BLACKROCK THROGMORTON TRUST PLC (LEI:
5493003B7ETS1JEDPF59)
All information is at 31 July
2018 and unaudited.
Performance at month end is calculated on a cum income
basis
|
One
Month
% |
Three
months
% |
One
year
% |
Three
years
% |
Five
years
% |
Net asset value |
0.6 |
7.7 |
20.4 |
66.5 |
123.5 |
Share price |
-0.7 |
5.3 |
29.1 |
78.5 |
135.8 |
Benchmark* |
0.3 |
1.1 |
4.6 |
27.9 |
60.8 |
Sources: BlackRock and Datastream
*With effect from 22 March 2018
the Numis Smaller Companies plus AIM (excluding Investment
Companies) Index replaced the Numis Smaller Companies excluding AIM
(excluding Investment Companies) Index as the Company’s benchmark.
The five year period indices have been blended to reflect this.
At month end |
Net asset value capital
only: |
608.08p |
Net asset value incl.
income: |
616.94p |
Share price |
556.00p |
Discount to cum income
NAV |
9.9% |
Net
yield1: |
1.6% |
Total Gross
assets2: |
£451.2m |
Net market exposure as
a % of net asset value3: |
107.6% |
Ordinary shares in
issue4: |
73,130,326 |
2017 ongoing charges*
(excluding performance fees)5,6: |
0.9% |
2017 ongoing charges*
ratio (including performance fees)5,6,7: |
2.2% |
*Ongoing Charges: The management fee rate reductions, as
detailed in the notes below, will impact management fees in 2017
and onwards. The impact of the new fee arrangements,
assuming the same level of performance from the manager and
assuming all other charges remain the same, would be to reduce the
level of Ongoing Charges borne by the Company.
1. Calculated using the 2017 interim dividend declared on
24 July 2017 and the 2017 final
dividend declared on 12 February 2018
and paid on 29 March 2018.
2. Includes current year revenue and excludes gross exposure
through contracts for difference.
3. Long positions less short positions as a percentage of net asset
value.
4. Excluding 7,400,000 shares held in treasury.
5. Calculated as a percentage of average net assets and using
expenses, excluding performance fees and interest costs for the
year ended 30 November 2017.
6. With effect from 1 August 2017 the
base management fee was reduced from 0.70% to 0.35% of gross assets
per annum.
7. Effective 1st December 2017 the
annual performance fee arrangements for the Company have
changed. The annual performance fee is now calculated using
performance data on an annualised rolling two year basis
(previously, one year) and the maximum annual performance fee
payable is effectively reduced to 0.90% of two year rolling average
month end gross assets (from 1% of average annual gross assets over
one year). Additionally, the Company now accrues this fee at a rate
of 15% of outperformance (previously 10%). The maximum annual total
fees (comprising the base management fee of 0.35% and a
potential performance fee of 0.90%) will therefore fall to
1.25% of average month end gross assets on a two year rolling basis
(from 1.70% of average annual gross assets).
Sector
Weightings |
% of
Total Assets |
|
|
Industrials |
32.3 |
Financials |
22.8 |
Consumer Services |
16.8 |
Technology |
8.6 |
Health Care |
7.7 |
Consumer Goods |
7.3 |
Basic
Materials |
3.4 |
Oil & Gas |
1.0 |
Net current assets |
0.1 |
|
----- |
Total |
100.0 |
|
===== |
Market Exposure
(Quarterly) |
|
|
31.08.17
% |
30.11.17
% |
28.02.18
% |
31.05.18
% |
Long |
115.3 |
116.9 |
119.6 |
115.9 |
Short |
5.8 |
6.3 |
8.4 |
10.0 |
Gross exposure |
121.1 |
123.2 |
128.0 |
125.9 |
Net exposure |
109.5 |
110.6 |
111.2 |
105.9 |
Ten Largest
Investments |
|
Company |
% of
Total Gross Assets |
|
|
Ascential |
3.2 |
Dechra
Pharmaceuticals |
2.8 |
Fever-Tree Drinks |
2.7 |
Hiscox |
2.6 |
SSP |
2.4 |
Robert Walters |
2.3 |
Bodycote |
2.3 |
Workspace Group |
2.3 |
4imprint Group |
2.2 |
CVS Group |
2.1 |
Commenting on the markets,
Dan Whitestone, representing the
Investment Manager noted:
During July the Company’s NAV per share rose by 0.6%* to 616.94p
on a cum income basis, outperforming our benchmark index which rose
by 0.3%*; the FTSE 100 Index rose 1.5%* (all performance figures
are in sterling terms with income reinvested).
The Company continued to deliver outperformance over the
benchmark during July, with both the long and short book
contributing positively. Within the long book a number of holdings
responded well to positive trading updates, whilst in the short
book the Company continued to benefit from stock specific
successes.
Shares in 4imprint rose after the company delivered better than
expected results for the first half of the year. Investment in
brand marketing has resulted in a strong increase in new customers,
exceeding management’s expectations, and the outlook for the second
half of the year looks positive. Shares in SSP Group responded well
to a positive third quarter trading update showing strong
like-for-like sales growth helped by the continued rise in air
travel. Self-help initiatives, for example in procurement
disciplines and range rationalisation continue to drive
improvements in gross margins, resulting in further upgrades. Other
notable contributors included Draper Esprit, Lonza and Advanced
Medical Solutions which all performed well in response to positive
company specific updates.
Our short position in a UK technology company, where we have
significant concerns about the company’s ability to monetise its
product offering, was among the top contributors during the month.
This company remains heavily loss making with significant cash
burn, and its shares subsequently fell by more than 20% in
July.
The largest detractor was cyber security business Sophos, which
fell after the company disappointed the market with lower than
expected billings growth. After a prolonged period of consistent
“beat and raise” updates, two of the last three updates have been
disappointing. We have been reducing the position earlier in the
year, and have reduced further this month in response to another
disappointment in the company’s renewal rate which challenges our
investment thesis. The second largest detractor was from Ascential,
which fell on the news of a slowdown in one of its recently
acquired business, despite beating results at every line at a group
level. We’ve discussed the moving parts with Management at some
length on their roadshow and it remains one of our larger
holdings.
Our view on the current environment, the economic cycle and
therefore the Company’s positioning hasn’t changed. Towards the end
of the month the market experienced a mini reversal which saw a
number of our holdings give back some recent performance. These
events often create opportunities for us to add to our holdings in
companies, where we see significant runways of earnings growth, at
more attractive prices. We therefore took the opportunity during
the month to add to Hiscox, Bodycote and Howden Joinery.
*Source: BlackRock as at 31 July
2018
17 August 2018
ENDS
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Neither the contents of the Manager’s website nor the contents of
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any other website) is incorporated into, or forms part of, this
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