BLACKROCK FRONTIERS INVESTMENT TRUST
PLC (LEI: 5493003K5E043LHLO706)
All information is at 30 September
2017 and unaudited.
Performance at month end with net income reinvested.
|
One
month
% |
Three
months
% |
One
year
% |
Three
years
% |
Five
years
% |
Since
Launch*
% |
Sterling: |
|
|
|
|
|
|
Share price |
-4.3 |
0.3 |
19.8 |
28.5 |
120.6 |
84.5 |
Net asset value |
-3.2 |
1.2 |
17.8 |
31.7 |
109.1 |
84.9 |
MSCI Frontiers Index
(NR) |
-2.0 |
4.6 |
21.5 |
16.0 |
82.9 |
54.2 |
MSCI Emerging Markets
Index (NR) |
-4.3 |
4.5 |
18.6 |
39.5 |
46.3 |
33.7 |
|
|
|
|
|
|
|
US Dollars: |
|
|
|
|
|
|
Share price |
-0.4 |
3.6 |
23.7 |
6.4 |
83.6 |
59.2 |
Net asset value |
0.8 |
4.6 |
21.6 |
9.0 |
73.9 |
59.3 |
MSCI Frontiers Index
(NR) |
2.0 |
8.0 |
25.5 |
-4.0 |
52.0 |
32.7 |
MSCI Emerging Markets
Index (NR) |
-0.4 |
7.9 |
22.5 |
15.4 |
21.6 |
15.1 |
Sources: BlackRock and Standard & Poor’s Micropal
* 17 December 2010.
At
month end
Ordinary Shares |
|
US Dollar |
|
Net asset value -
capital only: |
192.16c |
Net asset value - cum
income: |
196.96c |
Sterling: |
|
Net asset value -
capital only: |
143.24p |
Net asset value - cum
income: |
146.82p |
Share price: |
149.00p |
Total assets (including
income): |
£261.1m |
Premium to cum-income
NAV: |
1.5% |
Gearing: |
nil |
Gearing range (as a %
of gross assets): |
0-20% |
Net yield*: |
3.6% |
Ordinary shares in
issue: |
177,868,108 |
Ongoing charges**: |
1.4% |
Ongoing charges plus
taxation and performance fee: |
2.4% |
*The Company’s yield based on dividends announced in the last 12
months as at the date of the release of this announcement is 3.6%
and includes the 2016 final dividend of 4.00
cents per share declared on 22
November 2016 and paid to shareholders on 17 February 2017 and the 2017 interim dividend of
2.70 cents per share announced on
25 May 2017 and paid to shareholders
on 30 June 2017.
**Calculated as a percentage of average net assets and using
expenses, excluding performance fees and interest costs for the
year ended 30 September 2016.
Sector
Analysis |
Gross
assets(%)* |
|
Country
Analysis |
Gross
assets(%)* |
|
|
|
|
|
Financials |
35.9 |
|
Argentina |
19.8 |
Consumer Staples |
13.2 |
|
Kuwait |
12.1 |
Energy |
11.5 |
|
Vietnam |
10.5 |
Health Care |
9.9 |
|
Romania |
9.5 |
Telecommunication
Services |
8.1 |
|
Egypt |
7.2 |
Materials |
7.3 |
|
Kazakhstan |
7.0 |
Industrials |
6.0 |
|
Morocco |
6.0 |
Real Estate |
5.5 |
|
Ukraine |
5.2 |
Utilities |
5.4 |
|
Sri Lanka |
4.7 |
Information
Technology |
3.3 |
|
Bangladesh |
4.2 |
Consumer
Discretionary |
1.6 |
|
Nigeria |
4.0 |
|
----- |
|
Kenya |
3.4 |
Total |
107.7 |
|
Philippines |
2.5 |
|
----- |
|
Eurasia |
2.1 |
Short positions |
0.0 |
|
Slovenia |
2.1 |
|
===== |
|
Colombia |
2.0 |
|
|
|
Estonia |
2.0 |
|
|
|
Tanzania |
1.8 |
|
|
|
PAN-LATAM |
1.5 |
|
|
|
PAN-Middle East |
0.1 |
|
|
|
|
----- |
|
|
|
Total |
107.7 |
|
|
|
|
----- |
|
|
|
Short positions |
0.0 |
|
|
|
|
===== |
|
|
|
|
|
*reflects gross market exposure from contracts for difference
(CFDs).
