BlackRock Income and Growth Investment Trust Plc - Portfolio Update
The information contained in this release was correct as at
https://www.londonstockexchange.com/exchange/news/market-news/market-news-home.html .
All information is at
Performance at month end with net income reinvested
Since One Three One Three Five 1 April Month Months Year Years Years 2012 Sterling Share price 2.5% 1.9% 16.1% 21.3% 27.5% 142.8% Net asset value 0.2% 3.3% 16.8% 24.1% 37.2% 144.9% FTSE All-Share Total Return 0.5% 2.4% 17.0% 24.4% 37.9% 139.3% Source: BlackRock
BlackRock took over the investment management of the Company with effect from
At month end
Sterling:
Net asset value - capital only: 225.23p Net asset value - cum income*: 229.09p Share price: 204.00p Total assets (including income): £49.5m Discount to cum-income NAV: 11.0% Gearing: 4.8% Net yield**: 3.7% Ordinary shares in issue***: 19,873,112 Gearing range (as a % of net assets): 0-20% Ongoing charges****: 1.28% * Includes net revenue of3.86 pence per share ** The Company's yield based on dividends announced in the last 12 months as at the date of the release of this announcement is 3.7% and includes the 2023 final dividend of 4.80p per share declared on21 December 2023 with pay date15 March 2024 , and the Interim Dividend of 2.70p per share declared on20 June 2024 with pay date29 August 2024 . *** excludes 10,081,532 shares held in treasury. **** The Company's ongoing charges are calculated as a percentage of average daily net assets and using management fee and all other operating expenses excluding finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain non-recurring items for the year ended31 October 2023 . In addition, the Company's Manager has also agreed to cap ongoing charges by rebating a portion of the management fee to the extent that the Company's ongoing charges exceed 1.15% of average net assets.
Sector Analysis Total assets (%) Support Services 11.6 Banks 8.4 Pharmaceuticals & Biotechnology 8.3 Media 7.6 Real Estate Investment Trusts 6.7 General Retailers 6.4 Oil & Gas Producers 6.3 Financial Services 6.0Household Goods & Home Construction 5.9 Mining 4.6 Personal Goods 3.5 Travel & Leisure 3.5 Industrial Engineering 3.4Nonlife Insurance 3.1 Gas, Water & Multiutilities 3.0 Food Producers 2.2 Life Insurance 1.8 Electronic & Electrical Equipment 1.6 Tobacco 1.4 General Industrials 1.0 Net Current Assets 3.7 ----- Total 100.0 ===== Country Analysis PercentageUnited Kingdom 92.8United States 1.9Switzerland 1.6 Net Current Assets 3.7 ----- 100.0 ===== Top 10 holdings Fund % AstraZeneca 7.2 RELX 5.3 Shell 4.5 3i Group 3.9 HSBC Holdings 3.5 Unilever 3.5 Rio Tinto 3.5 National Grid 3.0 London Stock Exchange Group 3.0 Segro 2.7
Commenting on the markets, representing the Investment Manager noted:
Performance Overview:
The Company returned 0.2% during the month net of fees, modestly underperforming the FTSE All-Share which returned 0.5%.
Market Summary:
Equity market volatility remained a feature during August. Early in the month, markets around the world saw sharp declines in response to a combination of disappointing economic data out of the US and an interest rate hike by the Bank of Japan.
In the US, a weak July jobs report, which showed payrolls increase by 114k, the smallest increase in over three years, coupled with a slight increase in unemployment rate to 4.3% 1 , fuelled fears about a US recession. The Bank of Japan's (BoJ) decision to increase its policy rate by 25 basis points 2 led to a sudden reversal of carry trade positions, which had depended on low borrowing costs in Japanese yen to invest in higher-yielding assets.
Market sentiment improved during the second half of the month as investors found reassurance in potential interest rate cuts by the
In the
During the period, The
Stock comments
Next was a top positive contributor to relative performance during the month after reporting very strong results. Second quarter full-price sales increased by 3.2% compared to last year, surpassing expectations by £42m in contrast to a forecasted 0.3% decline due to last year's exceptional summer. The first half (H1) saw full price sales rise by 4.4%, exceeding guidance of 2.5%.
Admiral reported very strong results, once again underscoring the quality of the organisation and its consistent performance. Despite offering a homogeneous product,
we believe Admiral continues to excel in understanding market cycles and delivering consistently superior returns compared to its peers. Achieving 15% year-on-year growth in
Spirax detracted following weak first-half results that prompted downgrades of 5% for 2024 and 10% for 2025. This year's downgrades are primarily driven by STS (Steam) due to weaker than expected industrial production. Additionally, the anticipated recovery in Biopharma and Semiconductor exposure has yet to materialise.
Oxford Instruments detracted from relative performance due to a combination of the broad cyclical sell-off in early August and, more specifically, being caught up in renewed geopolitical tension within semiconductor markets related to
Changes
During the period we sold Intermediate Capital as the shares have performed very strongly since purchase.
Outlook
Equity markets entered 2024 in a buoyant mood following a strong and broad rally in the latter part of 2023. The outlook, and optimism, is a far cry from when supply chains were hugely disrupted, and inflation was double digit and well ahead of central banks' targets prompting rapid and substantial interest rates hikes despite an uncertain demand environment.
Markets have shifted to `goldilocks' territory whereby slowing inflation has signalled the peak for interest rates while broad macroeconomic indicators that have been weak are not expected to deteriorate further. This is also helpful for the cost and availability of credit which has recently improved having been deteriorating through most of 2023. Despite expectations for rate cuts moderating significantly, stock markets have continued to make progress in the developed world.
With the
The
We continue to focus the portfolio on cash generative businesses that we believe offer durable, competitive advantages as we believe these companies are best placed to drive returns over the long-term. Whilst we anticipate economic and market volatility will persist throughout the year, we are excited by the opportunities this will likely create; by seeking to identify the companies that strengthen their long-term prospects as well as attractive turnarounds situations.
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