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Share Name Share Symbol Market Type Share ISIN Share Description
Blackrock World Mining Trust Plc LSE:BRWM London Ordinary Share GB0005774855 ORD 5P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -6.00 -0.96% 618.00 618.00 620.00 625.00 618.00 625.00 212,422 12:00:21
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments 46.5 43.9 22.5 27.5 1,106

BlackRock World Mng Final Results

04/03/2021 8:04pm

UK Regulatory (RNS & others)


 
TIDMBRWM 
 
BlackRock World Mining Trust plc LEI - LNFFPBEUZJBOSR6PW155 
 
 
    Annual Results Announcement (Article 4 Transparency Directive, DTR 4.1) 
                      for the year ended 31 December 2020 
 
Performance record 
 
                                                               31 December   31 December 
                                                                      2020          2019 
 
Net assets (£'000)¹                                                930,825       757,110 
 
Net asset value per ordinary share (NAV) (pence)                    536.34        433.17 
 
Ordinary share price (mid-market) (pence)                           522.00        383.00 
 
Reference Index4 - net total return                               4,566.93      3,786.17 
 
Discount to net asset value2,3                                        2.7%         11.6% 
 
Performance 
 
Net asset value per share (with dividends reinvested)3              +31.8%        +17.2% 
 
Ordinary share price (with dividends reinvested)3                   +46.7%        +19.4% 
 
Reference Index4                                                    +20.6%        +15.3% 
 
                                                                  ========      ======== 
 
1    The change in net assets reflects market movements, dividends paid and the 
buyback of ordinary shares into treasury during the year. 
 
2     This is the difference between the share price and NAV per share with 
debt at par. Further details of the calculation of the discount are given in 
the Glossary in the Annual Report and Financial Statements. 
 
3    Alternative Performance Measures, see Glossary in the Annual Report and 
Financial Statements. Performance figures are calculated in sterling terms with 
dividends reinvested. 
 
4    MSCI ACWI Metals and Mining 30% Buffer 10/40 Index (net total return). 
 
                                                   Year ended    Year ended 
                                                  31 December   31 December        Change 
                                                         2020          2019             % 
 
Revenue 
 
Net revenue profit after taxation (£'000)              35,451        39,561         -10.4 
 
Revenue return per ordinary share (pence)               20.40         22.46          -9.2 
 
Dividend per ordinary share (pence) 
 
- 1st interim                                            4.00          4.00             - 
 
- 2nd interim                                            4.00          4.00             - 
 
- 3rd interim                                            4.00          4.00             - 
 
- Final                                                  8.30         10.00         -17.0 
 
Total dividends paid and payable                        20.30         22.00          -7.7 
 
                                                     ========      ========      ======== 
 
Chairman's Statement 
 
HIGHLIGHTS 
 
  * NAV per share +31.8%1 (with dividends reinvested) 
 
  * Share price +46.7%1 (with dividends reinvested) 
 
  * Dividend -7.7% 
 
I am pleased to present the Annual Financial Report for the year ended 31 
December 2020. 
 
PERFORMANCE 
It is very pleasing to report that over the twelve months to 31 December 2020, 
the Company's net asset value per share (NAV) returned +31.8%1 and the share 
price +46.7%1. In comparison, over the same period the Company's Reference 
Index, the MSCI ACWI Metals & Mining 30% Buffer 10/40 Index (net total return), 
returned +20.6%, our previous reference index, the EMIX Global Mining Index, 
returned +21.8%, the FTSE All-Share Index returned -9.8% and the UK Consumer 
Price Index (CPI) increased by 0.6%. 
 
This is an excellent achievement given that our Portfolio Managers have had to 
navigate the exceptional global economic and social upheaval following the 
outbreak of COVID-19 and the ensuing pandemic. A detailed commentary on the 
portfolio's performance, its positioning, ESG factors and their importance in 
portfolio construction together with the investment outlook for the forthcoming 
year can be found in the Investment Manager's Report. Since the year end and up 
until the close of business on 1 March 2021, the Company's NAV has increased by 
8.5%. 
 
1    Alternative Performance Measures. All percentages calculated in sterling 
terms with dividends reinvested. Further details of the calculation of 
performance with dividends reinvested are given in the Glossary in the Annual 
Report and Financial Statements. 
 
OVERVIEW 
The year ended 31 December 2020 saw enormous disruption brought on by the 
global pandemic, which led to the partial shutdown of many economies across the 
world for much of the period. The nature and scale of the disruption was 
unparalleled but the significant fiscal and monetary response was also 
unprecedented. This response played an important part in markets rebounding 
from their March lows. It has also ensured that economies would not suffer 
large scale or permanent demand destruction outside a few specific industries. 
 
Throughout the COVID-19 outbreak, the Board has had to adjust its mode of 
operation to minimise the risk the virus has posed to the health and wellbeing 
of those working on the management and administration of the Company. The Board 
has continued to meet regularly and since April all scheduled meetings have 
been held by video conference. The Board has also worked closely with its 
Manager to ensure that the Company's operations have not been adversely 
impacted, that BlackRock and key service providers have established business 
continuity plans and a good level of service has continued to be maintained. 
Unfortunately, however, the arrangements for last year's Annual General Meeting 
were disrupted as a result of COVID-19 related restrictions and, with the 
current lockdowns in place, this may well be the case again for the forthcoming 
Annual General Meeting. The proposed Annual General Meeting arrangements are 
set out below. 
 
REVENUE RETURN AND DIVIDS 
The Company's revenue return per share for the year amounted to 20.40p compared 
with 22.46p for the previous year, representing a decrease of 9.2%. The main 
difference was a fall in special dividends received from our investee 
companies, although the Company benefited from the positive outcome on a tax 
ruling which was explained in my Interim Statement to shareholders. In August 
2020, HM Revenue & Customs accepted that the Company was entitled to claim 
double tax relief in relation to underlying tax suffered on dividends received 
from non-UK companies in a number of past accounting periods and subsequently 
the Company received a corporation tax refund including interest of £2,980,000. 
 
During the year, three quarterly interim dividends each of 4.00p per share were 
paid on 26 June 2020, 25 September 2020 and 18 December 2020. The Board is 
proposing a final dividend payment of 8.30p per share for the year ended 31 
December 2020. This, together with the quarterly interim dividends, makes a 
total of 20.30p per share (2019: 22.00p per share) representing a decrease of 
7.7% on payments made in the previous financial year and, as in past years, all 
dividends are fully covered by income. In accordance with the Board's stated 
policy, the total dividends represent substantially all of the year's available 
income. 
 
Subject to approval at the Annual General Meeting, the final dividend will be 
paid on 6 May 2021 to shareholders on the Company's register on 19 March 2021, 
the ex-dividend date being 18 March 2021. It remains the Board's intention to 
seek to distribute substantially all of the Company's available income along 
similar lines in the future. 
 
DISCOUNT CONTROL 
The Board recognises the importance to investors that the market price of the 
Company's shares should not trade at a significant discount to the underlying 
NAV. Accordingly, the Board monitors the Company's discount to NAV and will 
look to buy back shares in normal market conditions if it is deemed to be in 
shareholders' interests. During the year, a total of 1,233,913 shares were 
purchased at an average price of 373.53p per share for a total gross 
consideration of £4,609,000. All shares have been placed in treasury. 
 
I am pleased to report that the Company's discount narrowed considerably during 
December and, at the year end, stood at 2.7%. Accordingly, no further shares 
have been purchased since the year end, up to and including the date of this 
report. Subsequent to the year end, the Company's shares have traded at a 
premium to the underlying NAV and 3,720,000 shares have been reissued from 
treasury at an average price of 588.59p per share and an average premium to the 
estimated NAV of 1.2% for a total gross consideration of £21,896,000. As at 1 
March 2021 the premium stood at 1.4%. 
 
Resolutions to renew the authorities to issue and buy back shares will be put 
to shareholders at the forthcoming Annual General Meeting. 
 
ESG AND SOCIALLY RESPONSIBLE INVESTMENT 
As a Board we are conscious that Environmental, Social and Governance (ESG) 
criteria are increasingly at the forefront of investors' minds. Given the 
nature of mining as an industry, your Board has a strong focus on ESG and 
believes that it is important that our Company's investee companies operate in 
a responsible and sustainable way having regard to the interests of all their 
stakeholders, whether these are shareholders, employees, customers, regulators 
or suppliers. The Board is also aware that ESG must be considered when 
investing in the Natural Resources sector and, as a general approach, the 
Company will not invest in companies which have high ESG risks and no plans to 
address existing deficiencies. Our Manager, BlackRock, has an Investment 
Stewardship team which is responsible for protecting and enhancing the value of 
your Company's investments through engagement with companies to encourage 
business and management practices that support sustainable financial 
performance over the long term. 
 
