BlackRock World Mining Trust Plc - Portfolio Update
PR Newswire
London, May 20
The information contained in this release was correct as at 30 April 2022. Information on the Company's up to date net asset values can be found on the London Stock Exchange website at:
https://www.londonstockexchange.com/exchange/news/market-news/market-news-home.html.
BLACKROCK WORLD MINING TRUST PLC (LEI - LNFFPBEUZJBOSR6PW155)
All information is at 30 April 2022 and unaudited.
| Performance at month end with net income reinvested | |||||
| One | Three | One | Three | Five | |
| Month | Months | Year | Years | Years | |
| Net asset value | -6.9% | 18.5% | 23.6% | 107.7% | 137.2% |
| Share price | -3.0% | 19.2% | 22.0% | 140.9% | 183.9% |
| MSCI ACWI Metals & Mining 30% Buffer 10/40 Index (Net)* | -5.2% | 15.7% | 14.8% | 73.1% | 95.8% |
| * (Total return) Sources: BlackRock, MSCI ACWI Metals & Mining 30% Buffer 10/40 Index, Datastream | |||||
At month end
| Net asset value (including income)1: | 716.85p |
| Net asset value (capital only): | 699.56p |
| 1 Includes net revenue of 17.29p | |
| Share price: | 723.00p |
| Premium to NAV2: | 0.9% |
| Total assets: | 1,496.9m |
| Net yield3: | 6.0% |
| Net gearing: | 12.1% |
| Ordinary shares in issue: | 184,806,116 |
| Ordinary shares held in Treasury: | 8,205,726 |
| Ongoing charges4: | 0.9% |
2 Discount to NAV including income.
3 Based on a second and third interim dividend of 5.50p per share declared on 19 August 2021 and 18 November 2021 respectively, and a final dividend of 27.00p per share declared on 8 March 2022, all in respect of the year ended 31 December 2021, and a first interim dividend of 5.50p per share declared on 6 May 2022 in respect of the year ending 31 December 2022.
4 Calculated as a percentage of average net assets and using expenses, excluding finance costs, for the year ended 31 December 2021.
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| Ten largest investments | |
| Company | Total Assets % |
| Glencore | 9.0 |
| Vale: | |
| Equity | 5.7 |
| Debenture | 3.1 |
| BHP | 8.0 |
| Anglo American | 6.3 |
| Freeport-McMoRan | 4.3 |
| Teck Resources | 4.2 |
| Rio Tinto | 4.1 |
| Newmont Mining | 3.7 |
| First Quantum Minerals: | |
| Equity | 2.8 |
| Bond | 0.8 |
| ArcelorMittal | 3.1 |
| Asset Analysis | Total Assets (%) |
| Equity | 92.8 |
| Bonds | 3.2 |
| Preferred Stock | 3.1 |
| Warrants | 0.1 |
| Net Current Assets | 0.8 |
| ----- | |
| 100.0 | |
| ===== | |
| Commenting on the markets, Evy Hambro and Olivia Markham, representing the Investment Manager noted: |
| Performance |
| The Company's NAV returned -6.9% in April, underperforming its reference index, the MSCI ACWI Metals and Mining 30% Buffer 10/40 Index (net return), which returned -5.2% (Performance figures in GBP). The mining sector pulled back in April on weakness across mined commodity prices. Ongoing COVID-19 lockdowns in China have led to a deterioration in demand conditions in the country. The mining sector also reported on Q1 production and cost results during the month. Overall, production numbers were disappointing, whilst cost inflation was also a key theme. Whilst weaker production was a negative for performance in April, it does indicate an even tighter supply and demand picture for the rest of the year. For reference, production of copper in Chile (which typically accounts for over 30% of global supply) was down by 7.2% year-on-year in March 2022, whilst the country's full year 2022 production is tracking at a similar level to that in 2004 despite significant investment across the industry to grow production. Real interest rates moved sharply higher during the month, with the US 10-year real interest rate moving back into positive territory. The US dollar also strengthened, with the DXY rising from 98.3 to 103.0, acting as a headwind for commodities and especially gold. |
| Strategy and Outlook |
| Supply and demand in mined commodity markets is generally very tight today and prices look well-supported in our view. On the demand side, increased global infrastructure spending is supporting demand, whilst we expect the mining sector to play a critical role in the coming years in supplying materials required for lower-carbon technologies, like wind turbines, solar panels and electric vehicles. The Russia/Ukraine crisis puts greater focus on energy independence, particularly for Europe, and will further accelerate investment into renewable energy capacity build out in our view. On the supply side, we are encouraged by what we are hearing from management teams in terms of maintaining their focus on capital discipline. Longer-term, ill-discipline remains a risk but, regardless, increases in capital expenditure would take some time to feed through into new supply given the time-lags associated with mining projects. Mining companies are generally in robust financial shape today with strong balance sheets and high levels of free cash flow being generated. Finally, we view mining equities as an effective way to hedge portfolios against persistent inflationary pressures, whilst, despite recent outperformance, valuations continue to look attractive in our view. |
| All data points are in USD terms unless stated otherwise. 20 May 2022 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. |
