Portfolio Update

BLACKROCK THROGMORTON TRUST PLC (LEI: 5493003B7ETS1JEDPF59)
 

All information is at 31 October 2017 and unaudited.
Performance at month end is calculated on a cum income basis

	One Month	Three months	One year	Three years	Five years
Net asset value	4.3	6.5	40.6	84.9	150.1
Share price	4.5	5.5	48.0	79.2	160.2
Benchmark*	2.1	3.9	24.4	47.6	92.0

Sources: BlackRock and Datastream

*With effect from 1 December 2013 the Numis Smaller Companies excluding AIM (excluding Investment Companies) Index replaced the Numis Smaller Companies plus AIM (excluding Investment Companies) Index as the Company’s benchmark. The five year period indices have been blended to reflect this.

At month end
Net asset value capital only:	545.06p
Net asset value incl. income:	552.71p
Share price	461.00p
Discount to cum income NAV	16.6%
Net yield1:	1.8%
Total Gross assets2:	£404.2m
Net market exposure as a % of net asset value3:	111.4%
Ordinary shares in issue4:	73,130,326
2016 ongoing charges* (excluding performance fees5,6:	1.1%
2016 ongoing charges* ratio (including performance fees)5,6,7:	1.3%

*Ongoing Charges: The recently announced management fee rate reductions, as detailed in the notes below, will impact management fees in 2017 and onwards.   As a result, the 2016 Ongoing Charge figures above should not be used as a guide to future costs.  The impact of the new fee arrangements, assuming the same level of performance from the manager and assuming all other charges remain the same, would be to reduce the level of Ongoing Charges borne by the trust.

1. Calculated using 2017 interim dividend declared on 24 July 2017 and 2016 final dividend declared on 6 February 2017.

2. Includes current year revenue and excludes gross exposure through contracts for difference.

3. Long positions less short positions as a percentage of net asset value.

4. Excluding 7,400,000 shares held in treasury.

5. Calculated as a percentage of average net assets and using expenses, excluding performance fees and interest costs for the year ended 30 November 2016.

6. With effect from 1 August 2017 the base management fee was reduced from 0.70% to 0.35% of gross assets per annum.

7. Effective 1st December 2017 the annual performance fee arrangements for the Company will change.  The annual performance fee will be calculated using performance data on an annualised rolling two year basis (previously, one year) and the cap on annual performance fees will be reduced to 0.9% of two year rolling average month end gross assets (from 1% of average annual gross assets over one year). Additionally, the Company will accrue this fee at a rate of 15% of outperformance (from 10%). The maximum annual total fee (comprising the base management fee and the performance fee) will therefore fall to 1.25% of average month end gross assets on a two year rolling basis (from 1.70% of average annual gross assets).

Sector Weightings	% of Total Assets
Industrials	34.8
Financials	18.6
Consumer Services	16.8
Consumer Goods	11.4
Basic Materials	7.6
Health Care	5.7
Technology	4.7
Oil & Gas	2.6
Net current liabilities	(2.2)
	-----
Total	100.0
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Market Exposure (Quarterly)

	30.11.16	28.02.17	31.05.17	31.08.17
Long	116.9	121.4	117.3	115.3
Short	8.5	6.7	6.1	5.8
Gross exposure	125.4	128.1	123.4	121.1
Net exposure	108.4	114.7	111.2	109.5

Ten Largest Investments
Company	% of Total Gross Assets
CVS Group	3.2
Dechra Pharmaceuticals	2.8
4imprint Group	2.7
Ibstock	2.3
Hill & Smith	2.2
Accesso Technology	2.2
Robert Walters	2.1
Melrose Industrials	2.1
Johnson Service Group	2.0
Big Yellow	2.0

Commenting on the markets, Mike Prentis and Dan Whitestone, representing the Investment Manager noted:

During October the Company’s NAV per share rose by 4.3% to 552.71p on a cum income basis whilst our benchmark (the Numis Smaller Companies excluding AIM (excluding Investment Companies) Index) rose by 2.1%; the FTSE 100 Index returned 1.6% (all performance figures are with income reinvested and net of ongoing charges and any applicable performance fees).

Stock selection was the primary driver of outperformance during the month while sector allocation detracted modestly.

The largest positive contributor to performance during the month was our holding in wound closure and care product developer Advanced Medical Solutions (AMS). The shares rallied after the company announced they had entered into a licensing agreement with Organogenesis Inc for its PHMB wound dressing. Under the agreement Organogenesis will have exclusive licence in the US to the patent, and in exchange AMS will receive $2.5m upfront and annual royalties until the patent expires in 2026. Shares in ticketing and virtual queuing solutions provider Accesso continued to rise following the strong interim results announced in September. The attraction market remains relatively early in the move towards electronic and mobile commerce and Accesso’s market leading technology is becoming increasingly central to its customers' propositions, leveraging software and data to improve guest experience while driving operator profitability. Keywords Studios, the leading outsourced partner to the video game industry, performed well after announcing an earnings accretive acquisition during the month.

Whilst short positions were a modest detractor in October, with a number of our shorts rising on the back of the market rise, we continued to deliver stock specific successes in the short book, notably a profit warning from an LED lighting company suffering from outsourcing challenges.

Next Fifteen Communications detracted during the month. The company reported good results showing continued growth in its first half (6 months end 31 July 2017) and a solid start to the second half, however the shares came under pressure as poor newsflow from peers in the sector was unhelpful for investor sentiment, despite very little direct read across to Next Fifteen.

Activity during October included new purchases in XP Power, a leading provider of power solutions, and Equiniti, which provides complex administration and payment services to a range of organisations. We further reduced some of our domestic exposed holdings and added to holdings which generate earnings from overseas.

24 November 2017

ENDS

Latest information is available by typing www.blackrock.co.uk/thrg 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.