BlackRock Throgmorton Trust Plc - Portfolio Update
PR Newswire
LONDON, United Kingdom, August 16
The information contained in this release was correct as at 31 July 2024. 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 THROGMORTON TRUST PLC (LEI: 5493003B7ETS1JEDPF59)
All information is at 31 July 2024 and unaudited.
Performance at month end is calculated on a cum income basis
| One | Three | One | Three | Five |
Net asset value | 7.3 | 10.8 | 18.3 | -19.7 | 32.5 |
Share price | 12.5 | 14.8 | 19.7 | -26.1 | 30.9 |
Benchmark* | 5.9 | 9.1 | 13.2 | -9.3 | 24.5 |
Sources: BlackRock and Deutsche Numis
*With effect from 15 January 2024 the Numis Smaller Companies plus AIM (excluding Investment Companies) Index changed to the Deutsche Numis Smaller Companies plus AIM (excluding Investment Companies).
At month end | |
Net asset value capital only: | 711.78p |
Net asset value incl. income: | 724.67p |
Share price | 676.00p |
Discount to cum income NAV | 6.7% |
Net yield1: | 2.3% |
Total Gross assets2: | £657.1m |
Net market exposure as a % of net asset value3: | 111.3% |
Ordinary shares in issue4: | 90,671,864 |
2023 ongoing charges (excluding performance fees)5,6: | 0.54% |
2023 ongoing charges ratio (including performance | 0.87% |
1. Calculated using the Final Dividend declared on 05 February 2024 paid on 28 March 2024, together with the Interim Dividend declared on 24 July 2024 to be paid on 27 August 2024.
2. Includes current year revenue and excludes gross exposure through contracts for difference.
3. Long exposure less short exposure as a percentage of net asset value.
4. Excluding 12,538,000 shares held in treasury.
5. 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 performance fees, finance costs, direct transaction charges, VAT recovered, taxation and certain other non-recurring items for the year ended 30 November 2023.
6. With effect from 1 August 2017 the base management fee was reduced from 0.70% to 0.35% of gross assets per annum. 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, including performance fees, but excluding finance costs, direct transaction charges, VAT recovered, taxation and certain other non-recurring items for the year ended 30 November 2023.
7. Effective 1st December 2017 the annual performance fee is calculated using performance data on an annualised rolling two-year basis (previously, one year) and the maximum annual performance fee payable is effectively reduced to 0.90% of two year rolling average month end gross assets (from 1% of average annual gross assets over one year). Additionally, the Company now accrues this fee at a rate of 15% of outperformance (previously 10%). The maximum annual total management fees (comprising the base management fee of 0.35% and a potential performance fee of 0.90%) are therefore 1.25% of average month end gross assets on a two-year rolling basis (from 1.70% of average annual gross assets).
Sector Weightings | % of Total Assets |
|
|
Industrials | 34.2 |
Financials | 18.7 |
Consumer Discretionary | 16.4 |
Basic Materials | 7.6 |
Technology | 5.7 |
Telecommunications | 3.9 |
Consumer Staples | 2.1 |
Real Estate | 2.1 |
Health Care | 1.5 |
Energy | 1.1 |
Communication Services | 0.8 |
Other | 0.1 |
Net Current Assets | 5.8 |
| ----- |
Total | 100.0 |
| ===== |
|
|
Country Weightings | % of Total Assets |
|
|
United Kingdom | 92.4 |
United States | 3.4 |
Ireland | 1.9 |
Australia | 0.8 |
France | 0.8 |
Canada | 0.5 |
Switzerland | 0.4 |
Sweden | -0.2 |
| ----- |
Total | 100.0 |
| ===== |
Market Exposure (Quarterly) | ||||
| ||||
| 31.08.23 | 30.11.23 | 29.02.24 | 31.05.24 |
Long | 112.7 | 111.3 | 117.9 | 114.9 |
Short | 4.5 | 3.8 | 3.2 | 2.3 |
Gross exposure | 117.2 | 115.1 | 121.1 | 117.2 |
Net exposure | 108.2 | 107.5 | 114.7 | 112.6 |
Ten Largest Investments | |
| |
Company | % of Total Gross Assets |
|
|
Breedon | 3.0 |
IntegraFin | 2.9 |
Oxford Instruments | 2.9 |
Gamma Communications | 2.9 |
Grafton Group | 2.9 |
Hill & Smith Holdings | 2.8 |
Rotork | 2.6 |
Tatton Asset Management | 2.5 |
WH Smith | 2.4 |
Workspace Group | 2.2 |
Commenting on the markets, Dan Whitestone, representing the Investment Manager noted:
The Company returned 7.3% in June, outperforming its benchmark - the Deutsche Numis Smaller Companies + AIM (excluding Investment Companies) Index - which returned 5.9%.1
To paraphrase a historical leader, there are some years where nothing happens and there are some months where years happen. July was in the latter camp for financial markets. In the month we had a UK general election, a US presidential assassination attempt, Biden's disastrous debate performance and subsequent withdrawal from the presidential race along with a slew of seemingly contradictory economic and company earnings data. The market's reaction to all this information was a violent rotation, with multi standard deviation moves under the surface, particularly in the US. As for the UK, it left some isolated from this volatility with the FTSE 100 Index up 3% and the FTSE 250 Index up 6.6%. UK economic data continued to improve, and domestic shares responded well to the General Election which was helpful to the Company's overall positioning.
The top contributor to performance during the month was WH Smith which rose on no stock specific news but benefitted from the general appreciation in consumer shares. Grafton delivered a resilient trading update highlighting the diversification of its business by geography but is ultimately still waiting for its end markets to recover. The third top contributor was Rosebank, an acquisition vehicle that we supported at IPO, as we know the Management team from Melrose. Another interesting company I'd flag is Breedon, which like Grafton delivered resilient trading in a period of adverse weather and subdued market conditions. Breedon continues to be impacted by negative volumes but has continued to make headway with pricing increases and cost efficiencies to protect profitability while it waits for a volume recovery (N.B. UK concrete volumes are now c.8% below the GFC (Global Financial Crisis) trough, and UK housing starts are at a c.20 year low). Breedon is a market leader with a demonstrable track record in improving ROCE (return on capital employed) and profitability, and we think there is a compelling investment here to play out with many drivers to improve the outlook for volumes (i.e. accommodative monetary policy, fiscal support, UK planning reform, new build housing recovery).
The biggest detractor was Ascential that was bid for at a large premium by Informa. This was a frustrating development as we had owned Ascential for some time but recently sold out. Shares in Boku fell during the month despite a strong trading update indicating around 30% year on year growth (in constant currency) over H1 of 2024, leaving them the requirement of around 9% growth in H2 to meet full year forecasts. Shares in staffing company Robert Walters fell after reporting weaker than expected trading as trading conditions remain subdued, particularly in regions dominated by political uncertainty.
With hopes for a period of greater UK political stability upon us, and a gradual but improving economic backdrop we think the outlook for UK small and mid-caps is compelling. We've continued to increase our exposure to domestic shares, notably housebuilders and brick manufacturers, as well as other industrial and consumer companies we think are well placed to benefit from an improving backdrop for volumes as we move through 2024 into 2025. As mentioned above, we see Labour's victory in the General Election as a positive for our universe. The net of the portfolio is around 108% while the gross is around 112%.
We thank shareholders for your ongoing support.
1Source: BlackRock as at 31 July 2024
16 August 2024
ENDS
Latest information is available by typing www.blackrock.com/uk/thrg 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.
