BLACKROCK THROGMORTON TRUST PLC
All information is at 31 May 2014 and unaudited.
Performance at month end is calculated on a cum income basis
One Three One Three
Month Months Year Years
Net asset value* -0.9% -6.0% 17.8% 47.3%
Net asset value -0.9% -6.0% 17.8% 41.4%
Share price -4.3% -8.4% 21.2% 52.8%
Benchmark** 0.5% -4.9% 18.0% 36.0%
Sources: BlackRock and Datastream
* Prior to dilution arising on conversion of subscription shares.
**With effect from 1 December 2013 the Numis Smaller Companies excluding AIM
(excluding investment companies) Index replaced the Numis Smaller Companies
plus AIM (excluding investment companies) Index as the Company's benchmark.
For the one year and three year periods the indices have been blended to
At month end
Net asset value capital only: 332.66p
Net asset value incl. income: 334.89p
Share price: 291.38p
Discount to cum income NAV 13.0%
Net yield: 1.4%*
Total gross assets: £244.9m**
Net market exposure as
a % of net asset value^: 104.5%
Ordinary shares in issue: 73,130,326***
*Calculated using prior year interim and final dividends paid.
**Includes current year revenue and excludes the gross exposure through
contracts for difference.
***Excluding 7,400,000 shares held in treasury.
^Long positions less short positions as a percentage of net asset value.
Sector Weightings % of total assets
Consumer Services 18.1
Basic Materials 7.0
Health Care 6.9
Consumer Goods 6.1
Oil & Gas 3.9
Net current liabilities 0.2
Market Exposure (Quarterly)
31.08.13 30.11.13 28.02.14 31.05.14
Long 117.5% 118.4% 118.8% 116.9%
Short 12.0% 11.2% 10.7% 12.4%
Gross exposure 129.5% 129.6% 129.5% 129.3%
Net exposure 105.4% 107.2% 108.1% 104.5%
Ten Largest Investments
Company % of total assets
Workspace Group 2.2
Restaurant Group 2.1
Dunelm Group 1.8
Optimal Payments 1.7
Bovis Homes 1.7
Rathbone Brothers 1.7
Commenting on the markets, Mike Prentis and Ralph Cox*, representing the
Investment Manager noted:
During May the Company's NAV per share fell by 0.9% on a cum income basis
whilst the benchmark index rose by 0.5%; the FTSE 100 Index rose by 0.9%. May
was a difficult month for smallcaps in particular, whilst midcaps showed some
recovery having fallen very sharply mid-month. The Company is more overweight
genuinely small companies and so we did not benefit significantly as midcaps
showed some recovery.
Newsflow from the portfolio during May has been good with strong results from
companies such as Victrex, Young & Co.'s Brewery, Paypoint, Aveva, Vertu,
Telford Homes, Iomart, Paragon, Telecom Plus, Topps Tiles and Grainger.
However, these good results have not led to strongly positive share price
moves. In many ways May was a rather perverse month for us, with these strong
results largely ignored by the market. We feel that, in addition to hedge fund
deleveraging to fund outflows, we have seen large cap fund managers reducing
their midcap exposure, which has served them well for a long time. We remain
convinced that on a medium term basis a well-chosen portfolio of dynamic, small
and midcap growth companies will outperform largecaps, as has been the case for
Turning back to May, the relative contribution from long only portfolio stock
selection was negative, additionally the contributions from long only portfolio
sector allocation and the CFD portfolio were also both slightly negative.
Looking at stock selection the largest negative contributors in the month were
Brainjuicer, Blinkx and Ithaca Energy, but each detracted from relative
performance by only 0.12%. Brainjuicer released a slightly cautious AGM
statement but estimates for the full year remain unchanged. Blinkx announced
full year results with revenues up by 25%, profit before tax up by 30%, net
cash of $126million and a confident outlook. Initially the shares reacted
positively but have since drifted off. For such a strongly profitable, cash
generative and cash rich business the shares look attractively valued. Ithaca
Energy announced first quarter profits of $16million and average production in
excess of 9,000 barrels of oil equivalent per day. However the market worried
about the delayed start to production from the new Stella development, now
scheduled for mid-2015.
On the positive side the best positive contributor to stock selection came from
Young & Co.'s Brewery, but it was a contribution of only 0.12%. As mentioned
above, Young's announced good final results with earnings per share up by 17%.
Whilst the contribution from sector allocation was negative, no sector made
much of a negative contribution, with the largest coming from our overweight
position in housebuilders, a position we have been reducing.
Portfolio activity during the month was fairly limited. We have generally
avoided recent IPOs.
*From 1 April 2014, Richard Plackett is on a six-month sabbatical. During this
period the BlackRock Throgmorton Trust plc is being co-managed by Ralph Cox.
10 June 2014
Latest information is available by typing www.blackrock.co.uk/thrg 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.