BlackRock Smaller Companies Trust Plc - Portfolio Update
PR Newswire
LONDON, United Kingdom, August 12
The information contained in this release was correct as at 31 July 2025. 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 SMALLER COMPANIES TRUST PLC (LEI:549300MS535KC2WH4082)
All information is at 31 July 2025 and unaudited.
Performance at month end is calculated on a Total Return basis based on NAV per share with debt at fair value
| One month % | Three months % | One year % | Three years % | Five years % | |
| Net asset value | 1.0 | 8.5 | -9.2 | -2.0 | 27.3 |
| Share price | 0.6 | 8.8 | -14.2 | 0.5 | 24.5 |
| Benchmark* | 0.7 | 11.6 | 2.5 | 10.7 | 39.9 |
Sources: BlackRock and Deutsche Numis
*With effect from 15 January 2024 the Numis Smaller Companies plus AIM (excluding Investment Companies) Index to Deutsche Numis Smaller Companies plus AIM (excluding Investment Companies).
At month end
| Net asset value Capital only (debt at par value): | 1,429.38p |
| Net asset value Capital only (debt at fair value): | 1,493.49p |
| Net asset value incl. Income (debt at par value)1: | 1,452.13p |
| Net asset value incl. Income (debt at fair value)1: | 1,516.24p |
| Share price: | 1,328.00p |
| Discount to Cum Income NAV (debt at par value): | 8.6% |
| Discount to Cum Income NAV (debt at fair value): | 12.4% |
| Net yield2: | 3.3% |
| Gross assets3: | £682.1m |
| Gearing range as a % of net assets: | 0-15% |
| Net gearing including income (debt at par): | 6.4% |
| Ongoing charges ratio (actual)4: | 0.8% |
| Ordinary shares in issue5: | 42,182,792 |
- Includes net revenue of 22.75p
- Yield calculations are based on dividends announced in the last 12 months as at the date of release of this announcement and comprise the Interim dividend of 15.50 pence per share (announced on 25 October 2024, ex-date on 31 October 2024, and paid on 04 December 2024) and final dividend of 28.50 pence per share (announced on 07 May 2025, ex-date on 15 May 2025, and paid on 26 June 2025).
- Includes current year revenue.
- 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 non-recurring items for year ended 28 February 2025.
- Excludes 7,810,731 ordinary shares held in treasury.
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| Ten Largest Equity Investments Company | % of portfolio |
| Boku | 3.0 |
| XPS Pensions | 2.8 |
| Great Portland Estates | 2.7 |
| Tatton Asset Management | 2.6 |
| IntegraFin | 2.6 |
| Morgan Sindall | 2.4 |
| Greencore Group Plc | 2.4 |
| Chemring Group | 2.2 |
| Rosebank | 2.0 |
| Serco Group | 2.0 |
Commenting on the markets, Roland Arnold, representing the Investment Manager noted:
During July the Company's NAV per share rose 1.0% to 1,516.24p on a total return basis, while our benchmark index, the Deutsche Numis Smaller Companies plus AIM (excluding Investment Companies) Index, returned 0.7%.1
Politics remained front and centre in the UK during July. Tensions over welfare reforms triggered a government U-turn, raising concerns about fiscal headroom. The Office for Budget Responsibility flagged growth risks ahead of the autumn budget, and the Chancellor signalled potential tax hikes to address the widening fiscal gap. Weak retail sales and a second consecutive GDP (Gross Domestic Product) contraction in May heightened expectations for a Bank of England rate cut in August, as the Monetary Policy Committee advocated for faster easing. UK equities benefited from global rotation out of U.S. assets through the month amid tariff tensions and policy risks. The FTSE 100 Index rose +4.3%, outperforming the small and mid-cap market which suffered from ongoing domestic woes.
Oxford Biomedica was the top contributor to performance during the month after also reporting strong H1 25 results and reiterating full-year guidance. The company secured £149 million in new orders in the period, more than doubling last year's figures. The second largest contributor was Boku, a specialist in localised payment solutions, which raised its full-year guidance following a continued shift away from traditional card-based transactions toward Local Payment Methods (LPMs). This structural change in consumer behaviour has propelled Boku's total payment volume beyond US$7 billion, underscoring its growing relevance in the digital payments ecosystem. The portfolio also benefited from M&A (mergers and acquisitions) activity, notably through our holding in Alpha Group International, a specialist in FX risk management and alternative banking solutions. Alpha received a recommended all-cash takeover offer from Corpay Inc., a US-listed digital payments firm, valuing the company at £1.8 billion, a 55% premium. The deal highlights the portfolio's exposure to high-quality, scalable financial technology businesses that are increasingly attractive to global acquirers.
While Alpha was beneficial to relative performance, the extent of M&A in the market more broadly continues to create challenges. This month it was financial services business, Just Group, which received an offer from Brookfield Wealth Solutions for a massive 75% premium. We did not own the shares, which therefore hurt relative performance. Frustratingly Just Group has subsequently issued a weak trading statement that highlights exactly why we had exited our position. The second largest detractor was another share that we do not own, Oxford Nanopore Technologies, which saw its share price jump in response to a solid trading update with revenue growth ahead of expectations. Finally, and in a direct contrast from last month where it was the top contributor on the back of strong results, Paypoint gave back some of its recent share price gains on no specific news.
For the last few months, we have been more constructive on the outlook for the UK market. Rates have been falling, unemployment whilst rising is still at historically low levels, real wage growth continues, and the government has made inroads into reducing regulatory over burden which has the potential to start to lift the country out of the productivity malaise of the last few years. However, we have to acknowledge more recent developments have not been supportive of this stance, with Labour backtracking on a number of initiatives, and the bond market's reaction to Rachel Reeves' emotional appearance at Prime Minister's Questions highlights the fragile nature of government finances. Once again, the predictability of the government is being called into question, once again this will lead to company management pausing on decisions, and once again it will raise the spectre of tax increases at the next budget.
All is not lost however, and whilst Trump's tariffs will no doubt have significant and far-reaching consequences, the recent signing of several trade deals has settled both bond and equity markets. Once the rules of engagement are known, companies can then begin to plan for the medium to long term. The release of the fiscal break in Germany has the potential to reinvigorate European investment, something that many UK companies will benefit from, and perhaps reminds investors there are profitable opportunities outside of the US equity market.
The pace of M&A shows little signs of slowing, with 30 bids in the first half of the year, highlighting the valuation anomaly that sits within the UK. This is the deepest and longest period of underperformance of UK SMID versus large cap we have seen in over 40 years. Whilst the outlook may still be difficult for many companies, we feel this is more than captured in valuations. With all the uncertainty in the US equity market and investors looking for other places to allocate money, a stabilising and cheap UK market could be a valid and attractive alternative.
We thank shareholders for your ongoing support.
1Source: BlackRock as at 31 July 2025
12 August 2025
ENDS
Latest information is available by typing www.blackrock.com/uk/brsc on the internet, "BLRKINDEX" on Reuters, "BLRK" on Bloomberg or "8800" on Topic 3 (ICV terminal). 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.
