BlackRock Frontiers Investment Trust Plc - Portfolio Update
PR Newswire
LONDON, United Kingdom, January 22
BLACKROCK FRONTIERS INVESTMENT TRUST PLC (LEI: 5493003K5E043LHLO706)
All information is at 31 December 2024 and unaudited.
Performance at month end with net income reinvested.
| One | Three | One | Three | Five | Since |
Sterling: |
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Share price | 6.0 | 9.3 | 16.0 | 37.0 | 46.4 | 165.1 |
Net asset value | 2.3 | 5.9 | 10.6 | 35.6 | 61.8 | 185.6 |
Benchmark (NR)** | 2.8 | 2.1 | 6.0 | 14.6 | 18.1 | 93.6 |
MSCI Frontiers Index (NR) | 1.7 | 5.9 | 11.4 | -2.7 | 15.6 | 88.0 |
MSCI Emerging Markets Index (NR) | 0.0 | -2.8 | 8.0 | 0.7
| 13.5 | 67.1 |
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US Dollars: |
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Share price | 4.5 | 2.1 | 13.9 | 26.7 | 38.5 | 114.0 |
Net asset value | 0.8 | -1.2 | 8.6 | 25.4 | 53.1 | 130.2 |
Benchmark (NR)** | 1.3 | -4.7 | 4.1 | 6.0 | 11.6 | 56.7 |
MSCI Frontiers Index (NR) | 0.2 | -1.2 | 9.4 | -10.0 | 9.3 | 51.0 |
MSCI Emerging Markets Index (NR) | 0.0 | -7.9 | 7.7 | -5.5 | 8.9 | 36.3 |
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 |
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US Dollar |
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Net asset value - capital only: | 205.27c |
Net asset value - cum income: | 212.08c |
Sterling: |
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Net asset value - capital only: | 163.90p |
Net asset value - cum income: | 169.34p |
Share price: | 158.50p |
Total assets (including income): | £320.5m |
Discount to cum-income NAV: | 6.4% |
Gearing: | Nil |
Gearing range (as a % of gross assets): | 0-20% |
Net yield*: | 4.7% |
Ordinary shares in issue**: | 189,270,248 |
Ongoing charges***: | 1.41% |
Ongoing charges plus taxation and performance fee****: | 2.33% |
*The Company's yield based on dividends announced in the last 12 months as at the date of the release of this announcement is 4.7%, and includes the 2024 interim dividend of 3.50 cents per share, declared on 31 May 2024, and paid to shareholders on 01 July 2024 and the final dividend of 6.00 cents per share, declared on 5 December 2024 payable to shareholders on 14 February 2025.
** Excluding 52,522,553 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 30 September 2023.
**** 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 30 September 2024.
Sector | Gross market value as a % of net assets |
| Country | Gross market value as a % of net assets |
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Financials | 42.0 |
| United Arab Emirates | 12.7 |
Industrials | 12.5 |
| Saudi Arabia | 12.5 |
Real Estate | 11.5 |
| Indonesia | 12.2 |
Consumer Discretionary | 10.4 |
| Turkey | 7.2 |
Communication Services | 9.9 |
| Poland | 6.6 |
Materials | 8.7 |
| Philippines | 6.4 |
Information Technology | 8.1 |
| Kazakhstan | 6.3 |
Consumer Staples | 4.2 |
| Hungary | 5.9 |
Health Care | 3.3 |
| Multi-International | 5.1 |
Energy | 1.8 |
| Pakistan | 5.0 |
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| Vietnam | 4.6 |
| 112.4 |
| Greece | 4.3 |
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| Kenya | 4.1 |
Short Positions | -4.0 |
| Bangladesh | 3.1 |
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| Thailand | 3.1 |
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| Malaysia | 2.6 |
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| Singapore | 2.3 |
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| Czech Republic | 2.0 |
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| Georgia | 1.8 |
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| Chile | 1.6 |
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| Egypt | 1.6 |
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| Cambodia | 0.7 |
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| Romania | 0.7 |
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| 112.4 |
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| Short positions | -4.0 ----
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*reflects gross market exposure from contracts for difference (CFDs).
