FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF
REGISTERED MANAGEMENT INVESTMENT COMPANY
Investment Company Act file number 811-21357
Franklin Templeton Limited Duration Income Trust
(Exact name of registrant as specified in charter)
One Franklin Parkway, San Mateo, CA 94403-1906
(Address of principal executive offices) (Zip code)
Murray L. Simpson, One Franklin Parkway, San Mateo, CA 94403-1906
(Name and address of agent for service)
Registrant's telephone number, including area code: 650 312-2000
Date of fiscal year end: 3/31
Date of reporting period: 12/31/04
Item 1. Schedule of Investments.
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
QUARTERLY STATEMENT OF INVESTMENTS
DECEMBER 31, 2004
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CONTENTS
Statement of Investments .................................................. 3
Notes to Statement of Investments ......................................... 11
[LOGO](R)
FRANKLIN(R) TEMPLETON(R)
INVESTMENTS
FRANKLIN o Templeton o Mutual Series
Quarterly Statement of Investments | 1
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FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
STATEMENT OF INVESTMENTS, DECEMBER 31, 2004 (UNAUDITED)
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COUNTRY PRINCIPAL AMOUNT(C) VALUE
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BONDS 58.9%
COMMERCIAL SERVICES 1.0%
JohnsonDiversey Holdings Inc., senior disc. note, zero cpn. to
5/17/07, 10.67% thereafter, 5/15/13 ................................. United States $ 4,300,000 $ 3,741,000
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COMMUNICATIONS 7.2%
Dobson Cellular Systems Inc., secured note, 144A, 9.875%,
11/01/12 ............................................................ United States 4,000,000 3,960,000
MCI Inc., senior note, 6.908%, 5/01/07 ............................... United States 1,108,000 1,137,085
MCI Inc., senior note, 7.688%, 5/01/09 ............................... United States 2,000,000 2,075,000
MCI Inc., senior note, 8.735%, 5/01/14 ............................... United States 950,000 1,023,625
Millicom International Cellular SA, senior note, 144A, 10.00%,
12/01/13 ............................................................ Luxembourg 4,000,000 4,205,000
NTL Cable PLC, senior note, 144A, FRN, 6.07%, 10/15/12 ............... United Kingdom 3,000,000 3,105,000
Qwest Services Corp., senior secured note, 144A, 13.00%,
12/15/07 ............................................................ United States 4,000,000 4,590,000
Rogers Wireless Communications Inc., senior secured note, 144A,
FRN, 5.525%, 12/15/10 ............................................... Canada 1,950,000 2,052,375
Rural Cellular Corp., senior note, 9.875%, 2/01/10 ................... United States 2,000,000 2,045,000
Time Warner Telecom Inc., senior note, 10.125%, 2/01/11 .............. United States 1,100,000 1,086,250
Time Warner Telecom Inc., senior note, 9.25%, 2/15/14 ................ United States 2,900,000 2,972,500
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28,251,835
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CONSUMER DURABLES 1.1%
D. R. Horton Inc., senior note, 8.00%, 2/01/09 ....................... United States 4,000,000 4,495,000
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CONSUMER NON-DURABLES 2.2%
Del Monte Corp., senior sub. note, B, 9.25%, 5/15/11 ................. United States 4,000,000 4,400,000
Smithfield Foods Inc., senior note, 8.00%, 10/15/09 .................. United States 4,000,000 4,450,000
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8,850,000
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CONSUMER SERVICES 15.9%
Advanstar Communications Inc., senior secured note, 10.75%,
8/15/10 ............................................................. United States 4,000,000 4,535,000
Boyd Gaming Corp., senior sub. note, 8.75%, 4/15/12 .................. United States 4,000,000 4,470,000
Charter Communications Holdings II, senior note, 10.25%,
9/15/10 ............................................................. United States 4,000,000 4,260,000
Clear Channel Communications Inc., senior note, 7.65%,
9/15/10 ............................................................. United States 4,000,000 4,556,608
CSC Holdings Inc., senior note, 8.125%, 7/15/09 ...................... United States 4,000,000 4,395,000
Dex Media West LLC, senior sub. note, 9.875%, 8/15/13 ................ United States 4,000,000 4,630,000
DirecTV Holdings LLC, senior note, 8.375%, 3/15/13 ................... United States 4,000,000 4,505,000
Inmarsat Finance PLC, senior note, 7.625%, 6/30/12 ................... United Kingdom 3,000,000 3,135,000
LIN Television Corp., senior note, 8.00%, 1/15/08 .................... United States 4,000,000 4,185,000
Marquee Inc., senior note, 144A, FRN, 5.97%, 8/15/10 ................. United States 4,000,000 4,230,000
Park Place Entertainment Corp., senior sub. note, 9.375%,
2/15/07 ............................................................. United States 4,000,000 4,420,000
Quarterly Statement of Investments | 3
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
STATEMENT OF INVESTMENTS, DECEMBER 31, 2004 (UNAUDITED) (CONTINUED)
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COUNTRY PRINCIPAL AMOUNT(C) VALUE
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BONDS (CONT.)
