BlackRock World Mining Trust Plc - Portfolio Update
PR Newswire
London, September 21
The information contained in this release was correct as at 31 August 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 WORLD MINING TRUST PLC (LEI - LNFFPBEUZJBOSR6PW155)
All information is at 31 August 2021 and unaudited.
| Performance at month end with net income reinvested | |||||
| One | Three | One | Three | Five | |
| Month | Months | Year | Years | Years | |
| Net asset value | -4.0% | -4.4% | 37.8% | 75.3% | 135.5% |
| Share price | -7.1% | -11.8% | 45.8% | 88.0% | 160.0% |
| MSCI ACWI Metals & Mining 30% Buffer 10/40 Index (Net)* | -2.7% | -2.7% | 34.2% | 57.7% | 105.8% |
| * (Total return) Sources: BlackRock, MSCI ACWI Metals & Mining 30% Buffer 10/40 Index, Datastream | |||||
At month end
| Net asset value (including income)1: | 608.67p |
| Net asset value (capital only): | 591.84p |
| 1 Includes net revenue of 16.83p | |
| Share price: | 566.00p |
| Discount to NAV2: | 7.0% |
| Total assets: | £1,255.4m |
| Net yield3: | 3.9% |
| Net gearing: | 11.8% |
| Ordinary shares in issue: | 183,750,814 |
| Ordinary shares held in Treasury: | 9,261,028 |
| Ongoing charges4: | 0.9% |
2 Discount to NAV including income.
3 Based on a quarterly interim dividend of 4.00p per share declared on 12 November 2020 and a final dividend of 8.30p per share announced on 5 March 2021 in respect of the year ended 31 December 2020, and a first interim dividend of 4.50p per share declared on 29 April 2021 and a second interim dividend of 5.50p per share declared on 19 August 2021 in respect of the year ending 31 December 2021.
4 Calculated as a percentage of average net assets and using expenses, excluding finance costs, for the year ended 31 December 2020.
| Country Analysis | Total Assets (%) | Sector Analysis | Total Assets (%) | |
| Global | 67.6 | Diversified | 41.1 | |
| Australasia | 6.7 | Copper | 18.8 | |
| United States | 6.6 | Gold | 16.4 | |
| Latin America | 5.8 | Steel | 10.2 | |
| South Africa | 4.0 | Iron Ore | 4.2 | |
| Other Africa | 3.1 | Platinum Group Metals | 4.0 | |
| Canada | 2.6 | Industrial Minerals | 2.3 | |
| Indonesia | 1.2 | Aluminium | 1.2 | |
| Russia | 1.1 | Nickel | 1.2 | |
| United Kingdom | 0.9 | Silver & Diamonds | 0.1 | |
| Net Current Assets | 0.4 | Zinc | 0.1 | |
| ----- | Net Current Assets | 0.4 | ||
| 100.0 | ----- | |||
| ===== | 100.0 | |||
| ===== | ||||
| Ten largest investments | |
| Company | Total Assets % |
| Vale: | |
| Equity | 6.0 |
| Debenture | 4.3 |
| BHP | 8.9 |
| Anglo American | 7.6 |
| Glencore | 6.5 |
| Rio Tinto | 5.7 |
| Freeport-McMoRan | 5.3 |
| ArcelorMittal | 4.9 |
| Newmont Mining | 3.4 |
| Barrick Gold | 2.9 |
| OZ Minerals | |
| Equity | 1.1 |
| Royalty | 1.7 |
| Asset Analysis | Total Assets (%) |
| Equity | 91.9 |
| Preferred Stock | 3.9 |
| Bonds | 3.7 |
| Warrants | 0.1 |
| Net Current Assets | 0.4 |
| ----- | |
| 100.0 | |
| ===== |
Commenting on the markets, Evy Hambro and Olivia Markham, representing the Investment Manager noted:
Performance
The Company's NAV returned -4.0% in August, underperforming its reference index, the MSCI ACWI Metals and Mining 30% Buffer 10/40 Index (net return), which returned -2.7% (Figures in GBP). The mining sector pulled back in August as most mined commodities came under pressure.
Expectations grew around China curbing steel production, which dampened demand expectations for iron ore (a key input in the steel production process) and saw the iron ore (62% fe.) price fall by 14.3%. Economic data from China was also weaker, with its manufacturing PMI below 50 for the first time since April 2020. Combined with deteriorating global COVID-19 data, which added to concerns around commodity demand, it saw the copper price, for example, fall by 1.8%.
The sector's negative performance in August came despite a very strong reporting season for the miners, which saw stellar returns to shareholders and continued focus on shareholder value creation and capex discipline.
Strategy and Outlook
We are optimistic on COVID-19 vaccine rollouts supporting global economic growth and, in turn, commodity demand. Meanwhile, our analysis shows that the mining sector has performed particularly strongly during periods with significant increases in inflation expectations which we believe we could see this year.
Increased fiscal stimulus globally aimed at kick-starting economies in the COVID-19 crisis is being geared towards infrastructure spending which should support mined commodity demand. Meanwhile, we see the mining sector playing a crucial role in supplying the materials required for low carbon technologies e.g. wind turbines and solar panels.
Capital expenditure has been slashed by the miners since the peak in 2013 which is constraining new commodity supply and supporting prices. Whilst capital expenditure has risen since 2016, it is still a long way below the peak, and we are encouraged by rhetoric from management teams around continued capital discipline.
Mining companies have focused on paying down debt in recent years and balance sheets are exceptionally strong today as a result. Given ongoing discipline, capital is being returned to shareholders in the form of dividends and buybacks.
All data points are in USD terms unless stated otherwise.
21 September 2021
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.
