Portfolio Update

BLACKROCK INCOME AND GROWTH INVESTMENT TRUST PLC (LEI:5493003YBY59H9EJLJ16)

All information is at 31 October 2017 and unaudited.

Performance at month end with net income reinvested

	One Month	Three Months	One Year	Three Years	Five Years	Since 1 April 2012
Sterling
Share price	3.0%	1.5%	14.8%	35.9%	77.7%	88.4%
Net asset value	1.8%	2.4%	13.8%	35.7%	67.7%	75.6%
FTSE All-Share Total Return	1.9%	2.8%	13.4%	31.0%	62.5%	67.4%
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:	205.71p
Net asset value - cum income*:	209.96p
Share price:	205.50p
Total assets (including income):	£51.7m
Discount to cum-income NAV:	2.1%
Gearing:	2.9%
Net yield**:	3.1%
Ordinary shares in issue***:	24,614,268
Gearing range (as a % of net assets)	0-20%
Ongoing charges****:	1.0%

* includes net revenue of 4.25 pence 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 3.1% and includes the 2016 final dividend of 3.90p per share declared on 21 December 2016 and paid to shareholders on 10 March 2017 and the 2017 interim dividend of 2.50p per share declared on 26 June 2017 and paid to shareholders on 1 September 2017.

*** excludes 8,319,664 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 2016.

Sector Analysis	Total assets (%)
Banks	8.9
Support Services	8.1
Pharmaceuticals & Biotechnology	7.3
Tobacco	7.1
Oil & Gas Producers	6.9
Financial Services	6.1
Media	5.9
Non-Life Insurance	5.9
Travel & Leisure	5.7
Construction & Materials	4.9
Food Producers	4.0
General Retailers	3.9
General Industrials	3.8
Industrial Engineering	3.1
Fixed Line Telecommunications	2.6
Beverages	2.5
Food & Drug Retailers	2.3
Mobile Telecommunications	1.9
Real Estate Investment & Services	1.8
Aerospace & Defence	1.7
Household Goods & Home Construction	1.5
Chemicals	1.4
Software & Computer Services	0.9
Real Estate Investment Trusts	0.9
Net Current Assets	0.9
	------
Total	100.0
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Ten Largest Equity Investments
Company	Total assets (%)
British American Tobacco	6.2
Lloyds Banking Group	4.4
RELX	4.3
Royal Dutch Shell ‘B’	4.2
Unilever	4.0
Rentokil Initial	3.6
Ferguson	3.3
John Laing Group	3.1
HSBC Holdings	3.0
BP Group	2.8

Commenting on the markets, Adam Avigdori and David Goldman representing the Investment Manager noted:

The UK stock market rose in October extending the gains year to date. Economic indicators pointed to the gradual economic recovery in Europe continuing. The ECB announced a reduction to its monthly bond purchases from EUR60bn to EUR30bn, but extended the duration signalling the winding down of its quantitative easing programme. The Bank of England signalled a greater possibility of raising the base rate in its November meeting in response to higher inflation and the Bank followed through as expected by raising rates to 0.5%. In Japan, prime minister Abe won a decisive victory in the general election signalling a continuation of policies designed to boost inflation. Mid- and Small-cap companies modestly outperformed the large cap FTSE 100 companies, with the oil & gas sector and mining sector benefiting from higher oil and commodity prices respectively. Utilities and Pharmaceutical companies underperformed. Over the quarter the Trust delivered a positive return of 1.8%, underperforming the FTSE All-Share which returned 1.9%. Inchcape was the largest detractor for the month. The company has been increasing its footprint in emerging markets and becoming more vertically integrated. Although next year’s forecasts have been impacted by currency downgrades, the company has a strong balance sheet which we expect them to deploy through highly accretive M&A. Kier shares fell over the course of the month despite no negative company specific news. Kier released robust results ahead of expectations and provided reassurance for next year’s double-digit earnings growth. Their balance sheet is strong with net debt at the lower end of estimates and the dividend is up 5% with improving dividend cover. BT shares continued their decline due to uncertainty around their fibre optic strategy and recent price cuts to line rental for BT customers is likely to have a revenue impact. We have met with the new incoming chairman and are reassured of an improving relationship with OFCOM. Rentokil was the largest contributor for the month. The company is on track to meet its full year expectations with continued organic growth. The severe weather in Central/North America has had a temporary impact which is now back to normal. This remains a high conviction holding with the potential for the company to sustain high organic growth plus deliver on M&A. Ferguson has announced like-for-like growth acceleration and a £500m share buyback. The company shows good control of working capital and cash flow is strong with net debt falling. The challenged UK business has seen a stabilisation in profits after a restructuring and, despite a future threat from Amazon, we continue to expect Ferguson to take market share in the US and benefit from growth in its end markets as the US economy continues to grow. The insurance industry has experienced a number of recent losses following the hurricane season. The frequency and severity of these increased the prospects for price rises in the re-insurance space next year, from which Hiscox would benefit. We continue to run a flexible and concentrated portfolio with competition for capital ensuring we only hold the highest conviction positions. In this regard, we added a position in Standard Chartered and increased our positions in Diageo, where we see a pick-up in growth and margins and in CRH where we are positive on the US construction industry. We reduced allocations to Babcock and to Next, Lloyds and Patisserie Valerie as we reduce exposure to the UK consumer. We see increasing pressure in the UK consumer space as rock bottom household savings is coupled with rising household debt levels. Whilst we remain cautious in this area, we certainly don’t treat all companies equally. By focussing on those companies that can generate cashflow from strong business models, have strong balance sheets or scope for management driven self-help, we are able to access some of the fantastic domestic opportunities starting to emerge. As ever, we remain believers that over the longer-term earnings and cashflow growth tend to be the dominant driver of share prices and where equity markets fail to recognise that, corporates buyers have the potential to exploit the opportunity. With a combination of continued sterling weakness and a low rate environment fuelling cheap debt, we believe that M&A activity will remain a theme throughout the remainder of the year.

9 November 2017