CONSUMER SERVICES (CONT.)
Paxson Communications Corp., senior secured note, 144A, 4.82%,
1/15/10 ............................................................. United States $ 3,500,000 $ 3,535,000
Pinnacle Entertainment Inc., senior sub. note, 8.75%, 10/01/13 ....... United States 1,000,000 1,087,500
Pinnacle Entertainment Inc., senior sub. note, B, 9.25%,
2/15/07 ............................................................. United States 2,077,000 2,123,732
Quebecor Media Inc., senior disc. note, zero cpn. to 7/15/06,
13.75% thereafter, 7/15/11 .......................................... Canada 4,000,000 3,980,000
Royal Caribbean Cruises Ltd., senior note, 8.00%, 5/15/10 ............ United States 4,000,000 4,540,000
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62,587,840
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ELECTRONIC TECHNOLOGY 2.3%
Solectron Corp., senior note, 9.625%, 2/15/09 ........................ United States 4,000,000 4,420,000
Xerox Corp., senior note, 9.75%, 1/15/09 ............................. United States 4,000,000 4,720,000
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9,140,000
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HEALTH SERVICES 3.2%
HCA Inc., senior note, 8.75%, 9/01/10 ................................ United States 4,000,000 4,577,524
Tenet Healthcare Corp., senior note, 6.375%, 12/01/11 ................ United States 4,000,000 3,730,000
Vanguard Health Holding Co. II LLC, senior sub. note, 144A, 9.00%,
10/01/14 ............................................................ United States 4,000,000 4,300,000
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12,607,524
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INDUSTRIAL SERVICES 3.1%
Allied Waste North America Inc., senior note, B, 8.50%,
12/01/08 ............................................................ United States 4,000,000 4,260,000
Hanover Equipment Trust 01, senior secured note, A, 8.50%,
9/01/08 ............................................................. United States 4,000,000 4,320,000
URS Corp., senior note, 11.50%, 9/15/09 .............................. United States 3,000,000 3,465,000
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12,045,000
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NON-ENERGY MINERALS 1.1%
Ispat Inland ULC, senior secured note, FRN, 7.86%, 4/01/10 ........... United States 4,000,000 4,370,000
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PROCESS INDUSTRIES 7.6%
Boise Cascade LLC, senior note, 144A, FRN, 5.005%, 10/15/12 .......... United States 3,000,000 3,127,500
Crown European Holdings SA, senior secured note, 10.875%,
3/01/13 ............................................................. France 4,000,000 4,750,000
Georgia-Pacific Corp., senior note, 9.375%, 2/01/13 .................. United States 4,000,000 4,680,000
Huntsman ICI Holdings LLC, senior disc. note, zero cpn.,
12/31/09 ............................................................ United States 6,000,000 3,390,000
Jefferson Smurfit Corp., senior note, 7.50%, 6/01/13 ................. United States 4,000,000 4,290,000
Lyondell Chemical Co., senior secured note, B, 9.875%, 5/01/07 ....... United States 2,696,000 2,837,540
Nalco Co., senior note, 7.75%, 11/15/11 .............................. United States 2,000,000 2,170,000
Rhodia SA, senior note, 10.25%, 6/01/10 .............................. France 4,000,000 4,520,000
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29,765,040
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4 | Quarterly Statement of Investments
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
STATEMENT OF INVESTMENTS, DECEMBER 31, 2004 (UNAUDITED) (CONTINUED)
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COUNTRY PRINCIPAL AMOUNT(C) VALUE
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BONDS (CONT.)
