Portfolio Update

BLACKROCK FRONTIERS INVESTMENT TRUST PLC (LEI: 5493003K5E043LHLO706)

All information is at 28 February 2023 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	0.7	7.1	12.1	48.8	4.8	115.3
Net asset value	0.9	1.5	11.7	48.3	12.5	131.9
Benchmark (NR)**	-2.4	-4.6	-0.7	20.9	8.7	78.3
MSCI Frontiers Index (NR)	-0.8	-1.2	-9.8	2.3	-1.8	62.3
MSCI Emerging Markets Index (NR)	-4.9	-2.1	-6.1	8.6	3.6	49.8
US Dollars:
Share price	-0.9	9.0	1.3	41.1	-7.8	68.0
Net asset value	-0.8	3.3	0.9	40.7	-1.0	80.7
Benchmark (NR)**	-4.0	-3.0	-10.4	14.6	-4.5	39.5
MSCI Frontiers Index (NR)	-2.5	0.4	-18.6	-3.1	-13.7	26.0
MSCI Emerging Markets Index (NR)	-6.5	-0.5	-15.3	2.9	-9.0	16.3

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
US Dollar
Net asset value - capital only:	174.94c
Net asset value - cum income:	176.33c
Sterling:
Net asset value - capital only:	144.50p
Net asset value - cum income:	145.65p
Share price:	137.00p
Total assets (including income):	£275.7m
Discount to cum-income NAV:	5.9%
Gearing:	nil
Gearing range (as a % of gross assets):	0-20%
Net yield*:	4.1%
Ordinary shares in issue**:	189,325,748
Ongoing charges***:	1.4%
Ongoing charges plus taxation and performance fee****:	1.4%

*The Company’s yield based on dividends announced in the last 12 months as at the date of the release of this announcement is 4.1% and includes the 2022 interim dividend of 2.75 cents per share, declared on 26 May 2022, and paid to shareholders on 24 June 2022 and the 2022 final dividend of 4.25 cents per share, declared on 8 December 2022, and payable to shareholders on 19 January 2023.

** 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 30 September 2022.

**** 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 2022.

Sector Analysis	Gross market value as a % of net assets		Country Analysis	Gross market value as a % of net assets
Financials	41.4		Saudi Arabia	17.8
Energy	14.0		Indonesia	17.2
Consumer Discretionary	11.6		Vietnam	8.7
Materials	10.9		Kazakhstan	7.6
Industrials	10.5		Thailand	7.5
Consumer Staples	10.2		Hungary	6.9
Information Technology	5.4		United Arab Emirates	6.1
Communication Services	3.7		Chile	5.9
Real Estate	2.6		Greece	5.3
Health Care	1.6		Malaysia	4.6
	-----		Poland	3.4
	111.9		Egypt	2.7
	-----		Qatar	2.6
Short positions	-3.9		Argentina	2.5
	=====		Philippines	2.1
			Panama	2.1
			Peru	1.7
			Georgia	1.6
			Colombia	1.6
			Romania	1.4
			Kuwait	1.3
			Kenya	0.7
			Ukraine	0.6
				-----
			Total	111.9
				-----
			Short positions	-3.9
				=====

*reflects gross market exposure from contracts for difference (CFDs).

Market Exposure
 

	31.03  2022    %	30.04  2022   %	31.05  2022   %	30.06  2022   %	31.07  2022   %	31.08  2022   %	30.09  2022    %	31.10  2022   %	30.11  2022   %	31.12  2022   %	31.01  2023   %	28.02  2023   %
Long	111.1	110.6	107.9	106.1	107.3	107.3	106.2	107.4	106.2	110.7	112.4	111.9
Short	2.3	1.8	4.7	4.6	6.2	5.3	5.2	5.3	4.8	4.9	5.1	3.9
Gross	113.4	112.4	112.6	110.7	113.5	112.6	111.4	112.7	111.0	115.6	117.5	115.8
Net	108.8	108.8	103.2	101.5	101.1	102.0	101.0	102.1	101.4	105.8	107.3	108.0

Ten Largest Investments

Company	Country of Risk	Gross market value as a % of net assets
Bank Central Asia	Indonesia	5.0
Astra International	Indonesia	3.6
PKO Bank Polski	Poland	3.4
National Bank of Greece	Greece	3.2
Saudi National Bank	Saudi Arabia	3.2
OTP Bank	Hungary	3.1
Abdullah Al Othaim Markets	Saudi Arabia	3.0
Genting Malaysia	Malaysia	3.0
JSC Kaspi	Kazakhstan	2.9
FPT	Vietnam	2.9

Commenting on the markets, Sam Vecht, Emily Fletcher and Sudaif Niaz, representing the Investment Manager noted:
 

The Company’s NAV was down by 0.8% in February, outperforming its benchmark, the MSCI Emerging ex Selected Countries + Frontier Markets + Saudi Arabia Index (“Benchmark Index”) which fell by 4.0%. For reference, the MSCI Emerging Markets Index ended the month down by 6.5% and the MSCI Frontier Markets Index was down by 2.5% over the same period. All performance figures are on a US Dollar basis with net income reinvested.

Markets across the board gave back gains after a strong January. In emerging markets, China was the key driver as US-China tensons re-escalated and expectations lowered around growth targets in the National People’s Congress. Parts of the frontier complex were also impacted by the spillover of Chinese sentiment – particularly South-East Asia where Vietnam (-11%), Thailand (-9%), Malaysia (-7%) and the Philippines (-5%). In Eastern Europe, we saw continued positive momentum from January, with Greece up by 9%. The picture in the Middle East was more mixed; Saudi Arabia (-7%) notably edged lower led by its banking sector. The Turkish market rallied in February despite the recent tragic earthquakes in the south of the country as the government announced explicit support for the stock market. We currently have no exposure in Turkey.

In terms of portfolio performance, National Bank of Greece (+19%) was the top performer. The stock has continued to do well in a rising rate environment and benefited from strong loan growth. Mitra Adiperkasa rose by 14% on back of improved consumer sentiment in Indonesia. Vista Energy (+13%) did well as it reported strong results and shared an optimistic outlook with the market. Saudi grocery operator, Abdullah Al Othaim (+10%), was also additive given strong operating results and as the company returned capital to shareholders as it continues to sell off non-core real estate assets.

On the other side, Vietnamese exposure detracted from performance, both brokerage SSI Securities (-17%) and Vietnam Technological and Commercial Bank (-14%) fell in line with the broader Vietnamese market. Resort operator Genting Malaysia (-10%) also hurt relative returns as cash generation remained weak.

We made a few changes to the portfolio in February. We took some profit in Emaar Properties and PKO Bank. We recycled our Saudi Arabia financials exposure into more preferred petrochemicals and oil services companies. We also added to Abdullah Al Othaim. We exited Ukrainian iron ore producer Ferrexpo over concerns of further escalation in the Russia-Ukraine conflict.

Our team sees a marked contrast in the monetary and fiscal policy decisions taken in small emerging/frontier versus developed markets in the post pandemic years and find significant value in currencies and equity markets across our investment opportunity set. We are optimistic over the long-term in our under-researched investment universe which should enable compelling alpha opportunities.

Sources:

¹BlackRock as at 28 February 2023

²MSCI as at 28 February 2023

17 March 2023

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.