REG-BlackRock World Mining Trust Plc: Portfolio Update

BlackRock World Mining TrustAnnouncement

17/03/2025 17:15

BLACKROCK WORLD MINING TRUST PLC (LEI) – LNFFPBEUZJBOSR6PW155

All information is at 28 February 2025 and unaudited.
 

 Performance at month end with net income reinvested                                           
                                                                                               
                                                          One    Three   One   Three   Five    
                                                          Month  Months  Year  Years   Years   
 Net asset value                                          -1.6%  -6.5%   5.4%  -12.8%  89.4%   
 Share price                                              -3.8%  -6.1%   3.4%  -20.7%  102.4%  
 MSCI ACWI Metals & Mining 30% Buffer 10/40 Index (Net)*  -1.0%  -3.3%   4.5%  -3.8%   75.9%   
                                                                                               
 * (Total return)  Sources: BlackRock, MSCI ACWI Metals & Mining 30% Buffer 10/40 Index, Datastream 
                                                                                               

At month end

 Net asset value (including income) 1 :  524.89p      
 Net asset value (capital only):         516.63p      
 Share price:                            478.00p      
 Discount to NAV 2 :                     8.9%         
 Total assets:                           £1,136.9m    
 Net yield 3 :                           4.8%         
 Net gearing:                            13.6%        
 Ordinary shares in issue:               190,868,036  
 Ordinary shares held in Treasury:       2,143,806    
 Ongoing charges 4 :                     0.95%        
 Ongoing charges 5 :                     0.84%        
                                                      

 

1 Includes net revenue of 8.26p.

2 Discount to NAV including income.

3 Based on the first interim dividend of 5.50p per share declared on 10 May
2024, second interim dividend of 5.50p per share declared on 23 August 2024,
third interim dividend of 5.50p per share declared on 15 November 2024 and the
final dividend of 6.50p per share declared on 4 March 2025 with ex date 20
March 2025 and pay date 27 May 2025 in respect of the year ended 31 December
2024.

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                   57.9          
 Canada                   11.4          
 Latin America            8.9           
 Australasia              8.3           
 United States            7.7           
 Other Africa             3.2           
 South Africa             2.2           
 Indonesia                0.5           
 Net Current Liabilities  -0.1          
                          -----         
                          100.0         
                          =====         
                                        

 

 

 Sector Analysis          Total         
                           Assets (%)   
                                        
 Diversified              29.6          
 Gold                     27.4          
 Copper                   22.4          
 Steel                    7.5           
 Iron Ore                 4.1           
 Industrial Minerals      2.6           
 Aluminium                2.2           
 Platinum Group Metals    1.7           
 Uranium                  1.3           
 Nickel                   0.9           
 Silver                   0.3           
 Zinc                     0.1           
 Net Current Liabilities  -0.1          
                          -----         
                          100.0         
                          =====         
                                        

 

 

 

 

 

 

 

 Ten largest investments                  
                                          
 Company                  Total Assets %  
                                          
 BHP:                                     
 Equity                   5.2             
 Royalty                  2.0             
 Rio Tinto                7.0             
 Agnico Eagle Mines       6.6             
 Anglo American           5.6             
 Glencore                 5.2             
 Wheaton Precious Metals  4.5             
 Vale:                                    
 Debenture                2.6             
 Equity                   1.8             
 Freeport-McMoRan         3.8             
 Barrick Gold             3.1             
 Newmont                  3.1             
                                          

 

 Asset Analysis           Total Assets (%)  
 Equity                   97.0              
 Bonds                    1.9               
 Preferred Stock          0.7               
 Convertible Bond         0.6               
 Option                   -0.1              
 Net Current Liabilities  -0.1              
                          -----             
                          100.0             
                          =====             
                                            

 

 Commenting on the markets, Evy Hambro and Olivia Markham, representing the Investment Manager noted:                                                                                                                                                                                                                                                                                                                                                                                                                            
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
 Performance The Company’s NAV decreased by 1.6% in February 2025, underperforming its reference index, the MSCI ACWI Metals and Mining 30% Buffer 10/40 Index (net return) which decreased by 1.0% (performance figures in GBP).  The mining sector experienced a difficult month, as equities fell despite a favourable environment of increasing commodity prices. Persistent cost inflation, though slowing, and rising capital expenditures have reduced cash distributions, leading to underwhelming equity performance.   
 Additionally, the recent reporting season revealed disappointment in cash flow generation among larger mining companies, resulting in lower dividend payouts, with payout ratios at the lower end of ranges.  Broader equity markets also struggled, with the MSCI All Country World Index falling by 0.6% over the month.  Performance in the commodities sector was mixed: iron ore (62% Fe) prices fell by 1.4%, while nickel and copper prices rose by 4.6% and 1.8%, respectively. In the precious metals space, the gold  
 price increased by 1.5%, whereas the silver price decreased by 1.2%.  U.S. President Trump implemented tariffs on imports from Canada, Mexico and China, which spurred uncertainty in the sector around potential retaliations and led to higher domestic prices for commodities. China’s manufacturing PMI rose to 50.2 in February from 49.1 in January 2025, indicating increased activity.  Strategy and Outlook  Near term, we expect performance to be driven by tariffs, protectionist measures and China stimulus and   
 the resulting impact on demand. Longer term, we expect mined commodity demand growth to be driven by increased global infrastructure build out, particularly related to the low carbon transition and increased power demand.  Meanwhile, the supply side of the equation is constrained. Mining companies have focused on capital discipline in recent years, meaning they have opted to pay down debt, reduce costs and return capital to shareholders, rather than investing in production growth. This is limiting new      
 supply coming online and there is unlikely to be a quick fix, given the time lags involved in investing in new mining projects. The cost of new projects has also risen significantly and recent M&A activity in the sector suggests that, like us, strategic buyers see an opportunity in existing assets in the listed market, currently trading well below replacement costs. Other issues restricting supply include cases of governments closing mines, permitting issues and a general lack of shovel-ready projects.     
 Turning to the companies, balance sheets in the sector are very strong relative to history. Despite this, valuations are low relative to historic averages and relative to broader equity markets.                                                                                                                                                                                                                                                                                                                              
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
 17 March 2025  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/22397/4119696/3325362.pdf)  



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