PRODUCER MANUFACTURING 4.1%
Case New Holland Inc., senior note, 144A, 9.25%, 8/01/11 ............. United States $ 4,000,000 $ 4,470,000
Invensys PLC, senior note, 144A, 9.875%, 3/15/11 ..................... United Kingdom 3,000,000 3,240,000
Milacron Escrow Corp., senior secured note, 11.50%, 5/15/11 .......... United States 4,000,000 4,260,000
TRW Automotive Inc., senior note, 9.375%, 2/15/13 .................... United States 3,500,000 4,077,500
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16,047,500
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REAL ESTATE INVESTMENT TRUSTS 1.1%
Host Marriott LP, senior note, 9.25%, 10/01/07 ....................... United States 4,000,000 4,480,000
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TRANSPORTATION 2.4%
CP Ships Ltd., senior note, 10.375%, 7/15/12 ......................... Canada 4,000,000 4,635,000
Laidlaw International Inc., senior note, 10.75%, 6/15/11 ............. United States 4,000,000 4,690,000
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9,325,000
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UTILITIES 6.6%
Calpine Corp., senior secured note, 144A, 8.50%, 7/15/10 ............. United States 4,000,000 3,450,000
Centerpoint Energy Inc., senior note, B, 7.25%, 9/01/10 .............. United States 4,000,000 4,466,600
Dynegy Holdings Inc., senior secured note, 144A, 9.875%,
7/15/10 ............................................................. United States 4,000,000 4,490,000
Edison Mission Energy, senior note, 9.875%, 4/15/11 .................. United States 4,000,000 4,760,000
El Paso Natural Gas Co., senior note, 7.625%, 8/01/10 ................ United States 4,000,000 4,400,000
Utilicorp United Inc., senior note, 9.95%, 2/01/11 ................... United States 4,000,000 4,550,000
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26,116,600
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TOTAL BONDS (COST $221,383,154) 231,822,339
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U.S. GOVERNMENT AND AGENCY SECURITIES 32.5%
FHLMC, 4.50%, 6/01/18 - 9/01/18 ...................................... United States 4,315,275 4,312,486
FHLMC, 5.00%, 9/01/18 - 6/01/34 ...................................... United States 25,763,417 25,838,560
FHLMC, 5.50%, 7/01/19 - 8/01/33 ...................................... United States 8,085,319 8,231,541
FHLMC, 6.00%, 7/01/28 - 9/01/33 ...................................... United States 6,640,299 6,870,588
FHLMC, 7.00%, 9/01/27 ................................................ United States 1,793,998 1,909,796
FHLMC, 8.00%, 1/01/31 ................................................ United States 649,711 704,276
FHLMC, 8.50%, 7/01/31 ................................................ United States 5,321,124 5,813,934
FNMA, 4.617%, 7/01/34 ................................................ United States 4,778,529 4,851,487
FNMA, 5.00%, 10/01/17 ................................................ United States 2,698,941 2,746,352
FNMA, 5.50%, 10/01/17 - 10/01/33 ..................................... United States 18,052,471 18,448,467
FNMA, 5.936%, 6/01/32 ................................................ United States 285,800 292,140
FNMA, 6.00%, 4/01/33 - 12/01/34 ...................................... United States 6,134,203 6,340,278
FNMA, 6.50, 8/01/32 .................................................. United States 3,311,133 3,476,466
FNMA, 7.00%, 9/01/18 ................................................. United States 802,861 856,855
FNMA, 8.00%, 10/01/29 ................................................ United States 646,779 704,312
FNMA, 8.50%, 8/01/26 ................................................. United States 788,982 869,989
GNMA, 5.50%, 4/15/33 - 12/15/34 ...................................... United States 10,856,858 11,098,815
GNMA, 6.50%, 6/15/31 - 12/15/33 ...................................... United States 13,174,243 13,883,569
GNMA, 7.00%, 12/20/28 - 12/20/30 ..................................... United States 3,126,282 3,313,944
Quarterly Statement of Investments | 5
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
STATEMENT OF INVESTMENTS, DECEMBER 31, 2004 (UNAUDITED) (CONTINUED)
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COUNTRY PRINCIPAL AMOUNT(C) VALUE
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U.S. GOVERNMENT AND AGENCY SECURITIES (CONT.)