Market Exposure
|
31.10
2016
% |
30.11
2016
% |
31.12
2016
% |
31.01
2017
% |
28.02
2017
% |
31.03
2017
% |
30.04
2017
% |
31.05
2017
% |
30.06
2017
% |
31.07
2017
% |
31.08 2017
%
|
30.09
2017
% |
Long |
106.4 |
102.3 |
108.4 |
115.0 |
115.8 |
112.1 |
108.9 |
105.0 |
103.9 |
106.6 |
107.9 |
107.7 |
Short |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
0.0 |
Gross |
106.4 |
102.3 |
108.4 |
115.0 |
115.8 |
112.1 |
108.9 |
105.0 |
103.9 |
106.6 |
107.9 |
107.7 |
Net |
106.4 |
102.3 |
108.4 |
115.0 |
115.8 |
112.1 |
108.9 |
105.0 |
103.9 |
106.6 |
107.9 |
107.7 |
Ten Largest Equity Investments
Company |
Country of Risk |
% of gross
assets |
|
|
|
Mobile Telecommunications |
Kuwait |
3.0 |
Grupo Financiero Galicia |
Argentina |
3.0 |
Pampa Energia |
Argentina |
2.9 |
Irsa Inversiones GDR |
Argentina |
2.9 |
Halyk Savings Bank |
Kazakhstan |
2.9 |
Equity Group |
Kenya |
2.7 |
MHP |
Ukraine |
2.6 |
Burgan Bank |
Kuwait |
2.3 |
Square Pharmaceuticals |
Bangladesh |
2.2 |
S.N.G.N Romgaz |
Romania |
2.2 |
Commenting on the markets, Sam
Vecht and Emily Fletcher,
representing the Investment Manager noted:
In September, the Company’s NAV rose by 0.8%(1) on a US
Dollar basis with net income reinvested. Its benchmark, the MSCI
Frontier benchmark rose by 2.0%(3) whilst the MSCI
Emerging Markets Index returned -0.4%(3) both on a US
Dollar basis over the same period.
The Argentinean market continued to perform strongly in
September, rising by 10.8%(1) and benefiting the
absolute performance of the portfolio which holds nearly
20%(1) in the country. Performance was driven by banks.
Banco Galicia and Grupo Supervielle
followed the trend of their peers earlier in the summer and raised
capital to allow them to continue to participate in the strong
local loan demand. Given the multiples that the stocks are trading
on, and the term structure in the local market, raising equity was
earnings accretive for both these banks and both deals were
oversubscribed. We added to positions in both of these banks in the
placings.
On the politics side, following a better than expected showing
in the mandatory primaries in August, President Mauricio Macri’s business and reform friendly
coalition has been improving its standing in the polls in the run
up to the end of October elections. The expectations of strong
growth and lower inflation for Argentina in 2018 provide a testament to the
reform-oriented agenda of President Macri, who has opened up the
economy and pushed market-friendly policies that have put
Argentina back on track. With
Macri’s political support strengthened and markets responding well,
he will have the ability to advance new reforms and build on his
successes as his second year in office ends.
Vietnam (+4.3%)(1)
also continued to perform strongly in September. In particular,
food and beverage company, Masan Group (+16.0%)(1),
rallied during the month as it announced a buyback of 10% of the
outstanding shares, hence the overweight position in the stock
contributed positively to portfolio returns.
In Kazakhstan, our
off-benchmark holding in mobile operator, KCell (+36.5% over the
month(1)), was a notable performer. The company
continued the positive momentum on the back of the guidance for the
positive tariff revisions and more optimistic outlook in the second
half of 2017. We have been trimming our position in the stock on
the back of this strong recent performance.
Kenya (-4.0%)(1)
declined in September. The presidential elections held in
August were annulled by the Supreme Court, describing the polls as
“neither transparent nor verifiable” and blaming the country’s
electoral commission for the shortcomings. The election is
scheduled to be re-run on 26 October
2017, despite the withdrawal of Raila Odinga, the opposition candidate. We
continue to hold positions in Equity Bank, in anticipation of a
return to growth within the economy post the elections.
In Romania
(-3.2%)(1) banks declined on the back of talks on the
potential introduction of a tax on bank assets. The discussions
were around introducing a tax of around 0.2%-0.3%(2) on
the banks’ assets, which although cancelled, still left the market
nervous and sceptical on the back of the news.
A position in recent Latin American pharmaceutical Initial
Public Offering (IPO), Biotoscana, also hurt performance as it fell
more than 10%(1) during the month. Post the end of
the month, the company announced that it had agreed a new
partnership with Eisai for four molecules: Halaven, Lenvima,
Fycompa and Inovelon, and we believe that the company will continue
to announce further deals showing the strength of its distribution
model.
Frontier Markets continue to exhibit strong Gross Domestic
Product growth and low government debt levels, and represent an
opportunity to invest in companies with strong cash flow and high
dividend yields, on some of the lowest valuations in the world.
20 October 2017
ENDS
Latest information is available by typing
www.blackrock.co.uk/brfi on the internet, "BLRKINDEX" on Reuters,
"BLRK" on Bloomberg or "8800" on Topic 3 (ICV terminal). Neither
the contents of the Manager’s website nor the contents of any
website accessible from hyperlinks on BlackRock’s website (or any
other website) is incorporated into, or forms part of, this
announcement