MLW Mer.L.World Mng

 
TIDMBRWM 
 
BLACKROCK WORLD MINING TRUST plc 
 
All information is at 30 September 2015 and unaudited. 
 
Performance at month end with net income reinvested 
 
                                         One         Three       One     Three       Five 
 
                                       Month        Months      Year     Years      Years 
 
Net asset value                        -9.6%        -27.2%    -45.8%    -61.1%     -65.1% 
 
Share price                            -6.5%       -26.3%     -48.2%    -58.3%     -59.9% 
 
Euromoney Global Mining Index          -8.9%      -25.3%      -39.5%    -54.0%     -61.0% 
 
(Total return) 
 
Sources: BlackRock, Euromoney Global Mining Index, Datastream 
 
At month end 
 
Net asset value including income*:                                                222.70p 
 
Net asset value capital only:                                                     214.01p 
 
*Includes net revenue of 8.69p 
 
Share price:                                                                      205.75p 
 
Discount to NAV**:                                                                   7.6% 
 
Total assets:                                                                     GBP469.9m 
 
Net yield***:                                                                       10.2% 
 
Net gearing:                                                                        18.5% 
 
Ordinary shares in issue:                                                     177,287,242 
 
Ordinary shares held in treasury:                                              15,724,600 
 
Ongoing charges****:                                                                 1.4% 
 
** Discount to NAV including income. 
*** Based on an interim dividend of 7.00p in respect of the year ending 
31 December 2015 and a final dividend of 14.00p in respect of the year ended 31 
December 2014. 
**** Calculated as a percentage of average net assets and using expenses, 
excluding finance costs for the year ended 31 December 2014. 
 
Sector                        % Total         Country Analysis                     % Total 
 
                               Assets                                               Assets 
 
Diversified                      41.9         Global                                  48.6 
 
Base Metals                      20.4         Latin America                           16.3 
 
Gold                             14.7         Australasia                              9.3 
 
Silver & Diamonds                11.2         Other Africa                             8.0 
 
Industrial Minerals               4.5         Canada                                   7.1 
 
Other                             3.9         Emerging Europe                          5.5 
 
Energy Minerals                   1.9         South Africa                             2.2 
 
Aluminium                         0.6         China                                    1.9 
 
Zinc                              0.4         Indonesia                                0.6 
 
Net current assets                0.5         Net current assets                       0.5 
 
                                -----                                                ----- 
 
                                100.0                                                100.0 
 
                                =====                                                ===== 
 
Ten Largest Investments 
 
                                               % Total 
Company                                         Assets 
 
BHP Billiton                                      13.9 
 
Rio Tinto                                         12.7 
 
First Quantum Minerals                             6.6 
 
Lundin Mining                                      5.1 
 
Norilsk Nickel                                     5.0 
 
Cerro Verde                                        3.7 
 
Glencore                                           3.5 
 
Fresnillo                                          3.5 
 
Avanco Resources                                   3.3 
 
Iluka Resources                                    2.7 
 
 
 
 
Commenting on the markets, Evy Hambro and Olivia Markham, representing the 
Investment Manager noted: 
 
Performance 
 
Continued concerns over the strength of the Chinese economy led to another 
challenging and volatile month for the mining sector. China's September 
Manufacturing PMI came in at 47.2, which was down from 47.3 in August and 
represented the lowest reading since March 2009. Meanwhile, data for August 
showed that fixed-asset investment in China had increased at its slowest 
pace in 15 years. These data points worsened sentiment towards the mining 
sector which, as measured by the Euromoney Global Mining Index, fell below 
the lowest levels seen during the depths of the Global Financial Crisis. 
 
During the month, there continued to be a disconnect between the moves in 
mining shares and the moves in underlying commodity prices. For example, 
copper equities continued to sell off aggressively, evidenced by the 
Euromoney Global Mining Copper Index falling -12.0%, whilst the physical 
copper price finished the month up +0.6%. 
 
Diversified miner Glencore dominated the headlines during the month. On 
7 September, the company announced plans to reduce its debt by $10bn 
through an equity issuance, suspension of its 2015 final dividend and 2016 
interim dividend and through a number of other measures. Later in the 
month, increased concerns about the company's debt level caused its share 
price to fall -29.7% in just one day (28 September). However, over the 
remaining two days of the month the market's concerns over immediate 
liquidity dissipated and the company's share price bounced back, recovering 
almost all of that one day fall - an example of the extreme volatility seen 
in mining shares during September. Having reduced our exposure to Glencore 
throughout 2015, we added to our position through participating in the 
company's placement on 16 September. In our view, the measures announced by 
Glencore represent a positive step towards strengthening its balance sheet 
and this is necessary in the current commodity price environment. 
 
Gold equities outperformed the broader mining space over the month as they 
were less impacted by worsening sentiment towards China and as they 
benefited from the gold price holding up better than most mined 
commodities. Our overweight positions in a number of high quality, mid-cap 
gold producers contributed positively to the Company's relative 
performance. 
 
All data points in USD terms 
 
Strategy and Outlook 
 
Good company strategy has been outweighed by weakening commodity demand and 
falling commodity prices in the past year. Looking ahead, the outlook for 
commodity prices remains subdued, given expectations of further US dollar 
strength and a modest demand outlook. This pressure will continue to force 
tough decisions and mining companies are likely to remain in austerity 
mode. Recent commodity price falls suggest further cuts to analyst earnings 
will be required. As the year progresses, we would expect an acceleration 
of closures of high-cost capacity in oversupplied markets. This bodes well 
for the longer term and limits the industry's ability to respond to the 
next upturn in demand which will ultimately see prices go higher. 
 
While the sector continues to face headwinds, it is important to remember 
that we are another year further into the underinvestment phase and closer 
to the deficit markets that we foresee. We expect an inflection point to be 
reached once price (and consequently return) expectations start to recover 
as a result of the supply curtailment, which should accelerate with the 
current commodity price weakness. 
 
15 October 2015 
 
ENDS 
 
Latest information is available by typing www.brwmplc.co.uk 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

October 15, 2015 11:48 ET (15:48 GMT)

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