BLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC: Portfolio Update
BLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC
All information is at 31 July 2012 and unaudited.
Performance at month end with net income reinvested
One Three One Three ^^Since Five
month months year years 31.03.06 years Sterling: Net asset value^ 1.7% -6.0% -16.6% 26.3% 72.7% 25.5% Share price 3.8% -8.1% -13.0% 25.4% 68.2% 20.5% MSCI EM Latin America 1.4% -5.2% -10.0% 27.8% 93.1% 41.4% US Dollars: Net asset value^ 1.6% -9.3% -20.4% 19.3% 56.1% -3.2% MSCI EM Latin America 1.3% -8.5% -14.1% 20.8% 74.4% 9.1%
^cum income - bond at par ^^Date which BlackRock took over the investment management of the Company.
Sources: BlackRock, Standard & Poor's Micropal
At month end
Net asset value - capital only: 548.67p Net asset value - cum income: 559.18p Net asset value - capital only and with bond at fair value: 544.79p Net asset value - cum income and with bond at fair value: 555.30p Net asset value - capital with bond converted: 544.79p Net asset value - cum income and with bond converted: 555.30p Share price: 519.00p Total Assets*: £283.17m Discount(share price to cum income NAV with bond at fair value***): 6.5% Average discount** over the month - cum income: 8.7% Gearing**: 10.9% Net yield: 3.6% Ordinary shares in issue~: 41,574,247
*Total assets include current year revenue. **Gearing is calculated using debt at par, less cash and cash equivalents and fixed interest investments as a percentage of net assets. ***To the extent that the US dollar Net Asset Value on an income inclusive with bond at fair value basis exceeds the current conversion price of $8.98 for the convertible bond, the discount is calculated using the share price as a percentage of the fully diluted cum income Net Asset Value in sterling terms. Where the Net Asset Value on an income inclusive with bond at fair value basis does not exceed the conversion price, the discount is calculated using the share price as a percentage of the cum income Net Asset Value with bond at fair value.
~Excluding 2,267,065 shares held in treasury.
Geographic Regional Exposure % Total Assets
Brazil 60.9 Mexico 20.1 Chile 4.2 Colombia 2.4 Peru 2.1 Panama 1.3 Argentina 0.8 Net current assets (inc.Fixed interest) 8.2
----- Total 100.0
Ten Largest Equity Investments(in percentageorder) Company Country of Risk % of Company
Vale Brazil 9.7 América Móvil Mexico 8.9 Petrobrás Brazil 7.4 Banco Bradesco Brazil 4.9 Fomento Economico Mexicano Mexico 4.0 Itau Unibanco Brazil 3.6 Groupo Televisa Mexico 3.4 AmBev Brazil 2.9 CCR Brazil 2.7 Natura Cosméticos Brazil 2.1
Commenting on the markets, Will Landers, representing the investment Manager noted;
For the month of July 2012, the Company posted a 1.7% increase in its NAV while the shares appreciated by 3.8% (all in sterling) while the Trust's benchmark, the MSCI EM Latin America Index returned 1.4%.
Positive contributions to performance during the month stemmed primarily from an underweight position and stock selection in Chile, an off-benchmark position in Colombia via Pacific Rubiales, stock selection in Mexico and the gearing. The largest individual positive contributors for the month included Mexican consumer goods name Kimberly-Clark, Brazilian utility Sabesp, Banco do Brasil and not owning Coca-Cola Femsa. Weighing on performance for the month was an overweight position in Panama via Copa Airlines. Individual negative contributions to performance for the month came from Vale, beverage name Femsa, wireless name TIM and not owning Itausa or Brasil Telecom.
During the month we increased exposure to Mexican broadcaster Televisa and introduced exchange Bolsa Mexicana and Brazilian utility TAESA. We also increased exposure to Brazilian steel name Gerdau and Mexican consumer goods name Kimberly-Clark. These moves were funded by exiting Brazilian utility name CTEEP, mining name Grupo Mexico as well as homebuilders PDG and Rossi and reducing exposure to Femsa and CCR. Net gearing was 10.9% at the end of July.
The prospects for the Latin American region continue to look positive - in the countries that the fund invests in, macroeconomic policies are generally sound, financial systems are well capitalized, strong middle classes are in the process of being established, and corporate governance is comparable to any market in the world. Short-term market direction will undoubtedly be guided by events in the Eurozone, and to a lesser extent China, but over time, region-specific fundamentals should once again be positive catalysts for the market.
We remain overweight Brazil and underweight Mexico but continue to favour domestically oriented stocks in both countries. We continue to be underweight materials but are overweight Vale given attractive valuations and the expected benefits from a weaker Brazilian Real. Despite a generally positive attitude towards Chile, Peru and Colombia, we maintain our large underweight to the Andean region given challenging valuations and low liquidity. However, we remain vigilant in our pursuit of companies that should benefit from attractive growth levels in the region.
14 August 2012
Latest information is available by typing www.brla.co.uk 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 -0- Aug/14/2012 15:25 GMT