Climate change is one of the most significant global risks and companies, 
governments and investors reacted positively during 2020, with firm policy 
commitments to achieve net zero emissions across many of the major world 
economies. We expect momentum to build and accelerate in 2021, with profound 
implications for the global economy. BlackRock believes that its clients are 
best served by being at the forefront of the transition to 'net zero' and in 
January 2021 announced key actions to help investors prepare for a net zero 
world, an approach fully supported by your Board. Further information can be 
found in the Strategic Report below. 
 
ARTICLES OF ASSOCIATION 
In light of the circumstances created by the outbreak of the COVID-19 pandemic, 
the Board is proposing to make amendments to the Articles of Association (the 
Articles) to enable the Company to hold general meetings (wholly or partially) 
by electronic means and to give additional powers in respect of postponing or 
adjourning meetings in appropriate circumstances. The amendments are being 
sought in response to challenges posed by government restrictions on social 
interactions as a result of the COVID-19 pandemic, which have made it 
impossible for shareholders to attend physical general meetings. 
 
The Board's objective in introducing these changes is to make it easier for 
shareholders to participate in general meetings through introducing electronic 
access for those unable to travel and also to ensure appropriate security 
measures are in place for the protection and wellbeing of shareholders. I 
should make it clear that these powers would only be used if the specific 
circumstances or applicable law and regulation required it and the Board's 
intention is to always hold a physical Annual General Meeting provided it is 
both safe and practical to do so. The safety of shareholders and the Company's 
third-party service providers must of course remain paramount. 
 
The principal changes proposed to be introduced in the Articles, and their 
effect, are set out in more detail in the Directors' Report in the Annual 
Report and Financial Statements. 
 
ANNUAL GENERAL MEETING 
The Company's Annual General Meeting will be held at the offices of BlackRock 
at 12 Throgmorton Avenue, London EC2N 2DL on Thursday, 29 April 2021 at 11.30 
a.m. Details of the business of the meeting are set out in the Notice of 
Meeting in the Annual Report and Financial Statements. 
 
At the time of writing, guidance has been issued by the UK, Scottish and Welsh 
governments, regarding measures to reduce the transmission of COVID-19 in the 
UK. These measures are, and will continue to be, subject to periodic amendment 
and currently impose rules on social distancing and limitations on, among other 
things, public gatherings. 
 
Accordingly, in view of this guidance, the Board is changing the format of the 
Annual General Meeting again this year to follow the minimum legal requirements 
for an Annual General Meeting. Only the formal business set out in the Notice 
will be considered. In line with this guidance, shareholders are strongly 
discouraged from attending the meeting and indeed entry will be refused if 
current UK Government guidance is unchanged. Shareholders are encouraged to 
check the Manager's website at blackrock.com/uk/brwm for updates to the Annual 
General Meeting arrangements, as changes may well be required to comply with 
new guidance and/or government measures. 
 
The Board is aware that many shareholders look forward to hearing the views of 
the Portfolio Managers and may have questions for them and the Board. 
Accordingly, the Annual General Meeting will be followed by a webinar to 
include an introduction from the Chairman and a presentation by the Portfolio 
Managers, followed by a question and answer session. Shareholders are invited 
to join the webinar and address any questions they have either by submitting 
questions during the webinar or in advance by writing to the Company Secretary 
at cosec@blackrock.com. Details of the exact timing and how to register for 
this event will be uploaded to the Manager's website at blackrock.com/uk/brwm. 
 
Notwithstanding these difficult circumstances, the Board looks forward to 
offering opportunities for shareholders to meet the Portfolio Managers in the 
future once it becomes safe for all. 
 
OUTLOOK 
World equities appear to be on a firmer footing and there is increased optimism 
now that the uncertainty of the US election has been resolved and the 
distribution of COVID-19 vaccines provides hope for some return to normality. 
However, at the time of writing, the full extent of the economic and social 
impact of the pandemic and the likely duration of the current national 
lockdowns remain unclear. There are still challenges in the very near term with 
a resurgence of cases and the emergence of new mutations of the virus. Ongoing 
policy support from central banks, alongside fiscal stimulus, is therefore 
vital to limit any permanent economic scarring. Widely administered, effective 
vaccinations should, however, provide more clarity for governments, businesses 
and households about the timescale to revive the post COVID-19 economy. 
 
Mined commodity prices performed well during 2020 aided by China's swift post 
pandemic recovery and significant government investment in infrastructure. In 
other regions, risks of pandemic-related supply disruptions and slower than 
forecast economic recovery may linger into next year but their impact on the 
sector should be relatively moderate and the dominance of China in determining 
overall demand growth for industrial metals will remain. The restrained 
approach to capital spending in the sector in recent years should also cap the 
rapid emergence of new supply, underpinning the current attractive margins for 
some time. Your Portfolio Managers therefore believe that the commodity demand 
and pricing outlook is strong, and they will remain focused on high quality 
companies with, alongside engagement on ESG matters, strong balance sheets and 
lower costs, an approach fully supported by the Board. 
 
DAVID CHEYNE 
Chairman 
4 March 2021 
 
Investment manager's report 
 
PORTFOLIO PERFORMANCE 
We are delighted to report that 2020 delivered another strong year for our 
Company despite the headwinds caused by the COVID-19 pandemic. Normally when 
global Gross Domestic Product (GDP) collapses, unemployment rates surge and 
equity market volatility explodes, the mining sector is one of the worst 
performing places to be invested but this time things were very different. The 
years of balance sheet repair, rigid capital discipline and sensible growth 
plans left the companies well placed to navigate the challenges brought about 
by the global pandemic. 
 
The table below highlights the Company's results versus the broader mix of 
comparators that the Board uses to assess performance. Not only has the share 
price return been positive for four out of the last five years, but the total 
share price return moved to a new all-time high on 31 December 2020. In 
addition, the share price has benefited from a narrowing of the discount 
especially during the last quarter of 2020. Revenues for the Company have been 
robust as strong balance sheets have allowed mining companies to continue 
returning surplus cash to shareholders. However, the decrease in special 
dividends has meant that this year the Company's total dividend payment to 
shareholders could not match last year's record payment level. 
 
                                        2020 Price     2020 Total    3 Year Total    5 Year Total 
                                         Change %       Return %        Return %        Return % 
 
Share price                                  36.3           46.7            56.3           289.5 
 
NAV per share                                23.8           31.8            36.7           227.1 
 
MSCI ACWI Metals & Mining 30%                17.5           20.6            22.8           186.2 
Buffer 10/40 Index 
 
FTSE 100 Index                              -14.3          -11.5            -5.3            26.2 
 
FTSE All-Share Index                        -12.5           -9.8            -2.7            28.5 
 
UK CPI                                        0.6            0.6             4.0             8.8 
 
                                         ========       ========        ========        ======== 
 
All performance figures in sterling with dividends reinvested. 
 
Source: BlackRock. 
 
Looking back on 2020 it is hard to know where to start given all the events 
that influenced returns. Obviously, the key factor was the outbreak of COVID-19 
leading to a global pandemic being declared. The huge impact of the virus on 
people's physical health during the year varied across the globe. Initially the 
virus outbreak affected China but by March it had spread to Europe leading to 
mass lockdowns across the continent. After rapidly moving through Europe, the 
virus impacted Africa and South America and reached North America in early 
summer, again leading to lockdowns to prevent it escalating to a level that 
would put the health service at risk. By late summer data suggested that the 
measures put into place to bring the virus under control had delivered the 
hoped-for results and restrictions were gradually lifted across the world, 
especially as research evidence suggested an effective vaccine was imminent. 
However, this positive momentum was short lived, as by early autumn the virus 
was spreading rapidly once again and new mutated strains, feared to be more 
contagious than the original ones, were causing record high rates of infections 
in Europe and the United States (US). Governments once again acted by bringing 
lockdowns back into play just as the year end festive season got under way. At 
the time of writing, it is clear that these new measures are likely to be in 
place for several months until confidence that the vaccine roll-out has had the 
desired effect in controlling the virus. 
 
Outside of the health risks, the virus obviously had a huge impact on economic 
activity. With large parts of the world in complete lockdown, many industries 
have been severely impacted including travel, tourism, hotels, leisure and 
entertainment, whilst others have thrived, the digital economy being the major 
beneficiary. Anything that could be bought online and delivered to your home 
saw a massive recovery from the lows in March and many companies have enjoyed 
staggering share price rallies leaving them at new all-time highs by the year 
end. Governments have sought to protect as much of the economy and workforce as 
possible by putting in place financial support packages to protect jobs and 
support businesses during the lockdown periods. These measures were meant to be 
short lived, but as the virus has continued to thrive, the economic life 
support that governments provided has been extended for far longer than 
originally expected. This has left central bank balance sheets with record 
levels of debt following this sharp increase in government spending and equally 
sharp drop in interest rates with many falling to zero or below. 
 
