Half-year Report

BLACKROCK FRONTIERS INVESTMENT TRUST PLC

LEI: 5493003K5E043LHLO706 - Article 5 Transparency Directive, DTR 4.2

HALF YEARLY FINANCIAL REPORT FOR THE SIX MONTHS ENDED 31 MARCH 2020

PERFORMANCE RECORD

The Company’s financial statements are presented in US Dollars. The Company’s shares are listed on the London Stock Exchange and quoted in UK Pounds sterling. The sterling amounts shown below are presented for convenience. The difference in performance measured in US Dollars and UK Pounds sterling reflects the change in the value of the Pound versus the US Dollar over the period.

FINANCIAL HIGHLIGHTS

	As at 31 March 2020	As at 30 September 2019
US Dollar
Net assets (US$’000)¹	255,277	400,820
Net asset value per ordinary share (US cents)	105.56	166.54
Ordinary share price (mid-market)² (US cents)	103.17	162.66
	-------------	-------------
Sterling
Net assets (£000)^1,2	205,877	325,262
Net asset value per ordinary share² (pence)	85.13	135.15
Ordinary share price (mid-market) (pence)	83.20	132.00
	-------------	-------------
Discount⁴	(2.3%)	(2.3%)
	========	========

Performance	Six months ended 31 March 2020 %	Year ended 30 September 2019 %	Since inception³ %
US Dollar
Net asset value per share (with dividends reinvested)⁴	-34.8	-1.5	-4.5
Benchmark Index (NR)^{5, 6}	-27.8	+0.0	-1.9
MSCI Frontier Markets Index (NR)^{5, 6}	-21.7	+5.9	+1.5
MSCI Emerging Markets Index (NR)⁶	-14.6	-2.0	-4.4
Ordinary share price (with dividends reinvested)⁴	-34.9	-6.3	-8.4
	-------------	-------------	-------------
Sterling
Net asset value per share (with dividends reinvested)⁴	-35.2	+4.2	+19.8
Benchmark Index (NR)^{5, 6}	-28.3	+5.8	+22.4
MSCI Frontier Markets Index (NR)^{5, 6}	-22.2	+12.0	+27.6
MSCI Emerging Markets Index (NR)⁶	-15.1	+3.7	+20.2
Ordinary share price (with dividends reinvested)⁴	-35.3	-0.9	+14.7
	========	========	========

¹ The change in net assets reflects shares issued in the period, dividends paid and market movements.

² Based on an exchange rate of US$1.2400 to £1 at 31 March 2020 and US$1.2323 to £1 at 30 September 2019.

³ The Company was incorporated on 15 October 2010 and its shares were admitted to trading on the London Stock Exchange on 17 December 2010.

⁴ Alternative Performance Measures, see Glossary in the half yearly report and financial statements.

⁵ With effect from 1 April 2018, the Benchmark Index changed to the MSCI Emerging Markets Index ex Selected Countries + MSCI Frontier Markets Index. Prior to 1 April 2018, the Benchmark Index was the MSCI Frontier Markets Index. The performance returns of the Benchmark Index during the prior year and since inception have been blended to reflect this change.

⁶ Net return (NR) indices calculate the reinvestment of dividends net of withholding taxes.

Sources: BlackRock and Datastream.

CHAIRMAN’S STATEMENT FOR THE SIX MONTHS TO 31 MARCH 2020

Dear Shareholder,
I am pleased to present the Company’s half-yearly financial report for the six months to 31 March 2020, albeit a difficult period for investors in equity markets generally.

PERIOD HIGHLIGHTS

Declared interim dividend of 2.75 US cents per share;
Yield of 6.7% (based on share price at 26 May 2020, interim dividend for 2020 and final dividend for 2019);
NAV total return of -34.8% (in US Dollar terms with dividends reinvested);
Share price total return of -34.9% (in US Dollar terms with dividends reinvested); and
1,150,000 new ordinary shares issued via tap issuance.

PERFORMANCE AND OVERVIEW
During the six months to 31 March 2020, the Company saw a NAV total return in US Dollars of -34.8%, while its Benchmark Index returned -27.8%. The Company’s share price total return was -34.9%. By comparison, the Company’s previous Benchmark Index, the MSCI Frontier Markets Index, returned -21.7% and the MSCI Emerging Markets Index returned -14.6%.

It is of course disappointing to report to shareholders that the Company underperformed the Benchmark Index during the period. This relative underperformance can be attributed to a number of factors and your investment managers provide a detailed description of the key contributors and detractors to performance during the period, portfolio activity and their views on the outlook for the second half of the year in their report which follows.

I am pleased to be able to report that subsequent to the period end and as at 26 of May 2020, the net asset value per share of the Company has increased by 12.9% from 105.56 cents per share to 119.20 cents per share and the Company’s share price has increased by 8.8% from 103.17 cents per share to 112.22 cents per share as at 26 May 2020. The Company’s Benchmark Index has increased by 11.2%.

REVENUE RETURN AND DIVIDENDS
The Company’s revenue return per share for the six months ended 31 March 2020 amounted to 1.77 US cents (2019: 3.19 US cents). The Board recognises that shareholders value the dividends paid by the Company, but is also cognisant that there has been a reduction in dividends received from the companies in the portfolio due to the ongoing COVID-19 outbreak.

Nonetheless, the Board is pleased to declare an interim dividend of 2.75 US cents per share (2019: 3.00 US cents per share) payable on 26 June 2020 to shareholders on the Company’s register on 5 June 2020. The shares will go ex-dividend on 4 June 2020. The final dividend of 4.75 US cents per share for the year ended 30 September 2019 was declared on 6 December 2019 and paid to shareholders on 7 February 2020. Whether the Company will pay a similar final dividend to last year will depend on the state of the revenue account in the second half of the year at which time the Board will have greater visibility of the total revenue received in the financial year. The Board may also consider the use of brought forward revenue reserve to support the full year dividend if deemed appropriate to do so.

SHARE CAPITAL
The Directors recognise the importance to investors of ensuring that the Company’s share price is as close to its underlying NAV as possible. Accordingly, the Directors monitor the share price closely and will consider the issue of ordinary shares at a premium or repurchase at a discount to help balance demand and supply in the market. For the period under review, the Company’s ordinary shares traded at an average discount to NAV of 0.6%, and were trading at a discount of 2.3% on a cum-income basis at 31 March 2020. The Directors currently have the authority to buy back shares in the market equivalent to 14.99% of the Company’s issued share capital and also to issue new shares equivalent to 10% of the Company’s issued share capital (excluding any shares held in treasury).

In response to demand for its shares the Company issued 1,150,000 new ordinary shares during the period for a gross total consideration of US$1,998,000. The new shares were issued at a premium to the prevailing NAV and were therefore accretive to the Company’s NAV per share. The Board believes that the issue of new shares by the Company, when demand cannot be met in the market, helps to regulate the share price premium to NAV, and that the economies of scale achieved through enlarging the Company are beneficial to shareholders. Since the period end and up to the date of this report, the Company has issued no further new ordinary shares. No shares were bought back in the period under review or up to the date of this report.

PERIODIC OPPORTUNITY FOR THE RETURN OF CAPITAL

The next such opportunity will take place in early 2021. Accordingly, the Board will formulate proposals in late 2020, which may, as they did in 2016, take the form of a tender offer. Further information will be provided in this year’s annual report which it is anticipated will be published in December 2020. In the interim, I would like to take this opportunity to thank shareholders for their ongoing support of the Company.

OUTLOOK
The recent outbreak of COVID-19 has negatively impacted global markets and has resulted in widespread quarantine, disruption to supply chains and an unprecedented and almost immediate cessation of economic activity. The health crises and the economic consequences of the outbreak may also exacerbate pre-existing political, social and economic risks in the markets in which this Company invests. Whilst it is impossible at this stage to estimate the full extent or the impact – both human and financial – or indeed the duration of the global economic downturn caused by the COVID-19 pandemic, it is also important to reflect on the scale and speed of the current market downturn relative to prior market falls.

However, unlike open-ended counterparts, closed-end funds are not obliged to sell down portfolio holdings at low valuations to meet liquidity requirements for redemptions. During times of elevated volatility and market stress, the ability of a closed-end fund structure to remain invested for the long-term enables the portfolio managers to adhere to disciplined fundamental analysis from a bottom-up perspective and be ready to respond to dislocations in the market as opportunities present themselves. The extreme volatility seen in markets as a result of the current fears has created inevitable opportunities to purchase some shares at extremely discounted valuations; our portfolio manager’s team remain attuned to the investment opportunities that this may present. The Board has also received regular updates from BlackRock to confirm that the Company’s operations are not affected and that established business continuity plans are effective.

Frontier markets will continue to be driven, to a significant extent, by internal factors and by domestic investor flows and this continues to offer significant diversification benefits in extreme times. Our portfolio management team’s focus on long-term capital growth provides us with confidence that the holdings in the Company’s portfolio are well placed to weather the storm.

The current bearish global sentiment towards the frontier and emerging markets has presented opportunities for our portfolio managers. To date, many of the countries which make up our frontier universe have been less affected by the COVID-19 crisis than their developed market counterparts and therefore your portfolio managers are cautiously optimistic on the outlook. Many of these countries have relatively low levels of foreign debt, higher yields, superior growth prospects, and are trading at a significant discount relative to the developed markets. In addition, our portfolio managers see a distinct value opportunity with the price-to-book ratio of our portfolio trading around its lowest level since launch, at around 1x.

Therefore, your Board believes that the Company’s frontier market universe continues to represent a compelling proposition for the medium to long-term investor. The Board remains confident that, notwithstanding the challenges in near term, your portfolio managers can resume their track record of outperformance, having extensive resources deployed to these inefficient markets and the local market knowledge required to capitalise on the opportunities now available in this dynamic asset class.

AUDLEY TWISTON-DAVIES
Chairman
28 May 2020

INVESTMENT MANAGER’S REPORT

PORTFOLIO & MARKET COMMENTARY
In the six months to 31 March 2020, the Company’s NAV returned -34.8%¹ versus its Benchmark Index which returned -27.8%². Over this time period, the MSCI Emerging Markets Index declined -14.6% and the MSCI Frontier Markets Index was down -21.7% (in US Dollar terms with dividends reinvested).

