REG-BlackRock World Mining Trust Plc: Portfolio Update

BlackRock World Mining TrustAnnouncement

20/09/2023 16:00

The information contained in this release was correct as at 31 August 2023.
Information on the Company’s up to date net asset values can be found on the
London Stock Exchange website at:

 

https://www.londonstockexchange.com/exchange/news/market-news/market-news-home.html.

 

BLACKROCK WORLD MINING TRUST PLC (LEI - LNFFPBEUZJBOSR6PW155)

All information is at 31 August 2023 and unaudited.
 

 Performance at month end with net income reinvested                                           
                                                                                               
                                                          One    Three   One    Three  Five    
                                                          Month  Months  Year   Years  Years   
 Net asset value                                          -6.6%  3.1%    4.8%   52.8%  94.4%   
 Share price                                              -6.4%  0.3%    -0.2%  70.0%  119.2%  
 MSCI ACWI Metals & Mining 30% Buffer 10/40 Index (Net)*  -5.7%  4.4%    7.3%   38.8%  63.1%   
                                                                                               
 * (Total return) Sources: BlackRock, MSCI ACWI Metals & Mining 30% Buffer 10/40 Index, Datastream 
                                                                                               

At month end

 Net asset value (including income) 1 :  602.21p      
 Net asset value (capital only):         585.04p      
 Share price:                            588.00p      
 Discount to NAV 2 :                     2.4%         
 Total assets:                           £1,302.1m    
 Net yield 3 :                           6.8%         
 Net gearing:                            13.2%        
 Ordinary shares in issue:               191,183,036  
 Ordinary shares held in Treasury:       1,828,806    
 Ongoing charges 4 :                     0.95%        
 Ongoing charges 5 :                     0.84%        
                                                      

 

1 Includes net revenue of 17.17p.

2 Discount to NAV including income.

3 Based on a third interim dividend of 5.50p per share declared on 16 November
2022, a final dividend of 23.50p per share recommended on 2 March 2023 in
respect of year ended 31 December 2022, a first interim dividend of 5.50p per
share declared on 18 April 2023 and a second interim dividend of 5.50p per
share declared on 24 August 2023 with ex-date 7 September 2023 and pay date of
6 October 2023 in respect of the year ending 31 December 2023.

4 The Company’s ongoing charges are calculated as a percentage of average
daily net assets and using the management fee and all other operating
expenses, excluding finance costs, direct transaction costs, custody
transaction charges, VAT recovered, taxation and certain other non-recurring
items for the year ended 31 December 2022.

5 The Company’s ongoing charges are calculated as a percentage of average
daily gross assets and using the management fee and all other operating
expenses, excluding finance costs, direct transaction costs, custody
transaction charges, VAT recovered, taxation and certain other non-recurring
items for the year ended 31 December 2022.


 

 Country Analysis    Total         
                      Assets (%)   
                                   
 Global              63.5          
 Australasia         10.4          
 Latin America       8.5           
 United States       7.1           
 Canada              4.8           
 Other Africa        3.1           
 Indonesia           0.7           
 South Africa        0.2           
 Asia                0.2           
 Net Current Assets  1.5           
                     -----         
                     100.0         
                     =====         
                                   

 

 

 Sector Analysis        Total         
                         Assets (%)   
                                      
 Diversified            35.0          
 Copper                 24.2          
 Gold                   14.3          
 Steel                  6.9           
 Industrial Minerals    6.6           
 Aluminium              2.8           
 Platinum Group Metals  2.3           
 Iron Ore               2.1           
 Uranium                1.6           
 Nickel                 1.5           
 Mining Services        1.1           
 Zinc                   0.1           
 Net Current Assets     1.5           
                        -----         
                        100.0         
                        =====         
                                      

 

 

 

 Ten largest investments                  
                                          
 Company                  Total Assets %  
                                          
 BHP:                                     
 Equity                   8.4             
 Royalty                  1.4             
 Glencore                 8.9             
 Vale:                                    
 Equity                   4.2             
 Debenture                2.3             
 Rio Tinto                5.4             
 Freeport-McMoRan         4.6             
 First Quantum Minerals:                  
 Equity                   3.2             
 Bond                     0.7             
 Teck Resources           3.4             
 Ivanhoe                  3.2             
 Newcrest Mining          3.2             
 ArcelorMittal            2.6             
                                          
                                          

 

 Asset Analysis      Total Assets (%)  
 Equity              96.3              
 Bonds               2.2               
 Net Current Assets  1.5               
                     -----             
                     100.0             
                     =====             
                                       
                                       

 

 Commenting on the markets, Evy Hambro and Olivia Markham, representing the Investment Manager noted:                                                                                                                                                                                                                                                                                                                                                                                                                            
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
 Performance                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
 The Company’s NAV fell by 6.6% in August, underperforming its reference index, the MSCI ACWI Metals and Mining 30% Buffer 10/40 Index (net return), which fell by 5.7% (performance figures in GBP).  August was a challenging month for the mining sector as economic data from China was softer than anticipated. The sector underperformed global equity markets, which also came under pressure, with the MSCI ACWI TR Index falling by 2.8%. Renewed stress in the Chinese property market contributed to weak             
 macroeconomic data from the country in August. For reference, China’s manufacturing PMI fell to 51.7 from 51.9 in July.  As a result, industrial mined commodities were mostly weak, with copper falling by 4.5%. Iron ore (62% fe) however, rose by 5.8%. Most precious metals also struggled, with gold and silver prices falling by 1.3% and 1.5% respectively. Platinum prices, however, rose by 3.3%.                                                                                                                      
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
 Strategy and Outlook                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
 We do not expect the mining sector to be immune to deteriorating global economic growth. However, whilst recession looms for developed markets, the most important economy for mining, China, is moving in the opposite direction, re-opening following a year of lockdowns and a strict zero-covid policy.  Meanwhile, mined commodity markets are generally tight, with inventories for many commodities at historic lows. At the same time, mined supply is being constrained by the underinvestment of recent years and     
 continued capital discipline. Mining companies are in an excellent financial position, in our view, with high levels of free cash flow, rock-solid balance sheets and a continued focus on returning capital to shareholders.  Last year we saw greater appreciation of the role mining companies will need to play in supplying the materials required for lower carbon technologies like wind turbines, solar panels and electric vehicles. In 2023 we are seeing Brown to Green emerge as a key theme, where mining companies 
 are focusing on reducing the greenhouse gas emissions intensity associated with their production. We expect to see a re-rating for the mining companies able to best navigate this and are playing this in the portfolio.  All data points are in USD terms unless stated otherwise.                                                                                                                                                                                                                                            
 20 September 2023  Latest information is available by typing www.blackrock.com/uk/brwm on the internet. 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.                                                                                                                                                                                                     

 



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