Portfolio Update
01 April 2008 - 12:26AM
UK Regulatory
MERRILL LYNCH NEW ENERGY TECHNOLOGY plc
All information is at 29 February 2008 and unaudited.
Performance at month end with net income reinvested
One Three Six One Five Since Launch
Month Months Months Year Years (23 Oct 00)
Net asset value 3.3% -7.3% 7.1% 17.8% 256.2% -32.0%
Share price 10.8% 5.1% 12.2% 20.4% 358.6% -33.5%
Source: BlackRock
At month end
Net asset value: 65.11p
Share price: 66.50p
Premium to NAV: -2.1%
Net yield: n/a
Total Assets: �157.7m
Gearing: 0.0%
Ordinary shares in issue: 241,750,000
Benchmark
Sector Analysis % of Total Country Analysis % of Total
Assets Assets
Renewable Energy 55.9 USA 33.9
Alternative Fuels 14.6 Spain 13.1
Enabling Energy Technology 14.2 Denmark 11.1
Materials Technology 5.6 Germany 7.8
Auto & On-Site Generation 3.3 United Kingdom 7.7
Energy Storage 0.6 Canada 6.2
Net current assets 5.8 India 3.0
----- South Africa 3.0
100.0 Belgium 2.5
===== Norway 1.9
France 1.8
China 1.3
Ireland 0.9
Current assets 5.8
-----
100.0
=====
Ten Largest Investments (in alphabetical order)
Company Country of Risk
American Superconductor USA
Climate Exchange United Kingdom
Clipper Windpower USA
FPL Group USA
Gamesa Spain
Itron USA
Potash Canada
Sasol South Africa
UBS Suzlon Energy India
Vestas Wind Systems Denmark
Robin Batchelor and Poppy Allonby, representing the Investment Manager, noted:
Portfolio Performance
The portfolio's NAV gained 3.3% in February, as investor confidence improved
after a turbulent January and the surging oil price focused attention on
alternatives. Notably, the Company's net asset value increased in value in a
period where global equities (represented by the MSCI World Index) declined by
0.7%. Although the market continues to be concerned with the potential for the
global liquidity crunch to reduce economic growth rates, investors continue to
appreciate the compelling growth fundamentals within the new energy sector,
underpinned by a positive legislative outlook (with particular regard to the US
election) and the high prices of oil, gas and coal.
Among the strongest contributors to performance was the portfolio's number one
holding Vestas Wind Systems, which continues to outperform conservative analyst
forecasts. Wind power offers utilities the cheapest and most effective way to
add new "clean" energy to their generation fleet, and industry-leading Vestas
has been achieving higher-than-expected margins by selling turbines on a spot
basis into this strong market.
Demand for wind power generating assets was underlined by a takeover battle
emerging for UK wind and biomass power producer Novera Energy. Investment
vehicles representing 3i Infrastructure Ltd and private equity firm Terra Firma
have been accumulating shares at 90p, around a 50% premium to the previous
share price.
Climate Exchange plc performed well, gaining 39% in February as the European
Climate Exchange announced plans to launch trading in contracts for Kyoto
Protocol certified emissions reductions.
Solar cell manufacturers such as Suntech Power were among the weaker performing
companies this month, on concern about potential margin pressures.
Portfolio Activity
We increased slightly our weighting in silicon-producing solar companies. We
anticipate that the ramp-ups of new Asian polysilicon startups will be slower
than forecast, thus keeping the silicon market tighter for longer.
Outlook
New energy stocks are not immune to the less predictable macro factors causing
heightened volatility and risk aversion in the broader equity markets.
Significant uncertainty and risk continue to overhang the market such as the
potential for further credit crunch-related write downs at the investment banks
and the impact that tighter credit will have on the broader economy. That said,
with energy prices still at record high levels and the momentum from `new
energy' policy and legislation on both sides of the Atlantic continuing
unabated, the long term outlook for the sector remains positive.
Latest information is available by typing www.blackrock.co.uk/its on the
internet, "BLRKINDEX" on Reuters, "BLRK" on Bloomberg or "8800" on Topic 3 (ICV
terminal).
31 March 2008
END
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