Kayne Anderson MLP / Midstream Investment Company

Overview

Objective

KYN is a non-diversified, closed-end fund with an investment objective to obtain a high after-tax total return for its shareholders by investing at least 85% of our total assets in energy-related master limited partnerships and their affiliates (“MLPs”) and in other companies that operate assets used in the gathering, transporting, processing, storing, refining, distributing, mining or marketing of natural gas, natural gas liquids, crude oil, refined petroleum products or coal (collectively with MLPs, “Midstream Energy Companies”).

Symbol KYN
Exchange NYSE
CUSIP 486606106
Inception Date 9/28/2004
Total Assets† $1,434 million
Leverage† $873 million
Distribution ($/share)1 $0.12
% of Portfolio Assets with Call Options† None
Investment Merits
Midstream Opportunities
  • Opportunity to invest across the full value chain for the midstream sector through investments in midstream MLPs and midstream companies
  • Midstream sector is expected to generate attractive risk-adjusted returns for investors; companies are expected to generate stable cash flows from fee based assets with high barriers to entry
Attractive Fund Structure
  • KYN issues a Form 1099 (as opposed to K-1s issued by MLPs)
  • Suitable for IRAs, foundations and tax-exempt accounts, because unlike direct holdings in MLPs, KYN does not generate unrelated business taxable income (UBTI)
Access to Private Investments
  • KYN provides access to private investment opportunities not otherwise available to retail investors
Daily Pricing
as of 4/3/20
Share Price $3.67
NAV $4.42

† As of 3/31/20
1 Payable on 4/30/20 (ex-date 4/22/20). (See “Distributions” section below for more information).

Back to Top

Performance

Share Price and NAV History
as of 4/3/20

Premium/Discount to NAV
as of 4/3/20

Performance data quoted represents past performance and are for the stated time period only. Past performance is not a guarantee of future results. Current performance may be lower or higher than that shown based on market fluctuations from the end of the reported period.

Total Return (NAV plus distributions)
as of 3/31/20

Period Returns (Not Annualized)
as of 3/31/20
3 Mo. 6 Mo. 1-Yr 2-Yr 3-Yr 5-Yr 10-Yr Since Inception
NAV and distributions2 -70.5% -71.0% -72.4% -66.4% -71.0% -76.2% -52.7% -32.3%
NAV only -71.1% -72.3% -74.9% -72.8% -78.7% -86.2% -80.8% -81.5%
Share price and distributions2 -73.4% -73.7% -75.1% -72.8% -76.5% -82.4% -66.6% -46.9%
Share price only -73.9% -74.9% -77.4% -78.0% -82.7% -89.8% -86.5% -85.5%
Calendar Year Returns
as of 3/31/20
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
NAV and distributions2 36.7% 12.8% 3.6% 35.7% 4.9% -43.5% 29.9% 3.3% -14.2% 17.2% -70.5%
NAV only 26.5% 5.1% -5.3% 28.9% -2.2% -48.4% 13.3% -7.0% -23.6% 6.3% -71.1%
Share price and distributions2 35.8% 3.6% 6.1% 42.4% 2.8% -50.5% 29.9% 8.0% -18.9% 11.6% -73.4%
Share price only 25.7% -3.5% -3.0% 35.2% -4.2% -54.7% 13.2% -2.7% -27.8% 1.2% -73.9%

2 Assumes that distributions have been reinvested through the Dividend Reinvestment Program (DRIP).

Growth of Hypothetical $10,000 Investment3
as of 3/31/20

3 This chart illustrates the growth of a hypothetical $10,000 investment in the fund’s common shares beginning on the inception date with all distributions reinvested through the Dividend Reinvestment Program (DRIP). Ending values as of the dates shown in the chart. Performance reflects the deduction of management fees and expenses but does not reflect transaction fees or broker commissions. Past performance is no guarantee of future results.

Back to Top

Portfolio

Portfolio (%)
as of 8/31/20

Top 10 Holdings
as of 3/31/20
Enterprise Products Partners L.P. 15.7%
MPLX LP 13.5%
The Williams Companies, Inc. 9.9%
Energy Transfer LP 9.4%
Magellan Midstream Partners, L.P. 7.4%
Shell Midstream Partners, L.P. 6.8%
Phillips 66 Partners LP 5.6%
ONEOK, Inc. 5.2%
EQM Midstream Partners, LP 5.1%
Plains All American Pipeline, L.P. 4.9%
% of Total Assets 83.5%

Portfolio holdings are subject to change without notice. The mention of specific securities is not a recommendation or solicitation for any person to buy, sell or hold any particular security. You can obtain a complete listing of holdings by viewing our quarterly or annual report for the most recent completed period.

Back to Top

Distributions

Annual Distributions per Calendar Year

* Based on year-to-date distributions paid or declared.

Tax Character of Distributions

Our distributions are treated as a taxable dividend (qualified dividends) to our common stockholders to the extent of our current and accumulated earnings and profits. If the distribution exceeds our current or accumulated earnings and profits, the distribution will be treated as a return of capital to our common stockholders to the extent of each stockholder’s basis in our common stock, and then the amount of a distribution in excess of such stockholder’s basis would be taxed as capital gain. Because the cash distributions received from the MLPs in our portfolio are expected to exceed the earnings and profits associated with owning such MLPs, a portion of our distributions may be paid from sources other than our current and accumulated earnings and profits. Common stockholders will receive a Form 1099-DIV from us, sample forms for each year can be found within the Tax Information section of this page.

