This announcement has been corrected to reflect a change to the
information
contained within the note ##. The sterling price of 459.00 has been
amended to
452.00 and the US cents rate prevailing at 31 March 2019 has been changed from
$1.3176 to $1.3030. All other information remains the
same.
BLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC (LEI:
UK9OG5Q0CYUDFGRX4151)
All information is at 31 March
2019 and unaudited.
Performance at month end with net income
reinvested
|
One
month
% |
Three
months
% |
One
year
% |
Three
years
% |
Five
years
% |
Sterling: |
|
|
|
|
|
Net asset value^ |
-1.6 |
4.0 |
-1.2 |
56.1 |
30.0 |
Share price |
-1.5 |
4.7 |
-0.7 |
56.2 |
28.4 |
MSCI EM Latin
America
(Gross Return)^^ |
-0.5 |
5.5 |
0.8 |
52.8 |
28.1 |
MSCI EM Latin
America
(Net Return)^^ |
-0.5 |
5.4 |
0.4 |
51.3 |
26.0 |
US Dollars: |
|
|
|
|
|
Net asset value^ |
-3.6 |
6.5 |
-8.3 |
41.4 |
1.5 |
Share price |
-3.5 |
7.1 |
-7.8 |
41.4 |
0.3 |
MSCI EM Latin
America
(Gross Return)^^ |
-2.5 |
7.9 |
-6.4 |
38.6 |
0.2 |
MSCI EM Latin
America
(Net Return)^^ |
-2.5 |
7.9 |
-6.7 |
37.1 |
-1.5 |
^cum income
^^The Company’s performance benchmark (the MSCI EM Latin America
Index) may be calculated on either a Gross or a Net return basis.
Net return (NR) indices calculate the reinvestment of dividends net
of withholding taxes using the tax rates applicable to non-resident
institutional investors, and hence give a lower total return than
indices where calculations are on a Gross basis (which assumes that
no withholding tax is suffered). As the Company is subject to
withholding tax rates for the majority of countries in which it
invests, the NR basis is felt to be the most accurate, appropriate,
consistent and fair comparison for the Company. Historically the
benchmark data for the Company has always been stated on a Gross
basis. However, as disclosed in the Company’s Interim Report for
the six months ended 30 June 2018, it
is the Board’s intention to monitor the Company’s performance with
reference to the NR version of the benchmark. For transparency both
sets of benchmark data have been provided.
Sources: BlackRock, Standard & Poor’s Micropal
At month
end |
|
Net asset value –
capital only: |
522.61p |
Net asset value – cum
income: |
525.43p |
Share price: |
452.00p |
Total Assets#: |
£216.1m |
Discount (share price
to cum income NAV): |
14.0% |
Average discount* over
the month – cum income: |
14.0% |
Net gearing at month
end**: |
7.2% |
Gearing range (as a %
of net assets): |
0-25% |
Net yield##: |
5.52% |
Ordinary shares in
issue (excluding 2,181,662 shares held in treasury): |
39,259,620 |
Ongoing
charges***: |
1.0% |
#Total assets include current year revenue.
##The yield of 5.5% is calculated based on total dividends
declared in the last 12 months as at the date of this announcement
as set out below (totalling 32.11
cents per share) and using a share price of 588.98 cents per share (equivalent to the
sterling price of 452.00 pence per
share translated in to US cents at the rate prevailing at
31 March 2019 of $1.3030 dollars to £1.00).
2018 Q3 interim dividend of 7.57
cents per share (paid on 23 August
2018)
2018 Q4 interim dividend of 7.85
cents per share (paid on 9 November
2018)
2019 Q1 interim dividend of 8.13
cents per share (paid on 8 February
2019)
2019 Q2 interim dividend of 8.56
cents per share (declared on 1 April
2019 and payable on 17 May
2019).
*The discount is calculated using the cum income NAV (expressed
in sterling terms).
**Net cash/net gearing is calculated using debt at par, less cash
and cash equivalents and fixed interest investments as a percentage
of net assets.
*** Calculated as a percentage of average net assets and using
expenses, excluding interest costs for the year ended 31 December 2018.
