REG-BlackRock Greater Europe Investment Trust Plc: Half-year Financial Report
20/05/2026 14:00
BlackRock Greater Europe Investment Trust plc
LEI: 5493003R8FJ6I76ZUW55
Half Yearly Financial Report for the six months ended 28 February 2026
Performance record
As at As at Change
28 February 2026 31 August 2025 %
Net assets (£’000)(1) 587,120 569,079 3.2
Net asset value per ordinary share (pence) 635.95 598.05 6.3
Ordinary share price (pence) 605.00 570.00 6.1
FTSE World Europe ex UK Index³ 2885.79 2461.90 17.2
Discount to cum income net asset value(2) 4.9% 4.7%
========== ==========
Performance (with dividends reinvested) For the six months For the six months
ended ended
28 February 2026 28 February 2025
Net asset value per share(2) 7.3% 0.1%
Ordinary share price(2) 7.2% 0.1%
FTSE World Europe ex UK Index³ 17.2% 4.6%
========== ==========
Performance since inception(4) (with dividends reinvested) For the For the
period since period since
inception to inception to
28 February 2026 28 February 2025
Net asset value per share(2) 804.2% 798.3%
Ordinary share price(2) 772.2% 748.5%
FTSE World Europe ex UK Index(3) 629.7% 486.9%
========== ==========
For the six For the six Change
months ended months ended %
28 February 2026 28 February 2025
Revenue
Net profit/(loss) after taxation (£’000) 1,466 (43) +3,509.3
Revenue earnings/(loss) per ordinary share (pence)(5) 1.57 (0.04) +4,025.0
Dividends (pence)
Interim dividend 1.75 1.75 -
========== ========== ==========
(
1
)
The change in net assets reflects payments for shares
repurchased into treasury, portfolio movements and dividends paid.
(
2
)
Alternative Performance Measures, see Glossary contained
within the Half Yearly Financial Report.
(
3
)
Reference index.
(
4
)
20 September 2004.
(
5
) Further details are given in
the Glossary contained within the Half Yearly Financial Report.
Chairman’s Statement
I am pleased to present the Company’s Half Yearly Financial Report for the
six months to 28 February 2026.
Overview
The Company’s Net Asset Value (NAV) significantly underperformed the
reference index (the FTSE World Europe ex UK Index) over the six months under
review, with an increase of 7.3% compared to a 17.2% increase in the reference
index. Over the same period, the Company’s share price returned +7.2% (all
percentages calculated in Sterling terms with dividends reinvested). This
disappointing outcome reflected, in part, a continuation of the
underperformance of quality growth stocks and market performance being led by
a narrow set of stocks. Stock selection was also a contributing factor.
Further detailed commentary is provided in the Managers’ report.
As shareholders are aware, the company pursues a long-term investment approach
based on investing in companies characterised by quality and enduring growth.
Consequently, the background has been difficult for an unusually extended
period. Since the Company launched in September 2004, the NAV total return has
been 804.2%, ahead of the reference index by 174.5% (an annualised
outperformance of 1.1%). However, whilst we can point to good long-term
performance, the Board appreciates that not all shareholders have experienced
this return.
The Board continues to support the quality growth strategy being pursued by
the manager. Having reflected on more recent poor performance, and after
discussion with the Board, our Manager has evolved the investment approach to
increase focus on company valuations, whilst continuing to have a bias towards
quality companies with good long-term growth potential. The Board believes
this more nuanced approach is in the best interests of shareholders and that,
overall, it should help to dampen portfolio volatility. To assist in this
implementation, Brian Hall joined as co-portfolio manager on 4 November 2025.
He is an experienced investor with a quality value focus and brings a deep
knowledge of European markets through multiple investment cycles. The Board
also believes the appointment of Benjamin Moore on 31 March 2026 will be
conducive in this evolution (further detail is provided in the Change in
Portfolio Manager section immediately below). The resulting changes to the
portfolio have been implemented carefully over the past six months.
Since the period end to 18 May 2026, the Company’s NAV has decreased by 5.8%
compared with a fall in the FTSE World Europe ex UK Index of 2.9% over the
same period.
Change in Portfolio Manager
It was with sadness that the Board announced on 31 March 2026 that Stefan
Gries, Portfolio Manager, would retire from the industry to focus on treatment
and recovery following personal health issues. Having served as portfolio
manager for the Company since 20 June 2017, Stefan has worked tirelessly to
deliver excellent long-term returns for shareholders during his tenure. The
Board thanks Stefan for his contribution and wishes him well for the future
and his recovery.
Benjamin Moore, a Managing Director within BlackRock’s European Fundamental
Equity team, has taken over Stefan’s role as portfolio manager and brings 11
years of experience at Columbia Threadneedle, including six years as Lead
Portfolio Manager for the CT European Select Fund. He began his career in
equity research at Goldman Sachs covering European mid-cap companies. Benjamin
acts as Lead Portfolio Manager for the Company, supported by Brian Hall who
remains co-manager on the portfolio. They will both continue to be supported
by the 22-strong BlackRock European Fundamental Equity team.
Benjamin has a strong track record built on a quality growth style, similar to
that employed by the Company, seeking quality companies which can grow over
the long term, while sustaining attractive economics thanks to robust
competitive advantages. Benjamin’s investment approach is expected to bring
an increased valuation awareness, as well as appreciation of businesses or
industries where returns are improving – thanks to factors such as
operational transformation, improved capital allocation or market
consolidation. This broadens the investable universe, allowing for more
valuation discipline while maintaining a strong focus on quality. The Board
supports this approach and believe it aligns well with the goal of dampening
fund volatility and enhancing returns for our shareholders over time.
Revenue earnings and dividends
The Company’s revenue return per share for the six-month period ended 28
February 2026 amounted to a profit of 1.57p compared with a loss of 0.04p for
the corresponding period in 2025. The increase was the result of special
dividends received in the period, changes to portfolio positioning and timing
of portfolio company dividend payments. The Board has taken this into account
in considering the interim dividend payment level.
The Board has declared an interim dividend of 1.75p (2025: 1.75p) per share.
The dividend will be paid on 24 June 2026 to shareholders on the Company’s
register on 29 May 2026, the ex-dividend date being 28 May 2026.
The Company has consistently grown its regular dividends in all the 20
financial periods since its inception on 20 September 2004, making the Company
an AIC Dividend Hero and therefore considered a strong and reliable option for
investors focused on income and, in particular, income growth.
Management of share rating
The Board monitors the discount to NAV closely and receives regular updates
from the Manager and our corporate broker, Cavendish Securities. In the
Board’s opinion, it is important to consider the discount in the context of
wider market conditions, with investor sentiment and discounts being
influenced by various external factors. Over the period, these have included a
continuation of the pervasive selling in the investment trust sector witnessed
since early 2022, ongoing geopolitical tensions, US politics and trade war
fears and more recently the conflict in the Middle East and disruption to the
Strait of Hormuz. Over the six-month period, the Board were therefore
proactive in implementing share buybacks with the objective of ensuring that
an excessive discount to NAV did not arise.
As part of this approach, the Company repurchased 2,834,395 shares
(representing 3.1% of the issued share capital as 28 February 2026) for a
total consideration of £16,662,000 over the six months under review. Since 28
February 2026 and up to the latest practicable date of 18 May 2026 a further
1,105,338 shares have been bought back for a total consideration of
£6,157,000. As at this date, the Company’s shares were trading at a
discount of 7.0%.
All shares were bought back at a discount to the prevailing NAV and the buy
backs were therefore accretive to existing shareholders. All shares bought
back have been placed in treasury for future reissue.
Tender offers
The Directors of the Company have the discretion to make semi-annual tender
offers at the prevailing NAV less 2%, for up to 20% of the issued share
capital in May and November of each year. The Board announced on 22 September
2025 that it had decided not to proceed with a tender offer in November 2025
and on 8 April 2026 that the tender offer in May 2026 would also not be
implemented. Despite a challenging period for discounts, the Board is pleased
to note that the Company’s share rating has been relatively stable versus
the market, trading at an average of 5.1% compared to a peer group average of
4.7% over the period under review. When viewed in the context of other funds
in the peer group with a similar quality growth oriented style (where the
average discount trended above 7% over the period) the Company’s discount
compares favourably.
