BLACKROCK NEW ENERGY INVESTMENT TRUST PLC: Portfolio Update
BLACKROCK NEW ENERGY INVESTMENT TRUST plc All information is at 28 February 2013 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 (Undiluted) 4.6% 15.0% 15.5% 6.2% -36.0% -56.5% Net asset value (Diluted) 4.6% 15.0% 15.5% 6.2% -36.0% -56.5% Share price 4.6% 16.6% 19.9% 16.1% -43.9% -62.7% Source: BlackRock
At month end Net asset value - capital only (undiluted): 41.28p Net asset value - cum income (undiluted): 41.32p Net asset value - capital only (diluted): 41.28p Net asset value - cum income (diluted): 41.32p Share price: 37.00p Discount to cum income NAV**: 10.45% Subscription share price: 0.275p Net yield****: 0.41% Total assets including current year revenue: £97.09m Gearing: Nil Ordinary shares in issue***: 234,970,407 Subscription shares in issue: 45,629,404
** Discount to NAV based on fully diluted NAV. *** Excludes 11,900,000 shares held in treasury. **** Based on a final dividend of 0.15p per share in respect of the year ended 31 October 2012.
Benchmark Sector Analysis Total Assets (%) Country Analysis Total Assets (%)
Enabling Energy & Infrastructure 30.7 USA 33.6 Renewable Energy Developers 22.5 Denmark 8.2 Energy Efficiency 22.1 Canada 8.0 Alternative Fuels 15.3 United Kingdom 7.9 Renewable Energy Technology 5.5 France 6.7 Net current assets 3.9 Germany 4.7
----- China 4.4 100.0 Portugal 3.9 ===== Switzerland 3.7 Finland 3.1 South Africa 2.4 Italy 2.0 Belgium 1.8 Brazil 1.7 Australia 1.6 Ireland 1.3 Japan 0.6 Spain 0.5 Net current assets 3.9 ----- 100.0 ===== Ten Largest Investments (in alphabetical order) Company Country of Risk ABB Reg Switzerland Altagas USA EDP Renovaveis Portugal ITC Holdings USA Johnson Controls USA NextEra Energy USA Novozymes Denmark Quanta Services USA Schneider Electric France Transcanada Canada Robin Batchelor and Poppy Allonby, representing the Investment Manager, noted: The NAV of the Company appreciated by 4.6% in February. For reference, the MSCI World Index returned 4.4% and the WilderHill New Energy Global Innovations, an index that is representative of the sector, gained 6.7% (DataStream, in sterling terms). Equity markets rolled off their January highs (in USD terms) as softer Chinese economic data and renewed Euro concerns post the Italian elections set a more cautionary tone to markets. There were, however, some positives. US economic data continued to indicate that the economy is recovering and while February Chinese PMI data was reported at a lower level than expected, it was still indicating growth. As we have previously reported, pricing pressures in the solar industry have led to political tensions between China, Europe and the US. In 2012 the US imposed anti-dumping duties on solar modules imported from China and the EU are investigating whether they should follow suit. In response, China has launched an investigation into whether polysilicon imported from Europe, South Korea and the US should be imposed with a duty. During the month China announced a delay to the results of this investigation; the market took this news to be a positive sign for international polysilicon producers such as Wacker Chemie. The European Parliament's Environment Committee endorsed a plan to backload carbon allowances out to 2019-2020. This plan, which would entail the withholding of 900 million tonnes of carbon allowances that were due to be auctioned for the 2013-2015 period is expected to support near term carbon prices. Performance The Company's holding in Wacker Chemie was a positive contributor to performance during the month but this was partially offset by our allocation to other solar names. Retroactive reforms to Spanish energy tariffs continued to weigh on the share prices of utilities with exposure to the country. As such, the Company's allocation to renewable energy developers operating in Spain detracted from performance in February. Vestas, the wind turbine producer, performed well as the company's full year results broadly met market expectations and their restructuring efforts appear to be delivering the expected results. The Company's allocation to Vestas contributed positively to performance in February. Portfolio Activity We took profits in an Alternative Fuels holding, rotating the capital into attractively valued energy infrastructure holdings. The acquisition of Shaw group by Chicago Bridge and Iron successfully completed during the month. We subsequently sold the shares we acquired in Chicago Bridge and Iron Company as part of this cash and share deal. Outlook The Company has been positioned to benefit from areas of the New Energy sector that are experiencing strong near-term growth. The pain that the Renewable Energy Technology sub-sector has suffered is showing little sign of imminent relief despite some recent positive newsflow. The price of a solar module has fallen by over 75% from the start of 2009 rendering many producers loss making. The solar industry is reaching the point of consolidation and with a much more competitive cost structure should enjoy resurgence at some point. That moment is sufficiently distant in our view for us to remain cautious on investment in the area and we continue to prefer opportunities amongst the Renewable Energy Developers. At the other end of the sector spectrum, and with a contrasting set of industry fundamentals, lie the Enabling Energy and Infrastructure companies and certain Energy Efficiency players who are enjoying bumper growth. The shale gas revolution and power grid expansion in the US has sparked an investment up-cycle in energy infrastructure spending which continues to gather momentum. Energy Efficiency has also benefitted from corporate and government cost saving - legislation to incentivize the adoption of energy efficiency technology is a more appealing option to a cash strapped government than renewable energy subsidy. We continue to believe that sector valuations are generally attractive, both relative to history and to broader equity markets, and there is scope for the positive sector fundamentals to be supported by continued M&A. At a General Meeting of the Company held on 25 July 2012 shareholders approved the removal of the requirement for an annual continuation vote and replaced it with the obligation for the Board to put forward proposals that shareholders be given the opportunity to elect to receive an amount per share in cash of NAV less applicable costs, shortly after the AGM in 2014. 13 March 2013 ENDS Latest information is available by typing www.brneplc.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- Mar/13/2013 15:55 GMT