The information contained in this release was correct as at
31 December 2021.
Information on the Company’s up to date net asset values can be
found on the London Stock Exchange Website at
https://www.londonstockexchange.com/exchange/news/market-news/market-news-home.html.
BLACKROCK FRONTIERS INVESTMENT TRUST
PLC (LEI: 5493003K5E043LHLO706)
All information is at 31 December
2021 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 |
1.3 |
7.6 |
12.9 |
10.7 |
24.7 |
93.6 |
Net asset value |
0.2 |
1.9 |
19.2 |
20.7 |
30.3 |
110.7 |
Benchmark (NR)** |
0.6 |
0.9 |
11.9 |
5.0 |
26.8 |
68.9 |
MSCI Frontiers Index
(NR) |
-0.9 |
0.3 |
20.8 |
34.7 |
44.1 |
93.2 |
MSCI Emerging Markets
Index (NR) |
-0.5 |
-1.8 |
-1.6 |
28.4 |
46.1 |
66.0 |
|
|
|
|
|
|
|
US Dollars: |
|
|
|
|
|
|
Share price |
3.8 |
8.0 |
11.9 |
17.8 |
36.9 |
68.9 |
Net asset value |
2.6 |
2.3 |
18.2 |
28.5 |
43.0 |
83.5 |
Benchmark (NR)** |
3.0 |
1.3 |
10.9 |
11.7 |
39.0 |
47.9 |
MSCI Frontiers Index
(NR) |
1.5 |
0.7 |
19.7 |
43.3 |
57.9 |
67.9 |
MSCI Emerging Markets
Index (NR) |
1.9 |
-1.3 |
-2.5 |
36.6 |
60.1 |
44.2 |
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: |
185.79c |
Net asset value - cum
income: |
190.69c |
Sterling: |
|
Net asset value -
capital only: |
137.17p |
Net asset value - cum
income: |
140.79p |
Share price: |
131.75p |
Total assets (including
income): |
£266.5m |
Discount to cum-income
NAV: |
6.4% |
Gearing: |
nil |
Gearing range (as a %
of gross assets): |
0-20% |
Net yield*: |
3.2% |
Ordinary shares in
issue**: |
189,325,748 |
Ongoing
charges***: |
1.4% |
Ongoing charges plus
taxation and performance fee: |
2.4% |
*The Company’s yield based on dividends announced in the last 12
months as at the date of the release of this announcement is 3.2%
and includes the 2021 interim dividend of 2.75 cents per share, announced on 01 June 2021 and paid to shareholders on
25 June 2021. Also included is the
2021 final dividend of 4.25 cents per
share, declared on 1 December 2021,
with pay date 11 February 2022.
** Excluding 52,497,053 ordinary 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 30 September 2021.
Sector
Analysis |
Gross
market value as a % of net assets |
|
Country
Analysis |
Gross
market value as a % of net assets |
|
|
|
|
|
Financials |
37.8 |
|
Saudi Arabia |
17.1 |
Consumer
Discretionary |
17.7 |
|
Indonesia |
12.8 |
Industrials |
15.9 |
|
Vietnam |
8.5 |
Materials |
8.2 |
|
Thailand |
7.8 |
Consumer Staples |
6.1 |
|
Greece |
7.0 |
Information
Technology |
4.8 |
|
United Arab
Emirates |
6.5 |
Real Estate |
4.2 |
|
Egypt |
5.7 |
Health Care |
4.0 |
|
Malaysia |
5.4 |
Energy |
2.8 |
|
Kazakhstan |
5.4 |
Utilities |
1.5 |
|
Philippines |
5.0 |
Communication
Services |
1.3 |
|
Poland |
4.2 |
|
----- |
|
Chile |
4.0 |
|
104.3 |
|
Qatar |
2.9 |
|
----- |
|
Hungary |
2.6 |
Short positions |
-1.0 |
|
Kenya |
2.2 |
|
===== |
|
Peru |
2.1 |
|
|
|
Romania |
1.8 |
|
|
|
Panama |
1.5 |
|
|
|
Pakistan |
1.4 |
|
|
|
Nigeria |
0.4 |
|
|
|
|
----- |
|
|
|
Total |
104.3 |
|
|
|
|
----- |
|
|
|
Short positions |
-1.0 |
|
|
|
|
===== |
*reflects gross market exposure from contracts for difference
(CFDs).
