|
|
One |
Three |
One |
Three |
Five |
*Since |
|
|
|
Month |
Months |
Year |
Years |
Years |
30.04.09 |
|
|
Sterling: |
|
|
|
|
|
|
|
|
Share price |
0.9% |
8.1% |
32.2% |
51.1% |
39.0% |
139.3% |
|
|
Net asset value |
-4.3% |
5.5% |
24.3% |
43.3% |
33.1% |
124.9% |
|
|
MSCI EM Europe |
-5.3% |
6.7% |
21.4% |
18.9% |
7.1% |
72.7% |
|
|
10/40(NR) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US Dollars: |
|
|
|
|
|
|
|
|
Share price |
5.0% |
11.6% |
36.5% |
25.0% |
15.5% |
116.7% |
|
|
Net asset value |
-0.3% |
8.9% |
28.3% |
18.6% |
10.6% |
103.7% |
|
|
MSCI EM Europe |
-1.4% |
10.2% |
25.4% |
-1.6% |
-11.03% |
56.4% |
|
|
10/40(NR) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sources: BlackRock,
Standard & Poor’s Micropal |
|
|
*BlackRock took over
the investment management of the Company with effect from 1 May
2009 |
|
|
|
|
|
At month end |
|
|
|
US Dollar: |
|
|
|
Net asset value –
capital only: |
473.29c |
|
|
Net asset value* – cum
income: |
487.36c |
|
|
Sterling: |
|
|
|
Net asset value –
capital only: |
352.79p |
|
|
Net asset value* – cum
income: |
363.27p |
|
|
Share price: |
342.25p |
|
|
Total assets^: |
£130.5m |
|
|
Discount (share price to
cum income NAV): |
5.8% |
|
|
Net cash at month
end: |
5.6% |
|
|
Net yield^^^^: |
1.7% |
|
|
Gearing range as a % of
Net assets: |
0-20% |
|
|
Issued Capital –
Ordinary Shares^^ |
35,916,028 |
|
|
Ongoing charges^^^ |
1.2% |
|
|
|
|
|
|
* Includes year to date
net revenue equal to 10.48 pence per share. |
|
|
^ Total assets include
current year revenue. |
|
|
^^ Excluding 5,000,000
shares held in treasury. |
|
|
^^^ Calculated as at 31
January 2017, in accordance with AIC guidelines. |
|
|
^^^^ Yield calculations
are based on dividends announced in the last 12 months as at the
date of release of this announcement, and comprise of the final
dividend of 7.50 cents per share, (announced on 28 March 2017,
ex-dividend on 18 May 2017) |
|
|
|
|
Sector
Analysis |
Gross
assets (%) |
|
Country
Analysis |
Gross
assets
(%) |
|
| Energy |
32.5 |
|
Russia |
54.7 |
|
| Financials |
28.3 |
|
Turkey |
16.1 |
|
| Telecommunication
Services |
8.6 |
|
Poland |
12.3 |
|
| Consumer Staples |
7.8 |
|
Greece |
6.7 |
|
| Materials |
4.9 |
|
Ukraine |
4.1 |
|
| Information
Technology |
4.4 |
|
Romania |
1.0 |
|
| Industrials |
3.4 |
|
Net current assets |
5.3 |
|
| Health Care |
2.6 |
|
|
|
|
| Real Estate |
2.4 |
|
|
|
|
| Net
current assets |
5.3 |
|
|
|
|
|
----- |
|
|
----- |
|
|
100.2 |
|
|
100.2 |
|
|
===== |
|
|
===== |
|
|
|
|
|
|
|
| Short positions |
(1.9) |
|
|
(1.9) |
|
|
|
|
|
|
|
Fifteen Largest Investments |
|
|
|
|
|
|
(in % order of Gross
Assets as at 30.09.17) |
|
|
|
|
|
|
|
|
|
|
| Company |
Region of
Risk |
Gross
assets |
|
|
|
(%) |
|
| Gazprom |
Russia |
10.0 |
|
| Sberbank |
Russia |
8.5 |
|
| Novatek |
Russia |
7.4 |
|
| Lukoil |
Russia |
5.3 |
|
| PKO Bank Polski |
Poland |
5.0 |
|
| Rosneft Oil Company |
Russia |
4.3 |
|
| Lenta |
Russia |
3.9 |
|
| Mobile Telesystems |
Russia |
3.8 |
|
| Alpha Bank |
Greece |
3.5 |
|
| National Bank of
Greece |
Greece |
3.2 |
|
| PZU |
Poland |
3.0 |
|
| Norilsk Nickel |
Russia |
2.8 |
|
| Mail.Ru |
Russia |
2.7 |
|
| TSKB |
Turkey |
2.6 |
|
| MD Medical Group |
Russia |
2.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commenting on the
markets, Sam Vecht and Christopher Colunga, representing the
Investment Manager noted; |
|
|
|
|
|
The MSCI Emerging Europe 10/40 Index returned -1.4% in September in
US Dollar terms*. The Company outperformed the index and returned
-0.3% in US Dollar terms*. |
|
|
|
|
|
|
|
Russia (+4.5%)*
continued to lead the region for the second month in a row as the
RUB strengthened 0.8%** and the Brent oil price reached towards 59
USD/barrel** during the month on the back of increasing
geopolitical tensions in Middle East after Turkey threatened to
shut down Kurdish oil shipments through its territory. The Fitch
rating agency reaffirmed Russia's investment rating at BBB- and
changed the outlook to positive from stable. Furthermore, the
economy continued to recover and inflation fell to 3%
year-over-year in September hitting its lowest level in a decade,
allowing the Central Bank of Russia to cut its key rate by 50bps to
