BlackRock Latin Am Portfolio Update

 
TIDMBRLA 
 
BLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC (LEI: UK9OG5Q0CYUDFGRX4151) 
All information is at 31 December 2018 and unaudited. 
 
Performance at month end with net income reinvested 
 
                                  One      Three       One     Three      Five 
                                month     months      year     years     years 
                                    %          %         %         %         % 
 
Sterling: 
 
Net asset value^                 -0.1        7.3       0.6      77.3      24.7 
 
Share price                       2.9        8.9      -1.0      73.1      22.0 
 
MSCI EM Latin America            -0.6        2.9      -0.4      77.1      21.1 
(Gross Return)^^ 
 
MSCI EM Latin America            -0.6        2.8      -0.8      75.3      19.2 
(Net Return)^^ 
 
US Dollars: 
 
Net asset value^                 -0.3        4.7      -5.4      53.0      -4.1 
 
Share price                       2.8        6.3      -6.9      49.4      -6.3 
 
MSCI EM Latin America            -0.7        0.5      -6.2      53.1      -6.9 
(Gross Return)^^ 
 
MSCI EM Latin America            -0.8        0.4      -6.6      51.5      -8.4 
(Net Return)^^ 
 
^cum income 
 
^^The Company's performance benchmark (the MSCI EM Latin America Index) may be 
calculated on either a Gross or a Net return basis. Net return (NR) indices 
calculate the reinvestment of dividends net of withholding taxes using the tax 
rates applicable to non-resident institutional investors, and hence give a 
lower total return than indices where calculations are on a Gross basis (which 
assumes that no withholding tax is suffered). As the Company is subject to 
withholding tax rates for the majority of countries in which it invests, the NR 
basis is felt to be the most accurate, appropriate, consistent and fair 
comparison for the Company. Historically the benchmark data for the Company has 
always been stated on a Gross basis. However, as disclosed in the Company's 
Interim Report for the six months ended 30 June 2018, it is the Board's 
intention to monitor the Company's performance with reference to the NR version 
of the benchmark. For transparency both sets of benchmark data have been 
provided. 
 
Sources: BlackRock, Standard & Poor's Micropal 
 
At month end 
 
Net asset value - capital only:                                        507.77p 
 
Net asset value - cum income:                                          510.62p 
 
Share price:                                                           437.50p 
 
Total Assets#:                                                          220.5m 
 
Discount (share price to cum income NAV):                                14.3% 
 
Average discount* over the month - cum income:                           15.9% 
 
Net gearing at month end**:                                               8.8% 
 
Gearing range (as a % of net assets):                                    0-25% 
 
Net yield##:                                                              5.4% 
 
Ordinary shares in issue (excluding 2,181,662 shares held in        39,259,620 
treasury): 
 
Ongoing charges***:                                                       1.1% 
 
#Total assets include current year revenue. 
 
##Calculated using total dividends declared in the last 12 months as at the 
date of this announcement (comprising, the 2017 final dividend of 7.00 cents 
per share, the first interim dividend under the new policy of 7.57 cents per 
share paid on 23 August 2018, the second interim dividend under the new policy 
of 7.85 cents per share paid on 9 November 2018 and the third interim dividend 
under the new policy of 8.13 cents per share declared on 2 January 2019 and 
payable on 8 February 2019) as a percentage of month end share price. As 
previously announced, the Board of the BlackRock Latin American Investment 
Trust plc have introduced a new dividend policy whereby the Company will pay 
regular quarterly dividends equivalent to 1.25% of the Company's US Dollar cum 
income NAV on the last working day of December, March, June and September each 
year, with the dividends being paid in February, May, August and November each 
year respectively. The yield on the Company's shares projecting future 
quarterly dividends forward based on the August and October 2018 paid dividends 
and 2 quarters being paid at the same rate as the declared January 2019 
dividend, based on the Company's share price at 31 December 2018 converted to 
US dollars at the exchange rate on 31 December 2018, would be 5.69%. 
 
*The discount is calculated using the cum income NAV (expressed in sterling 
terms). 
 
**Net cash/net gearing is calculated using debt at par, less cash and cash 
equivalents and fixed interest investments as a percentage of net assets. 
 
*** Calculated as a percentage of average net assets and using expenses, 
excluding interest costs for the year ended 31 December 2017. 
 
