Portfolio Update

BLACKROCK FRONTIERS INVESTMENT TRUST PLC (LEI: 5493003K5E043LHLO706)

All information is at 30 June 2024 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	-2.0	-4.1	10.6	35.8	30.8	140.5
Net asset value	2.4	-2.0	11.3	40.1	41.5	169.7
Benchmark (NR)**	1.7	-2.6	5.0	16.9	4.8	84.2
MSCI Frontiers Index (NR)	0.7	0.6	13.0	-0.9	12.3	80.4
MSCI Emerging Markets Index (NR)	4.7	4.9	13.2	-6.5	17.3	67.8
US Dollars:
Share price	-2.7	-4.0	10.0	24.4	30.0	95.9
Net asset value	1.7	-1.9	10.7	28.3	40.6	119.4
Benchmark (NR)**	1.0	-2.5	4.4	6.9	4.1	50.5
MSCI Frontiers Index (NR)	0.0	0.6	12.3	-9.3	11.6	46.2
MSCI Emerging Markets Index (NR)	3.9	5.0	12.5	-14.4	16.5	36.0

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:	197.80c
Net asset value - cum income:	202.18c
Sterling:
Net asset value - capital only:	156.48p
Net asset value - cum income:	159.94p
Share price:	143.75p
Total assets (including income):	£302.8m
Discount to cum-income NAV:	10.1%
Gearing:	Nil
Gearing range (as a % of gross assets):	0-20%
Net yield*:	4.6%
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 4.6%, and includes the 2023 final dividend of 4.90 cents per share, declared on 30 November 2023, and paid to shareholders on 14 February 2024, and the 2024 interim dividend of 3.50 cents per share, declared on 31 May 2024, and paid to shareholders on 01 July 2024.

** 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	46.2		Saudi Arabia	18.3
Industrials	12.7		Indonesia	13.1
Energy	11.3		United Arab Emirates	8.7
Materials	10.2		Philippines	8.4
Real Estate	9.6		Kazakhstan	8.4
Consumer Staples	8.5		Hungary	7.3
Communication Services	7.6		Greece	5.8
Consumer Discretionary	6.3		Poland	5.7
Information Technology	4.8		Qatar	5.1
Health Care	1.0		Turkey	4.6
Utilities	0.2		Pakistan	3.9
	-----		Thailand	3.8
	118.4		Kenya	3.6
	-----		Czech Republic	3.0
Short positions	-2.9		Vietnam	3.0
			Malaysia	2.5
			Singapore	2.4
			Colombia	2.1
			Multi-International	1.8
			Chile	1.7
			Georgia	1.4
			Egypt	1.3
			Cambodia	1.0
			Romania	0.8
			Bangladesh	0.7
				-----
				118.4
				-----
			Short positions	-2.9 ----

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

Market Exposure
 

	31.07  2023     %	31.08  2023     %	30.09  2023     %	31.10  2023     %	30.11  2023     %	31.12  2023     %	31.01  2024     %	29.02  2024     %	31.03  2024     %	30.04  2024     %	31.05  2024     %	30.06  2024     %
Long	113.0	113.3	114.9	118.8	113.4	116.6	119.5	121.4	120.4	120.8	118.1	118.4
Short	3.0	3.0	3.0	3.1	4.6	4.7	3.6	3.5	2.7	2.3	2.4	2.9
Gross	116.0	116.3	117.9	121.9	118.0	121.3	123.1	124.9	123.1	123.1	120.5	121.3
Net	110.0	110.3	111.9	115.7	108.8	111.9	115.9	117.9	117.7	118.5	115.7	115.5

Ten Largest Investments

Company	Country of Risk	Gross market value as a % of net assets
Bank Central Asia	Indonesia	4.7
Saudi National Bank	Saudi Arabia	4.5
Emaar Properties	United Arab Emirates	4.4
Kaspi.Kz JCS	Kazakhstan	4.0
FPT	Vietnam	3.0
Etihad Etisalat	Saudi Arabia	2.9
Wizz Air Holdings	Hungary	2.8
Jeronimo Martins	Poland	2.6
Ayala Land	Philippines	2.6
OTP Bank	Hungary	2.6

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

The Company’s NAV rose by 1.7% in June, outperforming its benchmark the MSCI Emerging ex Selected Countries + Frontier Markets + Saudi Arabia Index (“Benchmark Index”) which returned +1.0%. For reference, the MSCI Emerging Markets Index was up by 3.9% while the MSCI Frontier Markets Index was down by 0.02% over the same period. All performance figures are on a US Dollar basis with net income reinvested.

Emerging Markets rose by 3.9% in June, outperforming Developed Markets (+2.0%). Asia (+4.3%) was the best performing region with strong flows into AI themes. Europe, the Middle East and Africa (EEMA) (+3.8%) underperformed against the broader index, with significant performance dispersion across markets. Latin America continued to underperform in June with a -6.1% month over month return.

Stock selection was a significant contributor in June. The largest Islamic bank in Indonesia Bank Syariah (+18%) rebounded from sell-off as concerns on fiscal trajectory of new government were mitigated with clarifications from economic transition team. Middle-East exposure did well with LNG transporter Qatar Gas Transport (+17.2), Saudi Arabian telecom operator Etihad Etisalat (Mobily) (+13.7%) and Emirati property developer Emaar Properties (+7.1%) main contributors. UAE property market continued to see strong momentum in the real estate market. Elsewhere, Vietnamese IT services provider FPT (+11.6%) was a strong performer. Indonesian retailer Mitra Adiperkasa (+15.1%) also helped performance, reversing some of the losses from May.

On the flipside, the Polish supermarket chain Jeronimo Martins (-12.5%) was the worst performing stock over the month, reversing gains from the two previous months. Philippines based resort and casino operator Bloomberry Resorts (-10.4%) was another detractor. The stock traded down despite meaningful earnings improvement as the new property ramps up. Argentinian energy company Vista Energy (-8.0%) also weighed on returns. The Argentinian market fell more broadly on concerns around Milei's ability to push through continued reforms. 

We made some changes to the portfolio in June. We initiated a position in UAE property developer Aldar Properties as we are positive on the company’s ability to deliver strong results on the back of strong presales and improvement in its recurring income portfolio. We have become incrementally negative on Argentina as Milei's ability to successfully push through reforms comes into question and the monetary policies implemented may not be sufficient to normalize the economic backdrop. Therefore we exited both Vista Energy and oil company YPF. We added to our position in Bloomberry Resorts to reflect conviction on back of weakness in stock which seems unmerited especially after our visit to their new property in Manilla.

As higher global rates continue to feed through into the real economy, we expect some moderation of demand in developed markets. We note slowing credit growth in particular in the US. In contrast, 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 have started to materialize in some countries. 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 relative developed 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 30 June 2024

2MSCI as at 30 June 2024

17 July 2024

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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