BlackRock Throgmorton Trust Plc - Portfolio Update

BLACKROCK THROGMORTON TRUST PLC
(LEI: 5493003B7ETS1JEDPF59)

All information is at 30 November 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	-1.8	2.1	33.9	77.0	145.4
Share price	-0.8	3.3	43.8	79.7	158.2
Benchmark*	-1.6	1.5	21.3	44.2	88.6

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:	534.54p
Net asset value incl. income:	542.68p
Share price	457.50p
Discount to cum income NAV	15.7%
Net yield1:	1.8%
Total Gross assets2:	£396.9m
Net market exposure as a % of net asset value3:	110.6%
Ordinary shares in issue4:	73,130,326
2016 ongoing charges* (excluding performance fees4:	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 have changed.  The annual performance fee will be calculated using performance data on an annualised rolling two year basis (previously, one year) and the maximum annual performance fee payable will effectively be reduced to 0.90% 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 (previously 10%). The maximum annual total fees (comprising the base management fee of 0.35% and a potential  performance fee of 0.90%) 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	34.4
Financials	19.3
Consumer Services	14.4
Consumer Goods	11.4
Basic Materials	7.9
Health Care	5.7
Technology	5.1
Oil & Gas	2.3
Net current liabilities	(0.5)
	-----
Total	100.0
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Market Exposure (Quarterly)

	28.02.17 %	31.05.17 %	31.08.17 %	30.11.17 %
Long	121.4	117.3	115.3	116.9
Short	6.7	6.1	5.8	6.3
Gross exposure	128.1	123.4	121.1	123.2
Net exposure	114.7	111.2	109.5	110.6

   

Ten Largest Investments
Company	% of Total Gross Assets
Dechra Pharmaceuticals	3.0
4imprint Group	2.6
Ibstock	2.3
Hill & Smith	2.2
Big Yellow	2.2
Accesso Technology	2.1
Robert Walters	2.1
CVS Group	2.1
Ascential	2.0
Avon Rubber	2.0

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

During November the Company’s NAV per share fell by 1.8% to 542.68p on a cum income basis whilst our benchmark (the Numis Smaller Companies excluding AIM (excluding Investment Companies) Index) fell by 1.6%; the FTSE 100 Index fell 1.8% (all performance figures are with income reinvested and net of ongoing charges and any applicable performance fees).

Stock selection contributed positively during the month, however the market rotation out of growth stocks and one stock specific event drove underperformance.

The largest stock specific detractor during the month was the UK’s leading veterinary practitioner CVS Group. The shares fell sharply on the last day of the month after the company released a trading statement flagging that like for like sales grew at only 1.5% (versus last year’s growth of over 6%) and that recent sales patterns had been more volatile. The fall in the share price (which was in excess of 20%) appears to be an overreaction to the 3% earnings downgrade for a quality business that we believe has a long runway of growth as they continue to consolidate the veterinary market.

The largest positive contributor during the month was Avon Rubber after the company’s full year results were slightly ahead of expectations, showing both divisions, Protection & Defence and Dairy trading well. Most importantly, the results provided the market with confidence in the outlook for the company, with the order book across both divisions looking strong heading into 2018, while the excellent cash generation provides management further firepower to pursue value enhancing acquisitions. Trifast, which is involved in the manufacture of industrial fastenings and components, reported half year results to September 2017 showing strong organic sales growth resulting in broker upgrades to the full year estimates.

Short positions continued to deliver stock specific success during the month, with one of the top contributors to performance being a short position in an Industrial which fell heavily in response to a significant profit warning relating to issues with new product launches. We remain short as we see further earnings risk to this business.

Activity during November included a new purchase in Smart Metering Systems, which connects, owns, operates and maintains metering systems. We further reduced some of our domestic exposed holdings and added to holdings which generate earnings from overseas.

14 December 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.

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