Whilst the pandemic has been the biggest factor during the year, other issues 
that had been expected to dominate events seem to have passed with only limited 
impact. In the US, President Trump lost his battle for a second term and now it 
seems that the Biden administration is likely to deliver sweeping changes on 
the environment, large increases to government spending and probably a less 
aggressive tone on Chinese trade, whilst still being tough on human rights and 
technology. Key for the resources sector will be the policy on spending and the 
environment. The combination of these two areas seems likely to result in a 
significant increase in investment to support the transition to a lower carbon 
economy, which is likely to be associated with an increase in commodity demand, 
especially for key metals such as copper. The focus on climate will likely see 
further pressure on fossil fuels and, over time, impact demand for them. 
 
Outside of the US, tensions related to Brexit have been high in Europe and 
between China and Australia on trade. As the year drew to a close, Brexit terms 
were finally agreed between the UK and Europe removing a key policy overhang 
for both economies. The likely outcome is for both economic areas to increase 
spending to support a recovery from the pandemic and limit the economic fallout 
from the UK leaving the European Union. In Australia it seems that China is 
doing everything it can to impact trade between the two countries with bans put 
in place on a whole range of goods from wine to coal. Should the situation 
continue to worsen, one key risk for the portfolio is Chinese demand for iron 
ore given its dominance in the seaborne market. Whilst iron ore is seen as 
unlikely to be brought into the fight, it is something we watch very closely 
given the large exposure within the portfolio. 
 
Positives over the last twelve months are that miners have generally benefited 
from a lack of cost inflation driven by weaker currencies in the first half of 
the year and the huge fall in the price of oil. In addition, the lack of 
growth-related spending means that labour costs have seen little upwards 
pressure from rising demand, as have prices for equipment. Looking into 2021, 
we expect these trends to reverse given weakness in the US dollar, the recovery 
in oil prices and a catch up in mining company capital expenditure, whilst 
labour cost inflation should be manageable given the high rates of unemployment 
across the world. 
 
After a year that has been disrupted in such a major way, it is very 
encouraging to see the long-term return and dividend trend for the Company 
remaining resolute. Many sectors and companies have been unable to pay 
dividends to shareholders during 2020 and the outlook for recovery in these 
areas remains uncertain to say the least. It is our hope that investors 
recognise the value of stable income from resource companies in a world where 
yields are now so low. Perhaps we will see a rotation of capital into mining 
companies during 2021? 
 
Since the Initial Public Offering of the Company in 1993 at 100p per share, the 
shares have delivered a NAV total return of 959.9%. On an annualised basis, the 
Company's NAV has returned 9.1% since launch compared to 6.2% and 6.7% for the 
FTSE 100 Index and FTSE All-Share Index respectively. 
 
MINING SECTOR OVERVIEW 
As discussed earlier, the influence of the pandemic has been significant in 
driving company performance during the year given the scale of government 
enforced lockdowns and the corresponding impact they had on economic activity. 
Companies operating in the most affected sectors such as travel, leisure, 
fitness studios, tourism, high street retail and entertainment saw revenues 
reduce radically and share prices collapse. On the other side of the equation, 
beneficiaries saw trends in place prior to the pandemic accelerate in their 
favour. Digital retail revenues exploded, home media entertainment soared, 
online grocery deliveries grew market share and at home, fitness services 
displaced gyms. These swings in economic fortune were reflected in the stock 
market with a massive divergence in performance by sector. We are pleased to 
say that despite all of the volatility, for the mining sector the outcome over 
the twelve month period was not only better than feared but actually extremely 
positive. 
 
Mining companies were well-positioned to see out the immediate volatility due 
to the robustness of their businesses. Strong revenues, rock solid balance 
sheets and long duration debt maturities softened the blow from lockdowns. In 
addition, immediate closure of capacity in response to virus outbreaks meant 
that inventories did not build into a supply overhang so that when demand 
restarted prices were able to react positively to the recovering activity. 
Finally, with limited amounts of new supply coming onstream, this has left the 
market looking 'short' compared to the likely ongoing demand recovery during 
2021. The chart on page 11 of the Annual Report and Financial Statements 
highlights the sensitivity of 'basic resources' to world GDP and no sector is 
better placed to benefit than the miners. 
 
Despite all of the positives, mining companies in the portfolio were rightly 
cautious during the initial virus outbreak and, given the timing, this resulted 
in lower than expected dividend payments to shareholders during the year. This 
was most acutely reflected in the low level of special dividends paid by the 
diversified majors whose balance sheets now hold significant levels of excess 
cash. Shareholders are expecting 2021 to be a year of significant distributions 
of excess cash, as most companies now have gearing well below the bottom end of 
guidance levels. For the Company, special dividends accounted for 0.30p per 
share in 2020 versus 3.80p in 2019, but looking forward this area could 
potentially be a very supportive factor for income in 2021. 
 
During the year the Company maintained large holdings in key producers of iron 
ore given the ongoing supply issues and resultant better than expected prices. 
Our holdings in key beneficiaries such as Vale, Rio Tinto, BHP and Fortescue 
Metals Group, together with the iron royalty exposures in Vale Debentures and 
Labrador Iron Ore, all helped to increase the Company's NAV during the year. 
Exposure to gold producers in the first half delivered excellent capital 
growth, as gold prices moved to new record levels on the back of the expansion 
of central bank balance sheets and collapse in interest rates. Gold shares 
enjoyed huge share price rallies, as the absence of cost inflation allowed them 
to capture the higher prices in margins. Also, in precious metals, the platinum 
group metals (PGM) sector enjoyed equally spectacular returns, with the PGM 
basket rising to new all-time highs, initially driven by palladium and then 
taken higher by rhodium during the second half of the year. 
 
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) ISSUES 
The focus on ESG continues to intensify with society increasingly aware of the 
climate risks facing civilisation. Sustainability is at the forefront of 
decision making for governments and regulators, climate risk is being embedded 
into corporate strategy, society is demanding change and there is a growing 
recognition from the financial community that ESG is a key driver of long-term 
growth. 
 
We are also challenging the executives of the portfolio companies in which we 
invest to set out how their current business plans are compatible with 
achieving a net zero carbon emissions economy by 2050. We are also supporting 
the adoption of the Task Force on Climate-related Financial Disclosures (TCFD) 
and the Sustainability Accounting Standards Board (SASB) disclosures to help 
bring greater focus on climate risk and broader sustainability issues. 
 
The commitment to sustainability was put to test in 2020 with COVID-19 
providing an opportunity for targets to be delayed. Encouragingly, we have seen 
numerous companies reconfirm and increase commitments around carbon emissions, 
using more sustainable packaging and increasing recycling rates highlighting 
the importance placed on this theme. Governments have centred stimulus packages 
around sustainability with a focus on renewable energy, electric vehicles and 
sustainable building materials, with investors rewarding companies that are 
embracing and benefiting from sustainability themes in the market. 
 
During the year a number of governments committed to carbon neutrality, most 
notably China, which is targeting to become carbon neutral by 2060. The scale 
of investment required to meet this goal is enormous and will be a key driver 
of China's GDP growth and commodity demand for decades to come. We view copper 
and other sustainable materials such as nickel, lithium and cobalt as the clear 
winners from this transition. Substantial investment will be required into 
these commodities with the mining sector a clear beneficiary of the energy 
transition. On the flip side, thermal coal faces increasing regulatory and 
societal pressure with demand expected to decline as cleaner and cheaper 
sources of renewable power become available. The Company is well-positioned to 
benefit from these trends and we expect to build exposure to metals that will 
benefit from this transition in years ahead. 
 
Within the portfolio, a number of the larger companies provided clarity on 
their long-term carbon emission targets. Companies such as Anglo American and 
BHP have committed to reduce their scope 1 & 2 emissions by 30% by 2030 and are 
looking to achieve carbon neutrality for their own operations by 2040 and 2050 
respectively. These commitments will be a key driver of investment going 
forward with the sector focused on replacing diesel with renewable power 
sources, investing in technology to reduce their own and their customers 
emissions and exiting businesses with a high carbon intensity. As at the end of 
the year, the Company has no exposure to pure-play thermal coal companies. 
 
ESG is a broad and rapidly evolving area and is of critical importance to the 
mining sector. As investment managers we spend a considerable amount of time 
understanding the ESG risks and opportunities facing companies and industries 
in the portfolio. As an extractive industry, the mining sector naturally faces 
a number of ESG challenges given its dependence on water, its carbon emissions 
and the geographical location of assets. However, we feel the sector 
under-emphasises the many positive ESG benefits it provides to society through 
the provision of critical infrastructure, taxes and employment to local 
communities, providing materials essential to human progress, enabling the 
carbon transition through the production of sustainable metals and continuing 
to improve health and safety standards across the industry. 
 
