annual sHORT report BlackRock UK Income Fund

For the year ended 28 February 2015 BlackRock UK Income Fund Performance Record

This Annual Short Report for the BlackRock UK Income Fund (the “Fund”) covers the year ended 28 February Capital (Unit Prices) 2015. The first six months were commented on in the Interim Report to 31 August 2014. A Income A Accumulation D Income D Accumulation Summary of Performance over the Period Units Units Units# Units† The Fund returned 11.7%* over the period from 1 March 2014 to 28 February 2015, significantly outperforming Highest Lowest Highest Lowest Highest Lowest Highest Lowest its benchmark, the FTSE All-Share Index, which returned 5.6%. During the six month period to 28 February Offer Bid Offer Bid Offer Bid Offer Bid 2015, the Fund returned 9.0%*, significantly outperforming its benchmark, which returned 4.1%. Price Price Price Price Price Price Price Price Calendar Year p p p p p p p p # The Fund delivered a yield of 3.4% compared to the FTSE All-Share Index’s 3.2%. Over a rolling three year 2015* 440.2 379.6 1,409 1,215 432.6 391.4 1,366 1,237 period (as stipulated by the Investment Association sector) the Fund has achieved its objective of delivering 110% of the yield of the Index. 2014 415.5 3 4 8 .1 1,330 1,107 407.7 358.3 1,287 1,125 Fund Managers’ Commentary 2013 391.9 333.0 1,222 1,013 382.6 340.2 1,175 1,019 One of the big surprises over the period was that the potential for a relatively modest rise in UK interest 2012 36 3.1 305.9 1,076 893.5 352.3 310.4 1,027 891.4 rates caused a disproportionately large reaction from equity markets. The change in guidance from the Bank of England about future interest rates caused investors to reassess risk levels and prompted a significant 2011 383.7 294.7 1,068 831.7 367.1 297.5 1,009 825.0 move away from medium-sized companies and those that are particularly sensitive to changes in rates. 2010 376.7 293.8 1,031 79 3.1 360.3 293.2 N/A N/A In the Fund, the largest positive contributor to performance was the holding in Shire following its proposed * To 28 February. # D Income class commenced April 2010. † D Accumulation class commenced June 2011. takeover by AbbVie. Following the bid and a significant rise in the share price, we sold our position but we did later buy back in at a lower price after the deal fell through. Reed Elsevier demonstrated the benefits of its consistent strategy, while other positive contributors included Carnival, Compass, British American Income (Net Distributions/Net Accumulations) Tobacco and Dixons Carphone. A Income A Accumulation D Income D Accumulation The main detractors were holdings in Spectris, Vodafone, Betfair and financial company Hargreaves Calendar Year Units Units Units# Units† Lansdown, after the fees it charges its customers came under greater pressure than had been expected. Pence per Unit Pence per Unit Pence per Unit Pence per Unit In the most recent six months, the major drivers of performance were its positions in Wolseley, Friends Life 2015* 9.19 5 9 2 9.18 9 6 9.5165 29.8388 and Howdens Joinery. 2014 10.0934 31.6250 11.14 0 9 34.5445 During the period we bought into Next, Lloyds and BT Group and added to existing holdings in Imperial Tobacco, Carnival and Friends Life. We reduced GlaxoSmithKline and Royal Dutch Shell and sold out of 2013 15.4153 46.2077 16 .115 4 47.5073 Reckitt Benckiser, Burberry and Marks & Spencer. 2012 13.6628 39.3027 14 .1767 37.2382 Eurozone economic activity is showing signs of improvement as the European Central Bank starts its 2011 13.0424 36.0543 12.9906 5.2782 massive spending programme in support of its economy (what is known as quantitative easing (“QE”)), but the end of QE in the US is contributing to high levels of uncertainty in the markets. We continue to 2010 12.5000 33.3400 4.4740 N/A focus on individual companies and their ability to determine their own future independent of any specific * To 30 April. # D Income class commenced April 2010. † D Accumulation class commenced June 2011. macroeconomic outcome. Companies that demonstrate they can grow through internal self-improvement and have a clear strategy to deploy the cashflow they generate are particularly attractive. Unit Price Summary March 2015 Unit Price as at Unit Price as at * Performance figures quoted are based on bid-to-bid dealing prices (the price at which units are sold) and are not the same as Unit Class 28 February 2015 28 February 2014 the net asset value reported in the financial statements which is at close of business. Performance is calculated net of fees and reported for the Fund’s class A Accumulation Units. A Income 410.4p 380.4p # Yield calculated as the sum of fund distributions over the past 12 months divided by the mid-price on 28 February 2015. A Accumulation 1,336p 1,19 4 p Distributions Payable D Income 423.6p 389.8p The final distribution payable on 30 April 2015 is 6.6959p net per income unit (30 April 2014: 2.5934p net A Income per income unit). D Accumulation 1,360p 1,208p

The final accumulation distribution payable on 30 April 2015 is 21.2836p net per accumulation unit A Accumulation (30 April 2014: 8.1749p net per accumulation unit).

