BLACKROCK GREATER EUROPE INVESTMENT TRUST PLC: Portfolio Update
BLACKROCK GREATER EUROPE INVESTMENT TRUST plc All information is at 31 December 2012 and unaudited.
Performance at month end with net income reinvested
One Three One Three Since launch
Month Months Year Years (20 Sep 04) Net asset value* (Undiluted) 1.3% 8.1% 22.5% 22.8% 137.3% Net asset value* (Diluted) 1.3% 8.8% 22.5% 22.8% 137.4% Share price 2.6% 8.9% 21.5% 23.0% 129.9% FTSE World Europe ex UK 1.9% 8.1% 17.8% 6.3% 85.4% Sources: BlackRock and Datastream
* Net asset value and share price performance includes the subscription share reinvestment, assuming the subscription share entitlement per share was sold and the proceeds reinvested on the first day of trading.
At month end Net asset value (capital only): 200.57p Net asset value (including income): 201.24p Net asset value (capital only)**: 200.57p Net asset value (including income)**: 201.24p Share price: 193.75p Discount to NAV (including income): 3.7% Discount to NAV (including income)**: 3.7% Gearing: 3.8% Net yield: 2.2% Total assets (including income): £242.8m Ordinary shares in issue***: 116,285,355
During the month 4,661,723 ordinary shares were tendered for total consideration of £9.2m. 1,291,662 were placed in treasury and the remaining 3,370,061 shares were cancelled.
** Diluted for treasury shares. *** Excluding 6,052,299 shares held in treasury.
Sector Analysis Total Assets (%) Index (%) Country Analysis Total Assets (%)
Consumer Goods 21.7 19.2 Switzerland 25.7 Industrials 15.5 15.2 Germany 21.1 Financials 14.2 20.7 France 17.3 Health Care 12.9 12.5 Netherlands 6.3 Basic Materials 12.9 8.6 Denmark 4.7 Oil & Gas 9.0 6.5 Russia 4.6 Consumer Services 6.8 5.3 Belgium 4.3 Technology 4.7 3.6 Finland 3.6 Utilities 2.4 4.3 Spain 2.4 Telecommunications 1.5 4.1 Portugal 2.3 Net current liabilities (1.6) - Ireland 2.0
----- ----- Hungary 1.7 100.0 100.0 Italy 1.5 ===== ===== Sweden 1.4 Norway 1.2 Other 1.5
Net current liabilities (1.6)
----- 100.0 ===== Ten Largest Equity Investments (in alphabetical order) Company BASF Germany Cie Financière Richemont Switzerland Continental Germany Novo Nordisk Denmark Roche Switzerland Schneider Electric France Swiss Re Switzerland Syngenta Switzerland Volkswagen Germany Zurich Insurance Switzerland Commenting on the markets, Vincent Devlin, representing the Investment Manager noted: During the month, the Company's NAV rose by 1.3% and the share price rose by 2.6%. For reference, the FTSE World Europe ex UK Index increased by 1.9% during the same period. December saw a continuation of the 'risk-on' rally that began in the summer of 2012. Investors remained bullish and rotated into more cyclical parts of the market at the expense of more 'defensive' names that had performed well in 2012. Both stock selection and sector allocation aided returns during the month. The Company's sector allocation, a larger weighting to basic materials and a lower weighting to telecoms, both provided meaningful contributions to returns. At a stock level, positions in utilities and financials performed best during December. Within utilities, a position in Iberdrola performed well after positive developments were made regarding tariff deficits, removing fears that Iberdrola would have higher taxes imposed to cover these deficits. Within financials, a position in Belgian bank KBC also performed strongly, after announcing a restructuring programme and benefiting from a benign macro environment and financial rally. Elsewhere within the Company, holdings in German auto company Volkswagen and French domestic autos name Renault both performed strongly, as did a position in Deutsche Lufthansa, a German aviation company, which benefited from the stable oil price and improving industry dynamics. Less successful positions included Italian name Saipem which underperformed after the company's CEO and COO both resigned over an investigation into contracts previously won in Algeria. We have maintained our position in the name as we feel the new CEO has vast experience within the industry and expect the stock to regain some of its losses. Within the same sector, CGG Veritas also underperformed over news of a delay to the deal with integrated geoscience business Fugro. The Company also incurred underperformance through a position in Technip, which experienced some sell-side analyst downgrades during the month, and Dutch oil & chemical storage company Vopak, which suffered from profit-taking in the market after a strong year of performance. At the end of the month, the Company had higher weightings (when compared with the FTSE World Europe ex UK Index) in basic materials, consumer goods, oil & gas, consumer services, technology, health care and industrials while having lower weights in utilities, telecoms and financials. Outlook After a trough in activity in the summer of 2012, global leading economic indicators have been improving across the US, Europe and China and the outlook for 2013 looks brighter than for 2012. This background is supportive for equities. However, there are still a number of uncertainties which can lead to further volatility in markets. Assuming that political momentum in the Eurozone continues to improve, and assuming that we avert a bad fiscal cliff outcome in the US, we are entering 2013 with: positive global economic momentum; promising structural reforms in Eurozone periphery countries gathering pace; supportive monetary policies across the world; attractive valuation levels for European equities both versus history, versus other developed markets and versus other asset classes; and investor positioning that remains low in European equities. We therefore see a potential total return for European equities of around 15% in 2013, despite the rally we have already seen in 2012. This is backed by better earnings momentum as we move through the year and a gentle re-rating of European equities as investor fears continue to diminish. 17 January 2013 ENDS Latest information is available by typing www.brgeplc.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. -0- Jan/17/2013 16:39 GMT