BlackRock Frontiers Investment Trust Plc - Portfolio Update
All information is at
Performance at month end with net income reinvested.
One Three One Three Five Since month months year years years Launch* % % % % % % Sterling: Share price 1.0 -2.6 15.5 42.6 40.5 145.4 Net asset value -2.2 -3.7 11.2 40.0 43.9 163.3 Benchmark (NR)** -3.4 -3.9 2.9 17.3 7.0 81.1 MSCI Frontiers Index (NR) 2.0 4.2 11.8 4.0 13.0 79.1 MSCI Emerging Markets Index (NR) -1.1 2.8 9.4 -7.1 17.960.3 US Dollars: Share price 2.7 -2.0 18.6 28.1 42.0 101.4 Net asset value -0.5 -3.1 14.2 25.8 45.4 115.8 Benchmark (NR)** -1.8 -3.3 5.7 5.0 8.0 49.0 MSCI Frontiers Index (NR) 3.8 4.8 14.9 -6.9 14.1 46.2 MSCI Emerging Markets Index (NR) 0.6 3.5 12.4 -16.6 19.0 30.9
Sources: BlackRock and Standard & Poor’s Micropal
*
** 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: 194.42c Net asset value - cum income: 202.26c Sterling: Net asset value - capital only: 152.70p Net asset value - cum income: 158.86p Share price: 149.50p Total assets (including income): £300.8m Discount to cum-income NAV: 5.9% Gearing: Nil Gearing range (as a % of gross assets): 0-20% Net yield*: 4.4% Ordinary shares in issue**: 189,325,748 Ongoing charges***: 1.38% Ongoing charges plus taxation and performance fee****: 3.78%
*The Company’s yield based on dividends announced in the last 12 months as at the date of the release of this announcement is 4.4%, and includes the 2023 final dividend of
** Excluding 52,497,053 ordinary shares held in treasury.
***The Company’s ongoing charges are calculated as a percentage of average daily net assets and using the management fee and all other operating expenses excluding performance fees, finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain non-recurring items for Year ended
**** The Company’s ongoing charges are calculated as a percentage of average daily net assets and using the management fee and all other operating expenses and including performance fees but excluding finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain non-recurring items for Year ended
Sector Gross market value Country Gross market value Analysis as a % of net assets Analysis as a % of net assets Financials 45.4 Saudi Arabia 15.6 Industrials 12.7 Indonesia 12.7 Energy 11.9 Kazakhstan 8.3 Materials 10.0 Philippines 8.2 Consumer Staples 9.1 United Arab Emirates 7.8 Real Estate 8.5 Hungary 7.3 Communication 7.1 Greece 6.1 Services Consumer 6.8 Poland 6.1 Discretionary Information 4.9 Turkey 4.9 Technology Health Care 0.9 Qatar 4.7 Utilities 0.8 Kenya 3.9 ----- Thailand 3.9 118.1 Argentina 3.5 ----- Czech Republic 3.5 Short positions -2.4 Pakistan 3.1 Vietnam 3.1 Malaysia 2.4 Singapore 2.3 Colombia 2.3 1.8 Chile 1.7 Multi-International 1.3 Georgia 1.1 Egypt 1.1 Cambodia 0.7 Bangladesh 0.5 Romania 0.2 Nigeria ----- 118.1 ---- Short positions -2.4 =====
*reflects gross market exposure from contracts for difference (CFDs).
Market Exposure
30.06 31.07 31.08 30.09 31.10 30.11 31.12 31.01 29.02 31.03 30.04 31.05 2023 2023 2023 2023 2023 2023 2023 2024 2024 2024 2024 2024 % % % % % % % % % % % % Long 116.9 113.0 113.3 114.9 118.8 113.1 116.6 119.5 121.4 120.4 120.8 118.1 Short 4.0 3.0 3.0 3.0 3.1 4.6 4.7 3.6 3.5 2.7 2.3 2.4 Gross 120.9 116.0 116.3 117.9 121.9 118.0 121.3 123.1 124.9 123.1 123.1 120.5 Net 112.9 110.0 110.3 111.9 115.7 108.8 111.9 115.9 117.9 117.7 118.5 115.7
Ten Largest Investments
Company Country of Risk Gross market value as a % of net assets Bank Central Asia Indonesia 4.4 Emaar Properties United Arab Emirates 4.2 Saudi National Bank Saudi Arabia 4.2 Kaspi.Kz JCS Kazakhstan 3.9 FPT Vietnam 3.1 Wizz Air Holdings Hungary 2.9 Jeronimo Martins Poland 2.9 Athens International Airport Greece 2.6 Vista Oil & Gas Argentina 2.5 CP All Thailand 2.5
Commenting on the markets,
The Company’s NAV fell by 0.5 % in May, outperforming its benchmark the MSCI Emerging ex Selected Countries + Frontier Markets + Saudi Arabia Index (“Benchmark Index”) which returned -1.8%. For reference, the MSCI Emerging Markets Index was up 0.6% while the MSCI Frontier Markets Index was up 3.8% over the same period. All performance figures are on a US Dollar basis with net income reinvested.
Emerging Markets posted flattish returns (+0.6%) in May, significantly underperforming Developed Markets (+4.5%). EMEA (-2.4%) underperformed against the broader index, with significant performance dispersion across markets.
Several stock picks did well in May. The Polish supermarket chain
On the flipside, Bank of Georgia (-30.0%) was the worst performer. The stock detracted after the passing of the Georgian Foreign Agents bill, which requires media and non-governmental organisations with over 20% foreign funding to register as foreign agents, undergo strict audits or incur fines. We reduced our exposure to the name over the month and we are monitoring the situation closely. IT services company EPAM (-24.4%) was another detractor, as the weaker full year guidance continued to weigh on the stock. Indonesian retailer Mitra Adiperkasa (-19.3%) also detracted on concerns around earnings growth.
Over the course of May, we made some changes to the portfolio. We initiated a position in
Isbank in
As higher global rates continue to feed through into the real economy, we expect some moderation of demand in developed markets. We note slowing credit growth in particular in the US. In contrast, we continue to see improving activity levels in frontier and smaller emerging markets. With inflation falling across many countries within our universe, rate cuts have started to materialize in some areas of our universe. This is a good set up for domestically oriented economies to see a cyclical pick up. We remain positive on the outlook for small emerging and frontier markets versus developed markets, and we find significant value in currencies and equity markets across our investment opportunity set. Our investment universe, in absolute and relative terms, remains under-researched and we believe this should enable compelling alpha opportunities.
Sources:
1
BlackRock as at
2
MSCI as at
ENDS
Latest information is available by typing www.blackrock.com/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.
Release
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