Market Exposure
| 31.01 2024 % | 29.02 2024 % | 31.03 2024 % | 30.04 2024 % | 31.05 2024 % | 30.06 2024 % | 31.07 2024 % | 31.08 2024 % | 30.09 2024 % | 31.10 2024 % | 30.11 2024 % | 31.12 2024 % |
Long | 119.5 | 121.4 | 120.4 | 120.8 | 118.1 | 118.4 | 116.1 | 112.3 | 107.9 | 110.1 | 109.6 | 112.4 |
Short | 3.6 | 3.5 | 2.7 | 2.3 | 2.4 | 2.9 | 3.5 | 3.6 | 3.9 | 3.6 | 3.3 | 4.0 |
Gross | 123.1 | 124.9 | 123.1 | 123.1 | 120.5 | 121.3 | 119.6 | 115.9 | 111.8 | 113.7 | 112.9 | 116.4 |
Net | 115.9 | 117.9 | 117.7 | 118.5 | 115.7 | 115.5 | 112.6 | 108.7 | 104.0 | 106.5 | 106.3 | 108.4 |
Ten Largest Investments
Company | Country of Risk | Gross market value as a % of net assets |
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Al Rajhi Bank | Saudi Arabia | 5.3 |
FPT | Vietnam | 4.6 |
Emaar Properties | United Arab Emirates | 4.5 |
Bank Central Asia | Indonesia | 4.5 |
LPP | Poland | 3.8 |
OTP Bank | Hungary | 3.8 |
Etihad Etisalat | Saudi Arabia | 3.3 |
Kaspi.Kz JCS | Kazakhstan | 3.2 |
Epam Systems | Multi-International | 3.1 |
Turkiye Is Bankasi | Turkey | 3.0 |
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Commenting on the markets, Sam Vecht, Emily Fletcher and Sudaif Niaz, representing the Investment Manager noted:
The Company's NAV rose by 0.8 % in December 2024, underperforming its benchmark the MSCI Frontier + Emerging Markets ex Selected Countries Index ("Benchmark Index") which returned +1.3%. For reference, the MSCI Emerging Markets Index remained flat at 0.0% while the MSCI Frontier Markets Index returned +0.2% over the same period. All performance figures are on a US Dollar basis with net income reinvested.
December was another lackluster month for emerging market equities, with the MSCI EM index trading sideways (-0.1%). Notably however, emerging markets outperformed developed markets as the MSCI World Index fell sharply (-2.6%). Latam (-7.3%) was the worst performing region for a second consecutive month, EM Asia (+0.2%) posted muted gains, and EEMEA (+0.8%) was the best performing region. UAE (+9.1%) was the best performing country in the index.
Although stock selection had a negative impact on the overall portfolio returns, certain stocks performed well. The largest contributor to returns was our position in UAE property developer Emaar Properties (+34.4%). The stock price rose primarily on the back of a higher than expected dividend announcement. Another strong performer was Digiplus Interactive Corporation (+26.3%), the Philippines based gaming conglomerate, on the back of strong activity indicators and plans to expand into other gaming verticals and new markets. Frontken (+10.8%), a Malaysia-based company specialising in providing equipment services to the semiconductor industry, was also additive. Vietnamese IT services provider FPT Corp (+5.6%) also contributed positively.
On the flipside, Kaspi (-11.0%), the Kazakh e-commerce and payments platform, was the biggest detractor, impacted by a weakening KZT. Philippines based resort and casino operator Bloomberry Resorts (-15.3%), continued to detract in December on the back of disappointing quarterly results. Ciputra Development (-9.8%), the Indonesian property developer, extended its losses from November and was another detractor over the month. We maintain our conviction in this stock as demand for their diversified residential portfolio should remain strong in the medium-term and the stock is attractively valued.
We made some changes to the portfolio in December. We topped up our holding in IT services company EPAM systems as we believe the company should see an acceleration in new business flow. We increased our exposure to Turkey by initiating a position in Turkish bank Akbank, and we took some profits in Emaar Properties. We reduced our exposure to Indonesian banks by exiting Bank Negara and rotating into Telkom Indonesia which we believe is near the end of its earnings downgrade cycle and the valuation looks attractive vs history.
We continue to see improving activity levels in some frontier and smaller emerging markets. With inflation falling across many countries within our universe, rate cuts should resume once US bond yields settle down. 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, 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:
1BlackRock as at 31 December 2024
2MSCI as at 31 December 2024
22 January 2025
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.
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