With this in mind and noting that the Company’s discount was trading at 6.3%
on 7 April 2026 and the average discount to NAV (cum income) was 5.3% over the
six months to 31 March 2026, the Board concluded that it was not in the
interests of shareholders as a whole to implement the May 2026 semi-annual
tender offer.
The Board believes that the share buyback activity undertaken in the period
has been beneficial in reducing the volatility of our share rating and
maintaining the discount within the peer group range. It will continue to
monitor the Company’s discount and may use the Company’s share buyback
powers to ensure that the share price does not go to an excessive discount to
the underlying NAV. The Board remains committed to supporting the share price
to a narrow discount or premium to its NAV.
Board composition
Having served as a Director of the Company since April 2015 Mr Peter Baxter
will retire as a Director following the Company’s next Annual General
Meeting in December 2026. As part of orderly succession planning, the Board
has commenced a search to identify a new Director, assisted by a third-party
recruitment firm. As part of this process, consideration is being given to
ensuring that the Board retains an appropriate balance of skills, knowledge
and experience, independence and diversity that meets or exceeds relevant best
practice. The process is underway and a further announcement will be made in
due course.
Outlook
The outlook for European equity markets has become more cautious following the
outbreak of conflict in the Middle East and the associated rise in energy
prices. Europe entered 2026 with strong momentum, supported by attractive
valuations and expectations of resilient growth. This contributed to improving
investor sentiment as investors sought to diversify away from the narrow range
of US stocks. However, supply chain disruptions, higher energy prices and
persistent inflation have now become the dominant near-term concern.
Higher energy prices present a challenge for Europe, given its dependence on
imported energy. This has increased the risk that inflation remains above
target for longer and has led investors to expect greater uncertainty over the
direction of monetary policy. While recession fears currently remain
contained, expectations for stronger economic growth have weakened, though
valuations, which in many cases remain close to or below long-term averages,
continue to provide some support.
Near-term volatility is likely to persist, with market direction depending on
the duration of the Middle East conflict, the path of energy prices and
central bank policy. Nevertheless, European equity markets continue to offer
opportunities, particularly among companies exposed to long-term drivers of
growth, with pricing power, strong cash generation and resilient balance
sheets.
Andrew Impey
Chairman
20 May 2026
Investment Manager’s
Report
Market review
The Company’s share price rose 7.2% and underlying NAV rose 7.3% over the
six months to 28 February 2026. By way of comparison, the FTSE World Europe ex
UK Index returned 17.2% during the same period (all performance returns in
Sterling terms with dividends reinvested).
Over the past six months, NAV performance has lagged the strongly rising
market and we are disappointed with the relative performance of the portfolio
over the period. While European equities moved higher overall, beneath the
surface we have experienced a difficult environment for higher-quality
companies. Stocks with stronger returns on invested capital, healthier balance
sheets, higher margins and stronger cash flow profiles – businesses we have
often preferred in the portfolio and which have been long-term strong
performers in European markets – have generally seen significant declines in
valuation, in some cases creating a marked disconnect between company earnings
and share price performance. By contrast, lower-quality stocks have seen
valuations rise.
This valuation re-rating – where investors have been willing to pay higher
valuations for lower-quality businesses – may be expected during periods of
strong economic growth, rising inflation or higher bond yields. Instead, it
has occurred against a relatively stable economic backdrop. We have witnessed
significant swings within the market without any clear change in the economic
cycle. In some cases, share price movements have become disconnected from
company fundamentals and have instead been driven by broader market trends,
creating challenging conditions for active managers. Even so, we are
disappointed with the portfolio’s relative performance over the period. In
response, we have made selective adjustments to the portfolio and continue to
identify attractive investment opportunities despite the uncertain external
backdrop. The portfolio remains positioned in line with these opportunities
and evolving market conditions.
We see two primary drivers dictating the market dynamics over the past six
months. The first has been concerns about the long-term outlook for certain
business models as Artificial Intelligence (AI) advances. This became the
dominant market theme during the period, leading to stark winners and losers
in share price performance. Companies linked to semiconductors, power and
data-centre infrastructure performed strongly as perceived AI beneficiaries,
while software and information services companies weakened on fears of
disruption. As these concerns intensified, investors rotated into what became
known as the “HALO” trade (Heavy Asset, Low Obsolescence) – favouring
businesses seen as less vulnerable to technological disruption, such as
utilities, infrastructure and industrial companies with significant physical
assets.
Secondly, open-ended funds investing in quality global companies have
experienced sustained investor outflows (>US$150 billion since the 2020 growth
peak). This has put additional pressure on share prices, as lower demand from
investors has contributed to falling valuations for many higher-quality
companies. In turn, this has created a difficult cycle of weaker performance
leading to further investor outflows. The chart below shows that global
quality/growth investment strategies have faced both weaker performance and
significant investor withdrawals in recent years. As returns have fallen,
investors have continued to pull money out of these strategies, creating
additional pressure on share prices and valuations.
Despite a strong rally in European equity markets, company results over the
period showed only modest earnings growth, with banks making the largest
contribution. Earnings growth in Europe continued to lag the US by a
considerable margin, meaning that higher valuations – rather than stronger
company profits – were the main driver of Europe’s relative market
outperformance versus the US. Geopolitical risks added further uncertainty
during the period, with oil prices rising significantly following the conflict
involving Iran. We remain closely engaged with the companies in the portfolio
and mindful of the potential impact that prolonged geopolitical tensions, or
disruption to oil supplies, could have on businesses and markets.
Portfolio performance – contributors and detractors:
In a
market with little tolerance for disappointing updates, share prices came
under pressure as a result of disappointing company guidance. Companies that
failed to meet investor expectations, or provide enough reassurance about
future performance, often saw sharp share price declines. This was a common
theme among several weaker contributors to performance during the period,
including Adyen, Belimo, ChemoMetec and Ferrari.
Adyen
was
the largest individual detractor from performance during the period, as the
market reacted negatively to changes in its guidance for 2026. The company
reduced its expected net revenue growth range from the low to mid-20% range in
October to 20–22% in February. We believe Adyen has struggled to manage
investor expectations during periods of market volatility and, in a market
highly sensitive to any disappointment, this led to a sharp share price
reaction. Communication from management also became less clear, making the
investment case more difficult to assess and reducing our confidence in the
company’s execution. As a result, we exited the position.
Despite reporting very strong results, including 23% organic sales growth in
2025 and a 36% return on capital employed, Belimo’s share price fell over
the period. The market reacted negatively to the company’s 2026 guidance,
although expectations for mid-teens revenue growth and margins above 20% were
broadly in line with market forecasts. We are familiar with Belimo management
taking a conservative approach to guidance before later upgrading expectations
and we remain confident in the company’s long-term execution. As a result,
we used the share price weakness as an opportunity to add to the position.
The portfolio’s position in ChemoMetec detracted from performance following
weak results. These were partly caused by the US government shutdown, which
delayed activity at certain laboratories and research institutions, slowing
customer purchasing and validation processes. Results also reflected a
previously identified slowdown in instrument sales, as customers take time to
validate new products before broader adoption. Over the longer term, however,
a new agreement with Roche appears to represent a significant growth
opportunity, which we believe is not yet fully reflected in the company’s
valuation. In addition, industry consolidation from three major players to two
should support stronger growth over the next five years.
Ferrari’s
share price fell following a disappointing capital markets day. The
company’s outlook was weaker than expected and, although management has
historically taken a conservative approach to guidance, it raised questions
about Ferrari’s longer-term growth potential. In recent years, growth has
been supported by strong demand for personalised vehicle features, which has
improved pricing and profitability, but this trend is expected to moderate.
More cautious communication from management led us to reassess the company’s
valuation and, ultimately, we exited the position during the period.
RELX
,
Nemetschek and SAP were all caught up in the ‘AI-loser’ narrative, despite
generally reporting strong financial results. An outlier was SAP, where growth
in its cloud backlog disappointed against elevated market expectations
following optimistic comments from management in December. This has since been
attributed to some more complex deals being delayed to 2026.
We continue to believe that the unique data bases these companies hold make
the barriers to AI disruption high. However, we must be pragmatic and
recognise the uncertainty that comes with rapid technological change. For
example, AI may eventually be able to replicate some of the services that
companies currently provide alongside their data and software offerings. We
are on high alert to any impacts this may have on business performance,
although we have not yet seen evidence of this.
