BLACKROCK FRONTIERS INVESTMENT TRUST
PLC (LEI: 5493003K5E043LHLO706)
All information is at 30 June
2019 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 |
5.3 |
4.9 |
-0.9 |
32.2 |
40.2 |
83.8 |
Net asset value |
4.2 |
5.3 |
2.1 |
30.4 |
41.4 |
90.7 |
Benchmark (NR)** |
3.8 |
5.4 |
12.1 |
47.2 |
42.5 |
75.7 |
MSCI Frontiers Index
(NR) |
1.3 |
7.2 |
8.8 |
33.6 |
29.3 |
60.6 |
MSCI Emerging Markets
Index (NR) |
5.2 |
3.0 |
5.0 |
42.3 |
51.9 |
43.1 |
|
|
|
|
|
|
|
US Dollars: |
|
|
|
|
|
|
Share price |
6.3 |
2.4 |
-4.4 |
26.0 |
4.6 |
50.7 |
Net asset value |
5.2 |
2.9 |
-1.5 |
24.2 |
5.4 |
56.1 |
Benchmark (NR)** |
4.9 |
2.9 |
8.0 |
40.2 |
6.1 |
44.6 |
MSCI Frontiers Index
(NR) |
2.3 |
4.7 |
4.9 |
27.2 |
-3.8 |
31.1 |
MSCI Emerging Markets
Index (NR) |
6.2 |
0.6 |
1.2 |
35.5 |
13.1 |
16.8 |
Sources: BlackRock and Standard & Poor’s Micropal
* 17 December 2010.
** The Company’s benchmark changed from MSCI Frontier Markets
Index to MSCI Emerging ex Selected Countries + Frontier Markets +
Saudi Arabia Index (net total return, USD) effective 1/4/2018.
At month
end |
|
US Dollar |
|
Net asset value -
capital only: |
172.88c |
Net asset value - cum
income: |
177.39c |
Sterling: |
|
Net asset value -
capital only: |
135.83p |
Net asset value - cum
income: |
139.38p |
Share price: |
137.00p |
Total assets (including
income): |
£335.4m |
Discount to cum-income
NAV: |
1.7% |
Gearing: |
nil |
Gearing range (as a %
of gross assets): |
0-20% |
Net yield*: |
4.8% |
Ordinary shares in
issue: |
240,672,801 |
Ongoing charges**: |
1.4% |
Ongoing charges plus
taxation and performance fee: |
1.4% |
*The Company’s yield based on dividends announced in the last 12
months as at the date of the release of this announcement is 4.8%
and includes the 2018 final dividend of 4.40
cents per share and special dividend of 1.0 cents per share, both of which were declared
on 11 December 2018 and were paid to
shareholders on 7 February 2019. Also
included is the 2019 interim dividend of 3.00 cents per share announced on 30 May 2019 and paid to shareholders on
28 June 2019.
**Calculated as a percentage of average net assets and using
expenses, excluding performance fees and interest costs for the
year ended 30 September 2018.
Sector
Analysis |
Gross
market value as a % of net assets |
|
Country
Analysis |
Gross
market value as a % of net assets |
|
|
|
|
|
Financials |
30.1 |
|
Indonesia |
14.6 |
Real Estate |
14.0 |
|
United Arab
Emirates |
9.5 |
Consumer Staples |
13.8 |
|
Thailand |
8.9 |
Consumer
Discretionary |
12.5 |
|
Egypt |
8.8 |
Energy |
9.4 |
|
Vietnam |
8.6 |
Industrials |
8.9 |
|
Argentina |
8.1 |
Materials |
8.5 |
|
Malaysia |
6.9 |
Health Care |
7.6 |
|
Kazakhstan |
6.0 |
Communication
Services |
6.1 |
|
Saudi Arabia |
5.0 |
Utilities |
2.0 |
|
Philippines |
5.0 |
Information
Technology |
1.2 |
|
Kuwait |
4.0 |
|
----- |
|
Romania |
3.9 |
|
114.1 |
|
Nigeria |
3.6 |
Short positions |
----- |
|
Greece |
2.7 |
|
-8.1 |
|
Pakistan |
2.6 |
|
===== |
|
Turkey |
2.4 |
|
|
|
Ukraine |
2.4 |
|
|
|
PAN-Africa |
2.3 |
|
|
|
Qatar |
2.3 |
|
|
|
Poland |
2.2 |
|
|
|
Kenya |
1.8 |
|
|
|
Colombia |
1.2 |
|
|
|
PAN-Asian |
0.7 |
|
|
|
Hungary |
0.3 |
|
|
|
Morocco |
0.3 |
|
|
|
|
----- |
|
|
|
Total |
114.1 |
|
|
|
|
----- |
|
|
|
Short positions |
-8.1 |
*reflects gross market exposure from contracts for difference
(CFDs).