GNMA, 8.00%, 1/20/28 - 2/20/32 ....................................... United States $ 584,883 $ 632,517
GNMA II, 8.00%, 2/20/30 - 5/20/30 .................................... United States 817,968 884,714
GNMA, SF, 5.00%, 10/20/33 ............................................ United States 5,433,008 5,437,955
GNMA, SF, 7.00%, 1/20/24 - 1/20/29 ................................... United States 579,737 616,150
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TOTAL U.S. GOVERNMENT AND AGENCY SECURITIES
(COST $126,638,630) 128,135,191
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ASSET-BACKED SECURITIES 10.3%
Argent Securities Inc., 2003-W5, M4, 4.85%, 10/25/33 ................. United States 4,000,000 4,230,170
GSR Mortgage Trust, 2003-AHL, B1, 6.00%, 10/25/33 .................... United States 5,000,000 5,127,315
Merrill Lynch Mortgage Investors Inc., 2003-OPT1, B2, 3.87%,
7/25/34 ............................................................. United States 1,000,000 1,037,142
Morgan Stanley ABS Capital, 2003-HE3, B1, 4.42%, 10/25/33 ............ United States 3,500,000 3,557,440
Morgan Stanley ABS Capital, 2003-NC10, B1, 5.20%, 10/25/33 ........... United States 3,000,000 3,091,406
Morgan Stanley Auto Loan Trust, 2003-HB1, D, 144A, 5.50%,
4/15/11 ............................................................. United States 2,307,921 2,288,709
Morgan Stanley Dean Witter Capital Trust I, 2003-NC3, B1, 4.45%,
3/25/33 ............................................................. United States 4,508,000 4,632,745
New Century Home Equity Loan Trust, 2003-2, M3, 4.981%,
1/25/33 ............................................................. United States 5,000,000 5,138,909
Option One Mortgage Loan Trust, 2003-6, M5, 5.233%,
11/25/33 ............................................................ United States 3,500,000 3,663,920
Residential Asset Securities Corp., 2003-KS10, MII3, 3.67%,
12/25/33 ............................................................ United States 1,500,000 1,532,455
Specialty Underwriting and Residential Finance, 03-BC4, B2, 3.80%,
11/25/34 ............................................................ United States 1,500,000 1,534,105
Structured Asset Investment Loan Trust, 03-BC13, 3.868%,
11/25/33 ............................................................ United States 3,340,000 3,385,934
Structured Asset Investment Loan Trust, 2003-BC2, M3, 4.555%,
4/25/33 ............................................................. United States 1,471,000 1,492,510
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TOTAL ASSET-BACKED SECURITIES (COST $39,191,046) 40,712,760
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SENIOR FLOATING RATE INTERESTS 40.5%
COMMERCIAL SERVICES .9%
DS Waters Enterprises LP, Term Loan, 6.67 - 7.266%, 11/07/09 ......... United States 3,840,000 3,728,640
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COMMUNICATIONS 2.8%
AAT Communications Corp., Term Loan B, 5.25 - 5.26%,
12/31/11 ............................................................ United States 3,000,000 3,039,999
ALEC Holdings Inc., Term Loan B, 5.813%, 8/20/10 ..................... United States 2,970,000 3,003,412
American Tower Corp., Term Loan B, 4.23%, 8/31/11 .................... United States 746,250 756,569
GCI Holdings Inc., Term Loan, 4.668%, 10/31/07 ....................... United States 712,753 720,529
Nextel Finance (Nextel Communications Inc.), Term Loan E, 4.688%,
12/15/10 ............................................................ United States 1,980,000 1,983,606
Valor Telecom Inc., First Lien Term Loan, 5.75 - 5.92%,
10/30/11 ............................................................ United States 1,496,250 1,513,083
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11,017,198
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6 | Quarterly Statement of Investments
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
STATEMENT OF INVESTMENTS, DECEMBER 31, 2004 (UNAUDITED) (CONTINUED)
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COUNTRY PRINCIPAL AMOUNT(C) VALUE
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SENIOR FLOATING RATE INTERESTS (CONT.)
