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BlackRock Commodities Income targeting 5p dividend

During the six month period ended 31 May 2016 BlackRock Commodities Income’s net asset value returned 8.8% and the share price returned 9.2%. Since the period end and up until close of business on 22 July 2016 the Company’s NAV has increased by 21.8% and the share price has risen by 13.2% (with income reinvested).The disparity between the NAV and share price performance, which has seen the Company’s share rating move from a premium to a discount over recent weeks, has been driven by a number of factors. These include the fall in sterling against the dollar post the referendum, which has been beneficial for the Company’s NAV performance given the large proportion of US dollar based assets, a rise in precious metal prices as a hedge against risk and reduced market liquidity as investors wait for clarity over the future direction of the UK economy.

The Board announced on 14 March 2016 that as falling commodity prices had forced many companies to reduce or cancel their dividend payments it had decided to revise its 2016 dividend target. The Board now intends to target a first and second quarterly interim dividend of 1.50 pence, followed by third and fourth quarterly interim dividend payments of 1.00 pence, making a total of 5.00 pence per ordinary share for the year as a whole1 (2015: target of 6.00 pence). The Board intends to use revenue reserves to support this target if portfolio income alone is insufficient. Thereafter, the Board’s intention is to maintain the quarterly dividend and grow this as market conditions allow. The first quarterly dividend of 1.50 pence per share was paid on 21 April 2016 and the second quarterly dividend of 1.50 pence per share was paid on 22 July 2016 to shareholders on the register on 24 June 2016 (2015: four quarterly interim dividends each of 1.50 pence per share were paid).

BRCI : BlackRock Commodities Income targeting 5p dividend

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