BLACKROCK NORTH AMERICAN INCOME TRUST plc
All information is at 31 July 2014 and unaudited.
Performance at month end with net income reinvested
One Three Six Since
Month months months launch
(24 Oct 2012)
Net asset value -0.8% 0.2% 3.5% 19.4%
Share price -3.9% -3.7% -3.2% 10.5%
Russell 1000 Value Index -0.4% 2.4% 7.4% 36.0%
At month end
Net asset value - capital only: 109.94p
Net asset value - cum income: 111.09p
Share price: 104.75p
Discount to cum income NAV: 5.7%
Net yield*: 3.8%
Total assets including current year revenue: £111.7m
Target annual dividend: 4.0p
Options overwrite: 17.85%
Ordinary shares in issue: 100,361,305
Ongoing charges**: 1.4%
*Based on dividends of 1p per share each declared on 3 October 2013,
13 February 2014, 14 May 2014 and 6 August 2014.
** Ongoing charges represent the management fee and all other operating
expenses excluding interest as a % of average shareholders' funds for the year
ended 31 October 2013.
Sector Analysis Total Assets (%)
Consumer Discretionary 9.8
Health Care 9.6
Consumer Staples 8.8
Information Technology 7.1
Telecommunication Services 2.2
Net current liabilities (1.1)
Country Analysis Total Assets (%)
United Kingdom 1.2
Net current liabilities (1.1)
Ten Largest Investments(in alphabetical order)
Company Country of Risk
Exxon Mobil USA
General Electric USA
Home Depot USA
JPMorgan Chase USA
Wells Fargo USA
Bob Shearer and Kathleen Anderson, representing the Investment Manager, noted:
For the one month period ended 31 July 2014, the Company's NAV decreased by
0.8% while the share price declined by 3.9% (all in sterling). The Company's
benchmark, the Russell 1000 Value Index, fell by 0.4% for the period.
On a relative basis, the largest contributor to relative performance was strong
stock selection in the industrials sector, followed by a combination of stock
selection and a small underweight position in the utilities sector. Individual
security selection within information technology, as well as the combination of
strong selection and a marginal overweight within telecommunications, also
added to relative performance during the month.
The largest detractor from relative performance for the month was stock
selection within consumer staples, particularly owning Coca-Cola, Diageo and
Kraft, all out-of-index positions that posted negative returns for the month.
Selection within both financials and consumer discretionary were also weaker
during the quarter; and the combination of a general underweight in information
technology and an overweight in industrials also detracted from performance.
Transactions: In July, we sold Veritiv, a small-cap, non-dividend paying spin
out from our position in International Paper. There were no other complete
purchases or sales during the period.
As of 31 July 2014, the Company's options exposure was 17.85% and the delta of
the options was 96.57%.
We are currently overweight to the industrials, consumer discretionary,
materials, consumer staples and telecom sectors. We are underweight to the
financials, health care, information technology, utilities and energy sectors.
Conversations with our management teams and economic data points (ISM,
employment, housing, etc) continue to support our view that the US economy is
slowly gaining strength. This economic improvement, the end of QE3, and
ultimately Fed action will likely cause interest rates (and volatility) to
drift higher. As the bounty of abundant liquidity is withdrawn, we expect
profitable companies with strong balance sheets, dominant competitive positions
and consistent earnings and dividend growth potential to outperform.
18 August 2014
Latest information is available by typing www.blackrock.co.uk/brna 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.