CONSUMER DURABLES 2.0%
BRP Holdings LP, Term Loan, 4.97%, 12/18/10 .......................... United States $ 3,960,000 $ 4,024,350
LandSource Communities Development LLC, Term Loan B, 4.938%,
3/31/10 ............................................................. United States 1,000,000 1,015,938
Sola International Inc., Term Loan, 4.92%, 12/05/09 .................. United States 962,500 964,550
Solo Cup Co., Term Loan B, 4.66 - 5.05%, 2/27/11 ..................... United States 1,989,975 2,029,154
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8,033,992
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CONSUMER NON-DURABLES 1.9%
Constellation Brands Inc., Term Loan B, 6.00%, 12/22/11 .............. United States 2,000,000 2,029,500
Dole Food Co. Inc., Term Loan D, 4.313 - 6.50%, 9/28/08 .............. United States 544,819 554,244
Land O'Lakes Inc., Term Loan B, 5.71%, 10/11/08 ...................... United States 695,661 706,625
Meow Mix Co., First Lien Term Loan, 6.20 - 7.02%, 8/21/09 ............ United States 1,033,797 1,016,998
Michael Foods Inc., Term Loan B, 4.63 - 5.09%, 11/21/10 .............. United States 643,505 654,163
Rayovac Corp., Term Loan C, 4.22 - 4.92%, 9/30/09 .................... United States 808,657 820,844
Southern Wine & Spirits of America Inc., Term Loan B, 4.81%,
7/02/08 ............................................................. United States 1,678,558 1,704,878
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7,487,252
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CONSUMER SERVICES 16.6%
Advertising Directory Solutions Inc., Term Loan B, 4.40%,
11/05/11 ............................................................ United States 3,000,000 3,028,125
Alderwoods Group Inc., Term Loan B1, 3.94 - 4.54%, 8/19/10 ........... United States 1,006,084 1,013,026
Alliance Gaming Corp., Term Loan B, 4.90%, 8/22/09 ................... United States 1,814,326 1,814,199
Canwest Media Inc., Term Loan E, 4.49%, 5/15/09 ...................... Canada 1,498,563 1,515,752
Charter Communications Operating LLC, Term Loan B, 5.38%,
4/23/11 ............................................................. United States 1,990,000 1,994,145
Cinram International Inc., Term Loan D, 5.40%, 9/30/09 ............... Canada 3,752,066 3,801,897
Cumulus Media Inc., Term Loan F, 3.938%, 11/18/11 .................... United States 1,995,000 2,004,143
Dex Media West LLC, Term Loan B, 4.10 - 6.00%, 3/09/10 ............... United States 3,270,507 3,306,960
DirecTV Holdings LLC, Term Loan, 4.39 - 4.41%, 3/06/10 ............... United States 1,651,837 1,680,232
Emmis Operating Co., Term Loan B, 4.10%, 11/10/11 .................... United States 1,000,000 1,011,389
Grapeclose Ltd. (Inmarsat), Term Loan B, 5.502%, 10/10/10 ............ United Kingdom 1,833,709 1,844,023
Grapeclose Ltd. (Inmarsat), Term Loan C, 6.002%, 10/10/11 ............ United Kingdom 1,838,018 1,854,044
Green Valley Ranch Gaming LLC, Term Loan B, 4.501%,
12/22/10 ............................................................ United States 992,500 1,004,906
Insight Midwest Holdings LLC, Term Loan A, 3.938%, 6/30/09 ........... United States 1,317,394 1,320,042
Insight Midwest Holdings LLC, Term Loan B, 5.188%, 12/31/09 .......... United States 2,009,700 2,044,311
Mediacom Broadband Inc., Term Loan B1, 4.81 - 5.06%,
9/12/10 ............................................................. United States 1,990,000 2,021,219
MediaNews Group Inc., Term Loan C, 3.92%, 12/30/10 ................... United States 2,306,591 2,326,243
Metro-Goldwyn-Mayer Studios Inc., Term Loan B, 5.06%,
4/30/11 ............................................................. United States 1,496,250 1,502,609
Mission Broadcasting Inc., Term Loan D, 4.31%, 12/31/10 .............. United States 1,290,375 1,296,827
New Skies Satellites B.V., Term Loan, 5.188%, 5/01/11 ................ United States 1,500,000 1,522,812
Nexstar Finance LLC, Term Loan D, 4.31%, 12/31/10 .................... United States 704,613 707,695
Panamsat Corp., Term Loan B, 5.16%, 8/01/11 .......................... United States 3,969,879 3,997,379
Quarterly Statement of Investments | 7
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
STATEMENT OF INVESTMENTS, DECEMBER 31, 2004 (UNAUDITED) (CONTINUED)
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COUNTRY PRINCIPAL AMOUNT(C) VALUE
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SENIOR FLOATING RATE INTERESTS (CONT.)
CONSUMER SERVICES (CONT.)
