BlackRock Smaller Companies Trust Plc - Portfolio Update
PR Newswire
London, May 19
The information contained in this release was correct as at 30 April 2021. 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 30 April 2021 and unaudited.
Performance at month end is calculated on a capital only basis
| One month % | Three months % | One year % | Three years % | Five years % | |
| Net asset value* | 9.0 | 16.9 | 55.8 | 30.9 | 99.2 |
| Share price* | 7.2 | 16.6 | 46.1 | 34.1 | 112.7 |
| Numis ex Inv Companies + AIM Index | 5.6 | 15.1 | 57.9 | 18.8 | 51.8 |
*performance calculations based on a capital only NAV with debt at par, without income reinvested. Share price performance calculations exclude income reinvestment.
Sources: BlackRock and Datastream
At month end
| Net asset value Capital only (debt at par value): | 2,021.83p |
| Net asset value Capital only (debt at fair value): | 2,012.62p |
| Net asset value incl. Income (debt at par value)1: | 2,035.96p |
| Net asset value incl. Income (debt at fair value)1: | 2,026.76p |
| Share price: | 1,914.00p |
| Discount to Cum Income NAV (debt at par value): | 6.0% |
| Discount to Cum Income NAV (debt at fair value): | 5.6% |
| Net yield2: | 1.7% |
| Gross assets3: | £1,083.8m |
| Gearing range as a % of net assets: | 0-15% |
| Net gearing including income (debt at par): | 7.7% |
| Ongoing charges ratio (actual)4: | 0.8% |
| Ordinary shares in issue5: | 48,829,792 |
Includes net revenue of 14.13p
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 12.8 pence per share (announced on 5 November 2020, ex-dividend on 12 November 2020, paid on 26 November 2020)and the final dividend of 20.50 pence per share declared on 7 May 2021 and payable on 18 June 2021 to shareholders on the register on 21 May 2021.
Includes current year revenue.
As reported in the Annual Financial Report for the year ended 28 February 2021 the Ongoing Charges Ratio (OCR) was 0.8%. The OCR is calculated as a percentage of net assets and using operating expenses, excluding performance fees, finance costs and taxation.
Excludes 1,163,731 ordinary shares held in treasury.
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| Ten Largest Equity Investments Company | % of portfolio |
| Treatt | 2.4 |
| Watches of Switzerland | 2.4 |
| CVS Group | 2.0 |
| Impax Asset Management | 2.0 |
| Ergomed | 2.0 |
| Breedon | 1.8 |
| YouGov | 1.8 |
| IntegraFin | 1.8 |
| Stock Spirits Group | 1.7 |
| Pets At Home | 1.6 |
Commenting on the markets, Roland Arnold, representing the Investment Manager noted:
During April the Company's NAV per share rose by 9.0%1 to 2,021.83p on a capital only basis, outperforming our benchmark index which returned 5.6%1; for comparison the FTSE 100 Index rose by 3.8%1 on a capital only basis.
Equity markets continued to rise during April, buoyed by the continued positive signs from the Covid-19 vaccine deployment and a strong corporate earnings season. The 12th of April brought the reopening of outdoor hospitality and non-essential retail in the UK as Covid-19 cases and death numbers fell. The ONS weekly indicators of the Covid-19 impact on the UK economy suggested that the return to normal had accelerated; compared to pre-pandemic levels, overall credit & debit card payments recovered to 98%, road traffic climbed to 103% and the proportion of the workforce on furlough declined to 13%. The style rotation from growth and into value, which was such a dominant driver of markets in the first quarter, seemingly paused during April as bottom-up fundamentals were the driving force behind market movements.
Positive earnings results were the key driver of the Company's NAV outperformance during the month, with a number of our holdings beating expectations and raising guidance. Shares in the sustainable-focused fund manager Impax Asset Management rallied after the company reported another strong quarter of AUM growth, with a 19% increase in the first 3 months of 2021. Treatt, the manufacturer of flavour and fragrance ingredients, rose in response to another positive update which confirmed that the company has continued to trade in line with the board's recently increased guidance (as revised from January 2021). Construction group Morgan Sindall provided an impressive trading update showing strong growth across the business since the start of the year, with upgrades to full year guidance. The backdrop of rising demand for affordable housing, urban regeneration and infrastructure investment continues to propel the group's secured order book, whilst operational delivery is expected to drive margin improvement throughout the year.
The positive earnings news across the market meant the largest detractors to performance were outperforming shares in the benchmark which were not owned in the portfolio. Amongst stocks that we did own, our holdings Stock Spirits, 4imprint and Team17 underperformed despite no stock-specific newsflow.
In the UK the vaccine rollout and pace of reopening continues to look positive and remains a key focus for investors. Like everyone we are monitoring the situation closely, and whilst there is always a risk a "variant of concern" may cause the re-opening plan to stutter, at this time we still believe the vaccine will ultimately see us return to a more normal way of life. The strength of trading shown in the recent reporting season provides us with confidence in our current positioning and the outlook for many businesses across the portfolio continues to improve. We also continue to see evidence of those companies that went into the Covid crisis in a strong position, both financially and operationally, are now emerging in even stronger positions. The ability of well-financed, market-leading businesses to improve their relative positions in times of stress has always been one of our core beliefs, and this crisis has only reinforced that belief.
We continue to focus on bottom-up company fundamentals, with a bias towards high quality market leading global businesses, which are operating in attractive end markets and run by strong management teams. The road ahead remains uncertain, and there is potential for sharp spikes in volatility. However, as always, we believe that focusing on the micro will triumph over the macro headwinds, and historically volatility has always created opportunity for this strategy. We thank shareholders for their continued support.
1Source: BlackRock as at 30 April 2021
19 May 2021
ENDS
Latest information is available by typing www.blackrock.co.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.