Equally, companies have so far been unable to fully reassure investors that
they are protected from potential AI disruption. As a result, market concerns
and share price volatility have remained elevated. We have therefore reduced
exposure to these holdings – trimming positions in RELX and SAP and exiting
Nemetschek – as, despite our positive long-term view on the businesses, we
currently see limited catalysts to change broader market sentiment.
BE Semiconductor
was one of the strongest contributors to performance, as semiconductor
companies benefited from rising demand linked to AI investment. Customers are
increasing production capacity to support growing AI needs, which has
tightened supply in parts of the semiconductor market and supported demand for
equipment manufacturers. A positive trading update from BE Semiconductor
showed very strong order growth, with orders rising 43% quarter-on-quarter and
105% year-on-year. Sentiment across the sector also improved after ASML
reported record quarterly bookings of €13.2 billion in the fourth quarter of
2025, well ahead of market expectations of €6.95 billion. We increased the
portfolio’s holding in ASML over the period, as we believe the semiconductor
industry is entering a new growth cycle with potential for earnings to exceed
current expectations.
Not holding Novo Nordisk benefited relative performance after results from its
latest Cagrisema obesity drug trial disappointed the market. The trial, which
compared the treatment directly against Eli Lilly’s Zepbound, failed to show
superior results. This has raised questions over the market’s long-term
sales expectations for the drug, while plans for further trials at higher
doses still leave considerable uncertainty.
European banks in the portfolio, including Allied Irish Banks (AIB) and
Caixabank, generated strong returns with momentum in the sector continuing.
Results showed healthy growth in net interest income, underpinned by stronger
deposit and loan growth, which has improved visibility of future earnings
while excess capital is being returned to shareholders. Despite strong recent
performance, valuations remain attractive. We see the next phase of returns
driven by earnings growth and improved profitability, supported by balance
sheet growth and underappreciated cost cut potential, while continuing to
deliver attractive yields.
European defence companies underperformed the market towards the end of 2025,
although this reversed in 2026 as geopolitical tensions rose. The
portfolio’s position in Kongsberg Gruppen contributed positively to returns
over the period. While geopolitical developments can create short-term
volatility in defence stocks, we remain focused on the long-term investment
case for the sector, which is based on Europe’s need to increase defence
spending and strengthen military capabilities over time, rather than on any
single current conflict.
Outlook
We ended the semi-annual period with a cautiously optimistic outlook for
European equities. The broader economic backdrop remained relatively stable,
while domestic conditions in countries such as Germany, Spain and France were
showing signs of improvement. In our view, this created a resilient backdrop
at the company level that could eventually shift market focus back towards
business fundamentals and lead to broader market participation, rather than
the narrow group of stocks that has driven performance recently. This view,
however, has been put on pause as the outbreak of the conflict in the Middle
East has significantly increased the range of possible geopolitical outcomes.
At the time of writing, the situation remains fluid. Although markets have
recovered somewhat from the sell-off seen in March, conditions continue to
evolve rapidly depending on developments and the prospects for a resolution.
Even so, our bottom-up company analysis continues to identify attractive
opportunities within European markets and we have adjusted the portfolio
accordingly. The rapid adoption of AI is benefitting not only semiconductor
companies, but also those necessary in rolling out data centres at such a high
rate. The large-scale investment required for AI infrastructure is supporting
demand for companies supplying data-centre equipment and power grid
infrastructure, as growing AI usage increases electricity demand.
With the consumer remaining under pressure and key brands facing pricing
challenges, we believe it is important to look beyond traditional consumer
defensive sectors for resilient earnings. Instead, we have favoured
Industrials supplying critical services, with recurring income often through
aftermarket and maintenance programmes. This includes the civil aerospace
industry where, irrespective of higher jet fuel prices and near-term air
traffic, the long-term requirement for servicing as engines age means
maintenance trends will ramp up into outer years and profits are yet to be
recognised.
Since the appointment of Benjamin Moore as lead portfolio manager on 31 March
2026, further changes have been made to the portfolio. We have continued to
reduce positions where AI disruption remains an overhang, in favour of
holdings we see to be beneficiaries of AI adoption, such as wafer fabrication
equipment companies, for example ASMi. Further, we have sought diversification
by broadening Industrial exposure, particularly across aerospace & defence,
such as Airbus and data centre exposure through Siemens Energy and Legrand, as
well as increasing our exposure to the defensive industrial gases segment, via
L’Air Liquide. As noted above, we continue to see opportunities in
financials, especially in European banks. New positions have been funded by
reducing exposure to luxury goods companies where persistently muted demand in
China, coupled with intensifying local competition leaves little margin of
safety in valuations.
Benjamin Moore and Brian Hall
BlackRock Investment Management (UK) Limited
20 May 2026
Ten largest investments
Together, the Company’s ten largest investments represented 44.7% of the
Company’s portfolio as at 28 February 2026 (31 August 2025: 49.1%)
1
ASML
(2025: 22nd)
Technology company
Market value: £37,603,000
Share of investments: 6.2%
ASML is
a Dutch semiconductor equipment manufacturer and the sole supplier of extreme
ultraviolet lithography systems used in advanced chip production. The company
is a key beneficiary of structurally rising semiconductor complexity, with
demand increasingly supported by a strengthening memory cycle alongside
continued investment from leading foundry customers. As industry conditions
have improved, order momentum and backlog visibility have strengthened,
leaving the company well positioned to deliver sustained long
-
term growth
underpinned by its unique technology and critical role in global semiconductor
manufacturing.
2
Safran
(2025: 1st)
Industrials company
Market value: £35,130,000
Share of investments: 5.7%
Safran
is a French multinational supplier of systems and equipment for aerospace,
defence and security. Operating in an oligopolistic market, this industry has
emerged from a heavy investment period in new planes and engines and we see
Safran as well placed to benefit from continued strength in its best-in-class
after-market business, as well as strong execution in its LEAP engine program
which should drive growth for the next decade. Additionally, the company
stands to gain from rising defence spending across Europe.
3
Schneider
Electric
(2025:
5th)
Industrials company
Market value: £30,165,000
Share of investments: 4.9%
Schneider Electric is a French multinational company specialising in digital
automation and energy management across various industries globally. The
company is a key beneficiary of structural investment in energy transition
solutions, with demand driven by three major trends: energy efficiency,
automation and digitisation. We expect sustained growth in its core markets,
supported by government programs promoting green initiatives and strong demand
from data centres, particularly as AI infrastructure expands. Schneider
Electric is a well-managed business offering compounding growth and attractive
returns on capital.
4
Compagnie
Financière Richemont
(2025: 9th)
Consumer Discretionary company
Market value: £28,373,000
Share of investments: 4.6%
Compagnie Financière Richemont (Richemont) is a Swiss luxury goods company
best known for its high-end jewellery and watch brands, including Cartier and
Van Cleef. It is well-positioned in the luxury segment with lower exposure to
China than peers and strong momentum in the hard-luxury category. Long-term
growth drivers for branded jewellery remain compelling and Richemont’s
premier brands enable it to fully capture this opportunity.
5
BE
Semiconductor
(2025: 17th)
Technology company
Market value: £25,839,000
Share of investments: 4.2%
BE Semiconductor is a Netherlands-based supplier of advanced
semiconductor assembly equipment, with a leading position in hybrid bonding
technology. The company is a key beneficiary of increasing chip complexity,
with demand supported by strong momentum in photonics, advanced packaging and
smartphone applications, alongside the potential adoption of hybrid bonding in
high-bandwidth memory and leading-edge logic. As customer investment
decisions progress, the company is well positioned to benefit from
structurally rising packing intensity and a widening opportunity set over the
medium term.
6
Kone
(2025: 16th)
Industrials company
Market value: £24,446,000
Share of investments: 4.0%
Kone is
a Finnish provider of elevators, escalators and related services, with a
growing focus on its higher
-
margin service and modernisation activities.
Order momentum remains strong, with growth supported by improving trends
across maintenance and modernisation, while operational execution continues to
underpin stable margins. The company is well positioned to benefit from
resilient urbanisation demand and a gradually improving end
-
market
backdrop, supported by its global installed base and service franchise.
7
Belimo
(2025: 4th)
Industrials company
Market value: £24,110,000
Share of investments: 3.9%
Belimo
is a Swiss specialist in heating, ventilation and air conditioning (HVAC)
solutions. Their leading technology focuses on reducing the energy consumption
and carbon emission of commercial buildings, such as data centres where there
is strong growth from the demand for cooling systems for NVIDIA’s Blackwell
chips. Belimo’s technological niches mean the company is well positioned to
continue outpacing the wider HVAC industry and benefit from hyperscalers
continuing to increase spending on AI projects.