Primedia Inc., Term Loan B, 5.063%, 6/30/09 .......................... United States $ 1,695,509 $ 1,663,189
R.H. Donnelley Inc., Term Loan D, 4.09 - 4.31%, 6/30/11 .............. United States 1,995,000 2,017,651
Rainbow National Services LLC, Term Loan B, 5.19%, 3/31/12 ........... United States 2,500,000 2,542,708
Reader's Digest Association Inc., Term Loan B, 4.55%, 5/20/08 ........ United States 436,207 442,136
(a)Regal Cinemas Inc., Term Loan B, 4.56%, 11/10/10 ..................... United States 2,922,185 2,953,964
Six Flags Theme Parks Inc., Term Loan B, 4.84%, 6/30/09 .............. United States 3,603,662 3,659,407
SpectraSite Communications Inc., Term Loan B, 4.03%, 5/30/12 ......... United States 3,250,000 3,275,051
Warner Music Inc., Term Loan B, 4.97 - 5.38%, 2/28/11 ................ United States 4,962,500 5,034,868
Wyndham International Inc., Term Loan B, 7.125%, 6/30/06 ............. United States 1,197,003 1,204,859
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64,405,811
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FINANCE 2.3%
Conseco Inc., Term Loan, 5.918%, 6/22/10 ............................. United States 1,920,000 1,957,200
General Growth Properties Inc., Term Loan B, 4.53%, 11/12/09 ......... United States 4,000,000 4,016,024
Newkirk Master LP, Term Loan, 6.92 - 7.06%, 11/24/06 ................. United States 839,085 847,739
Refco Group Ltd. LLC, Term Loan B, 5.163%, 8/05/11 ................... United States 2,244,375 2,271,868
-------------
9,092,831
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HEALTH SERVICES 1.9%
Davita Inc., Term Loan B, 3.98 - 4.775%, 6/30/10 ..................... United States 3,644,719 3,658,063
Multiplan Inc., Term Loan, 5.31%, 3/04/09 ............................ United States 888,889 899,795
(a)Pacificare Health Systems Inc., Term Loan B, 4.063 - 4.25%,
12/13/10 ........................................................... United States 2,000,000 2,003,126
Quintiles Transnational Corp., Term Loan B, 6.67 - 6.81%,
9/25/09 ............................................................ United States 987,500 1,006,016
-------------
7,567,000
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INDUSTRIAL SERVICES 1.8%
Allied Waste North America Inc., Term Loan C, 5.24 - 5.27%,
1/15/10 ............................................................ United States 981,531 997,277
Allied Waste North America Inc., Term Loan D, 4.54%, 1/15/10 ......... United States 1,963,062 1,990,914
Washington Group International Inc., Synthetic Term Loan, 2.32%,
10/01/07 ........................................................... United States 4,000,000 4,006,640
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6,994,831
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NON-ENERGY MINERALS .8%
St. Marys Cement Inc., Term Loan B, 4.56%, 12/04/09 .................. Canada 2,982,456 3,017,873
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PROCESS INDUSTRIES 2.6%
Berry Plastics Corp., Term Loan C, 4.22%, 7/22/10 .................... United States 865,251 877,147
Boise Cascade LLC, Term Loan B, 4.688%, 10/01/11 ..................... United States 1,301,370 1,318,812
Boise Land and Timber Corp., Term Loan C, 4.688%, 10/01/10 ........... United States 1,198,630 1,202,792
8 | Quarterly Statement of Investments
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
STATEMENT OF INVESTMENTS, DECEMBER 31, 2004 (UNAUDITED) (CONTINUED)
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COUNTRY PRINCIPAL AMOUNT(C) VALUE
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SENIOR FLOATING RATE INTERESTS (CONT.)
PROCESS INDUSTRIES (CONT.)
Graham Packaging Co., First Lien Term Loan, 4.875 - 5.00%,
10/07/11 ........................................................... United States $ 1,200,000 $ 1,217,785
Graham Packaging Co., Second Lien Term Loan, 6.813%,
4/07/12 ............................................................ United States 1,000,000 1,027,000
Nalco Co., Term Loan B, 3.93 - 4.53%, 11/04/10 ....................... United States 3,329,426 3,380,929
Rockwood Specialties Group Inc., Term Loan D, 4.38%, 7/30/11 ......... United States 1,000,000 1,007,734
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10,032,199
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PRODUCER MANUFACTURING 3.1%
Day International Group Inc., Term Loan D, 5.92 - 6.06%,
1/01/10 ............................................................ United States 802,547 805,067
Headwaters Inc., Term Loan B, 5.33%, 4/30/11 ......................... United States 1,382,812 1,402,403