While the majority of the Company's holdings have advanced their ESG 
credentials during the year, particularly around climate change and COVID-19 
support provided to their host communities and employees, there have sadly also 
been some ESG controversies. The most notable was the destruction of historical 
caves at Juukan Gorge on the land of the Puutu Kunti Kurrama and Pinikura 
people (PKKP) in the Pilbara region of Western Australia. This tragic incident 
has cast a dim light over Rio Tinto's ESG practices which ultimately saw the 
removal of the CEO and a number of other key executives. Following the 
Australian parliamentary inquiry into Juukan Gorge and a review of the Native 
Title Act, we expect increased scrutiny over land access and regulatory 
approval for future projects which adds uncertainty to Australian iron ore 
supply longer term. 
 
Norilsk Nickel has been under significant scrutiny following an oil spill which 
saw circa 21,000t of diesel spilled into the Arctic region. Norilsk has been 
ordered to pay US$1.9 billion in fines and damages. 
 
Vale has been under ESG scrutiny following the tailings dam incidents at 
Samarco in 2015 and Brumadinho in 2019. Both events have been extremely tragic 
and resulted in a heavy focus on tailings dam management across the sector. 
Vale is committed to restoring Brumadinho and continues to make good progress 
rebuilding its pact with society. Vale has implemented a number of changes to 
its tailings dam management process following an independent review to ensure 
it is aligned with the highest level of international practices. As confidence 
increases in the improved ESG credentials of the company, we would expect the 
shares to re-rate higher to reflect the reduced ESG risk. 
 
ESG is an integral element of the investment process used to build and manage 
the portfolio. As a general approach the Company will not invest in companies 
which have high ESG risks and which have no plans to address existing 
deficiencies. 
 
We are also challenging the executives of the portfolio companies in which we 
invest to set out how their current business plans are compatible with 
achieving a net zero carbon emissions economy by 2050. We are also supporting 
the adoption of the Task Force on Climate-related Financial Disclosures (TCFD) 
and the Sustainability Accounting Standards Board (SASB) disclosures to help 
bring greater focus on climate risk and broader sustainability issues. 
 
There will be cases where a serious event has occurred and in that case we will 
assess whether the company is taking appropriate action to resolve matters 
before deciding what to do. Depending on our assessment of the reaction of the 
Board and management to the event, we will take appropriate measures, which 
may include the full disposal of shares. 
 
In addition there will be companies which have derated on the back of an ESG 
event or generally poor ESG practices and there may be opportunities to invest 
at a discounted price. However we will only invest in these value-based 
opportunities if we are satisfied that there is real evidence that the 
company's culture has changed and that better operating practices have been put 
in place. In these cases, we will actively engage with management and closely 
monitor their remedial programmes. 
 
Should a company achieve such a change, the shares can go from trading at an 
ESG discount to more normal multiples or even an ESG premium which will be to 
the benefit of the Company and all stakeholders. 
 
SHAREHOLDER RETURNS 
Despite 2020 being a slightly lower year for income compared to the record of 
2019, compared with other sectors it was an outstanding result. Only a handful 
of companies either cancelled dividend payments or deferred them until later in 
the year which is remarkable given the scale of economic impact caused by 
global lockdowns. The principal difference between the two years was the lower 
level of special dividends in 2020 which was mostly in response to cautiousness 
rather than an inability to pay. What was most pleasing was the adherence to 
policy on shareholder returns, as normally companies would have been forced 
into change during recessions. Dividends generally remained robust in absolute 
terms as shown in the chart on page 14 of the Annual Report and Financial 
Statements. Within the data the growth seen from gold companies has been 
spectacular. 
 
A number of gold producers announced 100% increases in dividends, admittedly 
from low levels, and a handful did this not once but twice during the year. 
Newmont Corporation enhanced its returns policy by committing to a new gold 
price linked dividend payment policy which at current prices should lead to 
further increases in payments. In general, the year was far better than feared 
and the outlook for 2021 looks particularly promising. 
 
GROWTH AND RESOURCE REPLENISHMENT 
Just as in prior years this theme is the hardest to capture, especially when it 
comes to production growth, as companies have remained disciplined in 
allocating capital to new projects. Whilst this is challenging in terms of 
identifying exposure to growth, it is extremely positive for commodity prices 
due to the lack of new supply and even more so when the demand outlook is as 
positive as it now appears. 
 
Within the portfolio, Anglo American remains the major contributor with the 
highest rate of production growth amongst the diversified miners, driven by new 
copper production coming from the Quellaveco project in Peru and longer term 
the Woodsmith polyhalite mine in Yorkshire. In copper, First Quantum Minerals 
has ramped-up its new Cobre Panama mine and is now able to use cash flow from 
higher production and better prices to reduce debt to more manageable levels. 
Ivanhoe Mines is on track to bring its new Kamoa-Kakula mine into production by 
the end of the year and ramp-up to capacity during 2022. Nevada Copper was the 
biggest detractor from performance within the growth area, as the company was 
forced to delay their ramp-up in capacity due to COVID-19 and, as a result, 
needed to raise additional debt at expensive rates and highly dilutive share 
issuance. Finally, the Company continued to support Nickel Mines as it raised 
capital to further grow production through exposure to additional production 
lines in Indonesia. Since the Company first supported Nickel Mines at its IPO 
in August 2018, the shares have risen by 2.5x and, in addition, the company 
paid an inaugural dividend in July 2020. 
 
The other source of growth for companies is mergers and acquisitions (M&A) 
activity, but this has also been constrained by the sector's focus on capital 
discipline. Gold has been the busiest area over the last few years and this 
continued in 2020 where the largest transaction was the merger between Northern 
Star Resources and Saracen Mineral Holdings. Key to this deal was the fact that 
each company bought a fifty percent stake in the Australian 'Super Pit' in 
Kalgoorlie from Newmont Corporation and Barrick Gold back in 2019. Simplifying 
the ownership structure should allow cost saving synergies to be captured, 
significant tax savings and the fast tracking of value-added investment 
decisions. Also, in gold, SSR Mining and Alacer Gold combined in a merger of 
equals, once again driven by cost synergies and increasing the diversity of the 
asset base. For the Company, the most beneficial deal was the announced 
purchase of Teranga Gold by Endeavour Mining. The Company bought its exposure 
in Teranga Gold in December 2019 when the business sought finance for the 
purchase of the Massawa gold project from Barrick Gold. Since then, the shares 
have risen almost threefold and the ability to retain ongoing exposure to the 
assets through a holding in Endeavour Mining means additional value can accrue 
to the Company over time. 
 
Outside of gold there were some smaller deals that impacted the portfolio. 
First, the sell down by Sheffield Resources in its Thunderbird Mineral Sands 
Project to Yansteel. This should see the project move forward by unblocking the 
financing hurdle that faced Sheffield Resources. Also, in Australia, Iluka 
Resources completed the demerger of its MAC iron ore royalty into a new listed 
company. It is believed that by placing the royalty into a separately listed 
company it will allow the new group, called Deterra Royalties, to diversify 
into other royalties. Lastly, Independence Group announced the purchase of a 
stake in the Greenbushes Lithium Mine via a holding in the joint venture that 
owns half the operation. The Company managed to buy into the deal during the 
capital raise to fund the transaction and the shares have risen significantly 
as the market rerates the combined business more akin to a higher multiple used 
for valuing ESG sustainable companies from the lower multiples normally 
applying to mining companies. 
 
BASE METALS 
The rerating of base metal prices since the virus-hit lows of March has been 
exceptional, with all base metal prices finishing the year higher. However, 
with the exception of copper, it is worth noting that average prices were 
actually lower on a year-on-year basis reflecting the steep COVID-19 drawdown 
in March. As we have seen in similar demand shock periods, financial investors 
used the base metals forward markets to express a negative view on the global 
economy. Much of the price rally can be explained by the broad-based pick-up in 
end demand. However, there were a number of other factors which intensified the 
rally such as COVID-19 related supply impacts, a collapse in scrap collection, 
speculative inflow into commodities and green related stimulus packages 
benefiting copper in particular. 
 
