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Share Name Share Symbol Market Type Share ISIN Share Description
Blackrock Income And Growth Investment Trust Plc LSE:BRIG London Ordinary Share GB0030961691 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  1.50 0.96% 157.00 151.00 163.00 161.00 155.50 155.50 923 09:00:34
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments 2.0 1.7 7.4 21.3 35

BlackRock Income Portfolio Update

16/10/2020 3:54pm

UK Regulatory (RNS & others)


 
TIDMBRIG 
 
The information contained in this release was correct as at 30 September 2020. 
Information on the Company's up to date net asset values can be found on the 
London Stock Exchange Website at: 
 
https://www.londonstockexchange.com/exchange/news/market-news/ 
market-news-home.html. 
 
BLACKROCK INCOME & GROWTH INVESTMENT TRUST PLC (LEI:BLACKROCK INCOME & GROWTH 
INVESTMENT TRUST PLC) 
All information is at 30 September 2020 and unaudited. 
 
Performance at month end with net income reinvested 
 
                                   One    Three        One    Three       Five     Since 
                                 Month   Months       Year    Years      Years   1 April 
                                                                                    2012 
 
Sterling 
 
Share price                      10.6%    12.7%      -5.5%     1.4%      23.6%     85.4% 
 
Net asset value                  -0.7%    -2.4%     -14.1%    -8.3%      13.4%     58.3% 
 
FTSE All-Share Total Return      -1.7%    -2.9%     -16.6%    -9.3%      18.6%     49.0% 
 
Source: BlackRock 
 
BlackRock took over the investment management of the Company with effect from 1 
April 2012. 
 
At month end 
 
Sterling: 
 
            Net asset value - capital only:                                             168.02p 
 
            Net asset value - cum income*:                                              170.65p 
 
            Share price:                                                                182.00p 
 
            Total assets (including income):                                              42.4m 
 
            Premium to cum-income NAV:                                                     6.7% 
 
            Gearing:                                                                       4.6% 
 
            Net yield**:                                                                   4.0% 
 
            Ordinary shares in issue***:                                             22,525,600 
 
            Gearing range (as a % of net assets):                                         0-20% 
 
            Ongoing charges****:                                                           1.1% 
 
 
* Includes net revenue of 2.63 per share 
** The Company's yield based on dividends announced in the last 12 months as at 
the date of the release of this announcement is 4.0% and includes the 2019 
final dividend of 4.60p per share declared on 24 December 2019 and paid to 
shareholders on 19 March 2020 and the 2020 interim dividend of 2.60p per share 
declared on 24 June 2020 and paid to shareholders on 1 September 2020. 
 
*** excludes 10,093,332 shares held in treasury 
 
**** Calculated as a percentage of average net assets and using expenses, 
excluding performance fees and interest costs for the year ended 31 October 
2019. 
 
 
 
Sector Analysis                              Total assets 
                                                      (%) 
 
Financial Services                                    9.9 
 
Pharmaceuticals & Biotechnology                       8.6 
 
Household Goods & Home Construction                   7.7 
 
Personal Goods                                        7.2 
 
Support Services                                      6.9 
 
Media                                                 6.8 
 
Mining                                                6.4 
 
General Retailers                                     5.1 
 
Tobacco                                               4.8 
 
Gas, Water & Multiutilities                           4.7 
 
Banks                                                 4.3 
 
Oil & Gas Producers                                   3.6 
 
Food & Drug Retailers                                 3.0 
 
Health Care Equipment & Services                      2.9 
 
Nonlife Insurance                                     2.9 
 
Travel & Leisure                                      2.5 
 
Life Insurance                                        2.2 
 
Electronic & Electrical Equipment                     1.4 
 
Industrial Engineering                                1.3 
 
Mobile Telecommunications                             0.8 
 
Technology Hardware & Equipment                       0.8 
 
Real Estate Investment Trusts                         0.5 
 
Beverages                                             0.5 
 
Net Current Assets                                    5.2 
 
                                                   ------ 
 
Total                                               100.0 
 
                                                     ==== 
 
Country Analysis          Percentage 
United Kingdom                    92.7 
United States                          2.1 
Net Current Assets                 5.2 
 
=------- 
 
100.0 
 
===== 
 
 
 
Top 10 holdings              Fund % 
 
AstraZeneca                     7.1 
 
Unilever                        5.8 
 
RELX                            5.2 
 
Reckitt Benckiser               5.1 
 
British American Tobacco        4.8 
 
BHP                             4.4 
 
Tesco                           3.0 
 
Smith & Nephew                  2.9 
 
3i                              2.8 
 
John Laing Group                2.8 
 
 
 
 
Commenting on the markets, Adam Avigdori and David Goldman representing the 
Investment Manager noted: 
 
Performance Overview: 
 
The BlackRock Income and Growth Trust returned -0.7% during the month, 
outperforming the FTSE All-Share which returned -1.7%. 
 
Market Summary: 
 
Global equity markets fell in September on the back of geopolitical risks and 
concerns over a second wave of virus infections causing renewed lockdown 
measures. US growth stocks came under pressure in early September, suffering 
their worst sell-off since the depths of the market turmoil in March, with the 
Nasdaq down -5.7% in September. The first US Presidential Election debate 
proved inconclusive and there continues to be a lack of market consensus about 
the ultimate outcome of the election. The death of renowned US Supreme Court 
Justice, Ruth Bader Ginsburg has left an open seat in the Court and looming 
debate over when it will be filled. The British Pound was down 4% against the 
USD as the UK government sought to push forward a bill in Parliament that would 
allow it to override parts of its Withdrawal Agreement with the European Union, 
raising concerns about the rising risks of a no-deal exit from the trading bloc 
at the end of the year if it pushes ahead. 
 