Itron Inc., Term Loan B, 4.688 - 4.813%, 11/24/10 .................... United States 811,216 820,004
Masonite International Corp., Term Loan C2, 4.688%, 8/31/08 .......... United States 992,491 1,009,294
Metaldyne (Mascotech Inc.), Term Loan D, 6.563%, 12/31/09 ............ United States 1,753,185 1,746,428
Sensus Metering Systems Inc., Term Loan, 4.391 - 4.421%,
12/17/10 ........................................................... United States 985,000 992,183
TriMas Corp., Term Loan B, 5.625%, 12/06/09 .......................... United States 2,296,607 2,326,391
(a)TRW Automotive Inc., Term Loan B, 3.625 - 4.125%, 10/31/10 ........... United States 3,000,000 3,008,751
-------------
12,110,521
-------------
RETAIL TRADE 1.3%
CSK Auto Inc., Term Loan C, 4.06%, 6/20/09 ........................... United States 495,000 501,772
The Jean Coutu Group (PJC) Inc., Term Loan B, 4.438%, 7/28/11 ........ United States 3,990,000 4,054,837
Pantry Inc., Term Loan, 4.67%, 3/12/11 ............................... United States 660,324 669,954
-------------
5,226,563
-------------
TECHNOLOGY SERVICES .1%
Worldspan LP, Term Loan, 5.813 - 8.00%, 6/30/07 ...................... United States 551,883 556,022
-------------
TRANSPORTATION .9%
Laidlaw International Inc., Term Loan B, 6.17%, 6/17/09 .............. United States 1,852,283 1,875,936
Northwest Airlines Inc., Term Loan, 9.10%, 11/23/10 .................. United States 1,500,000 1,544,063
-------------
3,419,999
-------------
UTILITIES 1.5%
AES Corp., Term Loan B, 4.25 - 4.40%, 4/30/08 ........................ United States 571,431 581,133
Calpine Corp., Second Lien Term Loan, 7.82%, 7/15/07 ................. United States 1,975,000 1,805,891
Coleto Creek WLE LP, Term Loan C, 5.63%, 7/31/12 ..................... United States 2,000,000 2,038,334
Texas Genco LLC, First Lien Term Loan, 4.48%, 12/14/11 ............... United States 1,415,385 1,435,984
-------------
5,861,342
-------------
TOTAL SENIOR FLOATING RATE INTERESTS (COST $158,442,928) 159,552,074
-------------
Quarterly Statement of Investments | 9
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
STATEMENT OF INVESTMENTS, DECEMBER 31, 2004 (UNAUDITED) (CONTINUED)
-----------------------------------------------------------------------------------------------------------------------------------
COUNTRY PRINCIPAL AMOUNT(C) VALUE
-----------------------------------------------------------------------------------------------------------------------------------
FOREIGN GOVERNMENT AND AGENCY SECURITIES 2.9%
Government of New Zealand, 8.00%, 11/15/06 ........................... New Zealand 1,100,000 NZD $ 814,538
Government of Thailand, 8.50%, 10/14/05 .............................. Thailand 120,000,000 THB 3,246,643
Kingdom of Norway, 6.75%, 1/15/07 .................................... Norway 8,300,000 NOK 1,483,830
Kingdom of Sweden, 8.00%, 8/15/07 .................................... Sweden 8,300,000 SEK 1,412,678
Korea Treasury Bond, 6.90%, 1/16/07 .................................. South Korea 3,600,000,000 KRW 3,775,229
New South Wales Treasury Corp., 6.50%, 5/01/06 ....................... Australia 800,000 AUD 636,030
-------------
TOTAL FOREIGN GOVERNMENT AND AGENCY SECURITIES
(COST $10,325,234) 11,368,948
-------------
------------------
SHARES
------------------
PREFERRED STOCK (COST $4,165,250) 1.1%
HEALTH SERVICES
Fresenius Medical Care Capital Trust II, 7.875%, 2/01/08 ............. Germany 4,000 4,350,000
-------------
TOTAL LONG TERM INVESTMENTS (COST $560,146,242) 575,941,312
-------------
SHORT TERM INVESTMENT (COST $9,387,598) 2.4%
(b)Franklin Institutional Fiduciary Trust Money Market Portfolio ........ United States 9,387,598 9,387,598
-------------
TOTAL INVESTMENTS (COST $569,533,840) 148.6% 585,328,910
PREFERRED SHARES (48.2)% (190,000,000)
OTHER ASSETS, LESS LIABILITIES (.4)% (1,556,786)
-------------
NET ASSETS APPLICABLE TO COMMON SHARES 100.0% $ 393,772,124
=============
CURRENCY ABBREVIATIONS | AUD - Australian Dollar | KRW - South Korean Won |
NOK - Norwegian Krone | NZD - New Zealand Dollar
SEK - Swedish Krona | THB - Thai Baht
GLOSSARY OF TERMS
FRN - Floating Rate Note
LLC - Limited Liability Corporation
LP - Limited Partnership
PLC - Partnership Liability Corporation
SF - Single Family
ULC - Unlimited Liability Corporation
(a) Security purchased on a delayed delivery basis.
(b) The Franklin Institutional Fiduciary Trust Money Market Portfolio is
managed by the Fund's investment manager.
(c) The principal amount is stated in U.S. dollars unless otherwise indicated.
