BlackRock World Mining Trust plc (LON:BRWM) has announced its latest portfolio update.
For more information on the Blackrock World Mining Trust and how to access the opportunities presented by mining, please visit www.blackrock.com/uk/brwm
All information is at 31 March 2024 and unaudited.
| Performance at month end with net income reinvested | |||||
| One | Three | One | Three | Five | |
| Month | Months | Year | Years | Years | |
| Net asset value | 10.7% | -3.5% | -9.4% | 19.9% | 78.8% |
| Share price | 8.4% | -9.0% | -17.8% | 8.2% | 91.3% |
| MSCI ACWI Metals & Mining 30% Buffer 10/40 Index (Net)* | 9.8% | -0.4% | -0.3% | 22.6% | 65.4% |
| * (Total return)Sources: BlackRock, MSCI ACWI Metals & Mining 30% Buffer 10/40 Index, Datastream | |||||
At month end
| Net asset value (including income)1: | 568.07p |
| Net asset value (capital only): | 560.36p |
| Share price: | 517.00p |
| Discount to NAV2: | 9.0% |
| Total assets: | £1,220.6m |
| Net yield3: | 6.5% |
| Net gearing: | 13.4% |
| Ordinary shares in issue: | 191,183,036 |
| Ordinary shares held in Treasury: | 1,828,806 |
| Ongoing charges4: | 0.91% |
| Ongoing charges5: | 0.81% |
1 Includes net revenue of 7.71p.
2 Discount to NAV including income.
3 Based on a first interim dividend of 5.50p per share declared on 18 April 2023, a second interim dividend of 5.50p per share declared on 24 August 2023, a third interim dividend of 5.50p per share declared on 11 October 2023 and a final dividend of 17.00p per share declared on 7 March 2024 with ex date 21 March 2024 and pay date 14 May 2024 in respect of the year ended 31 December 2023.
4 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 finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain other non-recurring items for the year ended 31 December 2023.
5 The Company’s ongoing charges are calculated as a percentage of average daily gross assets and using the management fee and all other operating expenses, excluding finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain other non-recurring items for the year ended 31 December 2023.
| Country Analysis | Total Assets (%) |
| Global | 63.6 |
| United States | 9.6 |
| Latin America | 8.2 |
| Canada | 7.8 |
| Australasia | 7.2 |
| Other Africa | 3.9 |
| Indonesia | 0.5 |
| South Africa | 0.1 |
| Net Current Liabilities | -0.9 |
| —– | |
| 100.0 | |
| ===== | |
| Sector Analysis | Total Assets (%) |
| Diversified | 35.8 |
| Copper | 25.1 |
| Gold | 15.3 |
| Steel | 9.9 |
| Industrial Minerals | 5.2 |
| Aluminium | 3.0 |
| Iron Ore | 2.4 |
| Uranium | 1.5 |
| Platinum Group Metals | 1.0 |
| Nickel | 1.0 |
| Mining Services | 0.6 |
| Zinc | 0.1 |
| Net Current Liabilities | -0.9 |
| —– | |
| 100.0 | |
| ===== | |
| Ten largest investments | |
| Company | Total Assets % |
| BHP: | |
| Equity | 7.6 |
| Royalty | 1.5 |
| Glencore | 8.0 |
| Vale: | |
| Equity | 4.0 |
| Debenture | 2.9 |
| Rio Tinto | 6.2 |
| Freeport-McMoRan | 4.8 |
| Nucor | 3.9 |
| Teck Resources | 3.8 |
| Barrick Gold | 3.1 |
| Wheaton Precious Metals | 3.0 |
| Anglo American | 3.0 |
| Asset Analysis | Total Assets (%) |
| Equity | 97.7 |
| Bonds | 1.5 |
| Preferred Stock | 1.0 |
| Convertible Bonds | 0.7 |
| Net Current Liabilities | -0.9 |
| —– | |
| 100.0 | |
| ===== |
Commenting on the markets, Evy Hambro and Olivia Markham, representing the Investment Manager noted:
Performance
The Company’s NAV rose by 10.7% in March, outperforming its reference index, the MSCI ACWI Metals and Mining 30% Buffer 10/40 Index (net return), which returned +9.8% (performance figures in GBP).
March was a positive month for the mining sector, outperforming broader equity markets, as the MSCI All Country World Index returned +3.1%. Improvements in economic data from the US and China helped boost investor sentiment and demand for mining stocks during the period. China’s manufacturing PMI rose above 50 for the first time since September 2023, increasing from 49.1 to 50.8. Copper stood out among industrial metals, delivering strong performance driven by tight physical markets and rising demand for use in electricity grids. The severity of the constraints on copper supply was highlighted by refining charges in China falling close to zero, having been ~US$80 six months ago (lower refining charges suggest refiners are struggling for materials and are cutting charges to be more competitive as a result).
On the other hand, ongoing weakness in China’s property market started to translate into some softness in steel demand and iron ore prices came under pressure. The Chinese government announced plans to reinstate pollution control measures, which is expected to result in production cuts for highly polluting industries such as steel and cement. For reference, prices for iron ore (62% fe) and nickel fell by 13.2% and 6.2% respectively, whereas zinc rose by 0.5%. Meanwhile, precious metals performance was strong during the month due to concerns around inflation and robust physical demand for gold. Gold, silver and platinum prices rose by 8.3%, 9.6% and 2.3% respectively.
Strategy and Outlook
China has re-opened but with less impact than had been expected. Uncertainty persists around China’s commodity demand, but we are seeing the Chinese administration announce financial support incrementally.
Longer term, we are excited by the structural demand growth for a range of mined commodities that will result from the low carbon transition. Meanwhile, commodity supply is likely to be constrained by the capital discipline of recent years, whilst inventories for many mined commodities are at historic lows. Mining companies have low levels of debt, continue to return capital to shareholders but appear to be entering a higher capital expenditure phase.
We are seeing Brown to Green emerge as a key theme, where mining companies are focusing on reducing the greenhouse gas emissions intensity associated with their production. We expect to see a re-rating for the mining companies able to best navigate this and are playing this in the portfolio.
For more information on the Blackrock World Mining Trust and how to access the opportunities presented by mining, please visit www.blackrock.com/uk/brwm
