Portfolio Update

BLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC
All information is at30 September 2016 and unaudited.
 

Performance at month end with net income reinvested.
 

	One month	Three months	One year	Three years		Five years	^^Since 31.03.06
Sterling:
Net asset value^	0.6	8.9	46.6	-0.1		0.7	63.4
Share price	1.8	11.3	49.6	-1.4		-5.5	53.5
MSCI EM Latin America	0.0	8.5	50.5	-1.8		-0.5	75.8
US Dollars:
Net asset value^	-0.2	5.9	25.7	-19.7		-15.9	22.6
Share price	0.9	8.1	28.3	-20.8		-21.1	15.1
MSCI EM Latin America	-0.8	5.4	29.0	-21.2		-17.0	31.7
^cum income ^^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:					444.26p
Net asset value – cum income:					450.61p
Share price:					395.40p
Total Assets#:					£179.2m
Discount (share price to cum income NAV):					12.3%
Average discount* over the month – cum income:					13.4%
Net gearing at month end**:					2.0%
Gearing range (as a % of net assets):					0-25%
Net yield##:					2.2%
Ordinary shares in issue***:					39,369,620
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 as a percentage of month end share price. *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. ***Excluding 2,071,662 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 December 2015.

Geographic Exposure	% of Total Assets	% of Equity Portfolio *	MSCI EM Latin American Index
Brazil	62.5	62.0	56.7
Mexico	26.4	26.1	28.2
Peru	6.3	6.2	2.9
Argentina	2.8	2.8	0.0
Chile	1.6	1.6	8.7
Colombia	1.3	1.3	3.5
Net current liabilities (inc.Fixed interest)	-0.9	0.0	0.0
	-----	-----	-----
Total	100.0	100.0	100.0
	-----	-----	-----

Sector	% of Equity Portfolio *	% of Benchmark
Financials	30.6	29.5
Consumer Staples	25.1	20.6
Energy	12.3	8.7
Materials	10.9	12.9
Industrials	6.5	6.3
Information Technology	4.1	2.1
Consumer Discretionary	3.6	6.5
Telecommunication Services	3.2	5.3
Utilities	2.4	6.1
Real Estate	1.3	1.6
Health Care	0.0	0.4
	-----	-----
Total	100.0	100.0
	-----	-----

*excluding net current assets & fixed interest

Ten Largest Equity Investments (in percentage order)

Company	Country of Risk	% of Equity Portfolio	% of Benchmark
Itau Unibanco	Brazil	9.3	6.1
Petrobras	Brazil	8.7	5.7
Banco Bradesco	Brazil	8.2	6.2
AmBev	Brazil	6.9	5.4
Femsa	Mexico	4.5	3.2
Cielo	Brazil	3.7	1.9
BRF	Brazil	3.5	2.0
Grupo Financiero Banorte	Mexico	3.4	2.5
Credicorp	Peru	3.3	1.9
Telefonica Brasil	Brazil	3.3	1.2

Commenting on the markets, Will Landers, representing the Investment Manager noted;

Performance

For the month of September 2016, the Company’s NAV rose by 0.6% and the share price rose by 1.8%, while the Company’s benchmark, the MSCI EM Latin America Index, returned 0.0% (all performance figures are in sterling terms). 

An allocation to off-benchmark Argentina was the largest contributor to performance, specifically our position in Pampa Energia which benefited from OPEC’s announcement of an agreement in principle to production cuts.  Petrobras also contributed positively to performance as a result of the OPEC announcement.

There were no material detractors from performance at the country level during the month.  At the stock level, an overweight to Brazilian rail operator Rumo weighed on returns suffering as a result of concerns about potentials delays in concession renewals and the proposed infrastructure package from the government.

Transactions/Gearing

During the month we reintroduced Vale given attractive valuations and our becoming more positive on the direction of iron ore prices. We exited Mexican broadcaster Televisa as the stock was close to our target price and due to concerns over potential noise around Univision looking to renegotiate the content agreement as a result of low ratings. We added to our position in the Brazilian exchange BM&F Bovespa due to attractive valuations following weakness in the stock after the impeachment vote.

Net gearing was approximately 2.0% at the end of September.

Positioning

We enter the last quarter of 2016 with the highest exposure to Brazil relative to the benchmark we have had in several quarters.  We are confident that the Temer administration will successfully deliver the necessary fiscal adjustments to bring back growth while allowing inflation to fall to the Central Bank's target, thus allowing an aggressive easing cycle that should make growth sustainable in the 3% plus range from 2018 onwards.  We are also overweight Peru and Argentina on expectations of improving growth and continued pro market reforms.  Chile and Colombia are large underweights on the back of populist policies in the former and lack of progress on the fiscal side for the latter.  Finally Mexico is an underweight on concerns regarding the impact of the US election on trade as well as unattractive valuations.

20 October 2016

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.