17 Nov 2016 14:51
BLACKROCK EMERGING EUROPE PLC - Portfolio UpdateBLACKROCK EMERGING EUROPE PLC - Portfolio Update
PR Newswire
London, November 17
| BLACKROCK EMERGING EUROPE PLC |
| All information is at 31 October 2016 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 | 6.6% | 15.4% | 39.1% | -2.0% | 17.6% | 93.0% | ||||||||||||
| Net asset value | 6.5% | 14.7% | 39.1% | 2.3% | 20.5% | 92.8% | ||||||||||||
| MSCI EM Europe 10/40 (NR) | 7.8% | 13.8% | 32.3% | -13.5% | -1.3% | 53.3% | ||||||||||||
| US Dollars: | ||||||||||||||||||
| Share price | 0.2% | 6.1% | 10.0% | -25.5% | -11.0% | 59.1% | ||||||||||||
| Net asset value | 0.1% | 5.5% | 10.0% | -22.3% | -8.8% | 58.9% | ||||||||||||
| MSCI EM Europe 10/40 (NR) | 1.3% | 4.6% | 4.5% | -34.2% | -25.4% | 26.3% | ||||||||||||
| 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: | 378.65c | |||||||||||||||||
| Net asset value** – cum income: | 386.53c | |||||||||||||||||
| Sterling: | ||||||||||||||||||
| Net asset value – capital only: | 310.15p | |||||||||||||||||
| Net asset value** – cum income: | 316.61p | |||||||||||||||||
| Share price: | 281.00p | |||||||||||||||||
| Total assets^: | £113.9m | |||||||||||||||||
| Discount (share price to cum income NAV): | 11.2% | |||||||||||||||||
| Net gearing at month end: | 5.7% | |||||||||||||||||
| Gearing range as a % of Net assets: | 0-20% | |||||||||||||||||
| Issued Capital – Ordinary Shares^^ | 35,967,728 | |||||||||||||||||
| Ongoing charges* | 1.3% | |||||||||||||||||
| * Calculated as at 31 January 2016, in accordance with AIC guidelines. | ||||||||||||||||||
| ** Includes year to date net revenue equal to 7.88 cents per share. | ||||||||||||||||||
| ^ Total assets include current year revenue. | ||||||||||||||||||
| ^^ Excluding 5,400,000 shares held in treasury. | ||||||||||||||||||
| Sector | Gross assets (%) | Country | Gross assets | |||||||||||||||
| Analysis | Analysis | (%) | ||||||||||||||||
| Financials | 43.6 | Russia | 49.5 | |||||||||||||||
| Energy | 25.7 | Turkey | 22.5 | |||||||||||||||
| Basic Materials | 8.7 | Poland | 10.8 | |||||||||||||||
| Consumer Staples | 7.1 | Ukraine | 8.3 | |||||||||||||||
| Information Technology | 5.9 | Greece | 7.4 | |||||||||||||||
| Industrials | 4.7 | Czech Republic | 3.5 | |||||||||||||||
| Telecommunications | 3.6 | Kazakhstan | 3.4 | |||||||||||||||
| Utilities | 3.6 | Romania | 1.9 | |||||||||||||||
| Consumer Discretionary | 2.9 | Net current liabilities | (5.4) | |||||||||||||||
| Health Care | 1.5 | ----- | ||||||||||||||||
| Net current liabilities | (5.4) | 101.9 | ||||||||||||||||
| ----- | ===== | |||||||||||||||||
| 101.9 | ||||||||||||||||||
| ===== | ||||||||||||||||||
| Short positions | (0.0) | (0.0) | ||||||||||||||||
| Fifteen Largest Investments | ||||||||||||||||||
| (in % order of Gross Assets as at 31.10.16) | ||||||||||||||||||
| Company | Region of Risk | Gross assets | ||||||||||||||||
| (%) | ||||||||||||||||||
| Sberbank | Russia | 11.6 | ||||||||||||||||
| Gazprom | Russia | 7.0 | ||||||||||||||||
| Novatek | Russia | 6.9 | ||||||||||||||||
| Lukoil | Russia | 5.5 | ||||||||||||||||
| Halk Bank | Turkey | 4.7 | ||||||||||||||||
| Globaltrans | Russia | 4.7 | ||||||||||||||||
| Garanti Bank | Turkey | 4.2 | ||||||||||||||||
| PZU | Poland | 4.1 | ||||||||||||||||
| PKO Bank Polski | Poland | 3.9 | ||||||||||||||||
| Turkcell | Turkey | 3.6 | ||||||||||||||||
| Moneta Money Bank | Czech Republic | 3.5 | ||||||||||||||||
| Inter RAO | Russia | 3.5 | ||||||||||||||||
| KazMunaiGas Exploration Production | Kazakhstan | 3.4 | ||||||||||||||||
| TSKB | Turkey | 3.4 | ||||||||||||||||
| Mail.Ru | Russia | 3.3 | ||||||||||||||||
| Commenting on the markets, Sam Vecht and Christopher Colunga, representing the Investment Manager noted; | ||||||||||||||||||
| Market Commentary | ||||||||||||||||||
| The MSCI Emerging Europe 10/40 Index rose by 1.3% in October in USD terms. The Company underperformed the index and was up by 0.1% in USD terms. Country performance in October was led by Hungary (+6.5%), the Czech Republic (+4.5%), Poland (+3.4%), and Greece (+3.6%); whilst Russia (+0.4%) and Turkey (-0.8%) lagged. Hungary’s strong performance was driven by the National Bank of Hungary’s unexpected policy easing. Greece was similarly helped by authority action as the Eurozone Finance Ministers’ approved the successful completion of the First Review and released the next bailout tranche of €2.8bn. In the face of falling oil prices and a weaker Ruble, Russia struggled in October. Conversely, Turkey declined the most over the month with the Turkish parliament extending the state of emergency by three months triggering further Turkish Lira weakening. Focus on: PZU PZU is a Polish insurance company with leading market share in Poland and an increasing presence in the Baltics. The stock has been under significant pressure this year as a result of weak investment income given the depressed bond yields and poor equity market in Poland; a change in the management team; and a change in strategy regarding the deployment of excess capital. Over the summer we felt that this de-rating became overdone and that the market was focusing on all the negatives, but none of the positives. Firstly, PZU is currently in talks to purchase Bank Pekao, one of the largest banks in Poland, and also one of the most profitable. If the transaction is completed near market prices, then PZU will be able to double the yield it earns on its investment income relative to the local bonds, providing a significant boost to earnings. Additionally, given the sheer amount of excess capital it possesses, we believe that they can make this acquisition whilst maintaining a strong dividend. Finally, the auto insurance market is seeing growth in pricing in excess of 20%. PZU is the largest player in this market and makes a significant amount of its earnings from auto insurance. Taken together PZU should see significant earnings growth in 2017 and continue to pay out generous dividends, all for a share price near its all-time low. | ||||||||||||||||||
| 17 November 2016 | ||||||||||||||||||
| 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. | ||||||||||||||||||