioned between the Trust and the borrower.
39
VAN KAMPEN SENIOR INCOME TRUST
NOTES TO FINANCIAL STATEMENTS -- JANUARY 31, 2005 (UNAUDITED) continued
At January 31, 2005, the following sets forth the selling participants with
respect to interests in Senior Loans purchased by the Trust on a participation
basis.
PRINCIPAL
AMOUNT VALUE
SELLING PARTICIPANT (000) (000)
Bank of America............................................. $4,100 $4,121
6. BORROWINGS
As of April 29, 2004, the shareholders approved amending the Trust's fundamental
investment restriction regarding the Trust's use of financial leverage. The
Trust is now able to utilize financial leverage to the maximum extent allowable
under the Investment Company Act of 1940, as amended. Under the 1940 Act, a fund
generally may not (i) borrow money greater than 33 1/3% of the fund's total
assets or (ii) issue preferred shares greater than 50% of the fund's total
assets. In using a combination of borrowing money and issuing preferred shares,
the maximum allowable leverage is somewhere between 33 1/3% and 50% (but in no
event more that 50%) of the Fund's total assets based on the relative amounts
borrowed or preferred shares issued.
The Trust has entered into a $700 million revolving credit and security
agreement. Annual commitment fees of .13% are charged on the unused portion of
the credit line. This revolving credit agreement is secured by the assets of the
Trust. For the six months ended January 31, 2005, the average daily balance of
borrowings under the revolving credit agreement was $491,114,130 with a weighted
average interest rate of 1.94%.
7. PREFERRED SHARES ISSUANCE
As of February 20, 2004, the Trust issued 5,600 shares each of Series M, Series
T, Series W, Series TH and Series F Auction Preferred Shares ("APS"), $.01 Par
Value, $25,000 liquidation Preference, for a total issuance of $700 million.
Dividends are cumulative and the dividend rates are generally reset every seven
days through an auction process. The average rate in effect on January 31, 2005
was 2.44%. During the six months ended January 31, 2005, the rates ranged from
1.49% to 2.91%.
The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of the "Preferred Share
Maintenance" expense in the Statement of Operations.
The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $25,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests and the APS are subject to
mandatory redemption if the tests are not met.
8. INDEMNIFICATIONS
The Trust enters into contracts that contain a variety of indemnifications. The
Trust's maximum exposure under these arrangements is unknown. However, the Trust
has not had prior claims or losses pursuant to these contracts and expects the
risk of loss to be remote.
40
VAN KAMPEN SENIOR INCOME TRUST
BOARD OF TRUSTEES AND IMPORTANT ADDRESSES
BOARD OF TRUSTEES
DAVID C. ARCH
ROD DAMMEYER
HOWARD J KERR
RICHARD F. POWERS, III* - Chairman
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN*
INVESTMENT ADVISER
VAN KAMPEN ASSET MANAGEMENT
1221 Avenue of the Americas
New York, NY 10020
CUSTODIAN AND TRANSFER AGENT
STATE STREET BANK
AND TRUST COMPANY
c/o EquiServe
P.O. Box 43011
Providence, Rhode Island 02940-3011
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
DELOITTE & TOUCHE LLP
180 North Stetson Avenue
Chicago, Illinois 60601
* "Interested persons" of the Trust, as defined in the Investment Company Act
of 1940, as amended.
41
VAN KAMPEN
AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY
We are required by federal law to provide you with a copy of our Privacy
Policy annually.
The following Policy applies to current and former individual clients of Van
Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors Inc.,
Van Kampen Funds Inc., Van Kampen Investor Services Inc. and Van Kampen Exchange
Corp., as well as current and former individual investors in Van Kampen mutual
funds, unit investment trusts, and related companies.
This Policy is not applicable to partnerships, corporations, trusts or other
non-individual clients or account holders, nor is this Policy applicable to
individuals who are either beneficiaries of a trust for which we serve as
trustee or participants in an employee benefit plan administered or advised by
us. This Policy is, however, applicable to individuals who select us to be a
custodian of securities or assets in individual retirement accounts, 401(k)
accounts, 529 Educational Savings Accounts, accounts subject to the Uniform
Gifts to Minors Act, or similar accounts.
Please note that we may amend this Policy at any time, and will inform you
of any changes to this Policy as required by law.
WE RESPECT YOUR PRIVACY
We appreciate that you have provided us with your personal financial
information. We strive to maintain the privacy of such information while we help
you achieve your financial objectives. This Policy describes what non-public
personal information we collect about you, why we collect it, and when we may
share it with others.
We hope this Policy will help you understand how we collect and share
non-public personal information that we gather about you. Throughout this
Policy, we refer to the non-public information that personally identifies you or
your accounts as "personal information."
