BlackRock World Mining Trust Annual Results
- BlackRock
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Evy Hambro
Hi, I’m Evy Hambro, and I’m joined by Olivia Markham. And together we co-manage the BlackRock World Mining Investment Trust. In this video, we're going to cover some of the highlights from our 2024 results and talk about our outlook for 2025 and beyond. 2024 was a challenging year for the mining sector, and the trust wasn't immune. With our net asset value declining by 10.6% and the share price finishing down 12.7%.
Evy Hambro
Economic weakness in China, Europe and other parts of the world, but downward pressure on commodity prices and reduced investor demand for mining shares. We saw a brief rally in September 2024 on the news of stimulus measures in China, but these ultimately underwhelmed investors.
Olivia Markham
Whilst the sector finished in negative territory due to the economic headwinds outlined by Evie, and as the market focused on a select few Mega-cap technology stocks, performance of the underlying commodities was generally positive. The key performers during the year, with gold and silver prices, which rose 27% and 22% respectively. Industrial metals were also positive, with the copper price a key exposure within the company, up 8%.
Olivia Markham
When looking at year on year average price levels. However, the iron ore price was particularly challenged, falling 30% on account of its sensitivity to China and its struggling property market.
Evy Hambro
The company's revenue per share generated through 2024 was 23.0 £0.09, once again exceeding analysts estimates due to the diversified sources of income within the portfolio, but this was not enough to offset the overall headwinds within the sector. The decrease was primarily driven by lower dividend payments from a number of key mining companies on lower profitability, and as they chose to invest into growth opportunities.
Evy Hambro
Other sources of revenue for the company were comparable to prior years, helping to soften the fall in income from ordinary dividends. Royalty income was 10% of overall revenue. Option income increased due to favorable conditions from selling volatility, while income from fixed income securities declined, in line with the strategy to focus elsewhere for revenues. As per the board's policy of paying out substantially all income received, the trust paid a full year dividend of £0.23, placing the trust on a yield of 4.5%, using the share price at the time of filming, representing a healthy premium to broader equity markets and the underlying sector.
Olivia Markham
We continue to seek opportunities in unquoted investments, which, as at the end of 2024, amounted to 8% of the portfolio. These consisted of a BHP Brazil Royalty Vale debentures, which are fixed income instruments that work like royalty, and two private companies, Jetty Resources and MCC mining. Since our initial 12 million investment into the BHP Brazil Royalty in 2014, a royalty previously operated by Oz Minerals and Biobank Resources.
Olivia Markham
Before that, we have now received 32 million in royalty payments. And as at the end of 2024, the royalty was valued at 22.2 million sterling. Income generated from options was 10.2 million pounds in 2024, which was higher than prior years. The increase was driven by a range of specific opportunities, such as M&A, short term spikes in volatility and greater breadth and the opportunity, said.
Olivia Markham
Meanwhile, gearing during the year averaged 11.6%.
Evy Hambro
In terms of our outlook from here. We remain confident that supportive demand trends, strong balance sheets, limited supply growth and low valuations are likely to underpin a recovery in share prices. However, for this to play out in the short term, this requires a catalyst to resolve fears around uncertainty in China and global trade tensions. Recent initiatives by the new Trump government could unlock some of these challenges, but it is too early to forecast this in the medium term.
Evy Hambro
Key trends driving global markets, such as the energy transition and artificial intelligence are likely to drive future growth well in excess of some of the near-term issues. In summary, with the fundamentals intact low valuations, and a positive outlook currently ignored by the broader market, it feels as though we are well positioned to capture returns when near-term concerns ease.
Evy Hambro
Thank you for listening.
Evy Hambro
Hi, I’m Evy Hambro, and I’m joined by Olivia Markham. And together we co-manage the BlackRock World Mining Investment Trust. In this video, we're going to cover some of the highlights from our 2024 results and talk about our outlook for 2025 and beyond. 2024 was a challenging year for the mining sector, and the trust wasn't immune. With our net asset value declining by 10.6% and the share price finishing down 12.7%.