8
MTU Aero
Engines
(2025:
15th)
Industrials company
Market value: £23,269,000
Share of investments: 3.8%
MTU Aero
Engines is a German aircraft engine manufacturer specialising in the
development, production and maintenance of civil and military aero engines.
The company is well positioned to benefit from structurally strong civil
aerospace demand and an expanding installed base, which supports a growing,
high-value aftermarket opportunity through maintenance and shop visits.
Continued programme execution and improving cash conversion over time underpin
the investment case, alongside exposure to long-duration growth in
next-generation engine platforms.
9
Lonza
Group
(2025:
10th)
Health Care company
Market value: £23,152,000
Share of investments: 3.8%
Lonza
Group (Lonza) is a Swiss life-sciences company. Lonza has established itself
as one of the leading manufacturers of high-end biological drugs as well as
cell and gene therapy. Its competitive edge lies in the complexity of its
production processes, which few peers can match, reinforced by high barriers
to entry such as stringent US Food and Drug Administration certification
requirements. These factors underpin the company’s strong market position
and long-term growth potential.
10
KBC Groep
(2025: 7th)
Financials company
Market value: £21,687,000
Share of investments: 3.6%
KBC
Groep (KBC) is a Belgian universal multi-channel bank-insurer, focusing on
private clients and small and medium-sized enterprises. KBC is a quality bank
which changed its focus following the Global Financial Crisis, building
resilience through conservative capital positions. KBC delivers above cost of
capital returns in its developed markets, while its Central and Eastern Europe
exposure provides additional growth at higher returns. Strong capital
discipline and cost control underpin profitability, while net interest income
remains robust.
All percentages reflect the value of the holding as a percentage of total
investments.
Portfolio analysis
as at 28 February 2026
All numbers in percentages. France Switzerland Ireland Germany Sweden Netherlands Denmark Belgium Spain Italy Central Eastern Europe Portfolio Portfolio FTSE World Europe ex UK 28.02.26
& Other* 28.02.26 31.08.25
Basic Materials – – – – – – – – – – 3.1 3.1 6.1 3.7
Consumer Discretionary 6.1 4.6 – – – – – – 2.8 – 13.5 13.5 14.7 8.8
Consumer Staples – – – – – – – – – – – – – 6.2
Energy – – – – – – – – – – – – – 4.4
Financials – – 3.4 – – 2.8 – 3.6 2.7 2.7 – 17.2 12.9 23.9
Health Care – 4.5 – – – – 2.0 – – – – 6.5 7.7 13.1
Industrials 17.2 3.9 3.1 3.8 3.1 2.1 – – – – – 40.1 38.9 20.8
Technology – 0.5 – 2.6 – 10.4 – – – – – 16.2 19.3 9.6
Real Estate – – – – – – – – – – – – 0.4 1.1
Utilities 3.4 – – – – – – – – – – 3.4 – 4.9
Telecommunications – – – – – – – – – – – – – 3.5
------ ------- ------- ------- ------- ------ ------ ------ ------ ------ ------ ------ ------ ------
Portfolio 26.7 13.5 6.5 6.4 3.1 15.3 2.0 3.6 5.5 2.7 – 100.0 – –
28.02.26
==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ====
Portfolio 20.0 16.2 6.0 13.6 2.9 12.9 2.7 4.4 2.2 4.9 – – 100.0 100.0
31.08.25
==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ====
FTSE World Europe ex UK Index 28.02.26 19.7 18.9 0.7 17.6 6.9 9.9 2.9 2.1 7.3 6.6 3.4 – 100.0 –
==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ==== ====
Percentages in the table above are a % of total investments. Based on country
of listing.
*More details regarding the country of listing can be found in the table on
pages 15 and 16 of the Half Yearly Financial Report.
Investments
as at 28 February 2026
Country Market % of
of listing value investments
£’000
Industrials
Safran France 35,130 5.7
Schneider Electric France 30,165 4.9
Kone Finland 24,446 4.0
Belimo Switzerland 24,110 3.9
MTU Aero Engines Germany 23,269 3.8
Kingspan Ireland 19,035 3.1
Assa Abloy Sweden 18,969 3.1
Legrand France 18,006 3.0
Kongsberg Gruppen Norway 17,955 2.9
Thales France 13,193 2.2
Ferrovial Netherlands 12,850 2.1
SPIE France 8,843 1.4
------------- -------------
245,971 40.1
Financials
KBC Groep Belgium 21,687 3.6
Allied Irish Banks Ireland 21,041 3.4
ABN AMRO Bank Netherlands 17,133 2.8
Intesa Sanpaolo Italy 16,677 2.7
Caixabank Spain 16,228 2.7
Erste Group Bank Austria 12,479 2.0
Sberbank(*) Russia 1 –
------------- -------------
105,246 17.2
Technology
ASML Netherlands 37,603 6.2
BE Semiconductor Netherlands 25,839 4.2
RELX** United Kingdom 16,346 2.7
SAP Germany 15,970 2.6
SMG Swiss Marketplace Group Switzerland 3,260 0.5
------------- -------------
99,018 16.2
Consumer Discretionary
Compagnie Financière Richemont Switzerland 28,373 4.6
Inditex Spain 16,928 2.8
Hermès France 15,939 2.6
L’Oréal France 12,446 2.0
LVMH France 9,377 1.5
------------- -------------
83,063 13.5
Health Care
Lonza Group Switzerland 23,152 3.8
ChemoMetec Denmark 12,376 2.0
Straumann Switzerland 4,220 0.7
------------- -------------
39,748 6.5
Utilities
Engie France 20,540 3.4
------------- -------------
20,540 3.4
Basic Materials
Linde*** United States 19,261 3.1
------------- -------------
19,261 3.1
Energy
Lukoil* Russia – –
------------- -------------
Total investments 612,847 100.0
======= =======
* The investments in Sberbank and Lukoil have been fair valued to a nominal
value of £0.01 due to sanctions imposed on Russia. The underlying value of
the positions on the Moscow Stock Exchange as at 28 February 2026 were £16.9
million and £10.9 million, respectively.
** RELX is listed in the UK but has global operations and a substantial
presence in Europe.
*** Linde is listed in the US but the business is historically rooted in
Europe as it was founded in Germany and incorporated in Ireland. The company
moved to a sole US listing in 2023.
All investments are in ordinary shares unless otherwise stated. The total
number of investments held at 28 February 2026 was 35 (31 August 2025: 34).
Industry classifications in the table above are based on the Industrial
Classification Benchmark standard for categorisation of companies by industry
and sector.
As at 28 February 2026, the Company did not hold any equity interests
comprising more than 3% of any company’s share capital.
Interim Management Report and Responsibility Statement
The Chairman’s Statement and the Investment Manager’s Report above give
details of the important events which have occurred during the period and
their impact on the financial statements.
Principal risks and uncertainties
The principal risks faced by the Company can be divided into various areas as
follows:
*
Counterparty;
*
Investment performance;
*
Legal and regulatory compliance;
*
Market;
*
Operational;
*
Financial; and
*
Marketing.
The Board reported on the principal risks and uncertainties faced by the
Company in the Annual Report and Financial Statements for the year ended 31
August 2025. A detailed explanation can be found in the Strategic Report on
pages 37 to 41 and in note 16 on pages 103 to 109 of the Annual Report and
Financial Statements which are available on the website maintained by
BlackRock at www.blackrock.com/uk/brge.
In the view of the Board, there have not been any changes to the fundamental
nature of the principal risks and uncertainties since the previous report and
these are equally applicable to the remaining six months of the financial year
as they were to the six months under review.
Going concern
The Directors, having considered the nature and liquidity of the portfolio,
the Company’s investment objective and the Company’s projected income and
expenditure, are satisfied that the Company has adequate resources to continue
in operational existence for the foreseeable future and is financially sound.
The Board remains mindful of heightened geopolitical and political uncertainty
arising from ongoing international conflicts, including military conflict in
the Middle East, disruption to the Strait of Hormuz and key global shipping
routes, and the continuation of the conflict in Ukraine, as well as evolving
global trade policy and its impact on key markets in which the Company
invests. In light of these developments, the Board continues to monitor
geopolitical risk as a standalone principal risk, recognising its potential to
exacerbate market volatility, disrupt economic activity and impact investor
confidence. The Board believes that the Company and its key third-party
service providers have in place appropriate business continuity plans and
these services have continued to be supplied without interruption.
