Last checked at 16 Mar 2017 16:45
BLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC - Portfolio UpdateBLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC - Portfolio Update
PR Newswire
London, March 16
BLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC (LEI: UK9OG5Q0CYUDFGRX4151)All information is at 28 February 2017 and unaudited.Performance at month end with net income reinvested
| One month % | Three months % | One year % | Three years % | Five years % | ^^Since 31.03.06 % | |
| Sterling: | ||||||
| Net asset value^ | 3.4 | 12.8 | 59.9 | 27.4 | -9.9 | 84.8 |
| Share price | 4.5 | 13.5 | 60.1 | 23.0 | -12.8 | 70.9 |
| MSCI EM Latin America | 4.7 | 13.0 | 65.8 | 30.3 | -8.6 | 103.1 |
| US Dollars: | ||||||
| Net asset value^ | 2.3 | 12.3 | 42.7 | -5.4 | -29.7 | 32.7 |
| Share price | 3.3 | 13.0 | 42.9 | -8.7 | -32.0 | 22.7 |
| MSCI EM Latin America | 3.6 | 12.5 | 48.0 | -3.3 | -28.8 | 45.7 |
^cum income
^^Date which BlackRock took over the investment management of the Company.
Sources: BlackRock, Standard & Poor’s Micropal
| At month end | |
| Net asset value – capital only: | 498.71p |
| Net asset value – cum income: | 509.16p |
| Share price: | 440.00p |
| Total Assets#: | £206.9m |
| Discount (share price to cum income NAV): | 13.6% |
| Average discount* over the month – cum income: | 14.4% |
| Net gearing at month end**: | 3.9% |
| Gearing range (as a % of net assets): | 0-25% |
| Net yield##: | 2.1% |
| Ordinary shares in issue***: | 39,369,620 |
| Ongoing charges****: | 1.2% |
#Total assets include current year revenue.
## calculated using total dividends declared in the last 12 months as at the date of this announcement as a percentage of month end share price.
\* 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.
***Excluding 2,071,662 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 December 2016.Geographic Exposure
| % of Total Assets | % of Equity Portfolio * | MSCI EM Latin American Index | ||
| Brazil | 67.8 | 67.3 | 60.1 | |
| Mexico | 22.8 | 22.6 | 25.3 | |
| Peru | 4.3 | 4.3 | 2.8 | |
| Argentina | 3.5 | 3.4 | 0.0 | |
| Chile | 1.5 | 1.5 | 8.7 | |
| Colombia | 0.8 | 0.9 | 3.1 | |
| Net current liabilities (inc.Fixed interest) | -0.7 | 0.0 | 0.0 | |
| ----- | ----- | ----- | ||
| Total | 100.0 | 100.0 | 100.0 | |
| ----- | ----- | ----- |
| Sector | % of Equity Portfolio * | % of Benchmark |
| Financials | 29.5 | 30.9 |
| Consumer Staples | 19.4 | 16.5 |
| Materials | 15.3 | 15.9 |
| Energy | 13.3 | 8.7 |
| Industrials | 6.5 | 6.4 |
| Telecommunication Services | 4.8 | 5.5 |
| Utilities | 4.1 | 6.5 |
| Consumer Discretionary | 3.9 | 5.8 |
| Information Technology | 2.2 | 1.5 |
| Real Estate | 1.0 | 1.4 |
| Health Care | 0.0 | 0.9 |
| ----- | ----- | |
| Total | 100.0 | 100.0 |
| ----- | ----- |
*excluding net current liabilities & fixed interestTen Largest Equity Investments (in percentage order)
| Company | Country of Risk | % of Equity Portfolio | % of Benchmark |
| Petrobras | Brazil | 9.6 | 5.9 |
| Banco Bradesco | Brazil | 8.7 | 6.6 |
| Itau Unibanco | Brazil | 7.7 | 7.1 |
| Vale | Brazil | 6.3 | 5.7 |
| AmBev | Brazil | 3.9 | 4.6 |
| BM&F Bovespa | Brazil | 3.7 | 1.8 |
| Femsa | Mexico | 3.5 | 2.5 |
| Telefonica Brasil | Brazil | 2.9 | 1.1 |
| Grupo Mexico | Mexico | 2.8 | 2.0 |
| Kroton Educacional | Brazil | 2.7 | 1.0 |
Commenting on the markets, Will Landers, representing the Investment Manager noted;
Performance
For the month of February 2017, the Company’s NAV rose by 3.4% and the share price rose by 4.5%, while the Company’s benchmark, the MSCI EM Latin America Index rose by 4.7% (all performance figures are in sterling terms).
At the country level, there were no material contributors to performance. An overweight to Brazilian railroad operator Rumo Logistica was the largest individual contributor. Despite expected weak 4Q16 returns, the market reacted positively to the better than expected guidance for volume growth, capex and harvest growth. An overweight to Brazilian toll road operator CCR added positively to performance on the back of a successful follow-on offering amid a more favourable environment, particularly falling interest rates in Brazil. Stock selection in Brazil was the largest detractor from returns. Stock selection in Mexico also weighed on returns. An overweight to Petrobras was the largest individual detractor from performance. The stock suffered after lowering gasoline/diesel prices during the month. A lack of exposure to Mexican broadcaster Televisa also detracted from performance.
Transactions/Gearing
During the month we added to Petrobras given positive news on regulation in Brazil and potential for further asset sales. We also added to Vale after the stock gave up all its gains from the corporation announcement during the month. These moves were partially funded by reducing exposure to Brazilian bank Banco Bradesco as the stock nears our price target. We reduced our position in Klabin given lower prospects for earnings growth under a stronger Brazilian Real scenario. Finally, we participated in the re-IPO of Cementos de Chihuahua given the company’s leading presence in the cement markets it participates in, especially in the US.
Net gearing was approximately 3.9% at the end of February.
Positioning
The portfolio is positioned to benefit from the gradual turnaround of the Brazilian economy, fueled by the ongoing fiscal reform (pension reform is next on the agenda) as well as the faster pace of rate cuts by the Central Bank. Mexico remains an underweight given the uncertainties around trade policy with the US under President Trump. Peru and Argentina continue to be favoured over Chile and Colombia. Overall, we maintain a portfolio that should benefit from a continuation of the positive performance of Latin American equities over the past few quarters.
16 March 2017
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.