BlackRock Throgmorton Trust Plc - Portfolio Update
PR Newswire
LONDON, United Kingdom, September 24
The information contained in this release was correct as at 31 August 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 August 2024 and unaudited.
Performance at month end is calculated on a cum income basis
| One | Three | One | Three | Five |
Net asset value | -1.9 | 1.1 | 19.0 | -25.6 | 31.2 |
Share price | -5.5 | -0.1 | 16.4 | -34.4 | 20.5 |
Benchmark* | -1.2 | 1.3 | 14.6 | -14.1 | 26.4 |
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: | 697.00p |
Net asset value incl. income: | 707.42p |
Share price | 635.00p |
Discount to cum income NAV | 10.2% |
Net yield1: | 2.4% |
Total Gross assets2: | £638.2m |
Net market exposure as a % of net asset value3: | 109.0% |
Ordinary shares in issue4: | 90,221,864 |
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 paid on 21 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 12,988,000 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 | 33.7 |
Financials | 18.6 |
Consumer Discretionary | 16.1 |
Basic Materials | 7.8 |
Technology | 5.8 |
Telecommunications | 3.7 |
Real Estate | 2.2 |
Consumer Staples | 1.9 |
Communication Services | 1.4 |
Health Care | 1.3 |
Energy | 1.1 |
Net Current Assets | 6.4 |
| ----- |
Total | 100.0 |
| ===== |
|
|
Country Weightings | % of Total Assets |
|
|
United Kingdom | 92.6 |
United States | 3.1 |
Ireland | 2.3 |
Australia | 0.9 |
Canada | 0.5 |
France | 0.5 |
Switzerland | 0.4 |
Sweden | -0.3 |
| ----- |
Total | 100.0 |
| ===== |
Market Exposure (Quarterly) | ||||
| ||||
| 30.11.23 | 29.02.24 | 31.05.24 | 31.08.24 |
Long | 111.3 | 117.9 | 114.9 | 111.7 |
Short | 3.8 | 3.2 | 2.3 | 2.7 |
Gross exposure | 115.1 | 121.1 | 117.2 | 114.4 |
Net exposure | 107.5 | 114.7 | 112.6 | 109.0 |
Ten Largest Investments | |
| |
Company | % of Total Gross Assets |
|
|
Breedon | 3.2 |
IntegraFin | 3.0 |
Grafton Group | 2.9 |
Oxford Instruments | 2.7 |
Tatton Asset Management | 2.7 |
Gamma Communications | 2.6 |
Hill & Smith Holdings | 2.6 |
Rotork | 2.5 |
Workspace Group | 2.4 |
GPE | 2.4 |
Commenting on the markets, Dan Whitestone, representing the Investment Manager noted:
The Company returned -1.9% in August, while its benchmark - the Deutsche Numis Smaller Companies plus AIM (excluding Investment Companies) Index - returned -1.2%.1
August was characterised by another period of volatility, with markets falling at the start of the month, catalysed by US employment data and Japan's interest rate hike and reduction in QE. We were slightly surprised by the visceral reaction to the soft US payroll data and increase in unemployment rate at the start of the month, in a period impacted by a sizeable hurricane. A reminder that a worry somewhere else in the world can still have a significant impact on UK small and medium sized company share prices. However, most markets recovered through the month on supportive economic data (inflation, services PMIs, jobless claims) before the Federal Reserve's comments regarding rate cuts at Jackson Hole catalysed a further rally most pronounced in highly shorted names. The picture in the UK remains encouraging, with further positive developments at the macro and fundamental level, so it is somewhat frustrating that UK small & mid-caps performed as they did, finishing the month in negative territory.
The largest positive contributor during the month was specialist business advisory firm, FRP Advisory. The company recently reported solid full year results to the end of April, highlighting excellent growth in both revenues and profits, with all five of its key pillars making a positive contribution. Strong organic growth across the group has been supplemented by targeted acquisitions, and the company maintains a net cash balance sheet with healthy M&A pipeline, which was further demonstrated post month-end with the acquisition of WlliamsAli. UK food delivery firm Deliveroo rose during the month in response to the company reporting its first profit since listing in 2021 with upgrades to full year guidance. Housebuilder Bellway issued a positive trading update that was ahead of expectations for both volumes and margins, with a positive outlook for the remainder of the year. As recent commentary of ours highlighted, we have been buying up our exposure to housebuilders and brick manufacturers as we think there is a compelling recovery play after a period of depressed volumes, considerable Government actions to increase supply (in the medium term) and an improving demand backdrop in the near term as the affordability picture improves on falling rates. In our opinion, Bellway, with its well-invested landbank and solid balance sheet looks well set to capitalise on the recovery in the coming years.
Specialist BTL mortgage lender, OSB Group, fell after the company reported slower than expected loan growth resulting in downgrades to full-year guidance. Increased competition in the BTL mortgage market and falling demand has continued to weigh on the lender, coupled with changes in customer behaviour (higher borrowing costs has meant borrowers are spending less time on higher reversion rates at the end of their fixed rate contract). Shares in Oxford Instruments fell on no news but were caught up in the broader UK mid cap / Industrial sell-off. Similarly, shares in Rotork weakened on broader weakness across the industrial space. H1 results were a touch soft largely due to tough comps, however the group saw solid growth in Oil & Gas and Power & Water divisions, more than offsetting weakness in Chemical, Process & Industrial.
Overall positioning in the portfolio remains unchanged and we have high conviction in our holdings, namely UK domestics (housebuilders, brick manufacturers, RMI recovery, differentiated retailers), and infrastructure beneficiaries. However, it is quite possible that volatility remains elevated in the coming weeks and months, and therefore the net and gross exposure are currently sitting at around 106% and 108% respectively. Furthermore, our current exposure ensures that we keep some dry powder for us to deploy and introduce new ideas. As the dust settles, we will look to add risk accordingly, across UK domestic and International focused businesses, which have all been caught up in the recent sell-off.
We thank shareholders for your ongoing support.
1Source: BlackRock as at 31 August 2024
24 September 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.