10 | See Notes to Statement of Investments. | Quarterly Statement of Investments
FRANKLIN TEMPLETON
LIMITED DURATION INCOME TRUST
NOTES TO STATEMENT OF INVESTMENTS (UNAUDITED)
The Franklin Templeton Limited Duration Income Trust (the Fund) is registered
under the Investment Company Act of 1940 as a diversified, closed-end investment
company.
1. INCOME TAXES
At December 31, 2004, the unrealized appreciation (depreciation) based on the
cost of investments for income tax purposes was as follows:
Cost of investments ........................................... $ 571,362,568
=============
Unrealized appreciation ....................................... $ 15,195,104
Unrealized depreciation ....................................... (1,228,762)
-------------
Net unrealized appreciation (depreciation) .................... $ 13,966,342
=============
For information on the Fund's policy regarding valuation of investments and
other significant accounting policies, please refer to the Fund's most recent
semiannual or annual shareholder report.
Quarterly Statement of Investments | 11
Item 2. Controls and Procedures.
(a) EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES. The Registrant maintains
disclosure controls and procedures that are designed to ensure that information
required to be disclosed in the Registrant's filings under the Securities
Exchange Act of 1934 and the Investment Company Act of 1940 is recorded,
processed, summarized and reported within the periods specified in the rules and
forms of the Securities and Exchange Commission. Such information is accumulated
and communicated to the Registrant's management, including its principal
executive officer and principal financial officer, as appropriate, to allow
timely decisions regarding required disclosure. The Registrant's management,
including the principal executive officer and the principal financial officer,
recognizes that any set of controls and procedures, no matter how well designed
and operated, can provide only reasonable assurance of achieving the desired
control objectives.
Within 90 days prior to the filing date of this Quarterly Schedule of Portfolio
Holdings on Form N-Q, the Registrant had carried out an evaluation, under the
supervision and with the participation of the Registrant's management, including
the Registrant's principal executive officer and the Registrant's principal
financial officer, of the effectiveness of the design and operation of the
Registrant's disclosure controls and procedures. Based on such evaluation, the
Registrant's principal executive officer and principal financial officer
concluded that the Registrant's disclosure controls and procedures are
effective.
(b) CHANGES IN INTERNAL CONTROLS. There have been no significant changes in the
Registrant's internal controls or in other factors that could significantly
affect the internal controls subsequent to the date of their evaluation in
connection with the preparation of this Quarterly Schedule of
Portfolio Holdings on Form N-Q.
Item 3. Exhibits.
(A) Certification pursuant to Section 30a-2 under the Investment Company Act of
1940 of Jimmy D. Gambill, Chief Executive Officer - Finance and Administration,
and Galen G. Vetter, Chief Financial Officer.
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) FRANKLIN TEMPLETON LIMITED DURATION INCOME TRUST
By /s/ Jimmy D. Gambill
--------------------
Chief Executive Officer - Finance and Administration
Date February 18, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By /s/ Jimmy D. Gambill
--------------------
Chief Executive Officer - Finance and Administration
Date February 18, 2005
By /s/ Galen G. Vetter
-------------------
Chief Financial Officer
Date February 18, 2005
EXHIBIT A
I, Jimmy D. Gambill, certify that:
1. I have reviewed this report on Form N-Q of Franklin Templeton Limited
Duration Income Trust;
2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the schedules of investments included in this
report fairly present in all material respects the investments of the registrant
as of the end of the fiscal quarter for which the report is filed;
4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Rule 30a-3(c) under the Investment Company Act of 1940) and internal control
over financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of a date within 90
days prior to the filing date of this report, based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and
5. The registrant's other certifying officer(s) and I have disclosed to
the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
February 18, 2005
/S/JIMMY D. GAMBILL
Chief Executive Officer - Finance and Administration
I, Galen G. Vetter, certify that:
1. I have reviewed this report on Form N-Q of Franklin Templeton Limited
Duration Income Trust;
2. Based on my knowledge, this report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the schedules of investments included in this
report fairly present in all material respects the investments of the registrant
as of the end of the fiscal quarter for which the report is filed;
4. The registrant's other certifying officer(s) and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Rule 30a-3(c) under the Investment Company Act of 1940) and internal control
over financial reporting (as defined in Rule 30a-3(d) under the Investment
Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused
such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of a date within 90
days prior to the filing date of this report, based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's most
recent fiscal quarter that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and
5. The registrant's other certifying officer(s) and I have disclosed to
the registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or
operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process,
summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal control over
financial reporting.
February 18, 2005
/S/GALEN G. VETTER
Chief Financial Officer