Selected commodity price changes during 2020 
 
                                                                Price         %    % Change 
                                                                31/12/  Change         Avg 
                                                                 2020        12    2020 vs. 
                                                                         month        2019 
 
Precious Metals US$/oz 
 
Silver                                                           26.5     47.2        26.6 
 
Gold                                                          1,897.8     24.8        27.1 
 
Platinum                                                      1,075.0     10.7         2.4 
 
Palladium                                                     2,370.0     23.4        42.5 
 
Base Metals US$/lb 
 
Tin                                                               9.3     19.6        -8.0 
 
Zinc                                                              1.2     19.7       -11.0 
 
Lead                                                              0.9     10.8        -8.6 
 
Aluminium                                                         0.9     10.8        -5.0 
 
Copper                                                            3.5     26.0         2.9 
 
Nickel                                                            7.5     18.7        -0.7 
 
Industrial Commodities 
 
Coking Coal US$/t                                               101.4    -25.4       -29.5 
 
Thermal Coal US$/t Newcastle                                     80.5     18.9       -22.8 
 
Iron Ore - fines 62% Fe China Import US$/t                      161.0     73.1        16.3 
 
Uranium US$/lb                                                   30.0     20.0        13.6 
 
Lithium Carbonate CIF to China spot 99% US$/t                 7,430.4     31.0       -36.6 
 
                                                              ======== ========   ======== 
 
 
Sources: Datastream and Bloomberg. 
 
Copper, the standout base metal in 2020, led the recovery. Its price bottomed 
at US$2.10/lb in March but subsequently rallied circa 70% to finish the year at 
US$3.53/lb, a price level not seen since 2013, with the market benefiting from 
strong Chinese imports for investment into the state grid, property and 
strategic stockpiling, a feature we have not seen in the market for a number of 
years. This surge in demand saw the copper market move into a deficit by year 
end, with investors beginning to reassess the longer-term demand picture as 
governments prioritise 'green-related' stimulus into renewables, electric 
vehicles and the grid which has the potential to see medium-term copper demand 
increase by 3% to 5% per annum. We view copper as a clear beneficiary from 
decarbonisation spending, which is a key multi-decade theme for the sector. 
Copper supply fundamentals also remain supportive with production impacted in 
key regions such as Peru and Chile, growth projects delayed by 12 to 24 months 
and scrap underperforming. We have previously talked about the long-term supply 
challenges the copper industry faces and, given the acceleration in 
green-related demand, we continue to remain positive on the commodity. 
 
The Company has a very large exposure to copper which represented 19.2% of the 
portfolio at the year-end and was the key driver of performance in 2020. 
Standout performers included Freeport-McMoRan which has seen a sharp inflection 
in free cash flow as the Grasberg underground mine ramps-up, First Quantum 
Minerals which is rapidly deleveraging as its flagship Cobre Panama mine 
increases production and OZ Minerals which has exceeded expectations at its 
newest asset Carrapateena and continues to extract value at Prominent Hill. As 
we look into 2021, Ivanhoe Mines will move from developer to producer at the 
world-class Kamoa-Kakula project and we are set to receive higher dividend 
payments from Cerro Verde. 
 
The other base metal that the Company has significant exposure to is nickel 
which saw its price rise by 18.7% in 2020. The nickel market has been in 
surplus for much of 2020. However, it tightened in Q4 as Chinese stainless 
steel demand recovered along with the rest of the world. A striking feature of 
the nickel market has been the rapid growth in nickel pig iron (NPI) production 
from Indonesia, which has overtaken China as the largest producer of NPI 
globally. The Company has directly benefited from this via its investment in 
Nickel Mines, an Australian listed nickel producer, that owns three nickel 
projects in Indonesia which are operated under an agreement with Tsingshan. 
Nickel Mines has been a remarkable investment for the Company with attributable 
production to grow from zero to circa 50ktpa Ni in under five years since the 
IPO of the company in 2018. 
 
BULK COMMODITIES 
Iron ore was the standout commodity during 2020, with the price rallying more 
than 70% to finish the year at US$161/t. It was a perfect storm for the iron 
ore market which saw record steel demand in China, coupled with ongoing supply 
issues in Brazil. Following the tragic Brumadinho tailings dam incident at the 
beginning of 2019, the iron ore market has significantly tightened with the 
price more than doubling. This tightness was intensified during 2020 with China 
surpassing expectations in ramping its steel production back above pre-COVID-19 
levels by the middle of the year, as the government increased infrastructure 
investment and eased the property sector in an effort to support the economy. 
China's overall steel output grew by 5% in 2020 to 1.05Bt and is poised to 
remain strong during 2021, underpinned by existing infrastructure projects. We 
would expect to see a moderation in steel demand during the second half of 2021 
as policy stimulus is phased out. However, we still expect China's steel output 
to remain strong with the iron ore market to be in deficit again in 2021. 
 
Supply disruption was a key feature of the iron ore market in 2020. This was 
largely centred on Brazil which saw Vale miss the mid-point of its original 
2020 guidance by over 40Mt, as operations were initially hampered by excessive 
rainfall and then by COVID-19. The Australian iron ore producers performed far 
better with BHP, Rio Tinto and Fortescue Metals Group seeing minimal 
operational impact from COVID-19. However, supply risks have risen following 
the Australian parliamentary inquiry into the destruction of Juukan Gorge and 
the review of the Native Title Act in Australia. This has the potential to 
force changes to current and future mine approvals, consequently impacting 
production and capital expenditure for the Australian iron ore producers. 
 
We would expect supply tightness to begin to ease from the end of 2021, as Vale 
continues to bring tonnes into the market and China looks to increase its use 
of scrap steel. Market commentators have talked about a 'stronger for longer' 
iron ore market which seems plausible and underpins a strong dividend outlook 
for the major producers. However, the last two years of elevated iron ore 
prices have incentivised new production into the market. The world class 
Simandou iron ore project has received approval from the Guinean government to 
be developed by a China led consortium. Despite the high capital intensity of 
the asset due to the associated infrastructure development, Simandou offers 
strategic benefits to China reducing their dependency on Australian iron ore 
and also providing them with another source of high-grade supply. The ultimate 
outcome of these additional projects coming to the market is likely to result 
in a larger oversupply of iron ore once China's steel production starts to 
moderate longer term. 
 
The Company has benefited from the high level of iron ore prices during 2020 
through its exposure to BHP, Rio Tinto, Vale (both equity and the Debentures), 
Fortescue Metals Group and Labrador Iron. These producers are enjoying record 
margins given the decline in their operating cost base since the last peak in 
the iron ore price and have returned a significant proportion of free cash flow 
in dividends. Given our expectation of another robust year for the iron ore 
market, we expect another strong year for shareholder returns in 2021. 
 
Coking coal is another key steel raw material but unlike iron ore the price was 
down 25% in 2020. Coking coal has been a casualty of the Australia-China trade 
dispute, with China placing an informal ban on Australian coal imports leaving 
circa 30% of Australia's metallurgical coking coal looking for a new home. A 
two-tier market has developed between the landed China seaborne price which is 
trading at a US$75/t premium to the equivalent quality of coking coal from 
Australia. While there has been some rebalancing of trade flows with Canada and 
Russia looking to fill the supply void, however, given the scale of the 
deficit, we would expect that China will allow imports from Australia again 
over the course of 2021. 
 
The Company's coking coal holdings include Teck Resources and BHP. Teck 
Resources has lagged the sector year-to-date given reduced coking coal demand 
in Europe, as well as the dramatic fall in the oil price which has impacted 
Fort Hills, its Canadian oil sands asset. With Teck Resources able to take 
advantage of the strong coking coal price in China and the better oil price 
outlook, we are looking for improved performance in 2021. 
 
PRECIOUS METALS 
2020 was a stellar year for the precious metals with a new all-time high gold 
price set at US$2,064/oz in August. Gold and silver prices were up 25% and 47% 
respectively which follows strong performance for both commodities in 2019. The 
huge expansion in central bank balance sheets, as governments adopted a 
'whatever it takes' approach in response to COVID-19, has seen a collapse in 
rates globally with the US 10 year real rate moving into negative territory in 
2020. This, combined with the US Federal Reserve moving to an average inflation 
target and willing to tolerate periods of higher inflation, we believe has 
opened the door for real rates to reach never previously seen low levels and a 
new higher trading range to be established for gold. 
 
An encouraging feature of the gold equity market in recent years has been the 
increased focus on shareholder returns, with higher gold prices translating 
into higher margins and dividends. The gold sector has generated decent returns 
in recent years with balance sheets deleveraged and growth projects 
rationalised, which has seen several companies materially raise dividends 
during 2020. Key dividend increases for the Company include Newmont Corporation 
with a 79% dividend increase announced at the beginning of the year which was 
supplemented by a new gold-linked dividend policy, Barrick Gold increasing its 
quarterly dividend by 80% and B2Gold by 100%. Given the continued strength in 
the gold price and the increased dividend commitment from the sector, we look 
forward to further dividend growth in 2021. 
 