The table below summarizes the tax character of our distributions for the past ten years.

Information on Tax Character of Distributions
Calendar Year Qualified Dividends Nondividend Distributions
(Return of Capital)		 Total
2009 – 100% 100%
2010 44% 56% 100%
2011 64% 36% 100%
2012 74% 26% 100%
2013 67% 33% 100%
2014 90% 10% 100%
2015 82% 18% 100%
2016 – 100% 100%
2017 28% 72% 100%
2018 100% – 100%
2019 – 100% 100%
2020E4 – 100% 100%

4 This estimate is based on our anticipated earnings and profits for fiscal 2020. The final determination of the tax character of distributions will be made in early 2021 and may differ substantially from this preliminary information.

Back to Top

Leverage

KYN uses leverage in the form of unsecured notes, preferred stock and revolving bank credit facilities to acquire additional portfolio investments consistent with its investment objective and strategies. Under normal conditions, our policy is to utilize leverage in an amount that represents approximately 25% to 30% of the fund’s total assets.

Leverage Summary
as of 3/31/20
Credit Facility Commitment Available Current Borrowings Rate Maturity
Revolving Credit Facility $300,000,000 $- LIBOR + 130 bps 2/8/2021
Senior Notes CUSIP Principal Outstanding Rate Maturity
BB 486606 H*O $19,234,234 3.77% 5/3/2021
CC 486606 H@8 41,765,766 3.95% 5/3/2022
EE 486606 J*8 50,000,000 3.20% 4/16/2021
FF 486606 J@6 65,000,000 3.57% 4/16/2023
GG 486606 J#4 45,000,000 3.67% 4/16/2025
JJ 486606 K@4 30,000,000 3.46% 7/30/2021
KK 486606 K#2 80,000,000 3.93% 7/30/2024
LL 486606 L*5 50,000,000 2.89% 10/29/2020
MM 486606 L@3 40,000,000 3.26% 10/29/2022
NN 486606 L#1 20,000,000 3.37% 10/29/2023
OO 486606 M*4 90,000,000 3.46% 10/29/2024
Total Notes $531,000,000
Mandatory Redeemable Preferred Stock CUSIP Current Outstanding Rate Maturity
C 486606 4#0 $42,000,000 7.20% 11/9/2020
H 486606 5#9 50,000,000 6.06% 7/30/2021
I 486606 6#8 25,000,000 5.86% 10/29/2022
J 486606 7#7 50,000,000 5.36% 11/9/2021
L 486606 2*6 100,000,000 5.38% 2/11/2027
M 486606 3*5 75,000,000 5.60% 2/11/2030
Total MRPS $342,000,000
Total Leverage $873,000,000
Recent Ratings

6 KYN Series N MRPS to be issued on May 12, 2020.

Balance Sheet
Back to Top

News

Sign Up for Email Alerts***

Back to Top

Resources

Credit Facility
Senior Notes
Mandatory Redeemable Preferred Shares (MRPS)
Dividend Reinvestment Plan
Back to Top

SEC Filings

SEC Filings (View All)
Back to Top

Tax Information

Back to Top

Goverance

Independent Directors
Interested Directors
Governance Documents
Code of Ethics
Voting Policies and Procedures
Charters

*Role as the KYN and KMF lead independent director effective April 2, 2020.

Back to Top

This material is provided for informational purposes only. This material shall not constitute an offer to sell or a solicitation to buy, nor shall there be any sale of any securities in any jurisdiction in which such offer or sale is not permitted. Performance data quoted represent past performance and are for the stated time period only, Past performance is not a guarantee of future results. Current performance may be lower or higher than that shown based on market fluctuations from the end of the reported period.

Closed-end funds, unlike open-end funds, are not continuously offered. After the initial public offering, shares are sold on the open market through a stock exchange. As with any other stock, total return and market value will fluctuate so that an investment, when sold, may be worth more or less than its original cost. Shares of closed-end funds frequently trade at a market price that is below their net asset value.

All investments involve risk, including possible loss of principal. An investment in the fund could suffer loss. The fund’s concentration of investments in energy-related MLPs and midstream entities subjects it to the risks of MLPs, midstream entities and the energy sector, including the risks of declines in energy and commodity prices, decreases in energy demand, adverse weather conditions, natural or other disasters, changes in government regulation, and changes in tax laws. Leverage creates risks which may adversely affect return, including the likelihood of greater volatility of net asset value and market price of common shares and fluctuations in dividend rates on any preferred shares, and increases a shareholder’s risk of loss. Before investing in the fund, you should consider the investment objective, risks, charges and expenses of the fund, which, together with other important information, are included in the fund’s most recent prospectus and other filings with the SEC, available here or at www.sec.gov. There can be no assurance that the fund’s investment objective will be attained.

Nothing contained in this communication is intended to recommend any investment policy or investment strategy or take into account the specific objectives or circumstances of any investor. Please consult with your investment, tax or legal adviser regarding your individual circumstances prior to investing.

NOT FDIC INSURED | NOT BANK GUARANTEED | MAY LOSE VALUE