The Company has a portfolio of investments which are predominantly readily
realisable and is able to meet all of its liabilities from its assets and
income generated from these assets. Accounting revenue and expense forecasts
are maintained and reported to the Board regularly and it is expected that the
Company will be able to meet all its obligations. The Investment Manager
generally aims to be fully invested and it is anticipated that gearing will
not exceed 15% of net asset value at the time of drawdown of the relevant
borrowings. Borrowings under the overdraft facility shall at no time exceed
£75 million or 15% of the Company’s net asset value (whichever is lower)
and this covenant was complied with during the period. At 28 February 2026,
the Company had net gearing of 4.4% (28 February 2025: net gearing of 10.1%;
31 August 2025: net cash of 3.1%). Based on the above, the Board is satisfied
that it is appropriate to continue to adopt the going concern basis in
preparing the financial statements. Ongoing charges for the year ended 31
August 2025 were approximately 0.95% of net assets.
Related party disclosure and transactions with the Manager
BlackRock Fund Managers Limited (BFM) was appointed as the Company’s
Alternative Investment Fund Manager (AIFM) with effect from 2 July 2014. BFM
has (with the Company’s consent) delegated certain portfolio and risk
management services, and other ancillary services, to BlackRock Investment
Management (UK) Limited (BIM (UK)). Both BFM and BIM (UK) are regarded as
related parties under the Listing Rules. Details of the fees payable are set
out in note 4 and note 13 below. The related party transactions with the
Directors are set out in note 12 below.
Directors’ responsibility statement
The Disclosure Guidance and Transparency Rules of the UK Listing Authority
require the Directors to confirm their responsibilities in relation to the
preparation and publication of the Interim Management Report and Financial
Statements.
The Directors confirm to the best of their knowledge that:
*
the condensed set of financial
statements contained within the Half Yearly Financial Report has been prepared
in accordance with applicable UK Accounting Standards and the Accounting
Standards Board’s Statement ‘Half Yearly Financial Reports’; and
*
the Interim Management Report, together
with the Chairman’s Statement and Investment Manager’s Report, include a
fair review of the information required by 4.2.7R and 4.2.8R of the FCA’s
Disclosure Guidance and Transparency Rules.
This Half Yearly Financial Report has not been audited or reviewed by the
Company’s auditors.
The Half Yearly Financial Report was approved by the Board on 20 May 2026 and
the above responsibility statement was signed on its behalf by the Chairman.
Andrew Impey
For and on behalf of the Board
20 May 2026
Income Statement
for the six months ended 28 February 2026
Six months ended Six months ended Year ended
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
Revenue Capital Total Revenue Capital Total Revenue Capital Total
Notes £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Gains/(losses) on investments held at fair value through profit or loss – 39,791 39,791 – 654 654 – (41,608) (41,608)
Gains/(losses) on foreign exchange – 52 52 – 865 865 – (249) (249)
Income from investments held at fair value through profit or loss 3 2,675 – 2,675 1,121 – 1,121 9,223 – 9,223
--------- --------- --------- --------- --------- --------- --------- --------- ---------
Total income 2,675 39,843 42,518 1,121 1,519 2,640 9,223 (41,857) (32,634)
--------- --------- --------- --------- --------- --------- --------- --------- ---------
Expenses
Investment management fee 4 (365) (1,460) (1,825) (483) (1,932) (2,415) (954) (3,818) (4,772)
Other operating expenses 5 (535) (5) (540) (391) (6) (397) (826) (15) (841)
--------- --------- --------- --------- --------- --------- --------- --------- ---------
Total operating expenses (900) (1,465) (2,365) (874) (1,938) (2,812) (1,780) (3,833) (5,613)
--------- --------- --------- --------- --------- --------- --------- --------- ---------
Net profit/(loss) before finance costs and taxation 1,775 38,378 40,153 247 (419) (172) 7,443 (45,690) (38,247)
Finance costs (21) (82) (103) (225) (902) (1,127) (297) (1,190) (1,487)
--------- --------- --------- --------- --------- --------- --------- --------- ---------
Net profit/(loss) before taxation 1,754 38,296 40,050 22 (1,321) (1,299) 7,146 (46,880) (39,734)
Taxation charge (288) – (288) (65) – (65) (462) – (462)
--------- --------- --------- --------- --------- --------- --------- --------- ---------
Net profit/(loss) after taxation 7 1,466 38,296 39,762 (43) (1,321) (1,364) 6,684 (46,880) (40,196)
===== ===== ===== ===== ===== ===== ===== ===== =====
Earnings/(loss) per ordinary share (pence) 7 1.57 40.92 42.49 (0.04) (1.35) (1.39) 6.89 (48.30) (41.41)
===== ===== ===== ===== ===== ===== ===== ===== =====
The total columns of this statement represent the Company’s profit and loss
account. The supplementary revenue and capital accounts are both prepared
under guidance published by the Association of Investment Companies (AIC). All
items in the above statement derive from continuing operations. No operations
were acquired or discontinued during the period. All income is attributable to
the equity holders of the Company.
The net profit/(loss) on ordinary activities for the period disclosed above
represents the Company’s total comprehensive income/(loss).
Statement of Changes in Equity
for the six months ended 28 February 2026
Called up share capital Share premium account Capital redemption reserve Special reserve Capital reserves Revenue reserve Total
Note £’000 £’000 £’000 £’000 £’000 £’000 £’000
For the six months ended 28 February 2026 (unaudited) 118 85,325 130 34,141 437,981 11,384 569,079
At 31 August 2025
Total comprehensive income:
Net profit for the period – – – – 38,296 1,466 39,762
Transactions with owners, recorded directly to equity:
Ordinary shares repurchased into treasury – – – (16,581) – – (16,581)
Share repurchase costs – – – (81) – – (81)
Dividends paid(1) 6 – – – – – (5,059) (5,059)
-------- -------- -------- -------- -------- -------- --------
At 28 February 2026 118 85,325 130 17,479 476,277 7,791 587,120
===== ===== ===== ===== ===== ===== =====
For the six months ended 28 February 2025 (unaudited)
At 31 August 2024 117 85,325 130 58,331 484,862 11,535 640,300
Total comprehensive loss:
Net loss for the period – – – – (1,321) (43) (1,364)
Transactions with owners, recorded directly to equity:
Ordinary shares repurchased into treasury – – – (13,133) – – (13,133)
Share repurchase costs – – – (76) – – (76)
Dividends paid(2) 6 – – – – – (5,153) (5,153)
-------- -------- -------- -------- -------- -------- --------
At 28 February 2025 117 85,325 130 45,122 483,541 6,339 620,574
===== ===== ===== ===== ===== ===== =====
For the year ended 31 August 2025 (audited)
At 31 August 2024 118 85,325 130 58,331 484,862 11,534 640,300
Total comprehensive (loss)/income:
Net (loss)/profit for the year – – – – (46,880) 6,684 (40,196)
Transactions with owners, recorded directly to equity:
Ordinary shares repurchased into treasury – – – (24,099) – – (24,099)
Share repurchase costs – – – (91) (1) – (92)
Dividends paid(3) 6 – – – – – (6,834) (6,834)
-------- -------- -------- -------- -------- -------- --------
At 31 August 2025 118 85,325 130 34,141 437,981 11,384 569,079
===== ===== ===== ===== ===== ===== =====
(
1
)
Final dividend paid in respect of the year ended 31 August
2025 of 5.40p per share was declared on 4 November 2025 and paid on 19
December 2025.
(
2
)
Final dividend paid in respect of the year ended 31 August
2024 of 5.25p per share was declared on 5 November 2024 and paid on
20 December 2024.
(
3
)
Interim dividend paid in respect of the year ended 31 August
2025 of 1.75p per share was declared on 6 May 2025 and paid on 18 June 2025.
Final dividend paid in respect of the year ended 31 August 2024 of 5.25p per
share was declared on 5 November 2024 and paid on 20 December 2024.
For information on the Company’s distributable reserves, please refer to
note 10 below.
