BLACKROCK SMALLER COMPANIES TRUST PLC
All information is at 31 May 2014 and unaudited.
Performance at month end is calculated on a capital only basis
One Three One Three Five
Month Months Year Years Years
Net asset value* -1.3% -5.5% 22.4% 48.1% 231.4%
Share price* -5.6% -10.2% 23.7% 55.8% 248.3%
Numis ex Inv Companies + AIM -0.2% -5.4% 14.8% 25.8% 107.3%
*performance calculations based on a capital only NAV with debt at par, without
income reinvested. Share price performance calculations exclude income
Sources: BlackRock and Datastream
At month end
Net asset value Capital only (debt at par value): 921.62p
Net asset value Capital only (debt at fair value): 914.17p
Net asset value incl. Income (debt at par value)**: 926.48p
Net asset value incl. Income (debt at fair value)**: 919.02p
Share price: 815.00p
Discount to Cum Income NAV (debt at par value): 12.0%
Discount to Cum Income NAV (debt at fair value): 11.3%
Net yield^^^: 1.5%
Gross assets^: £483.5m
Gearing range as a % of total assets: 0-15%
Net gearing including income (debt at par): 9.8%
2014 Ongoing charges ratio^^: 0.7%
Ordinary shares in issue#: 47,879,792
**includes net revenue of 4.86p
^includes current year revenue
^^As reported in the Annual Financial Report for the year ended
28 February 2014, the ongoing charges ratio is calculated as a percentage of
net assets and using operating expenses, excluding performance fees, finance
costs and taxation.
^^^Yield calculations are based on dividends announced in the last 12 months as
at the date of release of this announcement, and comprise the final dividend of
7.40 pence per share (announced on 25 April 2014 and gone ex-dividend on 14 May
2014) and the interim dividend of 4.60 pence per share, (announced on 24
October 2013, going ex-dividend on 30 October 2013).
#excludes 2,113,731 shares held in treasury.
Sector Weightings % of portfolio
Consumer Services 17.0
Health Care 7.3
Basic Materials 6.9
Consumer Goods 6.4
Oil & Gas 3.8
Telecommunications Services 1.7
Ten Largest Equity Investments
Company Total Market Value %
Workspace Group 1.8
Senior Engineering 1.8
Polar Capital Holdings 1.7
Optimal Payments 1.6
Avon Rubber 1.6
Headlam Group 1.4
Restaurant Group 1.4
Commenting on the markets, Mike Prentis, representing the Investment Manager
During May the Company's NAV per share fell by 1.3% on a capital only basis
whilst the benchmark index fell by 0.2%; by contrast the FTSE 100 Index rose by
1.0%. May was a difficult month for smallcaps in particular, whilst midcaps
showed some recovery having fallen very sharply mid-month. The portfolio is
more overweight in 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 shares price
moves. In many ways May was a rather perverse month for us, with these good
performances 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 many years.
Turning back to May, the relative contribution from stock selection and sector
allocation were both negative, whilst the impact of gearing was negligible.
Looking at stock selection the largest negative contributor to stock selection
in the month was Brainjuicer but this detracted only 0.1% from relative
performance. Brainjuicer did put out a slightly cautious AGM statement but
estimates for the full year remain unchanged.
On the positive side the best positive contribution to stock selection came
from Xaar, but it was a contribution of only 0.1%. Xaar shares partly recovered
after the sell off last month, but in June Xaar has warned on profits.
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.
17 June 2014
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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.