The six-month period has seen a marked change in sentiment and risk-preference. Markets were increasingly bullish going into year-end 2019 as liquidity conditions, led by further central bank easing, improved. At the same time, US-China trade tensions abated following the announcement of a Phase 1 deal, resulting in a risk-on environment that helped Emerging Markets maintain strong flow momentum into January 2020. Unfortunately, that exuberance was short lived as coronavirus headlines took hold and fears of the virus spreading outside China shocked markets. In the year to date, governments have struggled to accurately predict the pace and breadth of the virus spread, leading to travel bans and lockdowns across the world. Globally, markets have sold-off, as uncertainty surrounding the length of impact has dragged down growth estimates and it continues to weigh on investor sentiment.

More recently, the lack of co-ordinated action from the Organisation of the Petroleum Exporting Countries (‘OPEC’), combined with very weak global demand, has resulted in Brent Crude trading at $22.70/barrel as of the end of March 2020, putting further pressure on global growth. Whilst much about the nature of the virus remains unknown, the extent of global liquidity provision, coordinated fiscal stimulus and early signs of a Chinese recovery should somewhat temper investor concerns. Frontier markets have entered this crisis in a better situation than before the Global Financial Crisis (‘GFC’) given lower levels of external debt and they are at an earlier point in their economic cycles and hence haven’t seen excessive lending in recent years.

Performance commentary over the period is somewhat of a tale of two epochs, before and after coronavirus. “BC” performance was led by Kazakhstan, particularly Halyk Bank, which performed strongly after reporting better than expected results and Kaz Minerals, a low cost copper producer. We trimmed Halyk Bank and fully exited our position in Kaz Minerals as prices rose during the quarter, which substantially protected performance through the market sell off. In March, we repurchased Kaz Minerals around 40% lower than our December exit price. Uranium producer, Kazatomprom (-5.3%), also performed well throughout the period as its business is relatively insulated from pandemic impact – nuclear power plants are considered baseload plants and have stable fuel demands, albeit with low turnover. Furthermore, since the Company’s revenues are US Dollar based, the recent depreciation in the Kazakhstani Tenge has helped at the margin.

Our position in Equity Group, Kenya was among the more resilient stocks in the universe as news that the government would be lifting interest rate caps was well received by the market. Our holdings in Pakistan have also been relative outperformers as the country has seen a substantial narrowing of its trade deficit over the last year, reducing pressure on its currency. MCB Bank and utility, Hub Power fell only 17% and 9% respectively. Elsewhere, our underweights in Chile (-40%), where demonstrations and social unrest have escalated through year-end putting pressure on both the foreign currency and equity markets, and Colombia (-43%), which fell precipitously following the oil price fall, benefited relative returns over the period.

Stocks in Indonesia performed especially badly during the period, with the market falling 35%. Smaller cap stocks in Indonesia were hit even harder. Retailer Mitra Adiperkasa (MAPI) fell 60.0% and mall operator Pakuwon Jati 59.7% over the time period. MAPI is currently trading at its lowest price to book valuation since 2009, a time when the balance sheet structure of the company was very different and it had significant foreign currency debt outstanding. As of the end of 2019, the company has net cash. Pakuwon Jati is trading at its lowest price to book valuation since the Asian Crisis (1997-99), a time when Net Debt/EBITDA for the company was > 20x. As of the last reported set of results it was at 0.1x. We think that there is significant upside for both positions. Since March month end, MAPI has risen 50% and Pakuon Jati 32%.

Relative performance was also hurt by a significant underweight position in Malaysia. As has historically been the case, Malaysia performed defensively in the market sell off, falling only 17% in the six months to March. We have struggled to find attractive stocks to own in Malaysia over the last few years and even now, Malaysia is one of the few markets across all of emerging and frontier markets which is not screening especially cheap relative to its history. As at the end of March the Malaysian market was still trading at a marginal premium to its historical price to book valuation .

In the UAE, a position in hospital operator NMC Health detracted from returns after the stock declined sharply (-28%) following allegations over its accounting practices. Having reviewed these allegations, we decided to exit the position at a loss in December, a good decision in hindsight as the company has since alleged that the management team funnelled significant cash out of the business, leaving it with very significant debts and the stock has delisted, effectively valuing the equity at zero. Real Estate stocks Emaar Properties (-52%) and Emaar Development (-47%) were also especially hard hit.

Vietnam was also a country where stocks sold off aggressively. Mobile World, the electronics retailer, sold off 55% to end March. Whilst its electronics business has been affected by COVID-19 shut downs, the grocery chain, which the company launched a few years ago, has seen strong growth with revenue up 156% for the first quarter of 2020, reaching 15% of total company revenue. Although the stock has bounced 39% in April, we believe that on 9x consensus earnings for 2020, the company still looks very attractively valued.

PORTFOLIO ACTIVITY
The Company continues to have large positions in Indonesia, Philippines, Kazakhstan, Egypt and Pakistan.

We added to the Philippines as the macro backdrop looks increasingly positive. The country has relatively strong underlying growth and should benefit from improving credit trends. Furthermore, additional interest rate and reserves requirement cuts should free up liquidity. We specifically bulked up exposure in Bank of Philippines and tobacco name, LT Group. We also initiated positions in resort operator Bloomberry Resorts, and industrial conglomerate GT Capital.

We have increased positions in Pakistan. The current government has agreed a deal with the International Monetary Fund which will see it commit to reducing the fiscal deficit to sustainable levels. In addition, current low oil prices are considerably positive for Pakistan which imports a significant portion of its requirements.

Earlier in the period we exited our last positions in Argentina on our belief that the fiscal adjustment needed in 2020 would be politically hard to achieve and it would be harder than the market was expecting for Argentina to reach a deal with its creditors. The increased budget pressures stemming from COVID-19 will push debt/GDP ratios even higher than these expectations.

We have exited the majority of our exposure in Nigeria, using the strength seen in February to trim stocks. Watching the country’s foreign exchange reserve holdings fall through the second half of 2019, we became increasingly concerned about rising pressure on the Naira, which has recently been exacerbated by falling oil prices.

We reduced positions in a number of oil stocks during the period. We participated in the successful IPO of Saudi Aramco, but exited after strong price performance and we reduced exposure to Colombian national oil company, Ecopetrol following a period of strength.

The Company started the half year with a net exposure of 106% and we slowly increased exposure throughout the calendar year end to reach 112% as at the end of January. We subsequently reduced exposure through February and March, partly through the use of targeted short positions to reach a low net exposure of around 96% mid March. From there, we have then found a number of very attractive stock positions to add into the portfolio. We bought positions in Polish retailer, LPP, and Eastern European airline, Wizz Air, two stocks which we think were excessively sold off and which offered very attractive valuations. Net exposure as of the end of March was 104%.

OUTLOOK

While it’s impossible to overstate how unprecedented the current situation is, given that one third of the world’s population is currently under lock down, we fully believe that the recent spikes in volatility and bearish global sentiment have created pockets of opportunity, which we are selectively taking advantage of. Broadly, we believe that the world will get Covid-19 under control; with virus cases peaking in Europe, we believe support will be given to markets amid hope that other countries can follow.

We have seen large scale fiscal and monetary responses from governments and central banks across both developed and emerging markets and expect this support to remain in place. Many emerging and frontier countries have gone into this crisis in a much better position than the 2008/9 crisis with lower debt levels, especially foreign currency debt, and with economies at much earlier stages of their economic cycles. This means that they have seen little of the excesses in credit extension that characterized 2007/8. Once we pass through the pain point of tighter financial conditions, we believe that the better growth and yield dynamics across these markets will shine through. In a world that is looking ever more starved of growth, the ability to generate endogenous growth as is found in countries such as Philippines, Peru, Indonesia and Poland should deserve a valuation premium, to the developed world, rather than the current significant discount. We believe that countries which have low levels of debt/GDP, with cheap currencies and are able to show strong levels of growth should attract significant attention from investors.

Valuations in frontier markets are at very attractive levels. Trading at around 1x trailing price/book value, our portfolio is as cheap as it has been since we launched the trust. Our universe is trading at an almost 40% discount to developed markets on a price/book basis. We are positioned in a number of companies that we believe will demonstrate their resilience and earnings power and we remain confident that these qualities will come to be recognized by the market. In a world searching for scarce growth and yield we believe strongly that following an unrewarding period for many emerging and frontier countries, that has lasted for more than dozen years, prospects might well improve in the post-Covid-19 era of 2020.

SAM VECHT AND EMILY FLETCHER
BlackRock Investment Management (UK) Limited
28 May 2020

¹ Source: BlackRock, as at 31 March 2020.

² Source: MSCI. With effect from 1 April 2018 the Benchmark Index changed to MSCI Emerging Markets ex Selected Countries + MSCI Frontier Markets Index + MSCI Saudi Arabia Index. Prior to 1 April 2018, the Benchmark Index was MSCI Frontier Markets Index. The performance of the Benchmark Index has been blended to reflect this change.

INTERIM MANAGEMENT REPORT AND RESPONSIBILITY STATEMENT

The Chairman’s Statement and the Investment Manager’s Report give details of the important events which have occurred during the period and their impact on the financial statements.

PRINCIPAL RISKS AND UNCERTAINTIES
A detailed explanation of the risks relating to the Company can be divided into various areas as follows:

· Investment Performance Risk;

· Income/Dividend Risk;

· Legal & Regulatory Risk;

· Counterparty Risk;

· Operational Risk;

· Political Risk;

· Financial Risk; and

· Market Risk.

The Board reported on the principal risks and uncertainties faced by the Company in the Annual Report and Financial Statements for the year ended 30 September 2019. A detailed explanation can be found in the Strategic Report on pages 36 to 38 and in note 18 on pages 91 to 105 of the Annual Report and Financial Statements which are available on the website maintained by BlackRock at: www.blackrock.co.uk/brfi.

An outbreak of an infectious respiratory illness caused by a novel coronavirus known as COVID-19 was first detected in China in December 2019 and has developed into a global pandemic. This coronavirus has resulted in travel restrictions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in healthcare service preparation and delivery, prolonged quarantines, cancellations, supply chain disruptions, and lower consumer demand, as well as general concern and uncertainty. The response to the COVID-19 pandemic has adversely affected the economies of many nations across the entire global economy, individual issuers and capital markets, and could continue with extents that cannot necessarily be foreseen. In addition, the impact of infectious illnesses in emerging market countries may be greater due to generally less established healthcare systems. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty.

