REG-BlackRock World Mining Trust Plc: Portfolio Update

BlackRock World Mining TrustAnnouncement

16/04/2024 17:30

BLACKROCK WORLD MINING TRUST PLC (LEI - LNFFPBEUZJBOSR6PW155)

All information is at 31 March 2024 and unaudited.
 

 Performance at month end with net income reinvested                                           
                                                                                               
                                                          One    Three   One     Three  Five   
                                                          Month  Months  Year    Years  Years  
 Net asset value                                          10.7%  -3.5%   -9.4%   19.9%  78.8%  
 Share price                                              8.4%   -9.0%   -17.8%  8.2%   91.3%  
 MSCI ACWI Metals & Mining 30% Buffer 10/40 Index (Net)*  9.8%   -0.4%   -0.3%   22.6%  65.4%  
                                                                                               
 * (Total return) Sources: BlackRock, MSCI ACWI Metals & Mining 30% Buffer 10/40 Index, Datastream 
                                                                                               

At month end

 Net asset value (including income) 1 :  568.07p      
 Net asset value (capital only):         560.36p      
 Share price:                            517.00p      
 Discount to NAV 2 :                     9.0%         
 Total assets:                           £1,220.6m    
 Net yield 3 :                           6.5%         
 Net gearing:                            13.4%        
 Ordinary shares in issue:               191,183,036  
 Ordinary shares held in Treasury:       1,828,806    
 Ongoing charges 4 :                     0.91%        
 Ongoing charges 5 :                     0.81%        

 

1 Includes net revenue of 7.71p.

2 Discount to NAV including income.

3 Based on a first interim dividend of 5.50p per share declared on 18 April
2023, a second interim dividend of 5.50p per share declared on 24 August 2023,
a third interim dividend of 5.50p per share declared on 11 October 2023 and a
final dividend of 17.00p per share declared on 7 March 2024 with ex date 21
March 2024 and pay date 14 May 2024 in respect of the year ended 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 2023.

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 2023.


 

 Country Analysis         Total         
                           Assets (%)   
                                        
 Global                   63.6          
 United States            9.6           
 Latin America            8.2           
 Canada                   7.8           
 Australasia              7.2           
 Other Africa             3.9           
 Indonesia                0.5           
 South Africa             0.1           
 Net Current Liabilities  -0.9          
                          -----         
                          100.0         
                          =====         
                                        

 

 

 Sector Analysis          Total         
                           Assets (%)   
                                        
 Diversified              35.8          
 Copper                   25.1          
 Gold                     15.3          
 Steel                    9.9           
 Industrial Minerals      5.2           
 Aluminium                3.0           
 Iron Ore                 2.4           
 Uranium                  1.5           
 Platinum Group Metals    1.0           
 Nickel                   1.0           
 Mining Services          0.6           
 Zinc                     0.1           
 Net Current Liabilities  -0.9          
                          -----         
                          100.0         
                          =====         
                                        

 

 

 

 

 

 

 

 Ten largest investments                  
                                          
 Company                  Total Assets %  
                                          
 BHP:                                     
 Equity                   7.6             
 Royalty                  1.5             
 Glencore                 8.0             
 Vale:                                    
 Equity                   4.0             
 Debenture                2.9             
 Rio Tinto                6.2             
 Freeport-McMoRan         4.8             
 Nucor                    3.9             
 Teck Resources           3.8             
 Barrick Gold             3.1             
 Wheaton Precious Metals  3.0             
 Anglo American           3.0             
                                          
                                          

 

 Asset Analysis           Total Assets (%)  
 Equity                   97.7              
 Bonds                    1.5               
 Preferred Stock          1.0               
 Convertible Bonds        0.7               
 Net Current Liabilities  -0.9              
                          -----             
                          100.0             
                          =====             
                                            

 

 Commenting on the markets, Evy Hambro and Olivia Markham, representing the Investment Manager noted:                                                                                                                                                                                                                                                                                                                                                                                                                            
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
 Performance  The Company’s NAV rose by 10.7% in March, outperforming its reference index, the MSCI ACWI Metals and Mining 30% Buffer 10/40 Index (net return), which returned +9.8% (performance figures in GBP).  March was a positive month for the mining sector, outperforming broader equity markets, as the MSCI All Country World Index returned +3.1%. Improvements in economic data from the US and China helped boost investor sentiment and demand for mining stocks during the period. China’s manufacturing PMI    
 rose above 50 for the first time since September 2023, increasing from 49.1 to 50.8. Copper stood out among industrial metals, delivering strong performance driven by tight physical markets and rising demand for use in electricity grids. The severity of the constraints on copper supply was highlighted by refining charges in China falling close to zero, having been ~US$80 six months ago (lower refining charges suggest refiners are struggling for materials and are cutting charges to be more competitive as a  
 result).  On the other hand, ongoing weakness in China’s property market started to translate into some softness in steel demand and iron ore prices came under pressure. The Chinese government announced plans to reinstate pollution control measures, which is expected to result in production cuts for highly polluting industries such as steel and cement. For reference, prices for iron ore (62% fe) and nickel fell by 13.2% and 6.2% respectively, whereas zinc rose by 0.5%. Meanwhile, precious metals performance 
 was strong during the month due to concerns around inflation and robust physical demand for gold. Gold, silver and platinum prices rose by 8.3%, 9.6% and 2.3% respectively.  Strategy and Outlook  China has re-opened but with less impact than had been expected. Uncertainty persists around China’s commodity demand, but we are seeing the Chinese administration announce financial support incrementally.  Longer term, we are excited by the structural demand growth for a range of mined commodities that will result 
 from the low carbon transition. Meanwhile, commodity supply is likely to be constrained by the capital discipline of recent years, whilst inventories for many mined commodities are at historic lows. Mining companies have low levels of debt, continue to return capital to shareholders but appear to be entering a higher capital expenditure phase.  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.                                                                                                                                                                                                                                                                                                                                                                                             
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
 16 April 2024  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.                                                                                                                                                                                                         

 

 Release (https://mb.cision.com/Main/22397/3962178/2736698.pdf)  



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