BlackRock Emerging Europe Portfolio Update
March 22 2018 - 1:08PM
UK Regulatory
TIDMBEEP
BLACKROCK EMERGING EUROPE PLC (LEI - 549300OGTQA24Y3KMI14)
All information is at 28 February 2018 and unaudited.
Performance at month end with net income reinvested
One Three One Three Five *Since
Month Months Year Years Years 30.04.09
Sterling:
Share price -0.8 10.2 25.2 76.9 45.0 168.2
Net asset value 0.2 11.3 18.2 68.3 30.5 150.6
MSCI EM Europe 0.1 10.3 15.9 46.1 3.1 88.1
10/40(NR)
US Dollars:
Share price -3.9 12.1 38.6 57.6 31.7 149.4
Net asset value -2.9 13.2 30.8 50.0 18.5 133.0
MSCI EM Europe -3.0 12.3 28.4 30.2 -6.4 74.9
10/40(NR)
Sources: BlackRock, Standard & Poor's Micropal
*BlackRock took over the investment management of the Company with effect from
1 May 2009
At month end
US Dollar:
Net asset value - capital only: 541.88c
Net asset value* - cum income: 557.56c
Sterling:
Net asset value - capital only: 393.29p
Net asset value* - cum income: 404.68p
Share price: 383.50p
Total assets^: GBP145.3m
Discount (share price to cum income NAV): 5.2%
Net gearing at month end: 2.5%
Net yield^^^^: 1.5%
Gearing range as a % of Net assets: 0-20%
Issued Capital - Ordinary Shares^^ 35,916,028
Ongoing charges^^^ 1.2%
* Includes year to date net revenue equal to 11.39 pence per share.
^ Total assets include current year revenue.
^^ Excluding 5,000,000 shares held in treasury.
^^^ Calculated as at 31 January 2017, in accordance with AIC guidelines.
^^^^ Yield calculations are based on dividends announced in the last 12 months
as at the date of release of this announcement, and comprise of the final
dividend of 7.50 cents per share, (announced on 28 March 2017, ex-dividend on
18 May 2017)
Sector Gross assets Country Gross
Analysis (%) Analysis assets
(%)
Financials 38.7 Russia 55.1
Energy 26.0 Poland 15.5
Telecommunication Services 11.5 Turkey 13.4
Consumer Staples 9.8 Greece 6.4
Health Care 5.5 Hungary 3.6
Materials 4.0 Ukraine 3.4
Information Technology 3.1 Pan-Emerging Europe 3.0
Consumer Discretionary 1.8 Net current liabilities (0.4)
Net current liabilities (0.4) -----
----- 100.0
100.0 =====
=====
Short position (1.4) (1.4)
Fifteen Largest Investments
(in % order of Gross Assets as at 28.02.18)
Company Region of Risk Gross assets
(%)
Sberbank Russia 9.8
Lukoil Russia 9.3
Gazprom Russia 8.8
PKO Bank Polski Poland 5.3
Lenta Russia 4.3
Rosneft Oil Company Russia 4.0
Novatek Russia 3.9
Turkcell Turkey 3.9
PZU Poland 3.7
Bank Pekao Poland 3.6
Gedeon Richter Hungary 3.6
Alpha Bank Greece 3.3
Mobile Telesystems Russia 3.2
National Bank of Greece Greece 3.1
Erste Group Bank Pan-Emerging Europe 3.0
Commenting on the markets, Sam Vecht and Christopher Colunga, representing the
Investment Manager noted;
Market Commentary
The MSCI Emerging Europe 10/40 Index declined by 3.0% in February meaning the
index relatively outperformed developing markets and other emerging markets
countries, thanks mostly to a positive performance from index heavyweight
Russia.* For reference, the MSCI Emerging Markets Index fell by 4.6%* and the
MSCI World was down by 4.3%* over the same period. February was marked by a
sharp correction in global equities giving back some of the strong January
gains, led by developed markets.
Russia was the region's top performer, rising by +0.8% in February as inflation
continued to fall triggering another interest rate cut of 25bps by the Bank of
Russia.** Stronger oil prices, driven by a combination of increased demand amid
cold winter conditions and tight supply, further supported the market. Central
Europe (Poland -9.9%, Hungary -7.7% and Czech Republic -4.6%) and Greece
(-8.2%) were weak reacting to the broader market sell off and giving up the
gains from the previous month.* Turkey (-2.0%) outperformed the region in
February following a decent 2017 year-end earnings season.
Focus on: MAIL.RU
Mail.Ru Group is an Internet company in Russia. It operates two most popular
social networks in Russia: VKontakte (VK) with 97m users and Odnoklassniki (OK)
with 71m. Its websites have the largest audience with over 90% of monthly
Internet users and capture the most screen time in Russia. In addition, Mail.Ru
owns the largest online games business in Russia, 2nd largest classifieds
portal and multiple other internet properties.
2017 was a strong year for Mail.Ru, helped by a continued recovery in the
Russian digital advertising market, turnaround in the games business via a
successful acquisition, and the launch and development of several new
verticals. VKontakte, the key social media unit, continued to gain users and
improve monetisation, delivering more than 50% top line growth. Games business
had an exceptionally strong year due to a VAT change (which was an effective
price increase) and strong growth in Pixonic, the recently acquired mobile
games studio. Mail.Ru also leveraged its audience reach to drive traffic to
developing adjacent businesses such as food delivery (Delivery Club, the no.1
player in this nascent market) and classifieds (Youla, a general classifieds
website launched less than 2 years ago). We have held the position in the stock
for over a year now and it has been a strong contributor to portfolio returns.
We continue to see the prospects in social network monetisation and synergies
in the adjacent businesses such as Delivery Club (food delivery), Youla (local
marketplace) and Pandao (cross border online retail).
*Source: BlackRock, MSCI, data as at end February 2018.
**Source: Bloomberg, data as at end February 2018.
22 March 2018
ENDS
Latest information is available by typing www.blackrock.co.uk/beep 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.
END
(END) Dow Jones Newswires
March 22, 2018 13:08 ET (17:08 GMT)
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