Geographic Exposure
|
% of
Total Assets |
% of
Equity
Portfolio * |
|
MSCI
EM Latin
America Index |
|
|
|
|
|
Brazil |
67.2 |
65.8 |
|
61.3 |
Mexico |
26.9 |
26.3 |
|
22.5 |
Argentina |
4.5 |
4.4 |
|
0.0 |
Chile |
3.6 |
3.5 |
|
8.7 |
Colombia |
0.0 |
0.0 |
|
3.9 |
Peru |
0.0 |
0.0 |
|
3.6 |
Net current
liabilities (inc. fixed interest) |
-2.2 |
0.0 |
|
0.0 |
|
----- |
----- |
|
----- |
Total |
100.0 |
100.0 |
|
100.0 |
|
----- |
----- |
|
----- |
Sector |
% of
Equity Portfolio * |
% of
Benchmark |
|
|
|
Financials |
29.7 |
33.6 |
Materials |
15.9 |
15.9 |
Consumer Staples |
14.5 |
14.8 |
Energy |
11.7 |
11.0 |
Industrials |
7.7 |
6.1 |
Communication
Services |
7.6 |
6.5 |
Consumer
Discretionary |
5.6 |
4.9 |
Utilities |
3.3 |
5.2 |
Information
Technology |
2.1 |
0.4 |
Real Estate |
1.9 |
1.3 |
Health Care |
0.0 |
0.3 |
|
----- |
----- |
Total |
100.0 |
100.0 |
|
----- |
----- |
*excluding net current assets & fixed interest
Ten Largest Equity Investments (in percentage order)
Company |
Country of Risk |
%
of
Equity Portfolio |
%
of
Benchmark |
|
|
|
|
Petrobras |
Brazil |
10.6 |
8.3 |
Itau Unibanco |
Brazil |
9.1 |
6.9 |
Vale |
Brazil |
6.3 |
6.6 |
Banco Bradesco |
Brazil |
6.1 |
7.5 |
America Movil |
Mexico |
5.1 |
3.8 |
Femsa |
Mexico |
4.6 |
2.9 |
Grupo Financiero
Banorte |
Mexico |
4.0 |
2.3 |
B3 |
Brazil |
3.0 |
2.7 |
Cemex SAB |
Mexico |
2.7 |
1.1 |
Banco do Brasil |
Brazil |
2.7 |
1.7 |
Commenting on the markets,
Sam Vecht and Ed Kuczma, representing the Investment Manager
noted;
For the month of March 2019, the
Company’s NAV returned -1.6%1 with the share price
moving -1.5%1. The Company’s benchmark, the MSCI EM
Latin America Index, returned -0.5% (on both a gross and net
basis)2 (all performance figures are in sterling terms
with dividends reinvested)
Latin America underperformed
both Emerging and Developed Markets in March as negative returns in
Brazil and Chile dragged on the region. An underweight to
Chile was the largest contributor
to relative performance. From a sector perspective selection in IT
and Energy benefitted the Company. Selection in Brazil, as well as a lack of positioning in
Colombia (the month’s top
performing country) were the main sources of underperformance.
Pockets of performance were felt on a stock specific basis.
Software firm, Linx, was the month’s top performer as the company
reported strong recurring revenues and growth from new initiatives,
particularly from Linx Digital and Linx Payhub. Despite politically
driven volatility impacting the broader Brazilian market, Petrobras
remained resilient on the back of oil price strength. Broadly we
also saw net positive contribution from Mexico as Andrés Manuel López Obrador’s (AMLO)
popularity continues to climb and activity showed signs of
stabilizing. FEMSA and Banco del Bajio were both additive over the month. On
the other hand Brazilian names detracted across sectors. Retailer,
Lojas Americanas, as well as lenders, Bradesco and Itau, were all
among the worst performers amid lacklustre economic activity and
social security reform delays. An off-benchmark position in telecom
name, Oi, was the month’s worst performer. Also detracting was our
lack of positioning in Colombia,
as anchored inflation and a resilient labour market has helped
drive domestic activity.
Positioning was relatively unchanged over the month.
Brazil remains our largest
overweight, however, we continue to actively manage our exposure,
and have recently reallocated some risk away from the country,
selectively adding to Mexico and
keeping some dry powder on the side lines. In Brazil we notably trimmed financials exposure,
while also bringing our position in Ambev to a modest underweight,
following a pick-up in competitive pressures from Heineken. We are
taking advantage of depressed valuations in Mexico to top up positions in FEMSA and
Walmart de Mexico. We also
initiated a position in airport operator GAP, on positive traffic
and commercial revenue outlook. We also added to Argentine
positions on weakness. The portfolio ended the month being
overweight Brazil and Mexico, while being underweight Chile, Peru,
and Colombia. We also maintain an
off-benchmark allocation to Argentina. At the sector level, we are
overweight the domestic consumer and real estate, while being
underweight utilities and financials.
Brazil remains our largest
overweight, given our positive expectations for the incoming
administration. So far President-elect Jair Bolsonaro has delivered
on his campaign promises, looking to reduce the size of government
by initially reducing the number of ministries, naming
sector/subject experts to lead cabinets, and pointing to a
continuation of the reform process initiated two years ago.
Meanwhile, the outlook for upcoming corporate results point to a
continuation in the economic recovery, providing strong momentum
for growth into 2019. Elsewhere, the cancellation of NAIM (the
New Mexico International Airport)
reminded markets of the concerns regarding increasing populism for
the incoming administration in Mexico, reiterating our cautiousness with
Mexican equities. We remain underweight the Andean region due to a
combination of unattractive valuation and disappointing growth.
Finally, the dramatic sell off in Argentina in 2018 leaves the stocks trading at
attractive valuations while interest rates and currency have mostly
stabilized providing a foundation for the economy to rebound from
recent downturn.
Sources:
1BlackRock as at 31 March
2019
2Datastream as at 31 March
2019
16 May 2019
ENDS
Latest information is available by typing
www.blackrock.co.uk/brla 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 the Manager’s website (or
any other website) is incorporated into, or forms part of, this
announcement.