Portfolio Update

BLACKROCK LATIN AMERICAN INVESTMENT TRUST PLC (LEI: UK9OG5Q0CYUDFGRX4151)
All information is at31 October 2018 and unaudited.

Performance at month end with net income reinvested   

	One month	Three months	One  year	Three years	Five years
Sterling:
Net asset value^	9.1	2.7	3.5	74.4	16.1
Share price	8.5	-1.3	-3.4	62.0	12.4
MSCI EM Latin America (Gross Return)^^	5.6	2.0	1.8	74.9	12.5
MSCI EM Latin America (Net Return)^^	5.6	1.9	1.4	73.1	10.7
US Dollars:
Net asset value^	6.9	0.0	-0.5	44.1	-7.7
Share price	6.3	-3.9	-7.2	33.8	-10.7
MSCI EM Latin America (Gross Return)^^	3.5	-0.7	-2.1	44.7	-10.5
MSCI EM Latin America (Net Return)^^	3.5	-0.8	-2.4	43.2	-12.0

^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:	519.39p
Net asset value – cum income:	519.39p
Share price:	436.00p
Total Assets#:	£223.2m
Discount (share price to cum income NAV):	16.1%
Average discount* over the month – cum income:	16.0%
Net gearing at month end**:	9.8%
Gearing range (as a % of net assets):	0-25%
Net yield##:	3.9%
Ordinary shares in issue (excluding 2,181,662 shares held in treasury):	39,259,620
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 (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 and the second interim dividend under the new policy of 7.85 cents per share declared on 2 October 2018 and payable on 9 November 2018) 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 2018 paid dividend and 3 quarters being paid at the same rate as the declared October 2018 dividend, based on the Company’s share price at 31 October 2018 converted to US dollars at the exchange rate on 31 October 2018, would be 5.3%.

*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 Assets	% of Equity Portfolio *		MSCI EM Latin America Index
Brazil	72.5	72.3		62.1
Mexico	22.8	22.7		22.3
Chile	3.1	3.1		8.7
Colombia	1.4	1.4		3.4
Argentina	0.5	0.5		0.0
Peru	0.0	0.0		3.5
Net current liabilities (inc. fixed interest)	-0.3	0.0		0.0
	-----	-----		-----
Total	100.0	100.0		100.0
	-----	-----		-----

Sector	% of Equity Portfolio *	% of Benchmark
Financials	32.6	31.8
Materials	18.2	17.7
Consumer Discretionary	11.0	5.9
Energy	10.6	11.6
Consumer Staples	9.2	14.3
Industrials	8.2	5.9
Telecommunication Services	5.9	5.5
Utilities	2.0	4.6
Information Technology	1.5	0.7
Health Care	0.8	0.6
Real Estate	0.0	1.4
	-----	-----
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
Petrobras	Brazil	10.6	8.8
Vale	Brazil	9.6	8.0
Itau Unibanco	Brazil	8.4	7.0
Banco Bradesco	Brazil	8.3	6.5
America Movil	Mexico	4.7	4.0
Grupo Financiero Banorte	Mexico	3.8	2.4
B3	Brazil	3.7	2.4
Femsa	Mexico	3.7	2.7
Lojas Renner	Brazil	2.8	1.2
Walmart de Mexico y Centroamerica	Mexico	2.7	2.2

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

For the month of October 2018, the Company’s NAV rose by 9.1%¹ with the share price rising by 8.5%¹. The Company’s benchmark, the MSCI EM Latin America Index, rose by 5.6%² on both a gross and net basis (all performance figures are in sterling terms with dividends reinvested).

Latin American equities performed strongly in October, outperforming both Emerging Markets and Developed Markets. The strong performance was led by Brazil, which rallied following the confirmation of a market friendly election outcome on 28 October 2018, with Bolsonaro winning 55% of the valid votes. The BRL (Brazilian Real) was responsible for approximately 50% of equity gains in USD. Therefore, the Company’s large overweight in Brazil was the month’s top contributor. In particular, the overweight in Banco Bradesco and Petroleo Brasileiro benefitted performance. All other Latin American countries posted negative returns during the month and consequently our underweight positions in Chile and Colombia contributed on a relative basis. Mexico was the biggest drag mostly due to the cancellation of the partially built airport in New Mexico City (the NAIM project), but also on concerns from persistent inflation that could lead Banxico (Mexico’s central bank) to hike rates further. The proposal from president-elect Andres Manuel Lopes Obrador (ALMO) to include public consultation in more political decisions was perceived as a dampener for business sentiment. Hence, the portfolio’s exposure to Mexico, such as Grupo Financiero Banorte and Arca Continental SAB, detracted most. Our position in Alsea, a Mexican multi-brand restaurant operator, also detracted on the back of an acquisition announced in Europe, which will put pressure on the company’s balance sheet and reduce the likelihood of a near-term equity raise.   

During the month, we added to Brazil on the positive macro outlook on the country following the elections.  We bought Brazilian insurance holding company, Seguridade Participacoes and added to the oil company, Petroleo Brasileiro. We reduced the exposure to Mexico and cut our holding in Walmart de Mexico following its strong performance. We ended the month overweight in Brazil and Mexico, underweight in Chile, Peru and Colombia. At the sector level, we are overweight in the domestic consumer and industrials and underweight in consumer staples and utilities.

Brazil is our largest overweight position, as high as it has been in years, 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 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, third quarter corporate results point to a continuation in the economic recovery, providing strong momentum for growth into 2019. Elsewhere, the cancellation of NAIM reminded markets of the concerns regarding increasing populism for the incoming administration in Mexico, reiterating our cautiousness with Mexican equities. We remain underweight in the Andean region due to a combination of unattractive valuations and disappointing growth, we are waiting for greater clarity regarding the success of the current stabilization program in Argentina before returning to that market.

Source: BlackRock as of 31 October 2018.

Sources:
¹BlackRock as at 31 October 2018
²Datastream as at 31 October 2018

21 November 2018

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.