BlackRock Smaller Companies Trust Plc A challenging year Net Asset Value per share fell by 6.6%

BlackRock

BlackRock Smaller Companies Trust Plc (LON:BRSC), today announced annual results for the year ended 28 February 2019.

PERFORMANCE RECORD

Performance
Net asset value per share (debt at par value)1 1,407.88p 1,506.78p -6.6
Net asset value per share (debt at par value, capital only)1,2 1,386.21p 1,487.48p -6.8
Net asset value per share (debt at fair value)1,3 1,400.57p 1,500.04p -6.6
Numis Smaller Companies plus AIM (excluding Investment Companies) Index1 5,231.98 5,700.84 -8.2
Ordinary share price 1,330.00p 1,325.00p +0.4
Year ended
28 February 2019
Year ended
28 February 2018
Change %
Revenue and dividends
Revenue return per share 33.67p 29.30p +14.9
Interim dividend per share 12.00p 10.00p +20.0
Proposed final dividend per share 19.20p 16.00p +20.0
Total dividends paid and payable 31.20p 26.00p +20.0
Assets
Total assets less current liabilities (£’000) 716,287 796,112 -10.0
Equity shareholders’ funds (£’000) 674,089 721,442 -6.6
Ongoing charges ratio4 0.7% 0.7%
Ongoing charges ratio (including performance fees)5 N/A 1.0% N/A
Dividend yield 2.3% 2.0%
Gearing 4.9% 9.8%

1 Excludes income reinvested.
2 The capital only net asset value (NAV) is calculated without income for the year to 28 February 2019 and 28 February 2018 respectively, net of dividends paid in respect of the relevant financial years. More detail is given in the Glossary. contained within the annual report.
3 The basis of calculation for the fair value of the debt is disclosed in note 13 of the financial statements and in the Glossary contained within the annual report.
4 Ongoing charges ratio calculated as a percentage of average shareholders’ funds and using operating expenses, excluding performance fees, finance costs, transaction costs and taxation, in accordance with AIC guidelines.
5 With effect from 1 March 2018, a performance fee is no longer charged. For the year ended 28 February 2018, a performance fee was charged. Please see note 4 for further details of the change.

 

CHAIRMAN’S STATEMENT

Your Company has a remarkable record. For sixteen consecutive years it has outperformed its benchmark and increased its dividend. Over that period, the NAV has increased nearly twelve-fold whereas the benchmark has increased less than four-fold (all calculations with income reinvested). The compound annual increase in dividends paid over the past ten years has been 20% per annum.

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PERFORMANCE
It has been a challenging year and it is disappointing that the Company’s Net Asset Value per share fell by 6.6%1. However, the Company outperformed its benchmark, the Numis Smaller Companies plus AIM (excluding Investment Companies) Index, which decreased by 8.2%1. During the financial year, your Company’s share price increased by 0.4%1 to 1,330.00p per share.

The year was characterised by an increase in volatility with significant declines in global markets at the start of the year offset by a rebound in April 2018. This was followed by further significant market falls in October and November 2018, driven by geopolitical concerns over the impact of US interest rate rises, uncertainty over trade disputes and increasing fears of a US recession. Higher quality growth stocks were the most severely affected which impacted the portfolio’s relative performance. In the UK, concerns over Brexit and a weaker currency resulted in markets lagging behind other global indices, with UK small and mid-capitalisation companies underperforming their larger peers. The FTSE AIM All-Share Index fell by 12.4%1 compared with the FTSE 250 Index which fell by 2.6%1 and the FTSE 100 Index which fell by 2.2%1.

The relative outperformance of the Company’s NAV over the year was largely attributable to good stock selection. The best individual stock performances came from companies with exposure to the oil price as well as those engaged in financial services, manufacturing and data analytics. The largest detractors from relative performance came mainly from companies in the retail sector which struggled in increasingly tough trading conditions. More details of the contributors to performance can be found in the Investment Manager’s Report.

Since the financial year end the Company’s NAV as at 30 April 2019 has increased by 9.3%1, against an increase in the benchmark of 4.0%1, and the share price has risen by 9.6%1.

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BlackRock Smaller Companies Trust plc

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