In the view of the Board, other than those noted above, there have not been any material changes to the fundamental nature of these risks since the previous report and these principal risks and uncertainties, as summarised, are equally applicable to the remaining six months of the financial year as they were to the six months under review.

GOING CONCERN
The Board is mindful of the uncertainty surrounding the potential duration of the COVID-19 pandemic and its impact on the global economy, the Company’s assets and the potential for the level of revenue derived from the portfolio to reduce versus the prior year. The Directors, having considered the nature and liquidity of the portfolio, the Company’s investment objective and the Company’s projected income and expenditure, are satisfied that the Company has adequate resources to continue in operational existence for the foreseeable future and is financially sound. The Board believes that the Company and its key third party service providers have in place appropriate business continuity plans and will be able to maintain service levels through the COVID-19 pandemic.

When the Company was launched in late 2010, the Board made a commitment that before the Company’s fifth AGM and at five yearly intervals thereafter, it would formulate and submit to shareholders proposals to provide them with an opportunity to realise the value of their ordinary shares at the applicable NAV per ordinary share less applicable costs. The next opportunity at which such proposals will be put to shareholders is in early 2021. The Board has reviewed the potential impact that such an offer may have on the Company’s going concern assessment, and in particular has considered feedback received from the Company’s corporate broker regarding shareholder demand for the Company’s shares and investor appetite for the Company’s investment strategy. The corporate broker remains in regular communication with shareholders and, based on shareholder views at the time of publication of this report, there is no indication that demand to exit will be at a level which would jeopardise the ongoing viability of the Company.

The Board has reviewed the potential impact that such an offer may have on the Company’s going concern assessment, and in particular has considered feedback received from the Company’s broker, Winterflood Securities, regarding shareholder demand for the Company’s shares and investor appetite for the Company’s investment strategy. Winterflood remains in regular communication with shareholders and, based on shareholder views at the time of publication of this report, does not anticipate that demand to exit will be at a level which would jeopardises the ongoing viability of the Company.

Based on the above, the Board is satisfied that it is appropriate to continue to adopt the going concern basis in preparing the financial statements. The Company has a portfolio of investments which are considered to be readily realisable and is able to meet all of its liabilities from its assets and income generated from these assets. Ongoing charges (excluding performance fees, finance costs, direct transaction costs, custody transaction charges, non-recurring charges and taxation) were approximately 1.39% of average net assets for the year ended 30 September 2019.

RELATED PARTY DISCLOSURE AND TRANSACTIONS WITH THE AIFM AND INVESTMENT MANAGER
BlackRock Fund Managers Limited (’BFM’) is the Company’s AIFM. BFM has (with the Company’s consent) delegated certain portfolio and risk management services, and other ancillary services to BlackRock Investment Management (UK) Limited (’BIM (UK)’). Both BFM and BIM (UK) are regarded as related parties under the Listing Rules. Details of the management and performance fees payable are set out in note 4 and note 14. The related party transactions with the Directors are set out in note 13.

DIRECTORS’ RESPONSIBILITY STATEMENT
The Disclosure Guidance and Transparency Rules (’DTR’) of the UK Listing Authority require the Directors to confirm their responsibilities in relation to the preparation and publication of the Interim Management Report and Financial Statements.

The Directors confirm to the best of their knowledge that:

· the condensed set of financial statements contained within the half yearly financial report has been prepared in accordance with the International Accounting Standard 34 – Interim Financial Reporting; and

· the interim management report, together with the Chairman’s Statement and Investment Manager’s Report, includes a fair review of the information required by 4.2.7R and 4.2.8R of the Financial Conduct Authority (’FCA’) Disclosure Guidance and Transparency Rules.

The half yearly financial report has been reviewed by the Company’s Auditors.

The half yearly financial report was approved by the Board on 28 May 2020 and the above responsibility statement was signed on its behalf by the Chairman.

AUDLEY TWISTON-DAVIES
For and on behalf of the Board
28 May 2020

TEN LARGEST INVESTMENTS¹ AS AT 31 MARCH 2020

United International Transport (Saudi Arabia, Industrials, 3.6% (2019: 2.2%))³ is a Saudi Arabian franchisee of the rental car company Budget International. United International Transport operates 101 rental offices with a fleet of over 24,000 cars.

LT Group (Philippines, Industrials, 3.4% (2019: 2.9%)) is a diversified investment company that is involved in beverages, tobacco, property development and banking businesses in the Philippines, including Philippines National Bank.

Eastern Tobacco (Egypt, Consumer Staples, 3.3% (2019: 2.9%)) is an Egypt-based company, which is engaged in manufacturing tobacco products. The company’s product portfolio includes cigarettes, cigars, pipe tobacco and molasses tobacco as well as other related products such as filter rods and homogenized tobacco.

Bank Mandiri (Indonesia, Financials, 3.3% (2019: 2.3%)) is one of Indonesia’s largest banks by assets, loans and deposits, providing a number of services to both individual and corporate clients.

Bank of the Philippine Islands (Philippines, Financials, 3.1% (2019: 2.5%)) is a leading bank in the Philippines and in the Southeast Asian region. BPI is a universal bank and together with its subsidiaries and affiliates, it offers a wide range of financial products and solutions that serve both retail and corporate clients. The bank has a network of over 800 branches in the Philippines, Hong Kong and Europe and close to 3,000 ATMs and CDMs (cash deposit machines).

Almarai (Saudi Arabia, Consumer Staples, 3.1% (2019: N/A))³ is a food and beverage manufacturer and distributor and considered the world’s largest vertically integrated dairy company. Almarai is active in five categories across the Middle East and North Africa – dairy, juice, baked goods, poultry and infant nutrition.

Astra International (Indonesia, Consumer Discretionary, 2.9% (2019: 3.5%))² is an Indonesian conglomerate. It owns Southeast Asia’s largest independent automotive group and is the leading provider of a full range of automobile and motor-cycle products. The company also has interests in financial services, heavy equipment, mining, construction and energy, agribusiness, infrastructure and logistics, information technology and property. It is also an active participant in the development of Indonesia’s strategic infrastructure, including toll roads, energy, transportation and logistics and sea ports.

Orascom Construction (Egypt, Industrials, 2.9% (2019: 2.6%)) is an engineering, procurement and construction contractor based in Egypt. The company was Egypt’s first multinational corporation and is now one of the region’s largest corporations focused on infrastructure, industrial and high-end commercial projects in the Middle East, North Africa, the United States and the Pacific Rim for public and private clients.

MCB Bank (Pakistan, Financials, 2.9% (2019: 2.0%))³ is one of Pakistan’s largest banks, serving over 8 million client accounts and operating over 1,400 branches domestically and abroad.

PTT Exploration & Production (Thailand, Energy, 2.8% (2019: N/A)) is one of Thailand’s national petroleum exploration and production companies. The firm is a subsidiary of the state-owned PTT Public Company Ltd. with projects across South East Asia, the Americas and Africa.

¹ All percentages reflect the gross market exposure of the holding as a percentage of net assets. Percentages in brackets represent the value of the holding as at 30 September 2019. Together, the ten largest investments represent 31.3% of net assets (30 September 2019: 29.1%).

² Includes exposure gained via contracts for difference and equity holdings.

³ Includes exposure gained solely via contracts for difference.

COUNTRY AND SECTOR ALLOCATION AS AT 31 MARCH 2020

COUNTRY ALLOCATION

Relative to the Benchmark Index (%)¹		Absolute weights (Gross Market Exposure as a % of Net Assets)¹
Egypt	9.4	Indonesia	12.2
Vietnam	8.3	Saudi Arabia	11.7
Kazakhstan	5.5	Thailand	10.5
Philippines	4.8	Egypt	10.2
Pakistan	4.3	Philippines	10.0
Romania	3.0	Vietnam	9.8
Indonesia	2.9	Kazakhstan	5.6
Ukraine	2.4	United Arab Emirates	4.5
Pan-Africa	1.8	Pakistan	4.4
Greece	1.7	Malaysia	4.4
United Arab Emirates	1.0	Romania	3.5
Kenya	0.9	Poland	3.0
Saudi Arabia	0.7	Greece	3.0
Hungary	0.0	Turkey	2.7
Senegal	-0.1	Qatar	2.7
Sri Lanka	-0.1	Chile	2.7
Tunisia	-0.1	Ukraine	2.4
Jordan	-0.1	Pan-Africa	1.8
Oman	-0.2	Hungary	1.6
Turkey	-0.2	Kenya	1.5
Croatia	-0.2	Colombia	0.5
Lebanon	-0.2	Nigeria	0.2
Bangladesh	-0.2
Mauritius	-0.2
Slovenia	-0.3
Nigeria	-0.3
Bahrain	-0.7
Czech Republic	-0.7
Poland	-0.8
Argentina	-0.8
Morocco	-1.0
Colombia	-1.0
Chile	-1.4
Thailand	-1.4
Peru	-1.8
Qatar	-3.5
Kuwait	-4.3
Malaysia	-5.9
Other countries in the benchmark	-12.3

Sources: BlackRock and Datastream.

¹ Includes exposure gained through equity positions and long and short CFD positions.

SECTOR ALLOCATION

Relative to the Benchmark Index (%)¹		Absolute weights (Gross Market Exposure as a % of Net Assets)¹
Consumer Discretionary	10.1	Financials	25.2
Consumer Staples	8.6	Consumer Staples	17.5
Industrials	7.2	Consumer Discretionary	13.5
Real Estate	6.9	Industrials	13.5
Information Technology	1.5	Real Estate	11.3
Energy	0.9	Energy	8.3
Other	-0.1	Materials	8.1
Health Care	-0.7	Communication Services	5.9
Materials	-1.2	Health Care	2.2
Utilities	-4.4	Information Technology	1.9
Communication Services	-5.0	Utilities	1.5
Financials	-14.9

Sources: BlackRock and Datastream.

¹ Includes exposure gained through equity positions and long and short CFD positions.

