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Putnam Premier Income Trust
IMPORTANT NOTICE: Beginning on January 1, 2021, reports like this one will no longer automatically be sent by mail. See inside for more information.
FUND SYMBOL
PPT
Annual report 7 | 31 | 19
Income funds invest in bonds and other securities with the goal of providing a steady stream of income over time.
Putnam Premier Income Trust Annual report 7 | 31 | 19
Message from the Trustees 1
About the fund 2
Interview with your fund’s portfolio manager 5
Your fund’s performance 11
Consider these risks before investing 13
Terms and definitions 14
Other information for shareholders 15
Important notice regarding Putnam’s privacy policy 16
Summary of dividend reinvestment plans 17
Trustee approval of management contract 19
Audited financial statements 23
Report of Independent Registered Public Accounting Firm 24
Federal tax information 113
Shareholder meeting results 113
About the Trustees 114
Officers 116
IMPORTANT NOTICE: Delivery of paper fund reports In accordance with regulations adopted by the Securities and Exchange Commission, beginning on January 1, 2021, reports like this one will no longer be sent by mail unless you specifically request it. Instead, they will be on Putnam’s website, and you will be notified by mail whenever a new one is available, and provided with a website link to access the report.
If you wish to stop receiving paper reports sooner, or if you wish to continue to receive paper reports free of charge after January 1, 2021, please see the back cover or insert for instructions. If you invest through a bank or broker, your choice will apply to all funds held in your account. If you invest directly with Putnam, your choice will apply to all Putnam funds in your account.
If you already receive these reports electronically, no action is required.
September 19, 2019
Dear Fellow Shareholder:
If there is any lesson to be learned from constantly changing financial markets, it is the importance of positioning your investment portfolio for your long-term goals. We believe that one strategy is to diversify across different asset classes and investment approaches.
We also believe your mutual fund investment offers a number of advantages, including constant monitoring by experienced investment professionals who maintain a long- term perspective. Putnam’s portfolio managers and analysts take a research-intensive approach that includes risk management strategies designed to serve you through changing conditions.
Another key strategy, in our view, is seeking the counsel of a financial advisor. For over 80 years, Putnam has recognized the importance of professional investment advice. Your financial advisor can help in many ways, including defining and planning for goals such as retirement, evaluating the level of risk appropriate for you, and reviewing your investments on a regular basis and making adjustments as necessary.
As always, your fund’s Board of Trustees remains committed to protecting the interests of Putnam shareholders like you, and we thank you for investing with Putnam.
Respectfully yours,
Robert L. Reynolds President and Chief Executive Officer Putnam Investments
Kenneth R. Leibler Chair, Board of Trustees
Message from the Trustees
About the fund
A multisector approach to fixed income When Putnam Premier Income Trust was launched in 1988, its three-pronged focus on U.S. investment-grade bonds, high-yield corporate bonds, and non-U.S. bonds was considered innovative.
In the more than 25 years since then, the fixed-income landscape has undergone a dramatic transformation, but the spirit of ingenuity that helped launch the fund is still with it today.
A veteran portfolio management team
The fund’s managers strive to build a well-diversified portfolio that carefully balances risk and return, targeting opportunities in interest rates, credit, mortgages, and currencies from across the full spectrum of the global bond markets.
D. William Kohli
Chief Investment Officer, Fixed Income Industry since 1988 At Putnam since 1994
Michael V. Salm
Co-Head of Fixed Income Industry since 1989 At Putnam since 1997
Paul D. Scanlon, CFA
Co-Head of Fixed Income Industry since 1986 At Putnam since 1999
Robert L. Davis, CFA
Portfolio Manager Industry since 1999 At Putnam since 1999
Brett S. Kozlowski, CFA
Portfolio Manager Industry since 1997 At Putnam since 2008
Michael J. Atkin
Portfolio Manager Industry since 1988 At Putnam since 1997 (Photo not available.)
