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20 Sep 2017 14:44
BlackRock Emerging Europe Plc - Portfolio UpdateBlackRock Emerging Europe Plc - Portfolio Update
PR Newswire
London, September 20
| BLACKROCK EMERGING EUROPE PLC (LEI - 549300OGTQA24Y3KMI14) |
| All information is at 31 August 2017 and unaudited. |
| Performance at month end with net income reinvested |
| One | Three | One | Three | Five | *Since | |||||||||
| Month | Months | Year | Years | Years | 30.04.09 | |||||||||
| Sterling: | ||||||||||||||
| Share price | 4.7% | 3.3% | 37.6% | 47.1% | 47.2% | 137.2% | ||||||||
| Net asset value | 8.5% | 8.3% | 34.3% | 46.3% | 42.4% | 135.0% | ||||||||
| MSCI EM Europe | 9.0% | 11.5% | 31.2% | 21.0% | 16.6% | 82.4% | ||||||||
| 10/40(NR) | ||||||||||||||
| US Dollars: | ||||||||||||||
| Share price | 2.4% | 3.1% | 35.3% | 14.1% | 19.4% | 106.3% | ||||||||
| Net asset value | 6.1% | 8.1% | 32.1% | 13.4% | 15.5% | 104.4% | ||||||||
| MSCI EM Europe | 6.5% | 11.3% | 29.1% | -6.1% | -5.4% | 58.6% | ||||||||
| 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: | 476.20c | |||||||||||||
| Net asset value* – cum income: | 488.94c | |||||||||||||
| Sterling: | ||||||||||||||
| Net asset value – capital only: | 369.58p | |||||||||||||
| Net asset value* – cum income: | 379.47p | |||||||||||||
| Share price: | 339.25p | |||||||||||||
| Total assets^: | £136.3m | |||||||||||||
| Discount (share price to cum income NAV): | 10.6% | |||||||||||||
| Net cash at month end: | 3.6% | |||||||||||||
| 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 9.89 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 (%) | |||||||||||
| Financials | 30.3 | Russia | 55.6 | |||||||||||
| Energy | 30.2 | Turkey | 18.0 | |||||||||||
| Consumer Staples | 8.4 | Poland | 11.7 | |||||||||||
| Telecommunication Services | 8.3 | Greece | 7.0 | |||||||||||
| Industrials | 5.4 | Ukraine | 4.5 | |||||||||||
| Materials | 4.7 | Net current assets | 3.4 | |||||||||||
| Information Technology | 4.3 | |||||||||||||
| Real Estate | 2.6 | |||||||||||||
| Health Care | 2.6 | |||||||||||||
| Net current assets | 3.4 | |||||||||||||
| ----- | ----- | |||||||||||||
| 100.2 | 100.2 | |||||||||||||
| ===== | ===== | |||||||||||||
| Short positions | (1.9) | (1.9) | ||||||||||||
| Fifteen Largest Investments | ||||||||||||||
| (in % order of Gross Assets as at 31.08.17) | ||||||||||||||
| Company | Region of Risk | Gross assets | ||||||||||||
| (%) | ||||||||||||||
| Sberbank | Russia | 10.2 | ||||||||||||
| Gazprom | Russia | 9.6 | ||||||||||||
| Novatek | Russia | 7.1 | ||||||||||||
| Lukoil | Russia | 5.1 | ||||||||||||
| PKO Bank Polski | Poland | 4.2 | ||||||||||||
| Rosneft Oil Company | Russia | 4.0 | ||||||||||||
| Lenta | Russia | 4.0 | ||||||||||||
| National Bank of Greece | Greece | 3.8 | ||||||||||||
| Mobile Telesystems | Russia | 3.7 | ||||||||||||
| Alpha Bank | Greece | 3.2 | ||||||||||||
| Turk Hava Yollari | Turkey | 3.1 | ||||||||||||
| PZU | Poland | 3.0 | ||||||||||||
| TSKB | Turkey | 3.0 | ||||||||||||
| Garanti Bank | Turkey | 2.9 | ||||||||||||
| Turkcell | Turkey | 2.7 | ||||||||||||
| Commenting on the markets, Sam Vecht and Christopher Colunga, representing the Investment Manager noted: | ||||||||||||||
| Market Commentary | ||||||||||||||
| The MSCI Emerging Europe 10/40 Index returned +6.5% in August in US Dollar terms. The Company underperformed the index and returned +6.1% in US Dollar terms. | ||||||||||||||
| All countries in the index posted positive returns. Russia (+8.0%) led the region as the Ruble strengthened by 3.0% helped by higher oil prices and a positive 2nd quarter earnings season. On the economic front, flash estimate for 2nd quarter GDP growth at +2.5% was better than consensus estimates: +1.7% and the 1st quarter: +0.5% (all over the last 12 months). Also, consumer inflation in July grew by 3.9% over the year and was less than expected, creating room for the central bank to continue the interest rate cut cycle further and bring down the cost of borrowing as the economy continues to recover. | ||||||||||||||
| Central European countries also performed strongly with Hungary (+7.6%) leading, followed by Poland (+6.7%) and Czech Republic (+1.8%). The region benefitted from a strong 2nd quarter earnings season, in particular for the banks. | ||||||||||||||
| Turkey (+4.6%) rose over the month as the Turkish Lira strengthened by 1.9% to the end of the month. The 2nd quarter earnings season beat expectations, especially for the large banks. The 12-month current account deficit contracted to US$ 34.3bn (4.1% of GDP) in June from US$ 35.5bn (4.3% of GDP) in May primarily due to the 13% contraction in the merchandise trade deficit and the 30% increase in tourism revenues over the year. | ||||||||||||||
| After a strong rally in summer, Greece cooled down in August although it ended the month in positive territory (+1.1%). The 2nd quarter GDP grew +0.5% vs expectations of 0.2% over the quarter, ESI (Economic Sentiment Indicators) were up to a two-year high of 99.0 and July PMI (Purchasing Manager Index) rose to 52.2 marking its highest reading since August 2008. | ||||||||||||||
| Focus on: Sberbank | ||||||||||||||
| Sberbank is Russia’s largest bank, state-owned. It has branches throughout the country and a 46% share in the retail deposit market. The stock performed well in 2016 amid Russian macro recovery and strong performance post OPEC production cut agreement, as well as continuing company’s restructuring strategy to improve its services and enhance efficiency. | ||||||||||||||
| We have been adding to our position in the stock since March 2017 on the basis of its strong fundamentals, attractive valuation, low cost of risk and ability to continue optimising the costs. Furthermore, as the Russian economy and consumer sector continue to recover and the central bank cuts the key policy rate, we expect the bank to see increased loan growth, in particular in mortgages. The stock has seen a pick-up in its price over the last 4 months in line with its strong 2nd quarter results and the lift in guidance on loans picking up. The recent strengthening in the Ruble and the interest rate cuts provided a further support to the bank’s NIMs (Net Interest Margins) through the year end. | ||||||||||||||
| 20 September 2017 | ||||||||||||||
| ENDS | ||||||||||||||
| 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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