Portfolio Update

BLACKROCK NORTH AMERICAN INCOME TRUST plc (LEI: 549300WWOCXSC241W468)
All information is at 31 December 2019 and unaudited.

Performance at month end with net income reinvested

	One Month	Three Months	Six Months	One Year	Three Years	Five Years
Net asset value	0.1%	0.2%	5.4%	20.7%	23.9%	79.8%
Share price	-0.1%	1.2%	5.7%	23.9%	27.2%	97.8%
Russell 1000 Value Index	0.3%	-0.1%	4.6%	21.7%	23.1%	75.3%

Source: BlackRock

At month end
Net asset value – capital only:	184.53p
Net asset value – cum income:	186.11p
Share price:	191.00p
Premium to cum income NAV:	2.6%
Net yield¹:	4.2%
Total assets including current year revenue:	£150.1m
Gearing:	Nil
Options overwrite:	14.2%
Ordinary shares in issue²:	80,654,044
Ongoing charges³:	1.1%

¹ In line with the dividend policy announced in the Annual Report on 17 December 2018 of dividends amounting to 8.00p per share for the year ending 31 October 2019 and based on the share price as at close of business on 31 December 2019.

² Excluding 19,707,261 ordinary shares held in treasury.

³ Ongoing charges represent the management fee and all other operating expenses excluding interest as a % of average shareholders’ funds for the year ended 31 October 2018.

Benchmark Sector Analysis	Total Assets (%)
Financials	26.0
Health Care	17.5
Energy	9.4
Information Technology	8.1
Industrials	7.9
Consumer Staples	7.0
Communication Services	6.9
Consumer Discretionary	5.5
Utilities	2.4
Materials	1.4
Net current assets	7.9
	-----
	100.0
	=====
Country Analysis	Total Assets (%)
United States	70.9
United Kingdom	6.2
Netherlands	3.7
Germany	2.8
Ireland	2.8
Switzerland	1.9
France	1.6
Japan	1.4
Canada	0.5
Norway	0.3
Net current assets	7.9
	-----
	100.0
	=====

Ten Largest Investments
Company	Country of Risk	Total Assets (%)
JPMorgan Chase	USA	4.0
Verizon Communications	USA	3.9
Wells Fargo	USA	3.4
Citigroup	USA	3.4
Bank of America	USA	2.9
Medtronic	Ireland	2.4
Williams Companies	USA	2.4
Anthem	USA	2.1
Koninklijke Philips	Netherlands	2.1
American International Group	USA	2.0

Tony DeSpirito, Franco Tapia and David Zhao, representing the Investment Manager, noted:

For the one-month period ended 31 December 2019, the Company’s NAV increased by 0.1% and the share price decreased by 0.1% (all in sterling). The Company’s benchmark, the Russell 1000 Value Index, returned 0.3% for the period.

At the sector level, the largest contributor to relative performance was stock selection in the health care sector. Within the sector, relative outperformance was generated primarily from our selection among health care providers, services and pharmaceuticals firms. Underweight exposure to the real estate sector also proved beneficial. In communication services, underweight exposure to the entertainment industry proved beneficial. Additionally, stock selection in consumer staples proved additive. Notably, selection decisions among food product companies proved beneficial, as did an underweight exposure to the food and staples retailing industry. Lastly, stock selection in the household durables industry within consumer discretionary contributed positively to relative results.

The largest detractor from relative performance was a combination of stock selection and allocation decisions in the information technology (IT) sector. Within the sector, selection decisions in the IT services industry hampered relative results, as did an underweight positioning in the semiconductors and semiconductor equipment industry. In utilities, stock selection among electric utilities weighed on relative returns. Stock selection in the energy sector also detracted from relative performance, primarily due to decisions made within the oil, gas and consumable fuels industry. Lastly, overweight exposure to the insurance industry detracted from relative returns during the month.

The portfolio’s option overwriting strategy contributed modestly to performance in December.

Transactions/Options

Transactions: In December, the portfolio initiated new positions in Berkshire Hathaway, Johnson & Johnson and Fortive. Additionally, we added to existing positions in Medtronic and Sanofi. Conversely, we exited our positions in Novo Nordisk, Marvell Technology, Johnson Controls, Mattel, Philip Morris, International Paper, Qualcomm, Masco, Marsh & McLennan and Goldman Sachs. Additionally, we trimmed our existing positions in Pfizer and State Street.

Options:  As of 31 December 2019, the Company’s options exposure was 14.2% and the delta of the options was 83.7. 

Positioning

As of the period end, the Company’s largest overweight positions relative to the benchmark were in the health care, financials and information technology sectors. The Company’s largest underweight positions relative to the benchmark were in the real estate, utilities and materials sectors.

Source: BlackRock. Data as of 31 December 2019.

15 January 2020

Latest information is available by typing blackrock.co.uk/brna 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 the Manager’s website (or any other website) is incorporated into, or forms part of, this announcement.