1. WHAT PERSONAL INFORMATION DO WE COLLECT ABOUT YOU?
To serve you better and manage our business, it is important that we collect and
maintain accurate information about you. We may obtain this information from
applications and other forms you submit to us, from your dealings with us, from
consumer reporting agencies, from our Web sites and from third parties and other
sources.
For example:
-- We may collect information such as your name, address, e-mail address,
telephone/fax numbers, assets, income and investment objectives through
applications and other forms you submit to us.
-- We may obtain information about account balances, your use of
account(s) and the types of products and services you prefer to receive
from us through your dealings and transactions with us and other
sources.
-- We may obtain information about your creditworthiness and credit
history from consumer reporting agencies.
-- We may collect background information from and through third-party
vendors to verify representations you have made and to comply with
various regulatory requirements.
-- If you interact with us through our public and private Web sites, we
may collect information that you provide directly through online
communications (such as an e-mail address). We may also collect
information about your Internet service provider, your domain name,
your computer's operating system and Web browser,
(continued on back)
VAN KAMPEN
AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY continued
your use of our Web sites and your product and service preferences,
through the use of "cookies." "Cookies" recognize your computer each
time you return to one of our sites, and help to improve our sites'
content and personalize your experience on our sites by, for example,
suggesting offerings that may interest you. Please consult the Terms of
Use of these sites for more details on our use of cookies.
2. WHEN DO WE DISCLOSE PERSONAL INFORMATION WE COLLECT ABOUT YOU?
To provide you with the products and services you request, to serve you better
and to manage our business, we may disclose personal information we collect
about you to our affiliated companies and to non-affiliated third parties as
required or permitted by law.
A. INFORMATION WE DISCLOSE TO OUR AFFILIATED COMPANIES. We do not disclose
personal information that we collect about you to our affiliated companies
except to enable them to provide services on our behalf or as otherwise required
or permitted by law.
B. INFORMATION WE DISCLOSE TO THIRD PARTIES. We do not disclose personal
information that we collect about you to non-affiliated third parties except to
enable them to provide services on our behalf, to perform joint marketing
agreements with other financial institutions, or as otherwise required or
permitted by law. For example, some instances where we may disclose information
about you to non-affiliated third parties include: for servicing and processing
transactions, to offer our own products and services, to protect against fraud,
for institutional risk control, to respond to judicial process or to perform
services on our behalf. When we share personal information with these companies,
they are required to limit their use of personal information to the particular
purpose for which it was shared and they are not allowed to share personal
information with others except to fulfill that limited purpose.
3. HOW DO WE PROTECT THE SECURITY AND CONFIDENTIALITY OF PERSONAL INFORMATION WE
COLLECT ABOUT YOU?
We maintain physical, electronic and procedural security measures to help
safeguard the personal information we collect about you. We have internal
policies governing the proper handling of client information. Third parties that
provide support or marketing services on our behalf may also receive personal
information, and we require them to adhere to confidentiality standards with
respect to such information.
Van Kampen Funds Inc.
1 Parkview Plaza, P.O. Box 5555
Oakbrook Terrace, IL 60181-5555
www.vankampen.com
Copyright (C)2005 Van Kampen Funds Inc. All rights reserved.
Member NASD/SIPC.
VVR SAR 3/05 RA05-00175P-Y01/05
(VAN KAMPEN INVESTMENTS LOGO)
Item 2. Code of Ethics.
Not applicable for semi-annual reports.
Item 3. Audit Committee Financial Expert.
Not applicable for semi-annual reports.
Item 4. Principal Accountant Fees and Services.
Not applicable for semi-annual reports.
Item 5. Audit Committee of Listed Registrants.
Not applicable for semi-annual reports.
Item 6. Schedule of Investments.
Please refer to Item #1.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 11. Controls and Procedures
(a) The Trust's principal executive officer and principal financial officer have
concluded that the Trust's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Trust in this Form N-CSR
was recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, based
upon such officers' evaluation of these controls and procedures as of a date
within 90 days of the filing date of the report.
(b) There were no changes in the registrant's internal control over financial
reporting that occurred during the registrant's most recent fiscal half-year
(the registrant's second fiscal half-year in the case
of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting.
Item 12. Exhibits.
(a) Code of Ethics -- Not applicable for semi-annual reports.
(b)(1) A certification for the Principal Executive Officer of the registrant is
attached hereto as part of EX-99.CERT.
(b)(2) A certification for the Principal
Financial Officer of the registrant is attached hereto as part of EX-99.CERT.
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.
(Registrant) Van Kampen Senior Income Trust
By: /s/ Ronald E. Robison
-----------------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: March 22, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed by the following
persons on behalf of the registrant and in the capacities and on the dates
indicated.
By: /s/ Ronald E. Robison
-----------------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: March 22, 2005
By: /s/ James W. Garrett
-----------------------------
Name: James W. Garrett
Title: Principal Financial Officer
Date: March 22, 2005