Blackrock Engy Regulatory News (BERI)

BLACKROCK ENERGY AND RESOURCES INCOME TRUST plc (LEI:54930040ALEAVPMMDC31)

All information is at 30 September 2023 and unaudited.

Performance at month end with net income reinvested

One

Three

Six

One

Three

Five

Month

Months

Months

Year

Years

Years

Net asset value

1.9%

3.1%

-0.7%

7.9%

110.3%

89.7%

Share price

1.6%

2.9%

-8.9%

2.5%

109.1%

85.0%

Sources: Datastream, BlackRock

At month end

Net asset value – capital only:

129.35p

Net asset value cum income1:

130.13p

Share price:

116.20p

Discount to NAV (cum income):

10.7%

Net yield:

3.8%

Gearing - cum income:

5.9%

Total assets:

£173.7m

Ordinary shares in issue2:

133,486,194

Gearing range (as a % of net assets):

0-20%

Ongoing charges3:

1.13%

1 Includes net revenue of 0.78p.

2 Excluding 2,100,000 ordinary shares held in treasury.

3 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 30 November 2022. In addition, the Company’s Manager has also agreed to cap ongoing charges by rebating a portion of the management fee to the extent that the Company’s ongoing charges exceed 1.25% of average net assets.

Sector Overview

Mining

41.2%

Traditional Energy

35.6%

Energy Transition

24.2%

Net Current Liabilities  

-1.0%

-----

100.0%

=====

Sector Analysis

% Total Assets^

Country Analysis

% Total Assets^

Mining:

Diversified

19.4

Global

58.4

Copper

8.0

USA

15.4

Industrial Minerals

4.1

Canada

9.1

Steel

2.5

Latin America

7.4

Aluminium

2.3

Germany

4.5

Nickel

1.8

France

2.5

Gold

1.7

Australia

1.3

Uranium

1.4

Africa

1.0

Platinum Group Metals

0.3

Ireland

0.7

Tin

-0.3

China

0.7

Subtotal Mining:

41.2

Net Current Liabilities

-1.0

-----

Traditional Energy:

100.0

Integrated

17.3

=====

E&P

13.6

Distribution

2.1

Oil Services

1.3

Storage

0.7

Refining & Marketing

0.6

Subtotal Traditional Energy:

35.6

Energy Transition:

Electrification

8.5

Energy Efficiency

8.1

Transport

5.1

Renewables

2.5

Subtotal Energy Transition:

24.2

Net Current Liabilities

-1.0

----

100.0

=====

^ Total Assets for the purposes of these calculations exclude bank overdrafts, and the net current liabilities figure shown in the tables above therefore exclude bank overdrafts equivalent to 4.9% of the Company’s net asset value.

Ten Largest Investments

Company

Region of Risk

% Total Assets

Exxon Mobil

Global

5.6

Glencore

Global

4.8

Teck Resources

Global

4.5

BHP

Global

4.3

Vale

Latin America

Equity

2.9

Bond

1.2

Shell

Global

3.9

First Quantum Minerals

Global

 Equity

1.4

Bond

1.5

BP

Global

2.8

TotalEnergies

Global

2.7

Canadian Natural Resources

Canada

2.6

Commenting on the markets, Tom Holl and Mark Hume, representing the Investment Manager noted:

The Company’s Net Asset Value (NAV) per share increased by 1.9% during the month of September (in GBP terms).

Global equity and bond markets saw security prices fall during September as continued hawkish commentary from the US Fed led to a change in expectations that interest rates may need to stay higher for longer. Government bond yields increased (prices fell) with the yield on US 10-year Treasury bonds notably moving from 4.1% to 4.6% over the month. Sectors with perceived interest rate sensitivity came under most pressure. Inflation, whilst easing, remains above central bank targets in the US, Europe and UK, whilst leading economic indicator, manufacturing PMI surveys, suggest economic growth challenges may persist in Europe and the US. Global equity markets represented by the MSCI ACWI All Country World Index returned -4.1% in September.

The mining sector held up reasonably well against relative to broader equity markets. Despite property sales and industrial activity data modestly improving, we generally continue to see sluggish macroeconomic data from China. For reference, China’s manufacturing PMI fell to 50.6 from 51.0 in August. Mined commodities were mixed, with the copper price falling by 2.3%. Iron ore (62% fe) however, rose by 1.7%. Precious metals were down across the board, with gold, silver and platinum prices falling by 4.4%, 8.5% and 5.8% respectively.

Within energy markets, global demand for oil has remained resilient in recent months, increasing by approximately 1mbpd, (c.1%) so far this year, according to the US Energy Information Administration. The announced extension of production cuts to the end of the year, by Saudi Arabia and Russia at the end of August suggested a tightening of oil supplies heading into the fourth quarter of the year, which supported oil prices through September. The Brent and WTI (West Texas Intermediate) oil prices rose by 9.8% and 8.6%, ending the month at $96/bbl and $91/bbl respectively. This helped energy equities outperform broader global equity markets, as measured by MSCI AC World Index, which returned -4.5% in September. The US Henry Hub natural gas price rose by 6.2% during the month to end at $2.93/mmbtu.

Within the energy transition theme, the clean power utility companies were negatively impacted from the repricing of bond yields and following recent stock specific reports of higher costs for offshore wind. Whilst the market appears to be questioning renewable funding growth in a higher interest rate environment it remains clear that investment in solar and onshore wind continue to accelerate and remain among the lowest cost forms of electricity generation. 2023 is expected to see a new record high in solar and wind power capacity installations with growth in the US, Europe and China. Europe’s focus on improving energy security was evident with comments from European Commission President Ursula von der Leyen, who commented that “the wind industry is central to delivering the EU Green Deal” and that they would “fast-track permitting”.

26 October 2023

ENDS

Latest information is available by typing www.blackrock.com/uk/beri 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.