Market Exposure
|
31.07
2018
% |
31.08
2018
% |
30.09
2018
% |
31.10
2018
% |
30.11
2018
% |
31.12
2018
% |
31.01
2019
% |
28.02
2019
% |
31.03
2019
% |
30.04
2019
% |
31.05
2019
% |
30.06
2019
% |
Long |
113.9 |
107.7 |
107.7 |
107.8 |
108.1 |
109.3 |
115.1 |
112.9 |
113.1 |
116.0 |
111.0 |
114.1 |
Short |
5.1 |
6.4 |
7.7 |
6.8 |
8.6 |
8.6 |
7.3 |
6.7 |
6.6 |
6.6 |
8.8 |
8.1 |
Gross |
119.0 |
114.1 |
115.4 |
114.6 |
116.7 |
117.9 |
122.4 |
119.6 |
119.7 |
122.6 |
119.8 |
122.2 |
Net |
108.8 |
101.3 |
100.0 |
101.0 |
99.5 |
100.7 |
107.8 |
106.2 |
106.5 |
109.4 |
102.2 |
106.0 |
Ten Largest Investments
Company |
Country of Risk |
Gross market value
as a % of net assets |
|
|
|
Bank Mandiri |
Indonesia |
3.5 |
Banco Macro |
Argentina |
3.5 |
National Medical Care |
Saudi Arabia |
3.2 |
Astra International |
Indonesia |
3.2 |
LT Group |
Philippines |
3.0 |
Vincom Retail |
Vietnam |
2.9 |
Charoen Pokphand Food |
Thailand |
2.8 |
Emaar Development |
United Arab Emirates |
2.7 |
YPF |
Argentina |
2.6 |
NMC Health |
United Arab Emirates |
2.6 |
Commenting on the markets, Sam
Vecht and Emily Fletcher,
representing the Investment Manager noted:
The Company’s NAV returned +5.2%1 versus its benchmark,
the MSCI Emerging ex Selected Countries + Frontier Markets + Saudi
Arabia Index (“Benchmark Index”), which was up 4.9% in
June2. For reference, the MSCI Frontiers Index was up
2.3%2, and the MSCI Emerging Markets Index was up
6.2%2 on a US Dollar basis, over the same period (all
performance figures are on a US Dollar basis with net income
reinvested).
Our allocation to Argentina was
the largest contributor to returns in June for the second month in
a row with MSCI Argentina up 27% as the currency stabilized on an
improved trade balance, helped by the record harvest. Several
polls showed a significant swing in voter sentiment towards
Mauricio Macri, putting him back
into contention for the coming Presidential election. Our holdings
in financial Banco Macro (+46%), energy company YPF (+23%) and
electric utility Pampa Energia (+38%) all rallied strongly. We have
continued to trim exposure on strong performance while remaining
positively positioned overall. Our holdings in Kazakhstan driven by copper miner Kaz Minerals
(+19%) also helped returns, as the stock recovered from its
sell-off in May as markets interpreted bad news as good news, given
the expected Fed Response (as shown by treasury yields) to a
weakening of the US economy. Our position in Romanian
financial Banca Transilvania (+15%) was an additional contributor
as the stock continued to rebound from the December sell off on the
back of strong reported activity from the domestic
economy.
Positioning in Thailand was the
top detractor from returns in June. The market performed
strongly over the month (+9.2%) as Junta leader Gen. Prayuth was
officially re-appointed as PM (Prime Minister) for a second term.
Thailand is a market in which we
find a few stock specific investment ideas while we continue to
think it looks less attractive from a macro point of view given low
growth and high valuations. Our newly initiated position in
Pakistan was a drag on returns in
June mainly due to ongoing deterioration in the value of the
Pakistani rupee which fell more than 8% over the month. Following
the replacement of its Finance Minister and Central Bank governor
over the last few months, Pakistan
finally agreed to a $6bn deal with
the IMF. Whilst this is the 13th IMF deal and the size of the
deal remains relatively small, the extent of the reform agenda that
the country is talking about alongside this deal is
impressive. Our holdings in Indonesia were an additional relative
detractor, driven by our holdings in conglomerate Astra
International (+0.9%) and coal miner PT Indo Tambangraya Megah
(+1.2%).
The Company initiated a position in Colombian Energy company
Ecopetrol. Our investment thesis is driven by our belief that the
company’s free cash flow yield is sustainable at current oil
prices, with further upsides potentially coming from increases in
recovery factors, well discoveries, and a maintenance of lower
crude differential. Elsewhere in the portfolio we continued to trim
positions in Argentina and
Greece on the back of strong
performance.
We continue to find value in the smaller emerging and frontier
markets and see the markets well supported by the lower rate
environment. In aggregate the wide subset of countries that make up
our investible universe continue to exhibit strong GDP growth, have
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.
Sources:
1BlackRock as at 30 June
2019
2MSCI as at 30 June
2019
17 July 2019
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 Kazakhstan