Balance Sheet
as at 28 February 2026
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
Notes £’000 £’000 £’000
Non current assets
Investments held at fair value through profit or loss 11 612,847 683,537 551,175
------------ ------------ ------------
Current assets
Current taxation asset 3,475 3,071 4,229
Debtors 637 66 640
Cash and cash equivalents – cash at bank – – 576
Cash and cash equivalents – Cash Fund(1) 638 – 16,221
------------ ------------ ------------
Total current assets 4,750 3,137 21,666
======= ======= =======
Current liabilities
Cash and cash equivalents – bank overdraft (12,218) (59,024) (1,468)
Other creditors (18,259) (7,076) (2,294)
------------ ------------ ------------
Total current liabilities (30,477) (66,100) (3,762)
------------ ------------ ------------
Net current (liabilities)/assets (25,727) (62,963) 17,904
------------ ------------ ------------
Net assets 587,120 620,574 569,079
======= ======= =======
Equity
Called up share capital 9 118 117 118
Share premium account 85,325 85,325 85,325
Capital redemption reserve 130 130 130
Special reserve 17,479 45,122 34,141
Capital reserves 476,277 483,541 437,981
Revenue reserve 7,791 6,339 11,384
------------ ------------ ------------
Total shareholders’ funds 587,120 620,574 569,079
======= ======= =======
Net asset value per ordinary share (pence) 7 635.95 639.30 598.05
======= ======= =======
(
1
)
Cash Fund represents funds held on deposit with the BlackRock
Institutional Cash Series plc - Euro Liquid Environmentally Aware Fund.
Statement of Cash Flows
for the six months ended 28 February 2026
Six months ended Six months ended Year ended
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
£’000 £’000 £’000
Operating activities
Net profit/(loss) before taxation(1) 40,050 (1,299) (39,734)
Changes in working capital items:
Decrease in debtors 3 200 108
Increase/(decrease) in other creditors 16,454 2,170 (3,131)
Other adjustments:
Finance costs 103 1,127 1,487
(Gains)/losses on investments held at fair value through profit or loss (39,791) (654) 41,608
(Gains)/losses on foreign exchange (52) (865) 249
Sale of investments held at fair value through profit or loss 175,197 116,457 302,212
Purchase of investments held at fair value through profit or loss (197,078) (107,358) (203,164)
Taxation on investment income (757) (148) (3,247)
Interest paid (103) (1,127) (1,487)
Refund of withholding tax reclaims 1,223 112 1,656
------------ ------------ ------------
Net cash (used in)/generated from operating activities (4,751) 8,615 96,557
======= ======= =======
Financing activities
Ordinary shares repurchased into treasury (17,151) (13,209) (24,003)
Dividends paid (5,059) (5,153) (6,834)
------------ ------------ ------------
Net cash used in financing activities (22,210) (18,362) (30,837)
======= ======= =======
(Decrease)/increase in cash and cash equivalents (26,961) (9,747) 65,720
Effect of foreign exchange rate changes 52 865 (249)
Cash and cash equivalents at the start of the period/year 15,329 (50,142) (50,142)
------------ ------------ ------------
Cash and cash equivalents at the end of the period/year (11,580) (59,024 ) 15,329
======= ======= =======
Comprised of:
Cash at bank – – 576
Cash Fund(2) 638 – 16,221
Bank overdraft (12,218) (59,024) (1,468)
------------ ------------ ------------
(11,580) (59,024) 15,329
======= ======= =======
(
1
)
Dividends and interest received in cash during the period
amounted to £2,624,000 and £1,000 (six months ended 28 February 2025:
£1,173,000 and £1,000; year ended 31 August 2025: £6,719,000 and £1,000).
(
2
)
Cash Fund represents funds held on deposit with the BlackRock
Institutional Cash Series plc - Euro Liquid Environmentally Aware Fund.
Notes to the Financial Statements
for the six months ended 28 February 2026
1. Principal activity
The principal activity of the Company is that of an investment trust company
within the meaning of Section 1158 of the Corporation Tax Act 2010.
2. Basis of preparation
The financial statements of the Company are prepared on a going concern basis
in accordance with Financial Reporting Standard 104 Interim Financial
Reporting (FRS 104) applicable in the United Kingdom and Republic of Ireland
and the revised Statement of Recommended Practice – ‘Financial Statements
of Investment Trust Companies and Venture Capital Trusts’ (SORP), issued by
the Association of Investment Companies (AIC) in October 2019 and updated in
July 2022, and the provisions of the Companies Act 2006.
The accounting policies and estimation techniques applied for the condensed
set of financial statements are as set out in the Company’s Annual Report
and Financial Statements for the year ended 31 August 2025.
3. Income
Six months ended Six months ended Year ended
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
£’000 £’000 £’000
Investment income:
UK dividends – – 656
Overseas dividends 2,403 1,120 8,442
Overseas special dividends 271 – 124
------------ ------------ ------------
Total investment income 2,674 1,120 9,222
Other income:
Interest received 1 1 1
------------ ------------ ------------
Total other income 1 1 1
------------ ------------ ------------
Total 2,675 1,121 9,223
======= ======= =======
Dividends and interest received in cash during the period amounted to
£2,624,000 and £1,000 respectively (six months ended 28 February 2025:
£1,173,000 and £1,000; year ended 31 August 2025: £6,719,000 and £1,000).
No special dividends have been recognised in capital during the period (six
months ended 28 February 2025: £nil; year ended 31 August 2025: £nil).
4. Investment management fee
Six months ended 28 February 2026 Six months ended 28 February 2025 Year ended 31 August 2025
(unaudited) (unaudited) (audited)
Revenue Capital Total Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Investment management fee 365 1,460 1,825 483 1,932 2,415 954 3,818 4,772
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Total 365 1,460 1,825 483 1,932 2,415 954 3,818 4,772
====== ====== ====== ====== ====== ====== ====== ====== ======
Up to 31 August 2025, the investment management fee is levied quarterly based
on a tiered basis: 0.85% per annum of the month-end net asset value up to
£350 million and 0.75% per annum of the month-end net asset value above £350
million.
With effect from 1 September 2025, the Company’s annual management fee was
reduced to the following tiers: 0.65% of month-end net assets up to and
including £400 million, 0.60% of month end net assets in excess of £400
million up to and including £1 billion and 0.525% of month-end net assets in
excess of £1 billion.
It is estimated that the Company’s ongoing charges ratio (OCR) will reduce,
allowing it to achieve an illustrative OCR of 0.775% (based on average net
assets for the year ended 31 August 2025), representing a material improvement
from the Company’s OCR of 0.95% for the year ended 31 August 2025 as set out
in note 5 of the Company’s Annual Financial Report for the year ended 31
August 2025.
The investment management fee is allocated 20% to the revenue account and 80%
to the capital account of the Income Statement. There is no additional fee for
company secretarial and administration services.
5. Other operating expenses
Six months ended Six months ended Year ended
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
£’000 £’000 £’000
Allocated to revenue:
Broker fees 24 24 48
Custody fees 32 35 68
Depositary fees 33 34 68
Audit fees(1) 30 31 59
Legal fees – 13 11
Registrar’s fees 56 48 98
Directors’ emoluments 105 94 207
Marketing fees 138 50 101
Postage and printing fees 29 30 59
AIC fees 14 11 23
Professional fees 9 5 16
Stock exchange listing fees 20 17 37
Write back of prior year expense accruals(2) – (39) (10)
Other administration costs 45 38 41
------------ ------------ ------------
Total revenue expenses 535 391 826
Allocated to capital:
Custody transaction costs(3) 5 6 15
------------ ------------ ------------
Total capital expenses 5 6 15
------------ ------------ ------------
Total 540 397 841
======= ======= =======
(
1
) No non-audit services are
provided by the Company’s auditors (six months ended 28 February 2025: none;
year ended 31 August 2025: none).
(
2
) No prior year expenses
have been written back in the period (six months ended 28 February 2025: legal
fees, professional fees and other administration costs; year ended 31 August
2025: legal fees and other administration costs).
(
3
) For the six month period
ended 28 February 2026, expenses of £5,000 (six months ended 28 February
2025: £6,000; year ended 31 August 2025: £15,000) were charged to the
capital account of the Income Statement. These relate to transaction costs
charged by the custodian on sale and purchase trades.
The direct transaction costs incurred on the acquisition of investments
amounted to £390,000 for the six months ended 28 February 2026 (six months
ended 28 February 2025: £90,000; year ended 31 August 2025: £194,000). Costs
relating to the disposal of investments amounted to £50,000 for the six
months ended 28 February 2026 (six months ended 28 February 2025: £34,000;
year ended 31 August 2025: £103,000). All transaction costs have been
included within the capital account.