Geographic Exposure 
 
                             % of Total      % of Equity           MSCI EM Latin 
                                 Assets      Portfolio *           America Index 
 
Brazil                             72.4             73.1                    61.5 
 
Mexico                             21.2             21.5                    22.8 
 
Chile                               3.1              3.2                     8.9 
 
Colombia                            1.4              1.4                     3.3 
 
Argentina                           0.8              0.8                     0.0 
 
Peru                                0.0              0.0                     3.5 
 
Net current liabilities             1.1              0.0                     0.0 
(inc. fixed interest) 
 
                                  -----            -----                   ----- 
 
Total                             100.0            100.0                   100.0 
 
                                  -----            -----                   ----- 
 
 
 
Sector                       % of Equity Portfolio               % of Benchmark 
                                                 * 
 
Financials                                    32.9                         33.6 
 
Materials                                     17.1                         16.4 
 
Consumer Discretionary                        11.1                          5.2 
 
Consumer Staples                               9.2                         14.6 
 
Energy                                         9.0                          9.8 
 
Industrials                                    8.7                          6.2 
 
Communication Services                         6.0                          6.9 
 
Utilities                                      2.9                          4.9 
 
Information Technology                         2.2                          0.5 
 
Health Care                                    0.8                          0.5 
 
Real Estate                                    0.1                          1.4 
 
                                             -----                        ----- 
 
Total                                        100.0                        100.0 
 
                                             -----                        ----- 
 
*excluding net current assets & fixed interest 
 
Ten Largest Equity Investments (in percentage order) 
 
                             Country of Risk                % of             % of 
Company                                         Equity Portfolio        Benchmark 
 
Banco Bradesco               Brazil                          9.2              7.2 
 
Itau Unibanco                Brazil                          9.0              7.6 
 
Petrobras                    Brazil                          9.0              7.2 
 
Vale                         Brazil                          8.7              7.1 
 
America Movil                Mexico                          4.8              4.1 
 
Femsa                        Mexico                          3.6              2.8 
 
Lojas Renner                 Brazil                          3.1              1.3 
 
Grupo Financiero Banorte     Mexico                          3.1              2.2 
 
B3                           Brazil                          3.0              2.4 
 
Walmart de Mexico y          Mexico                          2.8              2.3 
Centroamerica 
 
Commenting on the markets, Ed Kuczma and Sam Vecht, representing the Investment 
Manager noted; 
 
For the month of December 2018, the Company's NAV returned -0.1%1 with the 
share price rising by 2.9%1. The Company's benchmark, the MSCI EM Latin America 
Index, fell by 0.6% (on both a net and gross basis)2 (all performance figures 
are in sterling terms with dividends reinvested). 
 
Our overweight positions and selections within Brazil were the primary drivers 
of returns during the month and performance remained resilient supported by 
stable economic activity. Consumption oriented names such as payment name, 
Linx, and retailers, Renner and B2W, performed well with B2W demonstrating its 
ability to maintain sales growth. A lack of positioning in beverage company, 
Ambev, was the largest individual contributor in December. On the other hand 
our holdings in Mexico weighed on performance in aggregate. Energy-related 
names, Petrobras and Ultrapar, were among the worst performers falling 
alongside declines in the oil price. Similarly, Vale and steel producer Gerdau, 
detracted from performance on commodity price weakness. 
 
During the month we trimmed some Brazilian exposure following strong relative 
performance in the region. On the other hand we added to Mexico as the market 
remained weak on what we believed to be overly negative sentiment. This 
positioning was rewarded on the back of a responsible budget proposal for 2019. 
Broadly, we have been active in taking profits across our positions and 
redeploying capital on market dips. More recently we have also trimmed exposure 
across the resource sectors. The portfolio ended the period being overweight 

Brazil, while being underweight Chile, Peru and Colombia, and maintaining a 
relatively neutral stance on Mexico. We continue to maintain an off-benchmark 
allocation to Argentina through software exporter, Globant. At the sector 
level, we are overweight the domestic consumer, while being underweight staples 
and utilities. 
 
Brazil remains our largest overweight, given our positive expectations for the 
incoming administration. So far President-elect, Jair Bolsonaro, has delivered 
on his campaign promises, looking to reduce the size of the government by 
initially reducing the number of ministries, naming sector/subject experts to 
lead cabinets, and pointing to a continuation of the reform process initiated 
two years ago. Meanwhile, the outlook for upcoming corporate results point to a 
continuation in the economic recovery, providing strong momentum for growth 
into 2019. Elsewhere, the cancellation of NAIM (New Mexico International 
Airport) reminded markets of the concerns regarding increasing populism for the 
incoming administration in Mexico, reinforcing our cautious view on Mexican 
equities. We remain underweight the Andean region due to a combination of 
unattractive valuation and disappointing growth. Finally, the dramatic sell off 
in Argentina in 2018 leaves the stocks trading at attractive valuations while 
interest rates and the currency have mostly stabilized providing a foundation 
for the economy to rebound from recent downturn. 
 
Sources: 
1BlackRock as at 31 December 2018 
2Datastream as at 31 December 2018 
 
18 January 2019 
 
ENDS 
 
Latest information is available by typing www.blackrock.co.uk/brla on the 
internet, "BLRKINDEX" on Reuters, "BLRK" on Bloomberg or "8800" on Topic 3 (ICV 
terminal).  Neither the contents of the Manager's website nor the contents of 
any website accessible from hyperlinks on the Manager's website (or any other 
website) is incorporated into, or forms part of, this announcement. 
 
 
 
END 
 

(END) Dow Jones Newswires

January 18, 2019 11:43 ET (16:43 GMT)