Portfolio Update

BLACKROCK FRONTIERS INVESTMENT TRUST PLC (LEI: 5493003K5E043LHLO706)

All information is at 30 November 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	4.1	-3.1	11.4	43.7	25.0	123.8
Net asset value	2.2	-2.5	8.3	48.1	38.3	147.5
Benchmark (NR)**	1.3	-2.0	-5.8	19.0	9.0	76.1
MSCI Frontiers Index (NR)	2.7	-2.8	0.4	6.5	11.9	65.0
MSCI Emerging Markets Index (NR)	3.5	1.2	-2.0	-6.8	13.1	50.0
US Dollars:
Share price	8.6	-3.2	18.5	36.4	24.2	82.7
Net asset value	6.6	-2.6	15.3	40.5	37.4	101.7
Benchmark (NR)**	5.7	-2.1	0.1	12.8	8.2	44.1
MSCI Frontiers Index (NR)	7.1	-2.9	6.7	1.0	11.0	33.9
MSCI Emerging Markets Index (NR)	8.0	1.1	4.2	-11.6	12.3	21.8

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:	188.18c
Net asset value - cum income:	193.68c
Sterling:
Net asset value - capital only:	148.64p
Net asset value - cum income:	152.99p
Share price:	140.00p
Total assets (including income):	£289.6m
Discount to cum-income NAV:	8.5%
Gearing:	Nil
Gearing range (as a % of gross assets):	0-20%
Net yield*:	4.5%
Ordinary shares in issue**:	189,325,748
Ongoing charges***:	1.38%
Ongoing charges plus taxation and performance fee****:	3.78%

*The Company’s yield based on dividends announced in the last 12 months as at the date of the release of this announcement is 4.5% and includes the 2023 interim dividend of 3.10 cents per share, declared on 6 June 2023, and paid to shareholders on 7 July 2023 and the 2023 final dividend of 4.90 cents per share, declared on 30 November 2023, and payable to shareholders on 14 February 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 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 2023.

Sector Analysis	Gross market value as a % of net assets		Country Analysis	Gross market value as a % of net assets
Financials	39.3		Indonesia	13.7
Energy	14.6		Saudi Arabia	11.6
Industrials	13.5		United Arab Emirates	8.7
Materials	12.2		Philippines	7.7
Consumer Staples	9.8		Kazakhstan	7.1
Consumer Discretionary	6.9		Thailand	6.3
Real Estate	6.5		Hungary	6.2
Information Technology	5.4		Vietnam	5.7
Communication Services	4.8		Chile	5.2
Health Care	0.4		Poland	4.8
	-----		Malaysia	4.5
	113.4		Colombia	4.2
	-----		Greece	4.0
Short positions	-4.6		Qatar	3.9
	=====		Turkey	2.9
			Multi-International	2.6
			Argentina	2.5
			Czech Republic	2.1
			Georgia	1.9
			Peru	1.6
			Romania	1.3
			Kuwait	1.1
			Cambodia Oman Ukraine Kenya Bangladesh Total	1.0 1.0 0.9 0.5 0.4 113.4
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			Short positions	-4.6
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*reflects gross market exposure from contracts for difference (CFDs).

Market Exposure
 

	31.12  2022     %	31.01  2023     %	28.02  2023     %	31.03  2023     %	30.04  2023     %	31.05  2023     %	30.06  2023     %	31.07  2023     %	31.08  2023     %	30.09  2023     %	31.10  2023     %	30.11  2023     %
Long	110.7	112.4	111.9	106.3	108.5	112.9	116.9	113.0	113.3	114.9	118.8	113.1
Short	4.9	5.1	3.9	3.9	3.8	3.6	4.0	3.0	3.0	3.0	3.1	4.6
Gross	115.6	117.5	115.8	110.2	112.3	116.5	120.9	116.0	116.3	117.9	121.9	118.0
Net	105.8	107.3	108.0	102.4	104.7	109.3	112.9	110.0	110.3	111.9	115.7	108.8

Ten Largest Investments

Company	Country of Risk	Gross market value as a % of net assets
Saudi National Bank	Saudi Arabia	4.4
Bank Central Asia	Indonesia	4.2
Emaar Properties	United Arab Emirates	3.4
Ayala Land	Philippines	3.1
Eldorado Gold	Turkey	2.9
PKO Bank Polski	Poland	2.9
FPT	Vietnam	2.8
National Bank of Greece	Greece	2.8
JSC Kaspi	Kazakhstan	2.8
Advanced Info Service	Thailand	2.7

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

The Company’s NAV rose by 6.6% in November, outperforming its benchmark the MSCI Emerging ex Selected Countries + Frontier Markets + Saudi Arabia Index (“Benchmark Index”) which returned 5.7%. For reference, the MSCI Emerging Markets Index was up by 8.0% while the MSCI Frontier Markets Index was up by 7.1% over the same period. All performance figures are on a US Dollar basis with net income reinvested.

November was a strong month for many of our markets and emerging markets more broadly, as all regions posted positive returns. Argentina was the best performing market, surging +42.4% following Javier Milei’s unexpected victory, which instilled cautious optimism in the market about the country’s potential for economic reform. Eastern European markets also did well with Greece up by 11.2%, followed by Poland (+9.6%) and Hungary (+8.4%).

Hungarian low-cost carrier Wizz Air (+27.0%) was the top performing stock over the month, after reporting an increase in passenger traffic numbers. National Bank of Greece (+22.3%) was another strong contributor as the final 20% stake held by the state-controlled bank HFSF was sold down. Elsewhere, IT services company EPAM (+18.7%) also contributed positively after delivering better-than-expected 3Q results. Portfolio performance was also supported by our positioning in ASEAN markets Philippines and Vietnam with both Ayala Land (+15.2%) and PetroVietnam Drilling (+20.4%) up over the month. As for detractors, Nakilat Qatar Gas Transport (-8.0%) was among the worst performers. Not owning Saudi Arabia's Al Rajhi Bank also detracted from relative returns as the bank has reached an inflection point in margins after several quarters of decline.

Over the course of November, we made few changes to the portfolio. We added to our holding in National Bank of Greece as we view the capital return potential from the bank to be substantial and think this is underestimated by the market. We shifted some of our financials exposures by exiting Bangkok Bank in Thailand and taking some profits in our holdings in Bank Central Asia and Bank Mandiri, while initiating a new position in Bank Syariah. We believe Bank Syariah has a long runway from low penetration of Islamic banking in Indonesia. We also exited our Saudi holdings in IT company ELM and outdoor advertising company, Arabian Contracting Services, as our investment theses have played out and both stocks have re-rated substantially on upgraded earnings growth profiles.

We believe global markets are starting to feel the impact of higher interest rates, noting slowing credit growth in particular as evidence that a demand slowdown is imminent developed markets. When combined with a Chinese economy which is struggling to find its footing we find it difficult to see where a meaningful pick up in global growth will come from. In contrast we see better fundamentals in frontier and smaller emerging markets. Monetary tightening across much of our universe was ahead of that in developed markets, particularly in Latin America and Eastern Europe. With inflation falling across many countries within our universe, rate cuts have started to materialize. This is a good set up for domestically oriented economies to see a cyclical pick up. Our investment universe, in absolute and relative terms, remains under-researched and we believe this should enable compelling alpha opportunities.

Sources:

1BlackRock as at 30 November 2023

2MSCI as at 30 November 2023

18 December 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.

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Release

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