6. Dividends
The Directors have declared an interim dividend of 1.75p per share for the
period ended 28 February 2026, payable on 24 June 2026 to shareholders on the
register on 29 May 2026. The total cost of the dividend based on 91,240,689
ordinary shares in issue at 18 May 2026 was £1,597,000 (six months ended 28
February 2025: £1,680,000).
In accordance with FRS 102, Section 32 Events After the End of the Reporting
Period, the interim dividend payable on the ordinary shares has not been
included as a liability in the financial statements, as interim dividends are
only recognised when they have been paid.
7. Earnings and net asset value per ordinary share
Revenue earnings/(loss), capital earnings/(loss) and net asset value per
ordinary share are shown below and have been calculated using the following:
Six months ended Six months ended Year ended
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
Net revenue profit/(loss) attributable to ordinary shareholders (£’000) 1,466 (43) 6,684
Net capital profit/(loss) attributable to ordinary shareholders (£’000) 38,296 (1,321) (46,880)
------------ ------------ ------------
Total profit/(loss) attributable to ordinary shareholders (£’000) 39,762 (1,364) (40,196)
------------ ------------ ------------
Total shareholders’ funds (£’000) 587,120 620,574 569,079
======= ======= =======
Earnings per share
The weighted average number of ordinary shares in issue during the period on which the earnings per ordinary share was calculated was: 93,578,494 98,146,439 97,066,146
The actual number of ordinary shares in issue at the end of the period on which the net asset value per ordinary share was calculated was: 92,321,027 97,070,633 95,155,422
Calculated on weighted average number of ordinary shares:
Revenue earnings/(loss) per share (pence) - basic and diluted 1.57 (0.04) 6.89
Capital earnings/(loss) per share (pence) - basic and diluted 40.92 (1.35) (48.30)
------------ ------------ ------------
Total earnings/(loss) per share (pence) - basic and diluted 42.49 (1.39) (41.41)
======= ======= =======
As at As at As at
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
Net asset value per share (pence) 635.95 639.30 598.05
Ordinary share price (pence) 605.00 596.00 570.00
======= ======= =======
There were no dilutive securities at 28 February 2026 (28 February 2025: none;
31 August 2025: none).
8. Reconciliation of liabilities arising from financing activities
Six months ended Six months ended Year ended
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
£’000 £’000 £’000
Bank overdraft at the beginning of the period/year 1,468 50,150 50,150
Cash flows:
Movement in overdraft 10,807 10,722 (47,195)
Bank overdraft interest paid (103) (1,127) (1,487)
Non cash flows:
Effects of foreign exchange loss/(gain) 46 (721) –
------------ ------------ ------------
Bank overdraft at the end of the period/year 12,218 59,024 1,468
======= ======= =======
See Note 11 for terms of the overdraft facility.
9. Called up share capital
Ordinary Treasury Total Nominal
shares shares shares value
number number number £’000
Allotted, called up and fully paid share capital comprised:
Ordinary shares of 0.1 pence each:
At 31 August 2024 (audited) 99,332,161 18,596,777 117,928,938 117
Ordinary shares repurchased into treasury (2,261,528) 2,261,528 – –
--------------- --------------- --------------- ---------------
At 28 February 2025 (unaudited) 97,070,633 20,858,305 117,928,938 117
Ordinary shares repurchased into treasury (1,915,211) 1,915,211 – –
--------------- --------------- --------------- ---------------
At 31 August 2025 (audited) 95,155,422 22,773,516 117,928,938 118
Ordinary shares repurchased into treasury (2,834,395) 2,834,395 – –
--------------- --------------- --------------- ---------------
At 28 February 2026 (unaudited) 92,321,027 25,607,911 117,928,938 118
========= ========= ========= =========
During the six months ended 28 February 2026, 2,834,395 ordinary shares were
repurchased and held in treasury (six months ended 28 February 2025:
2,261,528; year ended 31 August 2025: 4,176,739) for a net consideration after
expenses of £16,662,000 (six months ended 28 February 2025: £13,209,000;
year ended 31 August 2025: £24,191,000).
Since 28 February 2026 and up to the latest practicable date of 18 May 2026,
1,105,338 ordinary shares have been repurchased and placed in treasury for a
total consideration of £6,157,000.
10. Reserves
The share premium account and capital redemption reserve of £85,325,000 and
£130,000 (28 February 2025: £85,325,000 and £130,000; 31 August 2025:
£85,325,000 and £130,000) are not distributable reserves under the Companies
Act 2006. In accordance with ICAEW Technical Release 02/17BL on Guidance on
Realised and Distributable Profits under the Companies Act 2006, the special
reserve and capital reserves may be used as distributable reserves for all
purposes and, in particular, the repurchase by the Company of its ordinary
shares and for payments as dividends. In accordance with the Company’s
Articles of Association, the special reserve of £17,479,000 (28 February
2025: £45,122,000; 31 August 2025: £34,141,000), capital reserves of
£476,277,000 (28 February 2025: £483,541,000; 31 August 2025: £437,981,000)
and the revenue reserve of £7,791,000 (28 February 2025: £6,339,000; 31
August 2025: £11,384,000) may be distributed by way of dividend. The gain on
the capital reserve arising on the revaluation of investments held of
£130,972,000 (28 February 2025: £210,107,000; 31 August 2025: £129,417,000)
is subject to fair value movements and may not be readily realisable at short
notice; as such it may not be entirely distributable. The investments are
subject to financial risks; as such capital reserves (arising on investments
sold) and the revenue reserve may not be entirely distributable if a loss
occurred during the realisation of these investments.
As at 28 February 2026, the Company’s distributable reserves excluding
capital reserves on the revaluation of investments amounted to £370,575,000
(28 February 2025: £324,895,000; 31 August 2025: £354,089,000).
11. Financial risks and valuation of financial instruments
The Company’s investment activities expose it to the various types of risk
which are associated with the financial instruments and markets in which it
invests. The risks are substantially consistent with those disclosed in the
previous annual financial statements, with the exception of those outlined
below.
Market risk arising from price risk
Price risk is the risk that the fair value or future cash flows of a financial
instrument will fluctuate because of changes in market prices (other than
those arising from interest rate risk or currency risk), whether those changes
are caused by factors specific to the individual financial instrument or its
issuer, or factors affecting similar financial instruments traded in the
market. Local, regional or global events such as war, acts of terrorism, the
spread of infectious illness or other public health issues, recessions,
climate change or other events could have a significant impact on the Company
and the market price of its investments and could result in increased premiums
or discounts to the Company’s net asset value.
Liquidity risk
The Company has an overdraft facility of the lower of £75 million or 15% of
the Company’s net assets (28 February 2025: lower of £75 million or 15% of
the Company’s net assets; 31 August 2025: lower of £75 million or 15% of
the Company’s net assets) which is updated and renewed on an annual basis.
Valuation of financial instruments
Financial assets and financial liabilities are either carried in the Balance
Sheet at their fair value (investments) or at an amount which is a reasonable
approximation of fair value (due from brokers, dividends and interest
receivable, due to brokers, accruals, cash and cash equivalents and
overdrafts). Section 34 of FRS 102 requires the Company to classify fair value
measurements using a fair value hierarchy that reflects the significance of
inputs used in making the measurements. The valuation techniques used by the
Company are explained in the accounting policies note on page 93 of the Annual
Report and Financial Statements for the year ended 31 August 2025.
Categorisation within the hierarchy has been determined on the basis of the
lowest level input that is significant to the fair value measurement of the
relevant asset.
The fair value hierarchy has the following levels:
Level 1 – Quoted market price for identical instruments in active markets
A financial instrument is regarded as quoted in an active market if quoted
prices are readily available from an exchange, dealer, broker, industry group,
pricing service or regulatory agency and those prices represent actual and
regularly occurring market transactions on an arm’s length basis. The
Company does not adjust the quoted price for these instruments.
Level 2 – Valuation techniques using observable inputs
This category includes instruments valued using quoted prices for similar
instruments in markets that are considered less than active, or other
valuation techniques where all significant inputs are directly or indirectly
observable from market data.
Level 3 – Valuation techniques using significant unobservable inputs
This category includes all instruments where the valuation technique includes
inputs not based on market data and these inputs could have a significant
impact on the instrument’s valuation.
