21 Nov 2017 14:25
BlackRock Emerging Europe Plc - Portfolio UpdateBlackRock Emerging Europe Plc - Portfolio Update
PR Newswire
London, November 21
| BLACKROCK EMERGING EUROPE PLC (LEI - 549300OGTQA24Y3KMI14) |
| All information is at 31 October 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 | 2.2 | 7.9 | 26.7 | 56.3 | 43.8 | 144.6 | ||||||||||||||||||||
| Net asset value | 1.3 | 5.3 | 18.2 | 46.4 | 35.0 | 127.9 | ||||||||||||||||||||
| MSCI EM Europe | 0.9 | 4.1 | 13.7 | 19.9 | 7.7 | 74.3 | ||||||||||||||||||||
| 10/40(NR) | ||||||||||||||||||||||||||
| US Dollars: | ||||||||||||||||||||||||||
| Share price | 1.1 | 8.8 | 37.8 | 29.7 | 18.5 | 119.2 | ||||||||||||||||||||
| Net asset value | 0.3 | 6.0 | 28.5 | 21.5 | 11.3 | 104.3 | ||||||||||||||||||||
| MSCI EM Europe | -0.1 | 4.9 | 23.7 | -0.5 | -11.24 | 56.2 | ||||||||||||||||||||
| 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: | 473.47c | |||||||||||||||||||||||||
| Net asset value* – cum income: | 488.77c | |||||||||||||||||||||||||
| Sterling: | ||||||||||||||||||||||||||
| Net asset value – capital only: | 356.52p | |||||||||||||||||||||||||
| Net asset value* – cum income: | 368.04p | |||||||||||||||||||||||||
| Share price: | 349.75p | |||||||||||||||||||||||||
| Total assets^: | £132.2m | |||||||||||||||||||||||||
| Discount (share price to cum income NAV): | 5.0% | |||||||||||||||||||||||||
| Net cash at month end: | 3.1% | |||||||||||||||||||||||||
| 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 11.52 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 | 33.1 | Russia | 56.1 | |||||||||||||||||||||||
| Financials | 31.2 | Poland | 18.1 | |||||||||||||||||||||||
| Telecommunication Services | 10.5 | Turkey | 11.6 | |||||||||||||||||||||||
| Consumer Staples | 7.5 | Greece | 6.3 | |||||||||||||||||||||||
| Materials | 4.4 | Ukraine | 4.0 | |||||||||||||||||||||||
| Information Technology | 4.2 | Romania | 1.0 | |||||||||||||||||||||||
| Real Estate | 2.6 | Net current assets | 2.9 | |||||||||||||||||||||||
| Health Care | 2.4 | |||||||||||||||||||||||||
| Industrials | 1.2 | |||||||||||||||||||||||||
| Net current assets | 2.9 | |||||||||||||||||||||||||
| ----- | ----- | |||||||||||||||||||||||||
| 100.0 | 100.0 | |||||||||||||||||||||||||
| ===== | ===== | |||||||||||||||||||||||||
| Short positions | (2.0) | (2.0) | ||||||||||||||||||||||||
| Fifteen Largest Investments | ||||||||||||||||||||||||||
| (in % order of Gross Assets as at 31.10.17) | ||||||||||||||||||||||||||
| Company | Region of Risk | Gross assets | ||||||||||||||||||||||||
| (%) | ||||||||||||||||||||||||||
| Gazprom | Russia | 10.2 | ||||||||||||||||||||||||
| Lukoil | Russia | 8.2 | ||||||||||||||||||||||||
| Sberbank | Russia | 6.6 | ||||||||||||||||||||||||
| PKO Bank Polski | Poland | 6.4 | ||||||||||||||||||||||||
| Novatek | Russia | 4.9 | ||||||||||||||||||||||||
| Rosneft Oil Company | Russia | 4.2 | ||||||||||||||||||||||||
| Lenta | Russia | 4.0 | ||||||||||||||||||||||||
| Mobile Telesystems | Russia | 3.9 | ||||||||||||||||||||||||
| Bank Pekao | Poland | 3.6 | ||||||||||||||||||||||||
| PZU | Poland | 3.4 | ||||||||||||||||||||||||
| Alpha Bank | Greece | 3.2 | ||||||||||||||||||||||||
| National Bank of Greece | Greece | 3.1 | ||||||||||||||||||||||||
| Norilsk Nickel | Russia | 2.9 | ||||||||||||||||||||||||
| Megafon | Russia | 2.8 | ||||||||||||||||||||||||
| Mail.Ru | Russia | 2.7 | ||||||||||||||||||||||||
| Commenting on the markets, Sam Vecht and Christopher Colunga, representing the Investment Manager noted; | ||||||||||||||||||||||||||
| The MSCI Emerging Europe 10/40 Index was relatively flat in October, declining -0.1%* in USD terms, as stronger growth outlook in the US led to higher bond yields, putting pressure on EM currencies. The Company outperformed the index over the period, returning +0.3%* in USD terms. | ||||||||||||||||||||||||||
| Central Europe outperformed as currencies strengthened against the Euro. Poland (+3.3%**) and the Czech Republic (+2.1%**) both saw 2Q17 GDP data surprise to the upside, with support from private consumption. Hungary (+5.0%**) was the region’s top performer despite slowing GDP, driven by stronger fixed investment and a rebound in public consumption, after three quarters of sequential decline. Turkey was relatively flat through October, despite the Lira depreciating by -6.0%**, resulting in its lowest monthly close. Bond yields rose to their highest levels since the financial crisis despite the Central Bank maintaining their effective lending rate at 12%** in the eyes of peaking inflation. Greece continues to lag the region, declining -2.1%** in September as the EU regulator continues its review of the country’s non-performing exposures and their subsequent reduction plans. Russia (-2.3%**) was the region’s worst performing market on specific earnings misses, despite a strong month for oil prices, given tightness in supply-demand fundamentals and geopolitical tensions in the Middle East. | ||||||||||||||||||||||||||
| Focus on: Polish Banks | ||||||||||||||||||||||||||
| The Central European 3 sub-region has been a standout performer YTD within emerging markets, on the back of stronger than expected growth, led by improving consumption and an uptick in fixed investment. Central European banks have been some of the top performers over this period despite largely driven by strong loan growth and improving cost management | ||||||||||||||||||||||||||
| Within the region, Polish banks have been our preferred points of exposure because they are among the most interest rate sensitive given that the majority of loans in the county are floating. Resultantly even a mild interest rate hike, ie 100bp, will see bank earnings up between 20-50% bank dependent. Given the strong economic growth in the country coupled with a tight labour market as seen in the rising wage inflation, we believe Poland may have to begin hiking rates sooner than the market expects. Specifically, PKO and Bank Pekao are both among the company’s top ten holdings. We’ve recently increased our position in Pekao as it has lagged peers following the polish government buying a stake. We are of the opinion that the dividend is likely to continue to be paid, and as such saw the sell off as overdone given the strong underlying dynamics at the bank. | ||||||||||||||||||||||||||
| *Source: BlackRock, data as at end October 2017. **Source: JPM, data as at end October 2017. | ||||||||||||||||||||||||||
| 21 November 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. | ||||||||||||||||||||||||||