INVESTMENTS AS AT 31 MARCH 2020

Company	Principal country of operation	Sector	Fair value and market exposure¹	Gross market exposure as a % of net assets³
			US$’000
Equity portfolio
PTT Exploration & Production	Thailand	Energy	7,086	2.8
Thai Beverage	Thailand	Consumer Staples	5,553	2.2
Total Access Communication	Thailand	Communication Services	4,702	1.8
Land & Houses Public Company	Thailand	Real Estate	4,060	1.6
Aeon Thana Sinsap	Thailand	Financials	3,116	1.2
Charoen Pokphand Food	Thailand	Consumer Staples	2,367	0.9
			--------------	--------------
			26,884	10.5
			--------------	--------------
Eastern Tobacco	Egypt	Consumer Staples	8,541	3.3
Orascom Construction	Egypt	Industrials	7,433	2.9
Medinet Nasr	Egypt	Real Estate	3,890	1.5
EFG Hermes Holdings	Egypt	Financials	3,770	1.5
Integrated Diagnostics	Egypt	Health Care	2,562	1.0
			--------------	--------------
			26,196	10.2
			--------------	--------------
Bank Mandiri	Indonesia	Financials	8,320	3.3
Unilever Indonesia	Indonesia	Consumer Staples	4,564	1.8
Astra International	Indonesia	Consumer Discretionary	3,582	1.4
Indo Tambangraya	Indonesia	Energy	3,401	1.3
Mitra Adiperkasa	Indonesia	Consumer Discretionary	3,293	1.3
PT Pakuwon Jati	Indonesia	Real Estate	2,700	1.1
			--------------	--------------
			25,860	10.2
			--------------	--------------
LT Group	Philippines	Industrials	8,665	3.4
Bank of the Philippine Islands	Philippines	Financials	8,000	3.1
Bloomberry Resorts	Philippines	Consumer Discretionary	5,478	2.2
GT Capital Holding	Philippines	Industrials	3,386	1.3
			--------------	--------------
			25,529	10.0
			--------------	--------------
Kazatomprom	Kazakhstan	Energy	6,294	2.5
Halyk Savings Bank	Kazakhstan	Financials	4,921	1.9
KAZ Minerals	Kazakhstan	Materials	3,220	1.2
			--------------	--------------
			14,435	5.6
			--------------	--------------
Emaar Development	United Arab Emirates	Real Estate	5,641	2.2
Emaar Properties	United Arab Emirates	Real Estate	4,078	1.6
Air Arabia	United Arab Emirates	Industrials	1,666	0.7
			--------------	--------------
			11,385	4.5
			--------------	--------------
British American Tobacco Malaysia	Malaysia	Consumer Staples	4,740	1.8
Genting	Malaysia	Consumer Discretionary	3,890	1.5
RHB Bank	Malaysia	Financials	2,044	0.8
Sapura Energy	Malaysia	Energy	665	0.3
			--------------	--------------
			11,339	4.4
			--------------	--------------
Banca Transilvania	Romania	Financials	5,519	2.2
Erste Group Bank	Romania	Financials	3,328	1.3
			--------------	--------------
			8,847	3.5
			--------------	--------------
Empresas CMPC	Chile	Materials	6,493	2.5
Banco Santander Chile	Chile	Financials	544	0.2
			--------------	--------------
			7,037	2.7
			--------------	--------------
Koza Altin	Turkey	Materials	4,662	1.8
Tupras	Turkey	Energy	2,218	0.9
			--------------	--------------
			6,880	2.7
			--------------	--------------
MHP	Ukraine	Consumer Staples	6,082	2.4
			--------------	--------------
			6,082	2.4
			--------------	--------------
Hellenic Telecom Organisation	Greece	Communication Services	3,540	1.4
National Bank of Greece	Greece	Financials	2,220	0.9
			--------------	--------------
			5,760	2.3
			--------------	--------------
Vivo Energy	Pan-Africa	Consumer Discretionary	4,567	1.8
			--------------	--------------
			4,567	1.8
			--------------	--------------
Bank Pekao	Poland	Financials	4,134	1.6
			--------------	--------------
			4,134	1.6
			--------------	--------------
Wizz Air Holdings	Hungary	Industrials	4,064	1.6
			--------------	--------------
			4,064	1.6
			--------------	--------------
Equity Group	Kenya	Financials	3,606	1.4
			--------------	--------------
			3,606	1.4
			--------------	--------------
Hub Power	Pakistan	Utilities	3,271	1.3
			--------------	--------------
			3,271	1.3
			--------------	--------------
Ecopetrol	Colombia	Energy	784	0.3
Ecopetrol ADR	Colombia	Energy	481	0.2
			--------------	--------------
			1,265	0.5
			--------------	--------------
United Bank for Africa	Nigeria	Financials	432	0.2
			--------------	--------------
			432	0.2
			--------------	--------------
Equity investments			197,573	77.4
			--------------	--------------
BlackRock’s Institutional Cash Series plc – US Dollar Liquid Environmentally Aware Fund (Cash Fund)			56,011	21.9
			--------------	--------------
Total equity investments (including Cash Fund)			253,584	99.3
			--------------	--------------
Total investments excluding CFDs			253,584	99.3
			=========	=========

Company	Principal country of operation	Sector	Fair value¹	Gross market exposure²	Gross market exposure as a % of net assets³
			US$’000	US$’000
CFD portfolio
Long positions
United International Transport	Saudi Arabia	Industrials		9,153	3.6
Almarai	Saudi Arabia	Consumer Staples		7,868	3.1
Yanbu National Petrochemical	Saudi Arabia	Materials		4,753	1.9
National Medical Care	Saudi Arabia	Health Care		3,204	1.2
				--------------	--------------
				24,978	9.8
				--------------	--------------
Vincom Retail	Vietnam	Real Estate		6,791	2.7
Quang Ngai Sugar	Vietnam	Consumer Staples		5,126	2.0
Mobile World	Vietnam	Consumer Discretionary		4,927	1.9
FPT	Vietnam	Information Technology		4,902	1.9
Petrovietnam Fertilizer & Chemicals	Vietnam	Materials		1,819	0.7
				--------------	--------------
				23,565	9.2
				--------------	--------------
MCB Bank	Pakistan	Financials		7,337	2.9
Hub Power	Pakistan	Utilities		658	0.2
				--------------	--------------
				7,995	3.1
				--------------	--------------
Ooredoo	Qatar	Communication Services		6,912	2.7
				--------------	--------------
				6,912	2.7
				--------------	--------------
Astra International	Indonesia	Consumer Discretionary		3,899	1.5
Mitra Adiperkasa	Indonesia	Consumer Discretionary		1,154	0.5
				--------------	--------------
				5,053	2.0
				--------------	--------------
LPP	Poland	Consumer Discretionary		3,487	1.4
				--------------	--------------
				3,487	1.4
				--------------	--------------
National Bank of Greece	Greece	Financials		1,779	0.7
				--------------	--------------
				1,779	0.7
				--------------	--------------
Equity Group	Kenya	Financials		269	0.1
				--------------	--------------
				269	0.1
				--------------	--------------
Sapura Energy	Malaysia	Energy		25	0.0
				--------------	--------------
				25	0.0
				--------------	--------------
Kuwait Food (Americana)⁴	Kuwait	Consumer Discretionary		3	0.0
				--------------	--------------
				3	0.0
			--------------	--------------	--------------
Total long CFD positions			(11,429)	74,066	29.0
			--------------	--------------	--------------
Total short CFD positions			192	(6,331)	(2.5)
			--------------	--------------	--------------
Total CFD portfolio			(11,237)	67,735	26.5
			=========	=========	=========

FAIR VALUE AND GROSS MARKET EXPOSURE OF INVESTMENTS

Portfolio	Fair value¹ US$’000	Gross market exposure² US$’000	Gross market exposure as a % of net assets³
Equity investments	197,573	197,573	77.4
Total long CFD positions	(11,429)	74,066	29.0
Total short CFD positions	192	(6,331)	(2.5)
Forward currency positions	1,034	16,043	6.3
	--------------	--------------	--------------
Total gross exposure	187,370	281,351	110.2
	--------------	--------------	--------------
Cash Fund³	56,011	56,011	21.9
	--------------	--------------	--------------
Total investments	243,381	337,362	132.1
	--------------	--------------	--------------
Cash and cash equivalents (net of bank overdraft)^1,3	2,003	(91,978)	(36.1)
Other net current assets	9,912	9,912	4.0
Non current liabilities	(19)	(19)	0.0
	--------------	--------------	--------------
Net assets	255,277	255,277	100.0
	=========	=========	=========

The Company was geared through the use of long and short CFD positions and gross and net gearing as at 31 March 2020 were 8.9% and 3.9% respectively (31 March 2019: 19.6% and 6.4%; 30 September 2019: 14.1% and 6.0%, respectively). Gross and net gearing are Alternative Performance Measures, see Glossary in the half yearly report and financial statements.

¹ Fair value is determined as follows:

Listed investments are valued at bid prices where available, otherwise at latest market traded quoted prices.
The sum of the fair value column for the CFD contracts totalling US$(11,237,000) represents the net losses on the fair valuation of all the CFD contracts, which is determined based on the difference between the notional transaction price and value of the underlying shares in the contract (in effect the unrealised gains/(losses) on the exposed positions). The cost of purchasing the securities held through long CFD positions directly in the market would have amounted to US$85,495,000 at the time of purchase, and subsequent market movements in prices have resulted in unrealised losses on the long CFD positions of US$11,429,000 resulting in the value of the total market exposure to the underlying securities decreasing to US$74,066,000 as at 31 March 2020. The notional price of selling the securities to which exposure was gained via the short CFD positions would have been US$6,523,000 at the time of entering into the contract, and subsequent market movement in prices have resulted in unrealised gains on the short CFD positions of US$192,000 resulting in the value of the market exposure of these investments decreasing to US$6,331,000 at 31 March 2020. If the short positions had been closed on 31 March 2020 this would have resulted in a gain of US$192,000 for the Company.

² Market exposure in the case of equity investments is the same as fair value. In the case of CFDs it is the market value of the underlying shares to which the portfolio is exposed via the contract.

³ The gross market exposure column for cash and cash equivalents has been adjusted to assume the Company held investments directly rather than exposure being gained through CFDs.

⁴ Unquoted investment.

INDEPENDENT REVIEW REPORT TO BLACKROCK FRONTIERS INVESTMENT TRUST PLC

INTRODUCTION
We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 31 March 2020 which comprises the Statement of Comprehensive Income, the Statement of Changes in Equity, the Statement of Financial Position, the Cash Flow Statement and the Notes to the Financial Statements. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

This report is made solely to the Company in accordance with guidance contained in International Standard on Review Engagements 2410 (UK and Ireland) “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our work, for this report, or for the conclusions we have formed.