Market Exposure
|
31.01
2021
% |
28.02
2021
% |
31.03
2021
% |
30.04
2021
% |
31.05
2021
% |
30.06
2021
% |
31.07
2021
% |
31.08
2021
% |
30.09
2021
% |
31.10
2021
% |
30.11
2021
% |
31.12
2021
% |
Long |
110.5 |
114.0 |
105.7 |
108.5 |
105.3 |
106.8 |
107.1 |
104.2 |
108.1 |
110.6 |
106.3 |
104.3 |
Short |
1.1 |
4.5 |
3.4 |
2.5 |
2.3 |
4.6 |
2.3 |
0.6 |
0.4 |
0.4 |
0.4 |
1.0 |
Gross |
111.6 |
118.5 |
109.1 |
111.0 |
107.6 |
111.4 |
109.4 |
104.8 |
108.5 |
111.0 |
106.7 |
105.3 |
Net |
109.4 |
109.5 |
102.3 |
106.0 |
103.0 |
102.2 |
104.8 |
103.6 |
107.7 |
110.2 |
105.9 |
103.3 |
Ten Largest Investments
Company |
Country of Risk |
Gross market value
as a % of net assets |
|
|
|
Saudi National Bank |
Saudi Arabia |
4.9 |
Bank Rakyat |
Indonesia |
4.0 |
Mobile World |
Vietnam |
3.4 |
Saudi British Bank |
Saudi Arabia |
3.2 |
Emaar Properties |
United Arab Emirates |
3.2 |
FPT |
Vietnam |
3.1 |
United International Transport |
Saudi Arabia |
2.9 |
LPP |
Poland |
2.8 |
JSC Kaspi |
Kazakhstan |
2.8 |
Indocement Tunggal Prakarsa |
Indonesia |
2.7 |
Commenting on the markets, Sam
Vecht and Emily Fletcher,
representing the Investment Manager noted:
The Company’s NAV returned +2.6% versus its benchmark the MSCI
Emerging ex Selected Countries + Frontier Markets + Saudi Arabia
Index (“Benchmark Index”), which returned +3.0% in December. For
reference, the MSCI Emerging Markets Index ended the month +1.9%
and the MSCI Frontier Markets Index +1.5% over the same period. For
the full calendar year 2021, the Company’s NAV returned +18.2%,
significantly outperforming its benchmark index which was up 10.9%.
For reference, the MSCI Emerging Markets Index finished 2021 down
2.5%, while MSCI Frontier Markets Index returned +19.7% (all
performance figures are on a US Dollar basis with net income
reinvested).
Our stock selection in Poland
was the largest contributor to returns over the month driven by
Polish retailer, LPP (+32%) which has benefited from consumer
recovery in Central and Eastern
Europe and delivered strong earnings results. Our position
in Indonesian cement producer, Indocement (+15%), contributed
positively, as the correction in coal price and reopening outlook
benefited the company. The position in National Bank of
Greece (+12%) also did well as the
company reported better than expected results, showing very low
levels of loan quality deterioration post Covid-19.
On the other side, Kazakh e-commerce and fintech platform, Kaspi
(-10%), gave back some performance after a strong year. Post month
end, Kazakhstan has seen
significant violent protests following fuel price hikes. As of
January 10th, Kazakh security forces
have restored calm in Almaty, with
some backing from Russian troops and stock prices have bounced off
their lows.
Philippines casino and resort
operator, Bloomberry Resorts (-20%), was the biggest detractor as
the renewed surge in Covid-19 globally raised the risk of further
lock down extensions. Chilean lithium producer, Albemarle (-12%),
also sold off following the election results given President
Boric’s hawkish stance on the privatization of lithium. Boric ran
his campaign on a promise to “bury” the neoliberal economic model.
We believe the stock is oversold and continue to like it.
It is worth highlighting events in Turkey, where the central bank cut its
benchmark lending rate for the fourth month in a row despite
consistently high inflation prints. The country’s deeply negative
real interest rates have put huge pressure on the Turkish lira,
which is down close 40% against the dollar since the central bank
began lowering borrowing costs in September. On 20th December, in
an unexpected turn of events, the Turkish government announced an
FX protection option for local retail investors, under which, if
they keep their deposits in lira, in addition to the interest, they
would be compensated for any FX depreciation. While this did
trigger a short-term rally in the lira, we continue to believe this
unorthodox policy is unlikely to be effective in restoring
confidence in the currency or economy. We currently have no
exposure to the market.
We made relatively few changes to the portfolio in December. We
trimmed our position in AKR Corpindo, a logistics and supply chain
company in Indonesia, on the back
of strong performance and in light of potential Omicron-related
disruption.
Whilst the Omicron variant spread rapidly around the globe in
December, markets generally looked past it as it became clear that
while the variant is more transmissible, it seems less dangerous in
severity.
Overall, for countries that have stable macro environments and
have made timely progress in vaccination rollouts, we believe the
global macro recovery provides a favourable backdrop to recover
lost economic productivity. Valuations in a lot of the frontier end
emerging markets remain attractive relative to their own history
and also relative to the more evolved markets. We believe our
opportunity set is a compelling universe to generate alpha.
Sources:
1BlackRock as at 31 December
2021
2MSCI as at 31 December
2021
21 January 2022
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.