BLACKROCK FRONTIERS INVESTMENT TRUST
PLC (LEI: 5493003K5E043LHLO706)
All information is at 30 September
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 |
-0.6 |
-3.6 |
-0.9 |
15.0 |
23.4 |
77.1 |
Net asset value |
0.1 |
-3.1 |
4.1 |
17.7 |
31.5 |
84.7 |
Benchmark (NR)** |
-1.4 |
-2.9 |
5.8 |
35.3 |
29.2 |
70.6 |
MSCI Frontiers Index
(NR) |
-3.1 |
2.1 |
12.0 |
29.2 |
23.4 |
64.0 |
MSCI Emerging Markets
Index (NR) |
0.7 |
-1.1 |
3.7 |
25.5 |
47.6 |
41.5 |
|
|
|
|
|
|
|
US Dollars: |
|
|
|
|
|
|
Share price |
0.6 |
-6.7 |
-6.3 |
9.2 |
-6.0 |
40.6 |
Net asset value |
1.2 |
-6.2 |
-1.6 |
11.7 |
0.2 |
46.4 |
Benchmark (NR)** |
-0.2 |
-6.0 |
0.0 |
28.4 |
-1.8 |
35.9 |
MSCI Frontiers Index
(NR) |
-2.0 |
-1.1 |
5.9 |
22.6 |
-6.2 |
29.6 |
MSCI Emerging Markets
Index (NR) |
1.9 |
-4.2 |
-2.0 |
19.0 |
12.2 |
11.8 |
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: |
161.17c |
Net asset value - cum
income: |
166.41c |
Sterling: |
|
Net asset value -
capital only: |
130.79p |
Net asset value - cum
income: |
135.04p |
Share price: |
132.00p |
Total assets (including
income): |
£325.0m |
Discount to cum-income
NAV: |
2.3% |
Gearing: |
nil |
Gearing range (as a %
of gross assets): |
0-20% |
Net yield*: |
5.0% |
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 5.0%
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 |
23.0 |
|
Indonesia |
13.1 |
Consumer Staples |
14.2 |
|
Thailand |
12.1 |
Industrials |
13.6 |
|
Egypt |
10.2 |
Consumer
Discretionary |
13.3 |
|
Vietnam |
9.9 |
Real Estate |
13.3 |
|
United Arab
Emirates |
9.1 |
Energy |
10.0 |
|
Malaysia |
5.8 |
Materials |
9.9 |
|
Philippines |
5.6 |
Health Care |
5.2 |
|
Kazakhstan |
5.2 |
Communication
Services |
4.0 |
|
Turkey |
5.2 |
Utilities |
1.8 |
|
Saudi Arabia |
4.6 |
Information
Technology |
1.8 |
|
Romania |
4.1 |
|
----- |
|
Pakistan |
3.9 |
|
110.1 |
|
Nigeria |
3.7 |
Short positions |
----- |
|
Greece |
3.0 |
|
-4.1 |
|
Colombia |
2.3 |
|
===== |
|
PAN-Africa |
2.3 |
|
|
|
Ukraine |
2.2 |
|
|
|
Qatar |
2.2 |
|
|
|
Chile |
1.9 |
|
|
|
Argentina |
1.7 |
|
|
|
Kenya |
1.1 |
|
|
|
Poland |
0.7 |
|
|
|
Morocco |
0.2 |
|
|
|
|
----- |
|
|
|
Total |
110.1 |
|
|
|
|
----- |
|
|
|
Short positions |
-4.1 |
|
|
|
|
===== |
|
|
|
|
|
*reflects gross market exposure from contracts for difference
(CFDs).