DIRECTORS’ RESPONSIBILITIES
The half-yearly financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure Guidance and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

As disclosed in note 2, the annual financial statements of the Company are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, “Interim Financial Reporting”, as adopted by the European Union.

OUR RESPONSIBILITY
Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

SCOPE OF REVIEW
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

CONCLUSION
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 31 March 2020 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure Guidance and Transparency Rules of the United Kingdom’s Financial Conduct Authority.

ERNST & YOUNG LLP
London
28 May 2020

STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 31 MARCH 2020

	Notes	Revenue US$’000			Capital US$’000			Total US$’000
		Six months ended		Year ended 30.09.19 (audited)	Six months ended		Year ended 30.09.19 (audited)	Six months ended		Year ended 30.09.19 (audited)
		31.03.20 (unaudited)	31.03.19 (unaudited)	Year ended 30.09.19 (audited)	31.03.20 (unaudited)	31.03.19 (unaudited)	Year ended 30.09.19 (audited)	31.03.20 (unaudited)	31.03.19 (unaudited)	Year ended 30.09.19 (audited)

Income
Income from investments held at fair value
through profit or loss	3	4,767	6,788	21,717	–	–	–	4,767	6,788	21,717
Net income from contracts for difference	3	1,075	2,679	1,858	–	–	–	1,075	2,679	1,858
Other income	3	51	111	216	–	–	–	51	111	216
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Total revenue		5,893	9,578	23,791	–	–	–	5,893	9,578	23,791
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Net (loss)/profit on investments held at fair value through profit or loss		–	–	–	(108,372)	5,151	(21,959)	(108,372)	5,151	(21,959)
Net profit/(loss) on foreign exchange		–	–	–	203	(333)	(406)	203	(333)	(406)
Net (loss)/profit from contracts for difference		–	–	–	(30,588)	(1,020)	1,423	(30,588)	(1,020)	1,423
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Total		5,893	9,578	23,791	(138,757)	3,798	(20,942)	(132,864)	13,376	2,849
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Expenses
Investment management and
performance fees	4	(418)	(422)	(886)	(1,671)	(1,686)	(3,543)	(2,089)	(2,108)	(4,429)
Other operating expenses	5	(533)	(535)	(1,082)	(49)	(97)	(214)	(582)	(632)	(1,296)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Total operating expenses		(951)	(957)	(1,968)	(1,720)	(1,783)	(3,757)	(2,671)	(2,740)	(5,725)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Net profit/(loss) on ordinary activities before finance costs and taxation		4,942	8,621	21,823	(140,477)	2,015	(24,699)	(135,535)	10,636	(2,876)
Finance costs	6	(4)	(308)	(311)	(16)	(1,230)	(1,245)	(20)	(1,538)	(1,556)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Net profit/(loss) on ordinary activities before taxation		4,938	8,313	21,512	(140,493)	785	(25,944)	(135,555)	9,098	(4,432)
Taxation	7	(664)	(1,354)	(2,588)	160	(129)	339	(504)	(1,483)	(2,249)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Profit/(loss) for the period		4,274	6,959	18,924	(140,333)	656	(25,605)	(136,059)	7,615	(6,681)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Earnings/(loss) per ordinary share (cents)	9	1.77	3.19	8.24	(58.16)	0.30	(11.15)	(56.39)	3.49	(2.91)
		=========	=========	=========	=========	=========	=========	=========	=========	=========

The total column of this statement represents the Company’s Statement of Comprehensive Income, prepared in accordance with the International Financial Reporting Standards (IFRS) as adopted by the European Union (EU). The supplementary revenue and capital columns are both prepared under guidance published by the Association of Investment Companies (AIC). All items in the above statement derive from continuing operations. No operations were acquired or discontinued during the year. All income is attributable to the equity holders of the Company.

The Company does not have any other comprehensive income/(loss). The net profit/(loss) for the period disclosed above represents the Company’s total comprehensive income/(loss).

STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 31 MARCH 2020

	Notes	Called up share capital US$’000	Share premium account US$’000	Capital redemption reserve US$’000	Special reserve US$’000	Capital reserves US$’000	Revenue reserve US$’000	Total US$’000
For the six months ended 31 March 2020 (unaudited)
At 30 September 2019		2,407	164,007	5,798	230,799	(18,374)	16,183	400,820
Total comprehensive income:
Net (loss)/profit for the period		–	–	–	–	(140,333)	4,274	(136,059)
Transactions with owners, recorded directly to equity:
Share issues	10	11	1,987	–	–	–	–	1,998
Share issue costs		–	(10)	–	–	–	–	(10)
Dividend paid¹	8	–	–	–	–	–	(11,472)	(11,472)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------
At 31 March 2020		2,418	165,984	5,798	230,799	(158,707)	8,985	255,277
		--------------	--------------	--------------	--------------	--------------	--------------	--------------
For the six months ended 31 March 2019 (unaudited)
At 30 September 2018		2,006	95,095	5,798	230,799	7,231	15,566	356,495
Total comprehensive income:
Net profit for the period		–	–	–	–	656	6,959	7,615
Transactions with owners, recorded directly to equity:
Share issues		62	10,783	–	–	–	–	10,845
Share issue costs		–	(55)	–	–	–	–	(55)
Share issues – conversion of C shares	11	339	58,184	–	–	–	–	58,523
Dividend paid²		–	–	–	–	–	(11,087)	(11,087)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------
At 31 March 2019		2,407	164,007	5,798	230,799	7,887	11,438	422,336
		--------------	--------------	--------------	--------------	--------------	--------------	--------------
For the year ended 30 September 2019 (audited)
At 30 September 2018		2,006	95,095	5,798	230,799	7,231	15,566	356,495
Total comprehensive income:
Net (loss)/profit for the year		–	–	–	–	(25,605)	18,924	(6,681)
Transactions with owners, recorded directly to equity:
Share issues		62	10,783	–	–	–	–	10,845
Share issue costs		–	(55)	–	–	–	–	(55)
Share issues – conversion of C shares	11	339	58,184	–	–	–	–	58,523
Dividends paid³		–	–	–	–	–	(18,307)	(18,307)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------
At 30 September 2019		2,407	164,007	5,798	230,799	(18,374)	16,183	400,820
		=========	=========	=========	=========	=========	=========	=========

¹ Final dividend of 4.75 cents per share for the year ended 30 September 2019, declared on 6 December 2019 and paid on 7 February 2020.

² Final dividend of 4.40 cents per share for the year ended 30 September 2018, declared on 10 December 2018 and paid on 7 February 2019 and special dividend paid in respect of the year ended 30 September 2018 of 1.00 cent per share, declared on 10 December 2018 and paid on 7 February 2019.

³ Final dividend of 4.40 cents per share for the year ended 30 September 2018, declared on 10 December 2018 and paid on 7 February 2019 and special dividend paid in respect of the year ended 30 September 2018 of 1.00 cent per share, declared on 10 December 2018 and paid on 7 February 2019. Interim dividend paid in respect of the year ended 30 September 2019 of 3.00 cents per share, declared on 30 May 2019 and paid on 28 June 2019.

Costs related to the acquisition and disposal of investments amounted to US$114,000 and US$334,000 respectively for the six months ended 31 March 2020 (six months ended 31 March 2019: US$341,000 and US$248,000; year ended 30 September 2019: US$528,000 and US$530,000).

The share premium account and capital redemption reserve are not distributable profits under the Companies Act 2006. The special reserve may be used as distributable profits for all purposes and, in particular, for the repurchase by the Company of its ordinary shares and for payment as dividends. In accordance with the Company’s articles, net capital reserves may be distributed by way of the repurchase by the Company of its ordinary shares and for payment as dividends.

STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2020

	Notes	31 March 2020 US$’000 (unaudited)	31 March 2019 US$’000 (unaudited)	30 September 2019 US$’000 (audited)
Non current assets
Investments held at fair value through profit or loss		253,584	415,383	393,582
		--------------	--------------	--------------
Current assets
Other receivables		4,919	8,674	7,760
Derivative financial assets held at fair value through profit or loss – contracts for difference		1,504	1,273	3,414
Derivative financial assets held at fair value through profit or loss – currency hedges		1,047	–	–
Cash and cash equivalents		2,248	4,656	6,020
Cash collateral held with brokers		24,340	4,270	40
		--------------	--------------	--------------
		34,058	18,873	17,234
		--------------	--------------	--------------
Total assets		287,642	434,256	410,816
		--------------	--------------	--------------
Current liabilities
Other payables		(18,407)	(7,714)	(5,211)
Derivative financial liabilities held at fair value through profit or loss – contracts for difference		(12,741)	(4,186)	(1,056)
Derivative financial liabilities held at fair value through profit or loss – currency hedges		(13)	–	–
Cash collateral received		(940)	–	(3,710)
Bank overdraft		(245)	(1)	–
		--------------	--------------	--------------
		(32,346)	(11,901)	(9,977)
		--------------	--------------	--------------
Total assets less current liabilities		255,296	422,355	400,839
		--------------	--------------	--------------
Non current liabilities
Management shares of £1.00 each (one quarter paid)		(19)	(19)	(19)
		--------------	--------------	--------------
Net assets		255,277	422,336	400,820
		=========	=========	=========
Equity attributable to equity holders
Called up share capital	10	2,418	2,407	2,407
Share premium account		165,984	164,007	164,007
Capital redemption reserve		5,798	5,798	5,798
Special reserve		230,799	230,799	230,799
Capital reserves		(158,707)	7,887	(18,374)
Revenue reserve		8,985	11,438	16,183
		--------------	--------------	--------------
Total equity		255,277	422,336	400,820
		=========	=========	=========
Net asset value per ordinary share (cents)	9	105.56	175.48	166.54
		=========	=========	=========

CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 31 MARCH 2020

	Six months ended 31 March 2020 US$’000 (unaudited)	Six months ended 31 March 2019 US$’000 (unaudited)	Year ended 30 September 2019 US$’000 (audited)
Operating activities
Net (loss)/profit on ordinary activities before taxation	(135,555)	9,098	(4,432)
Add back finance costs	20	1,538	1,556
Net loss/(profit) on investments and contracts for difference held at fair value through profit or loss (including transaction costs)	136,781	(5,839)	17,258
Net (gain)/loss on foreign exchange	(203)	333	406
Sales of investments held at fair value through profit or loss	104,580	155,958	298,919
Purchases of investments held at fair value through profit or loss	(88,128)	(212,672)	(355,397)
Sales of Cash Funds¹	99,830	143,864	307,793
Purchases of Cash Funds¹	(84,655)	(108,476)	(278,045)
Amounts paid for losses on closure of contracts for difference	(39,006)	(35,239)	(67,119)
Amounts received on gains on closure of contracts for difference	23,157	39,342	70,065
Decrease/(increase) in other receivables	245	(1,410)	(16)
Increase in other payables	13,161	3,866	1,546
Decrease/(increase) in amounts due from brokers	2,596	(6,491)	(6,971)
Increase/(decrease) in amounts due to brokers	35	(4,105)	(4,182)
Net cash collateral (pledged)/received	(27,070)	5,910	13,850
Taxation paid	(504)	(1,494)	(2,266)
	--------------	--------------	--------------
Net cash inflow/(outflow) from operating activities	5,284	(15,817)	(7,035)
	--------------	--------------	--------------
Financing activities
Interest paid	(20)	(25)	(43)
Cash proceeds from ordinary share issues	1,998	10,845	10,845
Ordinary share issue costs paid	(10)	(55)	(55)
Cash proceeds from C share issue	–	9,853	9,853
Cash received from BlackRock Emerging Europe Plc	–	7,353	7,353
C share issue costs paid	–	(504)	(610)
Dividends paid	(11,472)	(11,087)	(18,307)
	--------------	--------------	--------------
Net cash (outflow)/inflow from financing activities	(9,504)	16,380	9,036
	--------------	--------------	--------------
(Decrease)/increase in cash and cash equivalents	(4,220)	563	2,001
Effect of foreign exchange rate changes	203	(333)	(406)
	--------------	--------------	--------------
Change in cash and cash equivalents	(4,017)	230	1,595
Cash and cash equivalents at the start of the period	6,020	4,425	4,425
	--------------	--------------	--------------
Cash and cash equivalents at the end of the period	2,003	4,655	6,020
	--------------	--------------	--------------
Comprised of:
Cash at bank	2,248	4,656	6,020
Bank overdraft	(245)	(1)	–
	--------------	--------------	--------------
Total	2,003	4,655	6,020
	=========	=========	=========

¹ Cash Funds represents funds held on deposit with BlackRock’s Institutional Cash Series plc – US Dollar Liquid Environmentally Aware Fund (31 March 2019: BlackRock’s Institutional Cash Series plc – US Dollar Liquidity Fund; 30 September 2019: BlackRock Institutional Cash Series plc – US Dollar Liquid Environmentally Aware Fund).

NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 31 MARCH 2020

1. PRINCIPAL ACTIVITY
The principal activity of the Company is that of an investment trust company within the meaning of Section 1158 of the Corporation Tax Act 2010.

2. BASIS OF PREPARATION
The half yearly financial statements for the period ended 31 March 2020 have been prepared in accordance with the Disclosure Guidance and Transparency Rules sourcebook of the Financial Conduct Authority and with International Accounting Standard 34 (IAS 34), ’Interim Financial Reporting’, as adopted by the European Union (EU). The half yearly financial statements should be read in conjunction with the Company’s Annual Report and Financial Statements for the year ended 30 September 2019, which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU and as applied in accordance with the provisions of the Companies Act 2006 and in accordance with IAS 34 Interim Financial Reporting.

Insofar as the Statement of Recommended Practice (SORP) for investment trust companies and venture capital trusts issued by the Association of Investment Companies (AIC) in October 2019, is compatible with IFRS, the financial statements have been prepared in accordance with guidance set out in the SORP.

The revised SORP issued in October 2019 is applicable for accounting periods beginning on or after 1 January 2019, therefore the Company has adopted the new SORP for the accounting year beginning 1 October 2019. As a result, there will be an amended presentation of movements in investments held at fair value through profit or loss in the notes to the financial statements, which will be included as part of the 2020 Annual Report and Financial Statements. As this note is not included as part of the Interim Report and Financial Statements, there is no impact on the Interim Report and Financial Statements as a result of the adoption of the revised SORP.

Adoption of new and amended standards and interpretations
IFRS 16 Leases
The Company adopted IFRS 16 as of the date of initial application of 1 October 2019. IFRS 16 specifies accounting for leases and removes the distinction between operating and finance leases. This standard is not applicable to the Company as it has no leases.

IFRIC 23 Uncertainty over Income Tax Treatments
The Company adopted IFRIC 23 as of the date of initial application of 1 October 2019. IFRIC 23 seeks to provide clarity on how to account for uncertainty over income tax treatments and specifies that an entity must consider whether it is probable that the relevant tax authority will accept each tax treatment, or group of tax treatments, that it plans to use in its income tax filing. The interpretation also requires companies to reassess the judgements and estimates applied if facts and circumstances change. The interpretation would require the Company to recognise uncertain tax positions which are more than probable within its financial statements and it could potentially require the Company to recognise tax reclaims filed with HMRC if their recoverability becomes more than probable. The adoption of this interpretation has had no impact on the financial statements of the Company.

IFRS standards that have yet to be adopted
Amendments to IFRS 3 – definition of a business (effective 1 January 2020). This amendment revises the definition of a business. According to feedback received by the International Accounting Standards Board, application of the current guidance is commonly thought to be too complex and it results in too many transactions qualifying as business combinations. The standard has not been endorsed by the EU. This standard is unlikely to have any impact on the Company.

Amendments to IAS 1 and IAS 8 – definition of material (effective 1 January 2020). The amendments to IAS 1, ’Presentation of Financial Statements’, and IAS 8, ’Accounting Policies, Changes in Accounting Estimates and Errors’, and consequential amendments to other IFRSs require companies to:

(i) use a consistent definition of materiality throughout IFRSs and the Conceptual Framework for Financial Reporting;

(ii) clarify the explanation of the definition of material; and

(iii) incorporate some of the guidance of IAS 1 about immaterial information.

This standard has not been endorsed by the EU. This standard is unlikely to have any impact on the Company.

Amendments to IFRS 9, IAS 39 and IFRS 7 – interest rate benchmark reform (effective 1 January 2020). These amendments provide certain reliefs in connection with the interest rate benchmark reform. The reliefs relate to hedge accounting and have the effect that the Inter Bank Offer Rate (IBOR) reform should not generally cause hedge accounting to terminate. However, any hedge ineffectiveness should continue to be recorded in the income statement. Given the pervasive nature of hedges involving IBOR based contracts, the reliefs will affect companies in all industries.

This standard has been endorsed by the EU. This standard is unlikely to have any significant impact on the Company.

IFRS 17 – insurance contracts (effective 1 January 2021). This standard replaces IFRS 4, which currently permits a wide variety of practices in accounting for insurance contracts. IFRS 17 will fundamentally change the accounting by all entities that issue insurance contracts and investment contracts with discretionary participation features. The standard has not been endorsed by the EU. This standard is unlikely to have any impact on the Company as it has no insurance contracts.

C share liability
On 27 November 2018, the Company issued 44,927,580 C shares with a nominal value of 10 cents each at a price of £1.00 per share. On 11 January 2019, the C shares were converted into Ordinary shares. The conversion ratio, which has been calculated by reference to the net assets of the Company attributable to the Ordinary shares and the net assets of the Company attributable to the C shares as at the close of business on 7 January 2019 was 0.7547 Ordinary shares for every C share held.

The C shares (when in issue) were listed on the London Stock Exchange. After the conversion of the C shares into Ordinary shares, the C shares were delisted on 22 January 2019.

While the C shares were in issue, the results, assets and liabilities attributable to the C shares were accounted for in a separate pool to the results, assets and liabilities of the Ordinary shares. A share of the management fee and other expenses for the period that the C shares had been in issue was allocated to the C share pool.

C shares are recognised on issue at fair value of the proceeds received less directly attributable transaction costs. After initial recognition, C shares are subsequently measured at amortised cost using the effective interest method. Amortisation is credited or charged to finance income or finance costs in the Statement of Comprehensive Income. Transaction costs are amortised to the earliest conversion period.

The C shares issued represented contracts for conversion into a variable number of Ordinary shares and therefore the C shares are classified as liabilities under IAS 32. The classification resulted in the issue costs and the return on the C shares being presented as finance costs in the Company’s Statement of Comprehensive Income. The return on the C shares represented an increase in the assets attributable to the C shares over and above the proceeds raised from their issue.

3. INCOME

	Six months ended 31 March 2020 (unaudited) US$’000	Six months ended 31 March 2019 (unaudited) US$’000	Year ended 30 September 2019 (audited) US$’000
Investment income:
UK dividends	–	–	139
Overseas dividends	3,469	4,109	14,573
Overseas special dividends	627	1,101	1,224
Overseas stock dividends	–	451	3,780
Interest from Cash Funds	671	1,068	1,942
Fixed interest income	–	59	59
	--------------	--------------	--------------
	4,767	6,788	21,717
	--------------	--------------	--------------
Net income from contracts for difference	1,075	2,679	1,858
	--------------	--------------	--------------
	5,842	9,467	23,575
	--------------	--------------	--------------
Other income:
Deposit interest	51	111	216
	--------------	--------------	--------------
Total income	5,893	9,578	23,791
	=========	=========	=========

Dividends and interest received in cash in the six months ended 31 March 2020 amounted to US$3,655,000 and US$651,000 (six months ended 31 March 2019: US$4,130,000 and US$1,040,000; year ended 30 September 2019: US$17,600,000 and US$2,007,000) respectively.

No special dividends have been recognised in capital for the six months ended 31 March 2020 (six months ended 31 March 2019: US$nil; year ended 30 September 2019: US$104,000).