In the UK, new restrictions were implemented following a spike in coronavirus 
cases, included limiting gatherings to 6, encouraging those that can work from 
home to do so and imposing a curfew on pubs and restaurants. The Chancellor's 
Winter Economy Plan was a scaled-down extension of existing measures, focusing 
on the immediate challenges to job retention and corporate cash flow, rather 
than longer-term structural initiatives; estimated at a total GBP5bn. The 
official UK unemployment rate is climbing although there were encouraging signs 
in hours worked and vacancies; those 'temporarily away from work', which 
includes furloughed employees, has fallen. 
 
The FTSE All Share fell -1.7% in September, with Oil and Gas, 
Telecommunications and Financials as top underperformers, whilst Consumer 
Goods, Utilities and Industrials outperformed. 
 
Stocks: 
 
Contributors to performance included John Laing Group. The company announced 
the sale of its largest asset for a good price. Meanwhile, the new CEO has 
implemented change and bought company shares, we continue to see this as a 
compelling investment case. Unilever also contributed after reporting strong 
results in the month. Not owning HSBC also contributed. Financials continue to 
underperform as we continue to see pressure on interest rates and thus concerns 
over the banks' earnings power. 
 
Not owning Diageo detracted from returns. The company announced better 
performance and shares rallied. Whitbread also detracted as travel and leisure 
companies generally continue to struggle. Grafton Group also detracted. 
 
Portfolio Activity: 
 
We purchased The Hut Group which IPO'd in the month, a British e-commerce 
company which sells consumer goods direct to consumer via its proprietary 
e-commerce platform. We anticipate strong growth from its ecommerce solutions 
business. The company's track record in successfully building its own Beauty 
and Nutrition brands and high-profile recent contract wins give us confidence 
in this solution. The group is well-invested, and we expect to see strong top 
line growth to drive strong margins and cash flow. 
 
We sold Trainline and Forterra. 
 
We added to 3i Group, Mastercard, Intermediate Capital and Maxim Integrated 
Products. We reduced BHP Group, Berkeley Group and Next. 
 
On Dividends: 
 
From peak to trough, FTSE All Share dividends fell by around 40%. The Trust has 
fared better than this as we have either not owned or been underweight the 
biggest cuts, and conversely, we have been overweight the more resilient parts 
of the market, we estimate that the Trust has seen a c.30% peak to trough 
decline in dividends.  We believe that this relative resilience stems from our 
focus on identifying cash generative franchises with robust balance sheets. 
 
When assessing the dividend outlook for the FTSE All Share, we estimate that 
around half of this 40% peak-to-trough fall in dividends will prove permanent 
and half will be temporary. Turning to the Trust, we expect less than 10% of 
the portfolio's dividend to be permanently impaired and we are already seeing a 
number of holdings coming back to the dividend list, in some cases reinstating 
dividends that had been deferred during the pandemic. 
 
We view the dividend outlook for the UK market with renewed optimism as we 
expect dividends, in aggregate, to be more resilient and to grow faster in 
future.  A number of companies that we have considered to be overdistributing 
for a number of years have now reset their distributions to more appropriate 
levels.  This gives us confidence that UK Equities offer an attractive source 
of yield in an income-starved global context. 
 
Outlook: 
 
The third quarter has seen a continued normalisation, with improved economic 
activity benefiting from ongoing fiscal and monetary support while government 
restrictions have been eased. In the UK, we have seen schools and offices 
reopening while companies attempt to gauge the underlying demand for their 
products and services as they prepare themselves for the impact of reduced and 
more selective furlough support.  We continue to monitor rising unemployment 
levels and note that the banks are already braced for a significant increase in 
impairments. On a more bullish note, however, we have seen evidence of robust 
consumer spending as Covid-19 impacted travel and leisure spend is diverted to 
other parts of the economy as evidenced by retailers posting strong numbers and 
rising house prices. Accordingly, we continue to tread cautiously; balancing 
the significant long-term opportunities we see with the wide range of 
short-term scenarios and factors. We expect volatility is likely to persist 
given large binary events on the horizon in the near-term, notably the US 
election, Brexit 'deal or no deal' as well as news flow around Covid-19 in 
terms of rising case numbers and the potential for further lockdowns as well as 
vaccines and treatment updates. Longer term, we are conscious of the growing 
tension between the US and China, as well as watching for the potential for a 
more inflationary backdrop which would likely have significant implications for 
market leadership. 
 
We continue use the scale and breath of the platform at BlackRock to leverage 
significant resources across stock analytics, market insights and data science. 
We know, from our experience in 2008/2009, how important these resources and 
support are and the opportunities it enables you to find. We seek to ensure the 
Trust continues to build on the resilience it has demonstrated amidst the 
volatility year to date to deliver strong capital and dividend growth over the 
long term. 
 
16 October 2020 
 
 
 
END 
 

(END) Dow Jones Newswires

October 16, 2020 10:54 ET (14:54 GMT)

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