Evy Hambro
Economic weakness in China, Europe and other parts of the world, but downward pressure on commodity prices and reduced investor demand for mining shares. We saw a brief rally in September 2024 on the news of stimulus measures in China, but these ultimately underwhelmed investors.
Olivia Markham
Whilst the sector finished in negative territory due to the economic headwinds outlined by Evie, and as the market focused on a select few Mega-cap technology stocks, performance of the underlying commodities was generally positive. The key performers during the year, with gold and silver prices, which rose 27% and 22% respectively. Industrial metals were also positive, with the copper price a key exposure within the company, up 8%.
Olivia Markham
When looking at year on year average price levels. However, the iron ore price was particularly challenged, falling 30% on account of its sensitivity to China and its struggling property market.
Evy Hambro
The company's revenue per share generated through 2024 was 23.0 £0.09, once again exceeding analysts estimates due to the diversified sources of income within the portfolio, but this was not enough to offset the overall headwinds within the sector. The decrease was primarily driven by lower dividend payments from a number of key mining companies on lower profitability, and as they chose to invest into growth opportunities.
Evy Hambro
Other sources of revenue for the company were comparable to prior years, helping to soften the fall in income from ordinary dividends. Royalty income was 10% of overall revenue. Option income increased due to favorable conditions from selling volatility, while income from fixed income securities declined, in line with the strategy to focus elsewhere for revenues. As per the board's policy of paying out substantially all income received, the trust paid a full year dividend of £0.23, placing the trust on a yield of 4.5%, using the share price at the time of filming, representing a healthy premium to broader equity markets and the underlying sector.
Olivia Markham
We continue to seek opportunities in unquoted investments, which, as at the end of 2024, amounted to 8% of the portfolio. These consisted of a BHP Brazil Royalty Vale debentures, which are fixed income instruments that work like royalty, and two private companies, Jetty Resources and MCC mining. Since our initial 12 million investment into the BHP Brazil Royalty in 2014, a royalty previously operated by Oz Minerals and Biobank Resources.
Olivia Markham
Before that, we have now received 32 million in royalty payments. And as at the end of 2024, the royalty was valued at 22.2 million sterling. Income generated from options was 10.2 million pounds in 2024, which was higher than prior years. The increase was driven by a range of specific opportunities, such as M&A, short term spikes in volatility and greater breadth and the opportunity, said.
Olivia Markham
Meanwhile, gearing during the year averaged 11.6%.
Evy Hambro
In terms of our outlook from here. We remain confident that supportive demand trends, strong balance sheets, limited supply growth and low valuations are likely to underpin a recovery in share prices. However, for this to play out in the short term, this requires a catalyst to resolve fears around uncertainty in China and global trade tensions. Recent initiatives by the new Trump government could unlock some of these challenges, but it is too early to forecast this in the medium term.
Evy Hambro
Key trends driving global markets, such as the energy transition and artificial intelligence are likely to drive future growth well in excess of some of the near-term issues. In summary, with the fundamentals intact low valuations, and a positive outlook currently ignored by the broader market, it feels as though we are well positioned to capture returns when near-term concerns ease.
Evy Hambro
Thank you for listening.
Trust-specific risks
BlackRock World Mining Trust plc
Counterparty Risk: The insolvency of any institutions providing services such as safekeeping of assets or acting as counterparty to derivatives or other instruments, may expose the Fund to financial loss.
Currency Risk: The Fund invests in other currencies. Changes in exchange rates will therefore affect the value of the investment.
Emerging Markets: Emerging markets are generally more sensitive to economic and political conditions than developed markets. Other factors include greater 'Liquidity Risk', restrictions on investment or transfer of assets and failed/delayed delivery of securities or payments to the Fund.
Gearing Risk: Investment strategies, such as borrowing, used by the Trust can result in even larger losses suffered when the value of the underlying investments fall.
Gold / Mining Funds: Mining shares typically experience above average volatility when compared to other investments. Trends which occur within the general equity market may not be mirrored within mining securities.