The last few years have been a busy period for M&A in the gold sector. The end 
of 2018 saw the merger of Barrick Gold and Randgold Resources followed quickly 
by the takeover of Goldcorp by Newmont Corporation. This was then followed by 
the merger of Barrick Gold and Newmont Corporation's Nevada gold assets to 
create a massive market-leading US gold business. The gold M&A market has been 
more subdued in 2020, the most notable transaction being the merger between 
Northern Star Resources and Saracen Mineral Holdings, its Joint Venture partner 
in the Kalgoorlie 'Super Pit'. Northern Star Resources has a proven track 
record of value creation from M&A where it has grown from a single asset, 
100koz producer in 2010, to today being over a 1Moz producer. 
 
Other notable contributors to performance this year include Newmont Corporation 
which offers the most attractive dividend yield of the senior producers, 
Wheaton Precious Metals which benefited from the strong increase in the silver 
price which is seeing rising industrial demand via increased solar investment 
and our exposure to the Russian gold producers, Polyus and Polymetal 
International. 
 
The PGMs continued their strong performance in 2020 with the palladium and 
platinum price up 23% and 11% respectively. We continue to remain positive on 
the PGM space and believe the PGM basket will remain high relative to history 
given limited new supply projects, increasing PGM loadings for auto catalysts 
to meet emissions standards and a sustained global auto recovery. In terms of 
supply, a combination of Anglo American Platinum's converter failure and South 
Africa's COVID-19 lockdowns, saw 2020 refined platinum and palladium supply 
fall by 22% and 24% respectively. In the year ahead, the PGMs we see as 
particularly strong are palladium, with the market forecast to remain in 
deficit in 2021 and rhodium the less talked about PGM which is seeing 
increasing demand to meet Nitrogen Oxide (NOx) emission standards. The move in 
the rhodium price in 2020 has been nothing short of spectacular at +280%. The 
Company has continued to increase its pure play PGM exposure via its holdings 
in Impala Platinum, Northam Platinum and Sibanye Stillwater, which combined 
equated to 4.7% of the portfolio at the end of December. In addition, the 
Company also has exposure to PGMs via its holding in Anglo American (7.2% of 
the portfolio) which owns 79% of Anglo American Platinum and Norilsk Nickel 
(1.1% of the portfolio). 
 
ROYALTIES AND ILLIQUID INVESTMENTS 
The Company currently has one unquoted investment, the OZ Minerals Brazil 
Royalty, representing 1.9% of the portfolio as at the end of December 2020. The 
Company has an additional royalty investment, Vale Shareholder Debentures, 
representing 4.1% of the portfolio. The latter is technically listed in Brazil 
but due to the limited liquidity it is covered in this section. Together the 
two royalty investments make up 6.0% of the portfolio. These, and any future 
investments, will be managed in line with the guidelines set by the Board as 
outlined to shareholders in the Strategic Report. 
 
OZ MINERALS BRAZIL ROYALTY CONTRACT (1.9% OF THE PORTFOLIO) 
In July 2014 the Company signed a binding royalty agreement with Avanco 
Minerals. The Company provided US$12 million in return for a Net Smelter Return 
(net revenue after deductions for freight, smelter and refining charges) 
royalty payments comprising 2% on copper, 25% on gold and 2% on all other 
metals produced from mines built on Avanco's Antas North and Pedra Branca 
licences. In addition, there is a flat 2% royalty over all metals produced from 
any other discoveries within Avanco's licence area as at the time of the 
agreement. 
 
In 2018 Avanco was acquired by OZ Minerals an Australian based copper and gold 
producer for A$418 million, with the royalty now assumed by OZ Minerals. Since 
our initial US$12 million investment was made, we have received US$15.1 million 
in royalty payments, with the royalty achieving full payback on the initial 
investment. As at the end of December 2020, the royalty was valued at £19.8m 
(1.9% of the portfolio) which equates to a 251.1% total return since our 
investment. 
 
In November 2019 OZ Minerals approved the development of the Pedra Branca 
underground mine and released a feasibility study and mine plan detailing an 
eight-year life of mine. This is OZ Minerals' second operating asset in Brazil 
and is expected to produce more than twice the amount of copper and gold 
production per year than the existing Antas Mine. Mining at Antas is scheduled 
to cease during 2021, after which ore from Pedra Branca will be processed 
through the existing facilities, making Pedra Branca a lower risk, capital 
light development project. Despite the challenges of operating in Brazil during 
COVID-19, we are pleased to report that the first development ore from Pedra 
Branca was trucked to the Carajas Antas hub during the September quarter, 
leaving the asset well-positioned to ramp-up production during the first half 
of 2021. 
 
From a valuation perspective, the discount rate applied to Pedra Branca has 
been moved to a level that reflects the project moving from development status 
to production. In addition, with the increasing amount of royalty revenue being 
generated from gold in line with the increase in the gold price, we have in 
part reflected a lower discount rate applied to gold royalties, in line with 
how the market prices precious metals royalties. This, in addition to minor 
changes to commodity prices, has resulted in a valuation of £19.8 million for 
the royalty which has been approved by the Directors after considering the 
independent valuation of the Royalty carried out by SRK Consulting (UK) 
Limited. 
 
VALE SHAREHOLDER DEBENTURES 
In early 2019 the Company completed a transaction to increase its holding in 
the Vale Shareholder Debentures. The Vale Debentures consist of a 1.8% net 
revenue royalty over Vale's Northern System and Southeastern System iron ore 
assets in Brazil, as well as a 1.25% royalty over the Sossego copper mine. The 
iron ore assets are world class given their grade, cost position, 
infrastructure and resource life which is well in excess of 50 years. Prior to 
this transaction, the Company had a 0.5% position in these securities versus 
the current level of 4.1%. 
 
The iron ore market has significantly tightened since Vale's tragic tailings 
dam accident at the beginning of 2019 which saw the iron ore price rally over 
30%. This was further intensified in 2020, with Vale failing to meet its annual 
production guidance due to severe rains in the first half of the year, as well 
as COVID-19 related operating challenges. These supply issues combined with 
record steel demand in China, saw the iron ore price increase by more than 70% 
in 2020. The Debentures have directly benefited from the move higher in the 
iron ore price with the Company enjoying increasing distributions as shown in 
the chart on page 20 of the Annual Report and Financial Statements. Vale is 
expected to spend US$13 billion restoring the communities and environment 
impacted by the Brumadinho incident between 2019 and 2030. However, it is 
important to note that this cost is not borne by the Debentures as they are a 
revenue royalty with payments directly linked to the iron ore price which 
appreciated during the first half of 2020. It is also important to highlight 
that the operations impacted by the incident are in the Southern and 
Southeastern System, with the Vale Debentures currently only making royalty 
payments from the Northern System. 
 
The chart on page 20 of the Annual Report and Financial Statements shows the 
historic distributions paid by Vale to the owners of the Debentures and in 2020 
this amounted to US$2.3 million for the Company. The payments are expected to 
grow further once royalty payments commence on the Southeastern System in 2024 
and volumes from the newly commissioned iron ore project S11D continue to 
ramp-up. Vale is looking to further increase production from the Northern 
System from 206mtpa today to 260mtpa longer term which provides additional 
upside to our original expectations for the Debentures. 
 
Whilst the Vale Debentures are a royalty, they are also a listed security on 
the Brazilian National Debentures System. However, shareholders should be aware 
that historically there has been a low level of liquidity in the Debentures and 
price volatility is to be expected. Since the acquisition in February 2019 the 
Debentures have paid out a total of R4.56/debenture resulting in a 20% 
distribution return in two years. The securities were priced at R48.2/debenture 
at the end of 2020 versus a price of R23 when the holding was last added to. 
 
We continue to actively look for opportunities to grow royalty exposure given 
it is a key differentiator of the Company and an effective mechanism to lock-in 
long-term income, which further diversifies the Company's revenues. 
 
FIXED INCOME SECURITIES 
The Company continues to have a small but decreasing proportion of the 
portfolio allocated to fixed income securities, due to the ongoing decline in 
interest rates leaving the arbitrage return net of tax less attractive than 
alternative investments. At the end of the year 4.2% of the portfolio was 
invested in fixed income securities. Outside of the decline in interest rates, 
the ongoing improvement in corporate balance sheets meant both repayment of 
expiring bonds and limited new issuance further reduced the opportunities 
available in the market. If current conditions continue then revenue from this 
area will decline further, but it is hoped that this will be covered by 
increases from other areas such as ordinary dividends. During the year one new 
holding was added to this part of the portfolio, ArcelorMittal Mandatory 
Convertible Notes (MCNs) purchased as part of a capital raising during the 
summer. Returns on this investment have been spectacular so far given the 
recovery in steel markets and it is hoped that, with the underlying company now 
committed to stepping up shareholder returns, income from the MCNs will rise in 
2021. As ever, we continue to look for new deals but with a very strict focus 
on return versus quality. 
 