4. INVESTMENT MANAGEMENT AND PERFORMANCE FEES

	Six months ended 31 March 2020 (unaudited)			Six months ended 31 March 2019 (unaudited)			Year ended 30 September 2019 (audited)
	Revenue US$’000	Capital US$’000	Total US$’000	Revenue US$’000	Capital US$’000	Total US$’000	Revenue US$’000	Capital US$’000	Total US$’000
Investment management fee	418	1,671	2,089	422	1,686	2,108	886	3,543	4,429
	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Total	418	1,671	2,089	422	1,686	2,108	886	3,543	4,429
	=========	=========	=========	=========	=========	=========	=========	=========	=========

An investment management fee equivalent to 1.10% per annum of the Company’s gross assets (defined as the aggregate net assets of the long equity and CFD portfolios of the Company) is payable to the Manager. In addition, the Manager is also entitled to receive a performance fee at a rate of 10% of any increase in the NAV at the end of a performance period over and above what would have been achieved had the NAV since launch increased in line with the Benchmark Index, which, since 1 April 2018, is a composite of the MSCI Emerging Markets Index ex Selected Countries + MSCI Frontier Markets Index + MSCI Saudi Arabia Index.

For the six months ended 31 March 2020, the Company’s NAV did not outperform the Benchmark Index on a US Dollar basis; therefore, a performance fee of US$nil has been accrued (six months ended 31 March 2019: US$nil; year ended 30 September 2019: US$nil).

The performance fee payable in any year is capped at an amount equal to 2.5% or 1.0% of the gross assets if there is any increase or decrease in the NAV per share at the end of the relevant performance period, respectively. Any capped excess outperformance for a period may be carried forward to the next two performance periods, subject to the then applicable annual cap. The performance fee is also subject to a high watermark such that any performance fee is only payable to the extent that the cumulative relative outperformance of the NAV is greater than what would have been achieved had the NAV increased in line with the Benchmark Index since the last date in relation to which a performance fee has been paid.

Under the terms of the C share issue in November 2018, BlackRock agreed to waive the management fees payable by the Company up to the value of the issue expenses that exceeded the capped amount of 1.00% of the gross proceeds from the issue of C shares. As the issue expenses exceeded the capped amount, the excess issue expenses of US$34,000 have been offset against the investment management fee payable by the Company during the period ended 31 March 2019 and year ended 30 September 2019.

5. OTHER OPERATING EXPENSES

	Six months ended 31 March 2020 (unaudited) US$’000	Six months ended 31 March 2019 (unaudited) US$’000	Year ended 30 September 2019 (audited) US$’000
Allocated to revenue:
Custody fee	167	184	366
Auditor’s remuneration:
– audit services	22	19	36
– other assurance services¹	5	5	8
Registrar’s fee	18	18	42
Directors’ emoluments	109	97	201
Broker fees	20	20	38
Depositary fees²	14	20	44
Marketing fees	49	44	79
AIC fees	16	13	26
FCA fees	9	9	16
Printing and Postage fees	16	22	40
Employer NI Contributions	15	10	20
Stock exchange listings	7	6	11
Legal and professional fees	7	7	12
Other administrative costs	59	61	143
	-------------	-------------	-------------
	533	535	1,082
	========	========	========
Allocated to capital:
Custody transaction charges	49	97	214
	-------------	-------------	-------------
	49	97	214
	-------------	-------------	-------------
	582	632	1,296
	========	========	========

¹ Fees for non audit services relate to the following services provided by the Auditor:

£4,000 (US$5,000) (six months ended 31 March 2019: £4,000 (US$5,000); year ended 30 September 2019: £6,500 (US$8,000) relating to the review of the interim financial statements.
£nil (US$nil) (six months ended 31 March 2019 and year ended 30 September 2019: £37,500 (US$49,000) (excluding VAT)) in respect of the work on the Company’s C share issue. These fees were included as part of the C shares liability detailed in note 11 and were debited to the Company’s Statement of Comprehensive Income as finance costs.

² All expenses other than depositary fees are paid in Sterling and are therefore subject to exchange rate fluctuations.

6. FINANCE COSTS

	Six months ended 31 March 2020 (unaudited)			Six months ended 31 March 2019 (unaudited )			Year ended 30 September 2019 (audited)
	Revenue US$’000	Capital US$’000	Total US$’000	Revenue US$’000	Capital US$’000	Total US$’000	Revenue US$’000	Capital US$’000	Total US$’000
Interest payable – bank overdraft	4	16	20	5	20	25	8	35	43
Amortisation of C share issue costs	–	–	–	122	488	610	122	488	610
Return on C shares	–	–	–	181	722	903	181	722	903
	-------------	-------------	-------------	-------------	-------------	-------------	-------------	-------------	-------------
Total	4	16	20	308	1,230	1,538	311	1,245	1,556
	========	========	========	========	========	========	========	========	========

7. TAXATION

	Six months ended 31 March 2020 (unaudited)			Six months ended 31 March 2019 (unaudited)			Year ended 30 September 2019 (audited)
	Revenue US$’000	Capital US$’000	Total US$’000	Revenue US$’000	Capital US$’000	Total US$’000	Revenue US$’000	Capital US$’000	Total US$’000
Analysis of tax charge/(credit) for the period:
Current tax:
Corporation tax	160	(160)	–	561	(561)	–	1,029	(1,029)	–
Corporation tax – prior year adjustment	–	–	–	415	(415)	–	415	(415)	–
Overseas tax	504	–	504	378	–	378	1,144	–	1,144
Overseas tax on capital gains	–	–	–	–	1,105	1,105	–	1,105	1,105
	-------------	-------------	-------------	-------------	-------------	-------------	-------------	-------------	-------------
Total tax charge	664	(160)	504	1,354	129	1,483	2,588	(339)	2,249
	========	========	========	========	========	========	========	========	========

8. DIVIDENDS
The Board has declared an interim dividend of 2.75 cents per share for the period ended 31 March 2020 which will be paid on 26 June 2020 to shareholders on the register at 5 June 2020 (interim dividend for the six months ended 31 March 2019 and for the year ended 30 September 2019: 3.00 cents per share paid on 28 June 2019 to shareholders on the register at 7 June 2019). This dividend has not been accrued in the financial statements for the six months ended 31 March 2020 as, under IFRS, interim dividends are not recognised until paid. Dividends are debited directly to reserves.

9. EARNINGS AND NET ASSET VALUE PER ORDINARY SHARE

	Six months ended 31 March 2020 (unaudited)	Six months ended 31 March 2019 (unaudited)	Year ended 30 September 2019 (audited)
Net revenue profit attributable to ordinary shareholders (US$’000)	4,274	6,959	18,924
Net capital (loss)/profit attributable to ordinary shareholders (US$’000)	(140,333)	656	(25,605)
	-----------------	-----------------	-----------------
Total (loss)/profit attributable to ordinary shareholders (US$’000)	(136,059)	7,615	(6,681)
	-----------------	-----------------	-----------------
Equity shareholders’ funds (US$’000)	255,277	422,336	400,820
	-----------------	-----------------	-----------------
The weighted average number of ordinary shares in issue during the period on which the earnings per ordinary share was calculated was:	241,292,473	218,214,127	229,597,290
	-----------------	-----------------	----------------
The actual number of ordinary shares in issue at the end of each period on which the net asset value per ordinary share was calculated was:	241,822,801	240,672,801	240,672,801
	-----------------	-----------------	-----------------
Return per ordinary share
Revenue earnings per share (cents)	1.77	3.19	8.24
Capital (loss)/earnings per share (cents)	(58.16)	0.30	(11.15)
	-----------------	-----------------	-----------------
Total (loss)/earnings per share (cents)	(56.39)	3.49	(2.91)
	==========	==========	==========

	As at 31 March 2020 (unaudited)	As at 31 March 2019 (unaudited)	As at 30 September 2019 (audited)
Net asset value per ordinary share (cents)	105.56	175.48	166.54
Ordinary share price (cents)¹	103.17	173.31	162.66
Net asset value per ordinary share (pence)	85.13	134.67	135.15
Ordinary share price (pence)	83.20	133.00	132.00
	======	======	======

¹ The Company’s share price is quoted in Sterling and the above represents the US dollar equivalent, based on exchange rates of $1.2400 to £1 at 31 March 2020, US$1.3031 to £1 at 31 March 2019 and US$1.2323 to £1 at 30 September 2019.

10. CALLED UP SHARE CAPITAL

	Number of ordinary shares	Nominal value
		US$’000
Allotted, called up and fully paid share capital comprised:
Ordinary shares of 1 cent each:
At 30 September 2019	240,672,801	2,407
	-----------------	-----------------
Share issues	1,150,000	11
	-----------------	-----------------
At 31 March 2020	241,822,801	2,418
	==========	==========

The Company also has in issue 50,000 management shares which carry the right to a fixed cumulative preferred dividend.

During the period to 31 March 2020, the Company issued 1,150,000 ordinary shares (six months ended 31 March 2019: 6,150,000; year ended 30 September 2019: 6,150,000) for a total gross consideration of US$1,998,000 (six months ended 31 March 2019: US$10,845,000; year ended 30 September 2019: US$10,845,000).

Since 31 March 2020 and up to the date of this report, no further ordinary shares have been issued.

11. C SHARES: FINANCIAL LIABILITY

	31 March 2020 US$’000	31 March 2019 US$’000	30 September 2019 US$’000
Net proceeds from issue of C shares	–	57,010	57,010
Amortisation of C share issue costs	–	610	610
Return on C share liability	–	903	903
Extinguishment of C share liability upon conversion to Ordinary shares	–	(58,523)	(58,523)
	-------------	-------------	-------------
	–	–	–
	========	========	========

On 27 November 2018, the Company issued 44,927,580 C shares with a nominal value of 10 cents each at a price of £1.00 per share. On 11 January 2019, the C shares were converted into 33,906,693 ordinary shares. The conversion ratio, which was calculated by reference to the net assets of the Company attributable to the ordinary shares and the net assets of the Company attributable to the C shares as at the close of business on 7 January 2019 was 0.7547 ordinary shares for every C share held.

The C shares (when in issue) were listed on the London Stock Exchange. After the conversion of the C shares to ordinary shares, the C shares were delisted on 22 January 2019.

While the C shares were in issue, the results, assets and liabilities attributable to the C shares were accounted for in a separate pool to the results, assets and liabilities of the ordinary shares. A share of management fee and other expenses for the period the C shares had been in issue was allocated to the C share pool.

