LMP Capital & Income Fund Inc. (“SCD”) Announces: Quarterly Distribution for June 2011 & Increased Managed Distribution R...
20 5월 2011 - 9:00PM
Business Wire
LMP Capital and Income Fund Inc. (NYSE: SCD) today announced a
quarterly distribution of $0.15 per share payable June 2011, and an
increased quarterly managed distribution rate of $0.28 per share
payable September 2011. The Fund also announced a repositioning of
its equity portfolio and some changes to the equity team.
The distribution schedules appear below:
Month
Ex-Date
Record
Date
Payable
Date
Amount
June 6/15/2011 6/17/2011 6/24/2011 $0.15 September 9/21/2011
9/23/2011 9/30/2011 $0.28
The Fund’s new quarterly managed distribution rate of $0.28 per
common share is payable September 30, 2011 to shareholders of
record as of September 23, 2011. This is the Fund’s second increase
in its quarterly distribution rate since December 2010; prior to
that the Fund had paid a quarterly distribution of $0.13 per share
since March 2009. The newly announced managed distribution rate
equates to an annualized distribution rate of approximately 8.1%
based on a May 18, 2011 market price of $13.85 per share.
In declaring the new rate, the Fund cited a repositioning of its
equity assets which ClearBridge Advisors, LLC (“ClearBridge
Advisors”), the Fund’s equity sub-advisor, believes is likely to
increase the level of income available from the Fund’s equity
investments. The Fund’s equity allocation will be repositioned to
include a broader range of higher-yielding securities such as real
estate investment trusts (“REITS”) and master limited partnerships
(“MLPs”). The Fund may increase its international exposure and may
opportunistically employ other techniques such as option writing.
The Fund continues to utilize a line of credit to enhance portfolio
returns; this line of credit provides the Fund with the ability to
moderate its use as market conditions and opportunities change. As
of May 18, 2011, the Fund was utilizing $120 million of a total
available line of credit of $150 million. While the quarterly
distributions are anticipated to be derived from a combination of
net investment income and potential short- and long-term capital
gains, these managed distributions also may include a return of
capital.
As part of the repositioning, the Fund announced changes to the
portfolio management team from ClearBridge Advisors that is
responsible for the day-to-day management of the Fund’s equity
assets and for the allocation of the Fund’s assets between equity
and fixed-income investments effective immediately. The portfolio
management team consists of Peter Vanderlee, CFA, Mark McAllister,
CFA, Tim Daubenspeck and Tatiana Thibodeau. Mr. Vanderlee continues
to be responsible for the Fund’s asset allocation, and will focus
on dividend-paying securities. Other members of the portfolio
management team will focus on their respective areas of investment
expertise: Mr. McAllister on REITS, Mr. Daubenspeck on
telecommunications, and Ms. Thibodeau on utilities. Hersh Cohen and
Mike Clarfeld, having been involved in turning the Fund around
after 2008, will leave the team to focus on their other mutual fund
and private client portfolios. In addition, Mr. Cohen will continue
to lead the portfolio management team at ClearBridge Advisors as
Chief Investment Officer. “Hersh and Mike have done a very
effective job of managing the Fund. During this period,
shareholders have benefitted from a significant increase in net
asset value along with rising income distributions,” remarked Peter
Sundman, Chief Executive Officer of ClearBridge Advisors. The
portfolio management team from Western Asset Management Company
will continue to be responsible for the Fund’s fixed income
investments and there are no changes to its portfolio management
team.
Under the terms of the Fund's managed distribution policy, the
Fund seeks to maintain a consistent distribution level, stated as a
fixed rate per common share per quarter, that may be paid in part
or in full from net investment income, realized capital gains and
return of capital, or a combination thereof. Shareholders should
note, however, that if the Fund's aggregate net investment income
and net realized capital gains are less than the amount of the
distribution level, the difference will be distributed from the
Fund's assets and will constitute a return of the shareholder's
capital. A return of capital is generally not taxable; however,
under certain circumstances a return of capital may be deemed to be
a taxable distribution to shareholders.
The Board of Directors may reduce the Fund's quarterly
distribution rate in the future or terminate or suspend the managed
distribution policy at any time. Any such reduction in the
quarterly distribution rate, termination or suspension could have
an adverse effect on the market price of the Fund’s shares.
Based on the Fund's accounting records as of the date of this
press release, the Fund estimates that approximately 100% of the
cumulative fiscal year-to-date distributions through September 2011
are sourced from net investment income. The estimated components of
each distribution will be provided to shareholders of record in a
separate notice.
Please note that neither this press release nor the separate
notice should be used for tax reporting purposes and that each is
being provided to announce the amount and estimated source of the
Fund's distributions that have been declared by the Board of
Directors. In early 2012, after definitive information is
available, the Fund will send shareholders a Form 1099-DIV, if
applicable, specifying how the distributions paid by the Fund
during the prior calendar year should be characterized for purposes
of reporting the distributions on a shareholder's tax return (e.g.,
ordinary income, long-term capital gain or return of capital).
LMP Capital and Income Fund Inc. is a non-diversified,
closed-end management investment company. Legg Mason Partners Fund
Advisor, LLC, a wholly-owned subsidiary of Legg Mason, Inc., serves
as the Fund's investment manager. The Fund is sub-advised by
ClearBridge Advisors and Western Asset Management Company,
affiliates of the investment manager.
Contact the Fund at 1-888-777-0102 for additional information,
or consult the Fund’s web site at www.leggmason.com/cef.
Data and commentary provided in this press release are for
informational purposes only. Legg Mason and its affiliates do not
engage in selling shares of the Fund. An investment in the Fund
involves risk, including loss of principal. Investment returns and
the value of shares will fluctuate. The repositioning of the Fund’s
portfolio, as described in this press release, may increase a
shareholder’s risk of loss associated with an investment in the
Fund’s shares.
LMP Capital and Income (NYSE:SCD)
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