DERIVATIVES ACTIVITY 
The Company from time to time enters into derivatives contracts, mostly 
involving the sale of 'puts' and 'calls'. These are taken to revenue and are 
subject to strict Board guidelines which limit their magnitude to an aggregate 
10% of the portfolio. During 2020 income generated from options was £8.8 
million net of contracts repurchased. This is higher than in the last couple of 
years, as the spike in volatility during the peak of the pandemic presented a 
range of great opportunities to monetise premiums. The majority of options 
expired out of the money as options were written with short lives and share 
prices rapidly recovered from the pandemic low point. Given the spike in 
volatility during the year, it is unlikely that this will be repeated in 2021 
and therefore income from options is likely to be lower. At the end of 2020 the 
Company had 2.6% of the net assets exposed to derivatives. 
 
GEARING 
Debt, which can be drawn down or repaid at any time, is used in the portfolio 
to take tactical advantage of market volatility and opportunities, as well as 
enhance overall returns over the medium to long term. At 31 December 2020, the 
Company had debt net of group cash amounting £114.8 million representing 
gearing of 12.3%. Over the last few years, the amount of gearing allocated 
against higher yielding mining company corporate bonds has declined due to 
increased returns available through the equities as well as reduced 
availability of bonds that meet our valuation criteria. For 2020 the majority 
of the Company's debt was once again hedged against the fixed income portfolio 
and royalty positions. 
 
OUTLOOK AND STRATEGY FOR 2021 
This time last year we made the following bold statement: 'After the strong 
returns generated during the year it might seem foolish to expect another year 
of competitive total returns for the mining sector in 2020 but with macro risks 
seemingly on the turn for the better this might easily play out'. With the 
benefit of hindsight, it is clear that whilst our forecast of strong returns 
played out, we never expected the scale of disruption caused by the COVID-19 
pandemic. This leads us to the often used quote from Mark Twain 'it is 
difficult to make predictions, particularly about the future' so this year we 
will limit our forecast to that of another strong year of expected returns 
without linking it to seemingly unforecastable macro events. 
 
Our confidence on returns comes from two areas: strong corporate outlook and 
commodity market imbalances. The former is based on the robust balance sheets, 
higher profit margins and five-year track record of shareholder return 
discipline. The combination of all of these gives us conviction when expecting 
companies to do the right thing for shareholders when faced with windfall gains 
from better than expected market conditions. With regard to the latter, as 
mentioned earlier in the report, the expected pick-up in fiscal spending around 
the world is set to drive commodity demand growth to levels above that of the 
last decade or longer. In addition, the underinvestment into supply over the 
last five years or more means that industrial commodity prices should be well 
supported in 2021. 
 
As always there are risks to the outlook and we are well aware that margins are 
elevated, especially for producers of iron ore where these are well above 
historic levels. Given the mean reverting nature of commodity markets, these 
will at some point contract despite ongoing supply side issues and better than 
expected demand from steel producers. In addition, the pressure on management 
to spend money on growth projects is at its greatest when balance sheets are 
strong, metal prices are high and demand is rising. We hope that any investment 
decisions are thoroughly reviewed to limit the chances of value destroying 
history repeating itself. 
 
In summary, we believe that with the demand outlook so strong there could be a 
few years of positive total returns ahead given how long it takes for new 
supply to come into production. The goal for the Company continues to be to 
deliver a superior total return for shareholders through the cycle from a 
combination of capital growth and a premium yield to that generally available 
from the mining sector and to keep generating competitive returns compared to 
world markets. 
 
EVY HAMBRO AND OLIVIA MARKHAM 
BLACKROCK INVESTMENT MANAGEMENT (UK) LIMITED 
4 March 2021 
 
TEN LARGEST INVESTMENTS 
 
1 + Vale1, 2 (2019: 3rd) 
Diversified mining group 
Market value: £114,280,000 
Share of investments: 10.9% (2019: 8.6%) 
 
One of the largest mining groups in the world, with operations in 30 countries. 
Vale is the world's largest producer of iron ore and iron ore pellets, and the 
world's largest producer of nickel. The group also produces manganese ore, 
ferroalloys, metallurgical coal, copper, platinum group metals, gold, silver 
and cobalt. 
 
2 - BHP3 (2019: 1st) 
Diversified mining group 
Market value: £79,817,000 
Share of investments: 7.6% (2019: 9.7%) 
 
The world's largest diversified mining group by market capitalisation. The 
group is an important global player in a number of commodities including iron 
ore, copper, metallurgical coal, manganese, nickel, silver and diamonds. The 
group also has significant interests in oil, gas and liquefied natural gas. 
 
3 - Rio Tinto3 (2019: 2nd) 
Diversified mining group 
Market value: £77,724,000 
Share of investments: 7.5% (2019: 9.3%) 
 
One of the world's leading mining groups. The group's primary product is iron 
ore, but it also produces aluminium, copper, diamonds, gold, industrial 
minerals and energy products. 
 
4 = Anglo American (2019: 4th) 
Diversified mining group 
Market value: £75,031,000 
Share of investments: 7.2% (2019: 6.1%) 
 
A global mining group. The group's mining portfolio includes bulk commodities 
including iron ore, manganese, and metallurgical coal, base metals including 
copper and nickel and precious metals and minerals including platinum and 
diamonds. The group has mining operations globally, with significant assets in 
Africa and South America. 
 
5 + Freeport-McMoRan (2019: 16th) 
Copper producer 
Market value: £54,595,000 
Share of investments: 5.2% (2019: 2.2%) 
 
A global mining group which operates large, long-lived, geographically diverse 
assets with significant proven and probable reserves of copper, gold and 
molybdenum. 
 
6 = Newmont Corporation (2019: 6th) 
Gold producer 
Market value: £46,903,000 
Share of investments: 4.5% (2019: 4.4%) 
 
Following the acquisition of Goldcorp in the first half of 2019, Newmont is the 
world's largest gold producer by market capitalisation. The group has gold and 
copper operations on five continents, with active gold mines in Nevada, 
Australia, Ghana, Peru and Suriname. 
 
7 - Barrick Gold (2019: 5th) 
Gold producer 
Market value: £43,339,000 
Share of investments: 4.1% (2019: 4.4%) 
 
Following the merger with Randgold Resources in 2018, Barrick Gold is the 
second largest gold producer by market capitalisation and has operations and 
projects in 15 countries across the world. In 2019, the group successfully 
established a joint venture with Newmont across their Nevada assets to maximize 
the synergies across both sets of assets. 
 
8 + Wheaton Precious Metals (2019: 9th) 
Precious metals streaming group 
Market value: £34,374,000 
Share of investments: 3.3% (2019: 3.7%) 
 
A precious metals streaming group. The group purchases silver and gold 
production from mines that it does not own and operate. The group has streaming 
agreements with 22 operating mines worldwide including Newmont's Penasquito, 
HudBay's Constancia and Vale's Salobo and Sudbury mines. 
 
9 + OZ Minerals2,4 (2019: 10th) 
Copper producer 
Market value: £33,544,000 
Share of investments: 3.2% (2019: 3.3%) 
 
An Australian based mining company, with a primary focus on copper. The company 
owns and operates the high quality Prominent Hill copper-gold mine and the 
Carrapateena copper-gold project, both situated in South Australia. In 2018 OZ 
Minerals successfully acquired Avanco Resources, with the Company's royalty 
assumed by OZ Minerals. 
 
10 - First Quantum Minerals1 (2019: 7th) 
Copper producer 
Market value: £29,954,000 
Share of investments: 2.9% (2019: 4.2%) 
 
An established growing copper mining group operating seven mines including the 
ramp-up of their newest mine, Cobre Panama, which declared commercial 
production in September 2019. The group is a significant copper producer and 
also produces nickel, gold and zinc. 
 
1     Includes fixed income securities. 
 
2     Includes investments held at Directors' valuation. 
 
3     Includes options. 
 
4     Includes mining royalty contract. 
 
All percentages reflect the value of the holding as a percentage of total 
investments. For this purpose, where more than one class of securities is held, 
these have been aggregated. 
 
Together, the ten largest investments represented 56.4% of total investments of 
the Company's portfolio as at 31 December 2020 (ten largest investments as at 
31 December 2019: 57.4%). 
 