Diversified holdings across a wide range of security types and market sectors
INVESTMENT ALLOCATIONS BY SECURITY TYPE
113.1%
27.5%
13.2%
0.2%
9.0%
0%
0%
0%
0%
0%
0%
Securitized
Credit
Government
Equity
Cash and net other assets
INVESTMENT ALLOCATIONS BY SECTOR
Agency pass-through
Commercial MBS
Agency collateralized mortgage obligations
High-yield corporate bonds
Non-agency residential MBS
Emerging-market bonds
Convertible securities
International Treasuries/agency securities
Bank loans
Investment-grade corporate bonds
Asset-backed securities
Equity investments
Cash and net other assets
49.6%
26.2%
22.4%
14.6%
13.4%
12.8%
1.5%
0.2%
9.0%
3.9%
3.9%
3.0%
2.5%
Allocations are shown as a percentage of the fund’s net assets as of 7/31/19. Cash and net other assets, if any, represent the market value weights of cash, derivatives, short-term securities, and other unclassified assets in the portfolio. Summary information may differ from the portfolio schedule included in the financial statements due to the inclusion of derivative securities, any interest accruals, the use of different classifications of securities for presentation purposes, and rounding.
Allocations may not total 100% because the table includes the notional value of certain derivatives (the economic value for purposes of calculating periodic payment obligations), in addition to the market value of securities. Holdings and allocations may vary over time.
Premier Income Trust 3 2 Premier Income Trust
Performance history as of 7/31/19
Annualized total return (%) comparison
LIFE OF FUND* (since 2/29/88)
10 YEARS 5 YEARS 3 YEARS 1 YEAR
6.66 5.76
7.34 6.83
0.53
2.91
10.19
3.34
0.93
2.49
6.21 7.39
1.431.21
8.09
4.51
2.41
7.53 6.79
The fund — at NAV Putnam Premier Income Trust (NYSE ticker: PPT)
Fund’s primary benchmark ICE BofAML U.S. Treasury Bill Index
Fund’s secondary benchmark Bloomberg Barclays Government Bond Index
Fund’s Lipper peer group average General Bond Funds (closed-end)
Data are historical. Past performance does not guarantee future results. More recent returns may be less or more than those shown. Investment return and net asset value will fluctuate, and you may have a gain or a loss when you sell your shares. Performance assumes reinvestment of distributions and does not account for taxes. Fund returns in the bar chart are at NAV. See below and pages 11–12 for additional performance information, including fund returns at market price. Index and Lipper results should be compared with fund performance at NAV.
Effective January 30, 2018, the ICE BofAML U.S. Treasury Bill Index replaced the Bloomberg Barclays Government Bond Index as the fund’s primary benchmark. In Putnam Management’s opinion, the new index is more appropriate to the fund’s flexible multisector investment approach.
* The fund’s primary benchmark (ICE BofAML U.S. Treasury Bill Index) was introduced on 6/30/92, which post-dates the inception of the fund’s class A shares.
Recent broad market index and fund performance
8.08%
7.99%
7.53%
4.51%
2.41%
U.S. bonds (Bloomberg Barclays U.S. Aggregate Bond Index)
U.S. stocks (S&P 500 Index)
Fund’s secondary benchmark (Bloomberg Barclays Government Bond Index)
Putnam Premier Income Trust (at NAV)
Fund’s primary benchmark (ICE BofAML U.S. Treasury Bill Index)
This comparison shows your fund’s performance in the context of broad market indexes for the 12 months ended 7/31/19. See above and pages 11–12 for additional fund performance information. Index descriptions can be found on pages 14–15.
4 Premier Income Trust
Interview with your fund’s portfolio manager
D. William Kohli Portfolio Manager
Bill is Chief Investment Officer, Fixed Income. He has an M.B.A. from the Haas School of Business, University of California, Berkeley, and a B.A. from the University of California, San Diego. Bill joined Putnam in 1994 and has been in the investment industry since 1988.
Michael J. Atkin; Robert L. Davis, CFA; Brett S. Kozlowski, CFA; Michael V. Salm; and Paul D. Scanlon, CFA, are also Portfolio Managers of the fund.
Bill, how would you summarize the fund’s investment environment during the reporting period