The table below gives a breakdown of the gross proceeds (excluding issue costs) from the issue of C shares during the period:

	31 March 2020 US$’000	31 March 2019 US$’000	30 September 2019 US$’000
Consideration received from C share issue pursuant to rollover option in connection with reconstruction of BlackRock Emerging Europe plc:
Investments	–	40,414	40,414
Cash	–	7,353	7,353
	-------------	-------------	-------------
	–	47,767	47,767
Proceeds from C share issue pursuant to placing and offer for subscription:
Cash	–	9,853	9,853
	-------------	-------------	-------------
Gross proceeds from issue of C shares	–	57,620	57,620
	========	========	========

The table below gives a summary of the results of the C share pool up to the date of conversion:

	31 March 2020 US$’000	31 March 2019 US$’000	30 September 2019 US$’000
Gross proceeds from issue of C shares	–	57,620	57,620
C share issue costs	–	(610)	(610)
Net revenue income	–	114	114
Fair value gains on investments and contracts for difference	–	789	789
Finance costs – amortisation of C share issue costs	–	610	610
	-------------	-------------	-------------
Value of C shares on conversion	–	58,523	58,523
	========	========	========

12. VALUATION OF FINANCIAL INSTRUMENTS
Financial assets and financial liabilities are either carried in the Statement of Financial Position at their fair value (investments and derivatives) or at an amount which is a reasonable approximation of fair value (due from brokers, dividends and interest receivable, due to brokers, accruals, cash at bank and bank overdrafts). IFRS 13 requires the Company to classify fair value measurements using a fair value hierarchy that reflects the significance of inputs used in making the measurements. The valuation techniques used by the Company are explained in the accounting policies note 2(h) as set out on page 77 of the Company’s Annual Report and Financial Statements for the year ended 30 September 2019.

Categorisation within the hierarchy has been determined on the basis of the lowest level input that is significant to the fair value measurement of the relevant asset.

The fair value hierarchy has the following levels:

Level 1 – Quoted market price for identical instruments in active markets
A financial instrument is regarded as quoted in an active market if quoted prices are readily available from an exchange, dealer, broker, industry group, pricing service or regulatory agency and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The Company does not adjust the quoted price for these instruments.

Level 2 – Valuation techniques using observable inputs
This category includes instruments valued using quoted prices for similar instruments in markets that are considered less than active, or other valuation techniques where all significant inputs are directly or indirectly observable from market data.

Valuation techniques used for non-standardised financial instruments such as options, currency swaps and other over-the-counter derivatives include the use of comparable recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, option pricing models and other valuation techniques commonly used by market participants making the maximum use of market inputs and relying as little as possible on entity specific inputs.

As at the period end the CFDs were valued using the underlying equity bid price and the inputs to the valuation were the exchange rates used to convert the CFD valuation from the relevant local currency in which the underlying equity was priced to US Dollars at the period end date. There have been no changes to the valuation technique since the previous year or as at the date of this report.

Level 3 – Valuation techniques using significant unobservable inputs
This category includes all instruments where the valuation technique includes inputs not based on market data and these inputs could have a significant impact on the instrument’s valuation.

This category also includes instruments that are valued based on quoted prices for similar instruments where significant entity determined adjustments or assumptions are required to reflect differences between the instruments and instruments for which there is no active market. The Investment Manager considers observable data to be that market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary and provided by independent sources that are actively involved in the relevant market.

The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement.

Assessing the significance of a particular input to the fair value measurement in its entirety requires judgement, considering factors specific to the asset or liability. The determination of what constitutes ’observable’ inputs requires significant judgement by the Investment Manager.

CFDs have been classified as Level 2 investments as their valuation has been based on market observable inputs represented by the market prices of the underlying quoted securities to which these contracts expose the Company.

The table below sets out fair value measurements using the IFRS 13 fair value hierarchy.

Financial assets/(liabilities) at fair value through profit or loss at 31 March 2020 (unaudited)	Level 1 US$’000	Level 2 US$’000	Level 3 US$’000	Total US$’000
Assets:
Equity investments	197,573	–	–	197,573
Cash Fund	56,011	–	–	56,011
Contracts for difference (fair value)	–	1,501	3	1,504
Derivative financial instruments – currency hedges (fair value)	–	1,047	–	1,047
Liabilities:
Contracts for difference (fair value)	–	(12,741)	–	(12,741)
Derivative financial instruments – currency hedges (fair value)	–	(13)	–	(13)
	-------------	-------------	-------------	-------------
	253,584	(10,206)	3	243,381
	========	========	========	========

Financial assets/(liabilities) at fair value through profit or loss at 31 March 2019 (unaudited)	Level 1 US$’000	Level 2 US$’000	Level 3 US$’000	Total US$’000
Assets:
Equity investments	349,854	–	–	349,854
Cash Fund	65,529	–	–	65,529
Contracts for difference (fair value)	–	1,270	3	1,273
Liabilities:
Contracts for difference (fair value)	–	(4,186)	–	(4,186)
	-------------	-------------	-------------	-------------
	415,383	(2,916)	3	412,470
	========	========	========	========

Financial assets/(liabilities) at fair value through profit or loss at 30 September 2019 (audited)	Level 1 US$’000	Level 2 US$’000	Level 3 US$’000	Total US$’000
Assets:
Equity investments	322,391	–	–	322,391
Cash Fund	71,191	–	–	71,191
Contracts for difference (fair value)	–	3,411	3	3,414
Liabilities:
Contracts for difference (fair value)	–	(1,056)	–	(1,056)
	-------------	-------------	-------------	-------------
	393,582	2,355	3	395,940
	========	========	========	========

There were no transfer between levels of financial assets and financial liabilities during the period recorded at fair value as at 31 March 2020, 31 March 2019 or the year ended 30 September 2019. The Company held one Level 3 security throughout the period ended 31 March 2020.

The values of derivative positions classified as Level 2 as at 31 March 2019 have been restated to fair value to align with the values presented on the Statement of Financial Position. The amounts presented in the prior period financial statements were presented on a gross exposure basis as follows: total gross exposure on long derivative positions was presented as an asset of $127,466,000 and total gross exposure on short derivative positions was presented as a liability of ($27,775,000).

A reconciliation of fair value measurement in Level 3 is set out below.

Level 3 Financial assets at fair value through profit or loss	31 March 2020 US$’000 (unaudited)	31 March 2019 US$’000 (unaudited)	30 September 2019 US$’000 (audited)
Opening fair value	3	3	3
Closing balance	3	3	3
	========	========	========

13. RELATED PARTY DISCLOSURE: DIRECTORS’ EMOLUMENTS
The Board consists of five non-executive Directors, all of whom are considered to be independent of the Manager by the Board. None of the Directors has a service contract with the Company. With effect from 1 October 2019, the Chairman receives an annual fee of £38,000, the Chairman of the Audit and Management Engagement Committee receives an annual fee of £32,000 and each of the other Directors receives an annual fee of £28,000.

As at 31 March 2020, an amount of US$16,000 (£13,000) was outstanding in respect of Directors’ fees (31 March 2019: US$16,000 (£12,000); 30 September 2019: US$15,000 (£12,000)).

At the period end, members of the Board, including any connected persons, held ordinary shares in the Company as set out below:

	Ordinary shares
Audley Twiston-Davies	128,935
Katrina Hart	30,009
Nick Pitts-Tucker	110,148
Sarmad Zok	–
Stephen White	30,000
	========

14. TRANSACTIONS WITH THE AIFM AND THE INVESTMENT MANAGER
BlackRock Fund Managers Limited (BFM) provides management and administration services to the Company under a contract which is terminable on six months’ notice. BFM has (with the Company’s consent) delegated certain portfolio and risk management services, and other ancillary services, to BlackRock Investment Management (UK) Limited (BIM (UK)). Further details of this investment management contract are disclosed on page 42 of the Directors’ Report in the Company’s Annual Report and Financial Statements for the year ended 30 September 2019.

The investment management fee due for the six months ended 31 March 2020 amounted to US$2,089,000 (six months ended 31 March 2019: US$2,108,000; year ended 30 September 2019: US$4,429,000). No performance fee is payable for the six months ended 31 March 2020 (six months ended 31 March 2019: US$nil; year ended 30 September 2019: US$nil).

At the period end, US$1,062,000 was outstanding in respect of management fees (31 March 2019: US$2,108,000; 30 September 2019: US$2,385,000). There was no performance fee outstanding at the period end (31 March 2019: US$nil; 30 September 2019: US$nil).

In addition to the above services, BlackRock has provided the Company with marketing services. The total fees paid or payable for these services to 31 March 2020 amounted to US$49,000 excluding VAT (six months ended 31 March 2019: US$44,000; year ended 30 September 2019: US$79,000). Marketing fees of US$105,000 excluding VAT (31 March 2019: US$112,000; 30 September 2019: US$147,000) were outstanding as at 31 March 2020.

The Company has an investment in the BlackRock Institutional Cash Series plc - US Dollar Liquid Environmentally Aware Fund of US$56,011,000 as at 31 March 2020 which is a fund managed by a company within the BlackRock Group (31 March 2019: US$65,529,000 held in BlackRock’s Institutional Cash Series plc - US Dollar Liquidity Fund; 30 September 2019: US$71,191,000 held in BlackRock’s Institutional Cash Series plc - US Dollar Liquid Environmentally Aware Fund).

15. CONTINGENT LIABILITIES
There were no contingent liabilities at 31 March 2020 (six months ended 31 March 2019: nil; year ended 30 September 2019: nil).

16. PUBLICATION OF NON STATUTORY ACCOUNTS
The financial information contained in this half yearly report does not constitute statutory accounts as defined in section 435 of the Companies Act 2006. The financial information for the six months ended 31 March 2020 and 31 March 2019 has not been audited.

The information for the year ended 30 September 2019 has been extracted from the latest published audited financial statements which have been filed with the Registrar of Companies, unless otherwise stated. The report of the auditors on those accounts contained no qualifications or statement under sections 498(2) or 498(3) of the Companies Act 2006.

17. ANNUAL RESULTS
The Board expects to announce the annual results for the year ending 30 September 2020 in December 2020.

Copies of the annual results announcement can be obtained from the Secretary on 020 7743 3000 or at cosec@blackrock.com. The Annual Report should be available by late December 2020 with the Annual General Meeting being held in February 2021.

FOR FURTHER INFORMATION, PLEASE CONTACT:

Simon White, Managing Director, Investment Trusts, BlackRock Investment Management (UK) Limited - Tel: 020 7743 3000

Press enquiries:
Lansons Communications – Tel: 020 7294 3689
E-mail: BlackRockInvestmentTrusts@lansons.com

28 May 2020

12 Throgmorton Avenue
London EC2N 2DL
END

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