Last checked at 12 May 2017 10:41
BlackRock Income and Growth Investment Trust Plc - Portfolio UpdateBlackRock Income and Growth Investment Trust Plc - Portfolio Update
PR Newswire
London, May 12
| BLACKROCK INCOME AND GROWTH INVESTMENT TRUST PLC (LEI:5493003YBY59H9EJLJ16) |
| All information is at 30 April 2017 and unaudited. |
| Performance at month end with net income reinvested |
| One Month | Three Months | One Year | Three Years | Five Years | Since 1 April 2012 | |||||
| Sterling | ||||||||||
| Share price | -0.3% | 4.9% | 16.0% | 32.2% | 78.1% | 78.7% | ||||
| Net asset value | 0.9% | 6.6% | 17.7% | 32.8% | 68.3% | 68.1% | ||||
| FTSE All-Share Total Return | -0.4% | 4.0% | 20.1% | 21.8% | 58.6% | 58.1% | ||||
| Source: BlackRock | ||||||||||
| BlackRock took over the investment management of the Company with effect from 1 April 2012. | ||||||||||
| At month end | ||||||||||
| Sterling: | ||||||||||
| Net asset value - capital only: | 200.44p | |||||||||
| Net asset value - cum income*: | 203.39p | |||||||||
| Share price: | 197.50p | |||||||||
| Total assets (including income): | £53.6m | |||||||||
| Discount to cum-income NAV: | 2.9% | |||||||||
| Net gearing: | 1.7% | |||||||||
| Net yield**: | 3.2% | |||||||||
| Ordinary shares in issue***: | 25,354,268 | |||||||||
| Gearing range (as a % of net assets): | 0-20% | |||||||||
| Ongoing charges****: | 1.0% | |||||||||
| * includes net revenue of 2.95 pence per share | ||||||||||
| ** The Company’s yield based on dividends announced in the last 12 months as at the date of the release of this announcement is 3.2% and includes the 2016 final dividend of 3.90p per share declared on 21 December 2016 and paid to shareholders on 10 March 2017 and the 2016 interim dividend of 2.40p per share announced on 29 June 2016 and paid to shareholders on 2 September 2016. | ||||||||||
| *** excludes 7,579,664 shares held in treasury | ||||||||||
| **** Calculated as a percentage of average net assets and using expenses, excluding performance fees and interest costs for the year ended 31 October 2016. | ||||||||||
| Sector Analysis | Total assets (%) | |||||||||
| Media | 9.6 | |||||||||
| Support Services | 7.9 | |||||||||
| Tobacco | 7.8 | |||||||||
| Banks | 7.5 | |||||||||
| Travel & Leisure | 7.3 | |||||||||
| Financial Services | 6.9 | |||||||||
| Pharmaceuticals & Biotechnology | 6.6 | |||||||||
| Oil & Gas Producers | 5.6 | |||||||||
| Food Producers | 5.5 | |||||||||
| Non-Life Insurance | 4.6 | |||||||||
| General Retailers | 4.4 | |||||||||
| General Industrials | 3.6 | |||||||||
| Mobile Telecommunications | 3.1 | |||||||||
| Fixed Line Telecommunications | 3.1 | |||||||||
| Construction & Materials | 2.8 | |||||||||
| Aerospace & Defence | 2.5 | |||||||||
| Food & Drug Retailers | 2.3 | |||||||||
| Real Estate Investment & Services | 2.0 | |||||||||
| Chemicals | 1.5 | |||||||||
| Household Goods & Home Construction | 1.5 | |||||||||
| Real Estate Investment Trusts | 1.0 | |||||||||
| Industrial Engineering | 0.8 | |||||||||
| Net Current Assets | 2.1 | |||||||||
| ------ | ||||||||||
| Total | 100.0 | |||||||||
| ====== | ||||||||||
| Ten Largest Equity Investments | ||||||||||
| Company | Total assets (%) | |||||||||
| British American Tobacco | 6.7 | |||||||||
| Unilever | 5.5 | |||||||||
| Lloyds Banking Group | 5.0 | |||||||||
| RELX | 3.9 | |||||||||
| Sky | 3.6 | |||||||||
| Royal Dutch Shell ‘B’ | 3.2 | |||||||||
| Rentokil Initial | 3.1 | |||||||||
| Vodafone | 3.1 | |||||||||
| BT Group | 3.1 | |||||||||
| John Laing Group | 2.9 | |||||||||
| Commenting on the markets, Adam Avigdori and Mark Wharrier representing the Investment Manager noted: | ||||||||||
| The FTSE All Share index returned -0.4% in April and is up 3.6% YTD. The Pound surged after Prime Minister Theresa May called for a snap General Election to be held in June. Resources and international earners lagged during the month, including the oil, mining and pharmaceutical sectors, due to sterling strength and commodity price weakness. Large caps trailed mid-caps with the FTSE 100 falling -1.3% while the FTSE 250 index rose 3.8%. The result of the first round of the French elections gave a boost to European exposed companies. The travel & leisure, real estate and financial services sectors all performed well. | ||||||||||
| The BlackRock Income and Growth had another positive month in April, returning 0.9% and outperforming the FTSE All-Share by 0.5%. | ||||||||||
| John Laing Group was the largest contributor to performance in April as full year results confirmed a 14% rise in NAV with strong underlying cash generation supporting a special dividend. | ||||||||||
| We have also seen positive contribution from Lloyds Banking Group where strong capital generation is supportive of dividend growth going forward. The company currently has a dividend yield of 4.5% and we expect this to grow materially over the coming years. The drag from legacy PPI related issues is now reducing and the core business is performing well. Overall recent results support our investment thesis that the business is improving itself and is attractively valued given our expectations of future dividend growth. | ||||||||||
| Elementis was another positive contributor this month following a trading statement which showed strength across the majority of their business, notably in personal care and energy. Their coatings business has also started the year well and there are some indications of improved demand in Chromium outside the US. | ||||||||||
| BT Group was the largest detractor this month as concerns crept in around a fall in earnings since early 2016 and risks around pricing in Openreach, the network arm of the company. We remain happy to hold this stock and believe the 5.5% yield is well supported in pretty much all scenarios. Negative performance also came through from not holding Prudential which has shown strong profits of late. | ||||||||||
| Over the course of the month we purchased a position in Premier Asset Management Group and sold out of Essentra due to concerns around trading which remains under pressure with modest revenue declines. | ||||||||||
| As ever, we remain believers that over the longer-term earnings and cashflow growth tend to be the dominant driver of share prices and where equity markets fail to recognise that, corporates buyers have the potential to exploit the opportunity; the bid for Unilever earlier this year was a good reminder of that dynamic as was the bid for both Sky and for ARM Holdings last year. With a combination of continued sterling weakness and a low rate environment fuelling cheap debt, we believe that M&A activity will remain a theme throughout the year. Markets are likely to remain skittish given macro headwinds, likely volatility in bond markets and an increasing level of political risks. However, we continue to find opportunities in those companies that can generate cashflow from strong business models, have favourable industry characteristics or scope for management driven self-help. While sometimes unnerving, we will continue to use market volatility to provide buying opportunities in those types of companies. | ||||||||||
| 12 May 2017 | ||||||||||