This category also includes instruments that are valued based on quoted prices
for similar instruments where significant entity determined adjustments or
assumptions are required to reflect differences between the instruments and
instruments for which there is no active market. The Investment Manager
considers observable data to be that market data that is readily available,
regularly distributed or updated, reliable and verifiable, not proprietary and
provided by independent sources that are actively involved in the relevant
market.
The level in the fair value hierarchy within which the fair value measurement
is categorised in its entirety is determined on the basis of the lowest level
input that is significant to the fair value measurement. If a fair value
measurement uses observable inputs that require significant adjustment based
on unobservable inputs, that measurement is a Level 3 measurement.
Assessing the significance of a particular input to the fair value measurement
in its entirety requires judgement, considering factors specific to the asset
or liability, including an assessment of the relevant risks including but not
limited to credit risk, market risk, liquidity risk, business risk and
sustainability risk. The determination of what constitutes ‘observable’
inputs requires significant judgement by the Investment Manager and these
risks are adequately captured in the assumptions and inputs used in the
measurement of Level 3 assets or liabilities.
Fair values of financial assets and financial liabilities
The table below is the analysis of the Company’s financial instruments
measured at fair value at the balance sheet date.
Level 1 Level 2 Level 3 Total
Financial assets at fair value through profit or loss £’000 £’000 £’000 £’000
Equity investments at 28 February 2026 (unaudited) 612,846 – 1 612,847
Equity investments at 28 February 2025 (unaudited) 683,536 – 1 683,537
Equity investments at 31 August 2025 (audited) 551,174 – 1 551,175
========= ========= ========= =========
The Company held two Level 3 securities as at 28 February 2026 (28 February
2025: two; 31 August 2025: two).
A reconciliation of fair value measurement in Level 3 is set out below.
Level 3 financial assets at fair value through profit or loss
Six months ended Six months ended Year ended
28 February 2026 28 February 2025 31 August 2025
(unaudited) (unaudited) (audited)
£’000 £’000 £’000
Opening fair value 1 1 1
Gain/(loss) on investments included in the Income Statement – – –
----------- ----------- -----------
Closing balance 1 1 1
======= ======= =======
As at 28 February 2026, 28 February 2025 and 31 August 2025, the investments
in Sberbank and Lukoil have been valued at a nominal value of £0.01 due to
the closure of the Moscow Stock Exchange to overseas investors and the
secondary listings of depositary receipts of Russian companies having been
suspended from trading. At the time of the invasion of Ukraine on 23 February
2022, the original book cost of these holdings was £28.7 million and its
carrying value was £20.7 million and these amounts were fair valued to a
nominal value of £0.01 on 3 March 2022.
For exchange listed equity investments, the quoted price is the bid price.
Substantially all investments are valued based on unadjusted quoted market
prices. Where such quoted prices are readily available in an active market,
such prices are not required to be assessed or adjusted for any business
risks, including climate change risk, in accordance with the fair value
related requirements of the Company’s financial reporting framework.
12. Related party disclosure
The Board now consists of five non-executive Directors, all of whom are
considered to be independent by the Board. None of the Directors has a service
contract with the Company. The Chairman receives an annual fee of £51,500,
the Chair of the Audit and Management Engagement Committee receives an annual
fee of £41,000 and each of the other Directors receives an annual fee of
£35,500. The Senior Independent Director receives an additional fee of
£1,000.
At the period end, the members of the Board held ordinary shares in the
Company as set out below:
28 February 28 February 31 August
2026 2025 2025
Andrew Impey 6,000 – 6,000
Peter Baxter 11,000 11,000 11,000
Paola Subacchi 11,734 11,700 11,734
Ian Sayers 4,000 4,000 4,000
Sapna Shah 4,000 4,000 4,000
Since the period end and up to the date of this report there have been no
changes in Directors’ holdings.
The transactions with the Investment Manager and AIFM are stated in note 13
below.
Significant holdings
The following investors are:
a. funds managed by the BlackRock Group or are affiliates of BlackRock,
Inc. (Related BlackRock Funds); or
b. investors (other than those listed in (a) above) who held more than 20%
of the voting shares in issue in the Company and are, as a result, considered
to be related parties to the Company (Significant Investors).
Total % of shares Total % of shares held by Significant Investors who are not affiliates of BlackRock Group or BlackRock, Inc. Number of Significant Investors who are not affiliates of BlackRock Group or BlackRock, Inc.
held by Related
BlackRock Funds
As at 28 February 2026 1.2 n/a n/a
As at 28 February 2025 1.2 n/a n/a
As at 31 August 2025 1.3 n/a n/a
======= ======= =======
13. Transactions with the Investment Manager and AIFM
BlackRock Fund Managers Limited (BFM) provides management and administration
services to the Company under a contract which is terminable on six months’
notice. BFM has (with the Company’s consent) delegated certain portfolio and
risk management services, and other ancillary services, to BlackRock
Investment Management (UK) Limited (BIM (UK)). Further details of the
investment management contract are disclosed in the Directors’ Report on
page 53 in the Annual Report and Financial Statements for the year ended 31
August 2025.
The investment management fee is levied quarterly based on a tiered basis:
0.65% of month-end net assets up to and including £400 million, 0.60% of
month-end net assets in excess of £400 million up to and including £1
billion and 0.525% of month-end net assets in excess of £1 billion. The
investment management fee due for the six months ended 28 February 2026
amounted to £1,825,000 (six months ended 28 February 2025: £2,415,000; year
ended 31 August 2025: £4,772,000). At the period end, £3,017,000 was
outstanding in respect of the management fee (28 February 2025: £6,287,000;
31 August 2025: £1,192,000).
In addition to the above services, BIM (UK) provided the Company with
marketing services. The total fees paid or payable for these services for the
six months ended 28 February 2026 amounted to £138,000 excluding VAT (six
months ended 28 February 2025: £50,000; year ended 31 August 2025:
£101,000). Marketing fees of £186,000 excluding VAT were outstanding at
28 February 2026 (28 February 2025: £117,000; 31 August 2025: £168,000).
During the year, the Manager pays the amounts due to the Directors. These fees
are then reimbursed by the Company for the amounts paid on its behalf. As at
28 February 2026, an amount of £246,000 was payable to the Manager in respect
of Directors’ fees (28 February 2025: £109,000; 31 August 2025: £141,000).
The Company has an investment in the BlackRock Institutional Cash Series plc -
Euro Liquid Environmentally Aware Fund of £638,000 (28 February 2025: £nil;
31 August 2025: £16,221,000) which for the period ended 28 February 2026 has
been presented in the financial statements as a cash equivalent.
The ultimate holding company of the Manager and the Investment Manager is
BlackRock, Inc., a company incorporated in Delaware, USA.
14. Contingent liabilities
There were no contingent liabilities at 28 February 2026 (28 February 2025:
none; 31 August 2025: none).
15. Publication of non statutory accounts
The financial information contained in this half yearly report does not
constitute statutory accounts as defined in Section 435 of the Companies Act
2006. The financial information for the six months ended 28 February 2026 and
28 February 2025 has not been audited.
The information for the year ended 31 August 2025 has been extracted from the
latest published audited financial statements, which have been filed with the
Registrar of Companies. The report of the auditors on those accounts contained
no qualification or statement under Sections 498 (2) or (3) of the Companies
Act 2006.
16. Annual results
The Board expects to announce the annual results for the year ending 31 August
2026 in early November 2026. Copies of the annual results announcement can be
obtained from the Secretary on 020 7743 3000 or
cosec@blackrock.com
. The Annual Report should be
available by November 2026 with the Annual General Meeting being held in
December 2026.
12 Throgmorton Avenue
London
EC2N 2DL
20 May 2026
For further information please contact:
Sarah Beynsberger, Director, Closed End Funds, BlackRock Investment Management
(UK) Limited
Tel: 020 7743 3000
Benjamin Moore, Brian Hall, Portfolio Managers, BlackRock Investment
Management (UK) Limited
Tel: 020 7743 3000
Press enquires:
Ed Hooper, Lansons Communications
Tel: 020 7294 3620
E-mail:
BlackRockInvestmentTrusts@lansons.com
or
EdH@lansons.com
END
The Half Yearly Financial Report will also be available on the BlackRock
website at
www.blackrock.com/uk/brge
. 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/22396/4350232/4104225.pdf)
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