The final distribution payable on 30 April 2015 is 6.9257p net per income unit (30 April 2014: 3.2286p net D Income per income unit).

The final accumulation distribution payable on 30 April 2015 is 21.7416p net per accumulation unit D Accumulation (30 April 2014: 10.1819p net per accumulation unit).

2 BlackRock UK Income Fund BlackRock UK Income Fund 3 Fund Information Portfolio Information

Summary of Investment Objective and Policy Five Largest Investments at 28 February 2015

The Fund aims to offer investors an above-average and growing income without sacrificing the % of Fund Value benefits of long-term capital growth. The Fund invests primarily in the shares of companies incorporated or listed in the UK. The Fund may also invest in collective investment schemes. British American Tobacco 5.48 Risk Profile AstraZeneca 4.92 The Fund is exposed to movements in UK stock markets which may cause the value of the Fund to fall Imperial Tobacco 4.83 or rise. HSBC 4.73 Fund Facts Reed Elsevier 3.88 Fund Managers Adam Avigdori & Mark Wharrier Establishment Date 15 February 1984 Five Largest Investments at 28 February 2014 Benchmark FTSE All-Share Index % of Fund Value Assets Under Management £361,286,293 Royal Dutch Shell class ‘B’ shares 6.89 Income Allocation Dates 31 January, 30 April, 31 July & 31 October British American Tobacco 5.42 Accounting Dates Last day of February & 31 August GlaxoSmithKline 5.25 Vodafone 4.42 Ongoing Charges The ongoing charges figures are based on expenses for the relevant period. These figures may vary Legal & General 4.35 from year to year. Classification of Investments Unit Class 1.3.2014 to 28.2.2015 1.2.2013 to 28.2.2014†  28 February 2015 A Income 1.67% 1.67% Banks Electronic & Electrical Equipment  28 February 2014 A Accumulation 1.67% 1.67% Financial Services D Income 0.92% 0.92% Fixed Line Telecommunication D Accumulation 0.92% 0.92% Food Producers General Industrial † Ongoing charges figures are based on annualised expenses for the period ended 28 February 2014. General Retailers Risk and Reward Profile Household Goods & Home Construction Industrial Engineering Lower risk Higher risk Typically lower rewards Typically higher rewards Industrial Transportation Unit Class Life Insurance

A Income 1 2 3 4 5 6 7 Media Mining A Accumulation 1 2 3 4 5 6 7 Mobile Telecommunications D Income 1 2 3 4 5 6 7 Non-Life Insurance D Accumulation 1 2 3 4 5 6 7 Oil & Gas Producers Pharmaceuticals & Biotechnology The risk indicator was calculated incorporating historical or simulated historical data and may not be a reliable indication of the future risk profile of each unit class. The risk category shown is not guaranteed and may change Real Estate over time. The lowest category does not mean risk free. For more information on this, please see the Fund’s Key Support Services Investor Information Documents (KIIDs), which are available at www.blackrock.com. During the year, the risk Tobacco indicator of each unit class changed from level 6 to 5 due to a decline in market volatility. Travel & Leisure Other

0% 2% 4% 6% 8% 10% 12%14%

% of the Fund

4 BlackRock UK Income Fund BlackRock UK Income Fund 5 All financial investments involve an element of risk. Therefore, the value of your investment and the income from it will vary and the return of your initial investment amount cannot be guaranteed. Changes in exchange rates may cause the value of an investment to fluctuate. For up-to-date prices and performance, please visit our website blackrock.co.uk. Past performance is not a guide to future performance and should not be the sole factor of consideration when selecting a product. Report and Accounts This report is to inform unitholders on the activities of the Fund during the reporting period, and the results of those activities at the end of the reporting period. For more information please contact the Manager. Copies of the Full Reports are available free of charge upon request from the BlackRock Investor Services Team on 0800 44 55 22.

You can obtain further information on this Fund by contacting your Financial Adviser. Alternatively, for more details on this and other BlackRock® Funds, including up to date prices and performance, please contact BlackRock Investor Services on 0800 44 55 22 or visit blackrock.co.uk. For your protection, telephone calls are usually recorded. This Report relates to the packaged products of, and is issued by, the Manager and Registrar: BlackRock Fund Managers Limited, 12 Throgmorton Avenue, London EC2N 2DL. Authorised and regulated by the Financial Conduct Authority. Registered in England No. 1102517. Trustee: BNY Mellon Trust & Depositary (UK) Limited, 160 Queen Victoria Street, London EC4V 4LA. Authorised and regulated by the Financial Conduct Authority. Auditor: Ernst & Young LLP, 1 More London Place, London SE1 2AF.

For more information 0800 44 55 22 blackrock.co.uk