BlackRock Latin American Investment Trust PLC on Wednesday said it is ‘optimistic for the outlook for Latin American equities’ after a ‘strong’ annual performance.

The Latin America-focused investor said its net asset value was 644.24 US cents at December 31, up from 502.95 cents at the same time one year prior.

Shares in the company were down 0.6% at 391.18 pence early on Wednesday afternoon in London.

BlackRock Latin American delivered a positive 37.8% NAV total return for 2023, ballooning from positive 6.6% in 022. This surpassed its benchmark, the MSCI EM Latin America Index, which gave a positive 32.7% return for 2023.

Chair Carolan Dobson explained: ‘The outperformance was driven by good stock selection across a range of markets, most notably driven by stock selection in Mexico, as the country has been and continues to be a key beneficiary from the shifting of global supply chains’.

BlackRock Latin American’s total dividend for 2023 was 28.82 cents per share, down 26% from 38.87 cents.

This was mainly due to 2022’s payout including a 13.00 cents special dividend, which the trust declared after revenue ‘was enhanced by a number of stock and special dividends’, and a tender offer in May 2022 reduced its issued share capital. BlackRock Latin American subsequently paid the special dividend to maintain its investment trust status, which requires the distribution of 85% of its revenue.

Looking ahead, BlackRock Latin American noted the impact of higher interest rates on global markets, but said that it ‘remain[s] optimistic about the outlook for Latin America’.

In particular, the trust is encouraged by positive market sentiment for investees operating in Brazil, where the government recently ‘embarked on some significant tax reforms which should allow businesses to operate more efficiently’.

The company is ‘optimistic for the outlook for Latin American equities’ more broadly, Chair Dobson said.

‘The markets in the Latin American region have...been able to benefit from significant opportunities for direct investment,’ she explained, ‘as governments and businesses globally re-think supply chain configuration and seek to diversify risk away from countries more prone to geopolitical fallouts.’

Dobson also noted the region’s large supplies of natural resources, as well as its status as an ‘agricultural powerhouse’.

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