8.5% and maintain a dovish outlook**. Retail sales surprised to the
upside (1.9% year-over-year vs consensus 1.1%) and August
Industrial Production growth at 1.5% year-over-year came in-line
with consensus expectations**. |
|
|
|
|
|
In the Central and
Eastern European region, the Czech Republic (+1.7%) was the only
country to end the month in positive territory, while Hungary
(-5.3%) and Poland (-3.8%) lagged*. This was in line with their
respective currencies as Hungarian Forint (-1.8%) and Polish Zloty
(-1.5%) weakened while the Czech Koruna (+0.5%) strengthened in
September. The 2nd quarter GDP growth in the Czech Republic was
revised even higher to 10.3% quarter-on-quarter (+4.7%
year-on-year) from the initial estimate of 9.5%*. |
|
|
|
|
|
For the first time in
the last 10 months, Turkey (-9.5%) fell on a monthly basis*. The
economy has been normalizing from the elevated credit fuelled
growth rates of the first half of the year. However, the
challenging political backdrop combined with an increasing current
account deficit, persistently high inflation and the spectre of
tighter global liquidity put pressure on the currency. |
|
|
|
|
|
Greece
(-14.0%) was a laggard over the period*. The market experienced a
strong rally over the summer as progress was made on the second
review of the country’s third bailout. However, the Greek market
gave up some of its gains in September due to IMF statements
calling for a €10bn recapitalization and Asset Quality Review for
the Greek Banks. Though these requests were later withdrawn, the
markets remained spooked. The situation was not helped by Germany’s
election outcome, which meant that Angela Merkel would have to
build a three-way coalition in order to form a government, even
though she convincingly scored a fourth term in office. This led to
some uncertainties around the Eurozone reforms and the speed at
which the third review would be completed. On the economic front,
GDP for the second quarter of 2017 grew at +0.8% year-over-year.
July Industrial Production at +1.7% came in marginally higher than
June (+1.6%) – the 10th consecutive month of expansion. August
Purchasing Managers Index (PMI) rose to 52.2, which marks the
highest reading since August 2008**. |
|
|
|
|
|
Focus
on: Novatek |
|
|
Novatek is Russia's
largest independent natural gas producer. The company is engaged in
exploration, production and processing of natural gas and liquid
hydrocarbon. The principal operating areas are concentrated in the
Yamal-Nenets Autonomous Region (YNAO) in Western Siberia – the
largest gas producing region in Russia accounting for 80% of
Russia’s natural gas production and approximately 16% of global gas
production. |
|
|
|
|
|
The company has been
investing in its $27bn Yamal LNG project, which is an integrated
project for natural gas production, liquefaction and marketing. It
is a large onshore conventional reserve base with high
concentration of reserves and low F&D (Finding and Development)
and Lifting costs and high efficiency factor of gas liquefaction
process due to sub-zero temperatures. The planned LNG plant will
ultimately have three trains with total capacity of c. 16.5 million
tonnes of liquefied natural gas per year. The first of these three
trains is expected to deliver first gas in November 2017, with the
second and third train following in 2018 and 2019. |
|
|
|
|
|
Over the
summer the stock exhibited some weakness when the oil price touched
US$44/bbl. We added to our position in the stock as we
believe the company is set to enter a new phase of growth through
the Yamal LNG project. Recently we have seen a strong upwards move
in the share price as the launch date draws nearer, and we believe
with the increase in free cash flow the project brings, we could
see a further lift to returns. |
|
|
|
|
|
*Source:
BlackRock, data as at end September 2017.
**Source: Bloomberg, BlackRock, data as at end September 2017. |
|
|
|
|
|
18 October 2017 |
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|
|
ENDS |
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Latest information is
available by typing www.blackrock.co.uk/beep 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. |
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