Market Exposure
|
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
% |
31.07
2019
% |
31.08
2019
% |
30.09
2019
% |
Long |
107.8 |
108.1 |
109.3 |
115.1 |
112.9 |
113.1 |
116.0 |
111.0 |
114.1 |
117.0 |
111.5 |
110.1 |
Short |
6.8 |
8.6 |
8.6 |
7.3 |
6.7 |
6.6 |
6.6 |
8.8 |
8.1 |
5.1 |
4.2 |
4.1 |
Gross |
114.6 |
116.7 |
117.9 |
122.4 |
119.6 |
119.7 |
122.6 |
119.8 |
122.2 |
122.1 |
115.7 |
114.2 |
Net |
101.0 |
99.5 |
100.7 |
107.8 |
106.2 |
106.5 |
109.4 |
102.2 |
106.0 |
111.9 |
107.3 |
106.0 |
Ten Largest Investments
Company |
Country of Risk |
Gross market value
as a % of net assets |
|
|
|
Astra International |
Indonesia |
3.5 |
Charoen Pokphand Food |
Thailand |
3.2 |
Vincom Retail |
Vietnam |
3.1 |
PTT Global Chemical |
Thailand |
3.1 |
Eastern Tobacco |
Egypt |
3.0 |
LT Group |
Philippines |
2.9 |
Mobile World |
Vietnam |
2.7 |
Emaar Development |
United Arab Emirates |
2.6 |
Orascom Construction |
Egypt |
2.6 |
Bank of the Philippine Islands |
Philippines |
2.5 |
Commenting on the markets, Sam
Vecht and Emily Fletcher,
representing the Investment Manager noted:
The Company’s NAV returned +1.2%1 versus its
benchmark the MSCI Emerging ex Selected Countries + Frontier
Markets + Saudi Arabia Index (“Benchmark Index”), which was down
0.2% in August2. For reference, the MSCI Frontiers
Index was down 2.0%2, and the MSCI Emerging Markets
Index was up 1.9% over the same period (all performance figures are
on a US Dollar basis with net income reinvested).
Stock selection in Chile,
Egypt and UAE (United Arab Emirates), were among the largest
contributors to Company’s returns in September. Chilean airline,
LatAm Airlines (+33%), was the month’s top performer, benefitting
from regional competitor Avianca’s bankruptcy, and a recent bid
from Delta to acquire a 20% stake of the company. Egypt saw a re-rating, supported by falling
inflation which has allowed the central bank to cut rates.
Positions in tobacco, namely Eastern Co. (+13%), and construction
firm, Orascom Construction (+15%), contributed positively, the
latter of which posted strong half yearly results and continues to
see a build-up in their order book. UAE hospital operator, NMC
(+10%), performed well on the back of positive half yearly results,
which show better cash flow conversion and improvements in
corporate governance.
On the other hand, Thai, Kazakh, and Indonesian positioning
detracted the most over the month. Thai staple name, CP Foods
(-11%), detracted amid weak chicken prices. Indonesian cement
producer, Semen Indonesia (-9%), fell back from recent highs.
Kazakh uranium miner, Kazatamprom (-12%), also weighed on returns
as the parent company announced a placing of shares in the
market.
The first half of September brought a significant style rotation
in equity markets, most stark in the US with a multiple standard
deviation move over a matter of days. The move in Emerging Markets,
though more muted, was notable. Positioning remained relatively
unchanged, however, we did make some notable stock specific trades
through September. In Poland, we
exited exiting copper miner, KGHM, on concerns of global growth
deterioration and also sold our position in Alior Bank, as
corporate asset quality issues persist. On the other hand, we
rotated capital into Thai petrochemical company, PTT Global
Chemical where we think valuation has hit trough levels and the
dividend yield remains attractive. We added a new position in
the Philippines, Bloomberry
Resorts, an integrated casino, entertainment and hotel complex.
The Philippines is one of our
preferred countries from a macro perspective where we think that
economic growth will be supported by recent rate cuts and RRR
(reserve requirement ratio) cuts by the BSP (The Bangko Sentral)
and a number of stocks look attractively valued.
We see significant value in the smaller emerging and frontier
markets and see the markets well supported by the lower rate
environment. We note that a lot of stocks in our universe are
trading at extreme valuations, which we view as an opportunity to
invest in a wide subset of countries which exhibit good growth,
have low government debt levels, and are home to companies with
strong cash flow and high dividend yields, trading on some of the
lowest valuations in the world.
Sources:
1BlackRock as at 30 September
2019
2MSCI as at 30 September
2019
21 October 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.