Company: CIF
Filing Date: 2025-01-27
Form Type: N-CSR
Source: 0001683863-25-000338
Chunk: 5

Company: MFS INTERMEDIATE HIGH INCOME FUND
Filing Date: 2025-01-27
Form: N-CSR
Chunk 5
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 Ukraine fight a seeming war of attrition while Israel continues to do battle with Iranian-backed proxy groups as well as withstanding several missile attacks from Iran itself, leading to bouts of
market volatility and fears of energy disruptions. Equity markets reacted favorably to the result of the U.S. presidential election, anticipating a low-tax, pro-growth, lighter regulatory touch from a second
Trump administration. However, rates markets are wary of a potential erosion of the U.S. government’s fiscal footing.

#### Factors Affecting Performance
Relative to the Bloomberg U.S.
Corporate High-Yield 2% Issuer Capped Index, the fund’s yield curve(y) positioning and longer duration(d) stance enhanced performance as interest rates generally declined throughout the reporting period. From a
quality perspective, the fund’s overweight allocation to “CCC” rated(r) securities benefited relative returns.

3

Management Review - continued

Conversely, the fund’s overweight allocation to “BB” rated bonds and underweight allocation to “CC” rated securities detracted from relative performance. Weak security selection within “CCC” rated bonds further weighed on the fund’s relative returns. From a sector perspective, bond selection within both the consumer cyclicals and consumer non-cyclicals sectors held back relative performance. The fund’s overweight exposure to the capital goods and insurance sectors also dampened relative results. The fund employs leverage and, to the extent that investments are purchased through the use of leverage, the fund’s net asset value may increase or decrease at a greater rate than a comparable unleveraged fund. During the reporting period, the use of leverage strengthened relative returns. The fund has a managed distribution policy, the primary purpose of which is to provide shareholders with a constant, but not guaranteed, fixed rate of distribution each month. This policy had no material impact on the fund's investment strategies during its most recent fiscal year. The level of distributions paid by the fund pursuant to its managed distribution policy may cause the fund's net asset value (NAV) per share to decline more so than if the policy were not in place, including if distributions are in excess of fund returns. However, the adviser believes the policy may benefit the fund’s market price and premium/discount to the fund’s NAV. For the twelve months ended November 30, 2024, the tax character of dividends paid pursuant to the managed distribution policy includes an ordinary income distribution of $1,870,641 and a tax return of capital distribution of $1,327,359. See “Managed Distribution Policy Disclosure”