BlackRock Smll Cos Portfolio Update
July 28 2021 - 06:47AM
UK Regulatory
TIDMBRSC
The information contained in this release was correct as at 30 June 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 June 2021 and unaudited.
Performance at month end is calculated on a capital only basis
One Three One Three Five
month months year years years
% % % % %
Net asset value* 1.0 11.8 52.2 27.7 121.8
Share price* -0.6 9.3 53.0 27.2 142.6
Numis ex Inv Companies + AIM Index -1.3 5.4 49.9 18.3 61.2
*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): 2,073.14p
Net asset value Capital only (debt at fair value): 2,062.44p
Net asset value incl. Income (debt at par value)1: 2,087.22p
Net asset value incl. Income (debt at fair value)1: 2,076.53p
Share price: 1,952.00p
Discount to Cum Income NAV (debt at par value): 6.5%
Discount to Cum Income NAV (debt at fair value): 6.0%
Net yield2: 1.7%
Gross assets3: £1,113.8m
Gearing range as a % of net assets: 0-15%
Net gearing including income (debt at par): 8.4%
Ongoing charges ratio (actual)4: 0.8%
Ordinary shares in issue5: 48,829,792
1. Includes net revenue of 14.08 p
2. Yield calculations are based on dividends announced in the last 12 months
as at the date of release of this announcement, and comprise the first
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 20.5 pence per share (announced on 7 May 2021, ex-dividend on
20 May 2021, paid on 18 June 2021).
3. Includes current year revenue.
4. 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.
5. Excludes 1,163,731 ordinary shares held in treasury.
Sector Weightings % of portfolio
Industrials 30.4
Consumer Discretionary 21.4
Financials 16.2
Consumer Staples 10.9
Technology 7.2
Basic Materials 5.2
Energy 3.6
Health Care 3.1
Telecommunications 1.6
Real Estate 0.4
-----
Total 100.0
=====
Country Weightings % of portfolio
United Kingdom 98.4
United States 1.2
Guernsey 0.4
-----
Total 100.0
=====
Ten Largest Equity Investments % of portfolio
Company
Watches of Switzerland 2.5
Treatt 2.3
Impax Asset Management 2.2
CVS Group 2.1
Breedon 1.9
Oxford Instruments 1.7
Pets At Home 1.6
Integrafin 1.6
Gamma Communications 1.6
YouGov 1.6
Commenting on the markets, Roland Arnold, representing the Investment Manager
noted:
During June the Company's NAV per share rose by 1.0%1 to 2,073.14p ,
outperforming our benchmark index, Numis ex Inv Companies + AIM Index, which
fell by -1.3%1; for comparison the FTSE 100 Index rose by 0.2%1 (all figures
are on a capital only basis).
Fresh concerns around the presence of the Delta variant of COVID-19 led UK
small & mid-caps lower during June, while more defensive large cap indices
moved marginally higher. Early in the month, OPEC (Organization of the
Petroleum Exporting Countries) and its allies agreed to continue relaxing curbs
on oil production signalling their confidence in improving oil demand and a
drop in the global supply glut; oil prices rallied as a result. Despite another
strong inflation print in the US, bond yields fell as investors focused on the
transitory drivers of this inflationary spike. This view was reenforced by the
FOMC (Federal Open Markets Committee) meeting during the month. Towards the end
of the month, concerns began to mount that the global recovery may slow as the
Delta variant of COVID-19 spread more widely. June's flash UK PMIs (Purchasing
Managers' Index) suggested a modest cooling in the pace of the recovery in
activity as the impact of the initial re-openings faded slightly. UK companies
are also increasingly reporting some shortages in finding new staff,
particularly in sectors heavily affected by COVID-19.
The Company was able to buck the trend of the falling market during June as a
result of a number of core portfolio holdings continuing to deliver impressive
trading updates. Shares in designer and manufacturer of customised electronics
to industry, DiscoverIE, rose in response to positive full year results. After
a challenging first half, the strong recovery in the second half of the year,
and disciplined management of expenditure resulted in earnings for the year
beating expectations. FTSE 250 listed asset manager, Liontrust, saw its shares
reach an all-time high after it reported that profit before tax more than
doubled year on year. The company has seen strong inflows, helped by the
tailwind behind ESG (Environmental, Social, and Governance) strategies, a trend
that looks well set to continue over the coming years. Shares in Oxford
Instruments rose after reporting very strong results and veterinary group, CVS,
also added to relative performance.
At a sector level, our underweight positioning in miners was beneficial;
however, our holding in Central Asia Metals was the largest single detractor to
performance. Shares in On the Beach slumped after the company reported weak
results as the impact of the pandemic continues to weigh on trading and
investors worried about the timing of recovery, given further travel
restrictions. We continue to believe that On the Beach will be a market share
winner as global travel resumes and we have therefore maintained the position.
Renewed concerns around the impact of the Delta variant of the virus on broader
economic growth impacted more macro-sensitive sectors as well, for example
housebuilders, including our holding in Vistry.
Globally, the vaccine deployment continues to make progress, and while rising
cases as a result of the Delta variant have caused some concern for investors,
we still believe the vaccine will ultimately see us return to a more normal way
of life. The strength of trading that we continued to see from our holdings in
June reaffirms our confidence in the Company's current positioning and the
outlook for many businesses across the portfolio. We also continue to see
evidence of those companies that went into the COVID-19 crisis in a strong
position, both financially and operationally, are 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 believe the ever-changing environment plays into the hands of
dynamic smaller companies, those able to rapidly shift their business models to
capitalise on new structural trends quickly as they emerge. We thank
shareholders for their continued support.
1Source: BlackRock as at 30 June 2021
28 July 2021S
Latest information is available by typing www.blackrock.com/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.
END
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July 28, 2021 07:47 ET (11:47 GMT)
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