INVESTMENTS AS AT 31 DECEMBER 2020 
 
                                                              Main          Market 
                                                      geographical           value            % of 
                                                          exposure           £'000     investments 
 
Diversified 
 
Vale                                                        Global          70,917             6.8 
 
Vale 0% Debentures*#                                        Global          43,363             4.1 
 
BHP                                                         Global          79,980             7.6 
 
BHP Put Option 15/01/21 £19                                 Global            (163)              - 
 
Rio Tinto                                                   Global          78,148             7.5 
 
Rio Tinto Call Option 15/01/21 £54                          Global            (424)              - 
 
Anglo American                                              Global          75,031             7.2 
 
Teck Resources                                              Global          23,077             2.2 
 
Glencore                                                    Global          17,540             1.7 
 
Independence Group                                     Australasia           1,006             0.1 
 
                                                                    --------------  -------------- 
 
                                                                           388,475            37.2 
 
                                                                          ========        ======== 
 
Gold 
 
Newmont Corporation                                         Global          46,903             4.5 
 
Barrick Gold                                                Global          43,339             4.1 
 
Wheaton Precious Metals                                     Global          34,374             3.3 
 
Northern Star Resources                                Australasia          22,504             2.2 
 
Franco-Nevada                                               Global          21,992             2.1 
 
Kinross Gold                                                Global          13,521             1.3 
 
Polymetal International                                      United         13,289             1.3 
                                                           Kingdom 
 
Polyus                                                      Russia          11,462             1.1 
 
Teranga Gold                                                Canada           8,934             0.9 
 
Agnico Eagle Mines                                          Canada           8,175             0.8 
 
B2Gold                                                      Canada           7,812             0.7 
 
Kirkland Lake Gold                                     Australasia           6,041             0.6 
 
Gold Fields                                           South Africa           5,654             0.5 
 
Alamos Gold                                                   Latin          4,805             0.5 
                                                           America 
 
Evolution Mining                                            Global           3,524             0.3 
 
Shanta Gold Convertible*                              Other Africa           1,313             0.1 
 
                                                                    --------------  -------------- 
 
                                                                           253,642            24.3 
 
                                                                          ========        ======== 
 
Copper 
 
Freeport-McMoRan                                            Global          54,595             5.2 
 
OZ Minerals Brazil Royalty#                                  Latin         19,753             1.9 
                                                           America 
 
OZ Minerals                                            Australasia          13,791             1.3 
 
First Quantum Minerals*                                     Global          29,954             2.9 
 
Sociedad Minera Cerro Verde                                   Latin         23,358             2.2 
                                                           America 
 
Lundin Mining                                               Global          16,496             1.6 
 
Ivanhoe Mines                                         Other Africa          15,204             1.5 
 
Antofagasta                                                   Latin          9,446             0.9 
                                                           America 
 
Ero Copper                                                    Latin          9,372             0.9 
                                                           America 
 
SolGold                                                       Latin          4,298             0.4 
                                                           America 
 
Nevada Copper                                                United          2,463             0.2 
                                                            States 
 
Solaris Resources#                                            Latin          2,405             0.2 
                                                           America 
 
                                                                    --------------  -------------- 
 
                                                                           201,135            19.2 
 
                                                                          ========        ======== 
 
Iron Ore 
 
Fortescue Metals Group                                 Australasia          28,793             2.8 
 
Labrador Iron                                               Canada          28,738             2.7 
 
Deterra Royalties                                      Australasia           5,424             0.5 
 
Equatorial Resources                                  Other Africa             499               - 
 
                                                                    --------------  -------------- 
 
                                                                            63,454             6.0 
 
                                                                           =======        ======== 
 
Platinum Group Metals 
 
Northam Platinum                                      South Africa          17,032             1.6 
 
Impala Platinum                                       South Africa          16,966             1.6 
 
Sibanye Stillwater                                    South Africa          15,255             1.5 
 
                                                                    --------------  -------------- 
 
                                                                            49,253             4.7 
 
                                                                          ========        ======== 
 
Steel 
 
ArcelorMittal*                                              Global          25,770             2.5 
 
Steel Dynamics                                               United          9,286             0.9 
                                                            States 
 
                                                                    --------------  -------------- 
 
                                                                            35,056             3.4 
 
                                                                          ========        ======== 
 
Nickel 
 
Nickel Mines                                             Indonesia          16,223             1.6 
 
Norilsk Nickel                                               United         11,163             1.1 
                                                           Kingdom 
 
Bindura Nickel                                        Other Africa             106               - 
 
                                                                    --------------  -------------- 
 
                                                                            27,492             2.7 
 
                                                                          ========        ======== 
 
Industrial Minerals 
 
Lynas Corporation                                      Australasia           7,823             0.7 
 
Iluka Resources                                        Australasia           7,369             0.7 
 
Sheffield Resources                                    Australasia           4,203             0.4 
 
                                                                    --------------  -------------- 
 
                                                                            19,395             1.8 
 
                                                                          ========        ======== 
 
Zinc 
 
Titan Mining+#                                               United          3,396             0.3 
                                                            States 
 
                                                                    --------------  -------------- 
 
                                                                             3,396             0.3 
 
                                                                          ========        ======== 
 
Silver & Diamonds 
 
Sierra Metals                                                 Latin          3,325             0.3 
                                                           America 
 
                                                                    --------------  -------------- 
 
                                                                             3,325             0.3 
 
                                                                          ========        ======== 
 
Aluminium 
 
Metro Mining                                           Australasia             608             0.1 
 
                                                                    --------------  -------------- 
 
                                                                               608             0.1 
 
                                                                          ========        ======== 
 
                                                                         1,045,231           100.0 
 
                                                                          ========        ======== 
 
Comprising 
 
- Investments                                                            1,045,818           100.1 
 
- Written options                                                             (587)           (0.1) 
 
                                                                          ========        ======== 
 
                                                                         1,045,231           100.0 
 
                                                                          ========        ======== 
 
*     Includes fixed income securities. 
 
#    Includes investments held at Directors' valuation. 
 
    Mining royalty contract. 
 
+    Includes warrant investments. 
 
All investments are in equity shares unless otherwise stated. The total number 
of investments as at 31 December 2020 (including options classified as 
liabilities on the balance sheet) was 56 (31 December 2019: 65). 
 
As at 31 December 2020 the Company held equity interests in two companies 
comprising more than 3% of a company's share capital as follows: Sheffield 
Resources and Titan Mining. 
 
PORTFOLIO ANALYSIS AS AT 31 DECEMBER 2020 
 
COMMODITY EXPOSURE1 
 
                               2020             2019#              2020 
                  Company portfolio Company portfolio  Reference Index* 
 
Other                          0.0%              2.0%              0.3% 
 
Coal                           0.0%              0.5%              0.0% 
 
Aluminium                      0.1%              0.2%              2.1% 
 
Silver & Diamonds              0.3%              5.8%              1.8% 
 
Zinc                           0.3%              0.1%              0.4% 
 
Industrial                     1.8%              4.6%              0.3% 
Minerals 
 
Nickel                         2.7%              2.6%              2.3% 
 
Platinum Group                 4.7%              0.0%              2.2% 
Metals 
 
Steel                          3.4%              0.0%             15.6% 
 
Iron Ore                       6.0%              1.2%              4.2% 
 
Copper                        19.2%             17.9%             10.0% 
 
Gold                          24.3%             23.2%             28.6% 
 
Diversified                   37.2%             41.9%             32.2% 
 
1     Based on index classifications. 
 
#    Represents exposure at 31 December 2019. 
 
*     MSCI ACWI Metals & Mining 30% Buffer 10/40 Index. 
 
GEOGRAPHIC EXPOSURE2 
 
                                                   2020 
 
Global                                            64.9% 
 
Australasia                                        9.4% 
 
Latin America                                      7.3% 
 
Other3                                             6.5% 
 
South Africa                                       5.2% 
 
Canada                                             5.1% 
 
Other Africa (ex South                             1.6% 
Africa) 
 
 
 
                                                   2019 
 
Global                                            63.8% 
 
Latin America                                     13.0% 
 
Canada                                             7.3% 
 
Australasia                                        6.5% 
 
Other4                                             5.4% 
 
South Africa                                       2.2% 
 
Other Africa (ex South                             1.8% 
Africa) 
 
2        Based on the principal commodity exposure and place of operation of 
each investment. 
 
3        Consists of Indonesia, Russia, United Kingdom and United States. 
 
4        Consists of Indonesia, Kazakhstan, Russia, Sweden, United Kingdom and 
United States. 
 
STRATEGIC REPORT 
 
The Directors present the Strategic Report of the Company for the year ended 31 
December 2020. The aim of the Strategic Report is to provide shareholders with 
the information to assess how the Directors have performed their duty to 
promote the success of the Company for the collective benefit of shareholders. 
 
The Chairman's Statement together with the Investment Manager's Report form 
part of this Strategic Report. The Strategic Report was approved by the Board 
at its meeting on 4 March 2021. 
 
PRINCIPAL ACTIVITIES 
The Company carries on business as an investment trust and has a premium 
listing on the London Stock Exchange. Its principal activity is portfolio 
investment and that of its subsidiary, BlackRock World Mining Investment 
Company Limited (together the Group), is investment dealing. 
 
Investment trusts are pooled investment vehicles which allow exposure to a 
diversified range of assets through a single investment, thus spreading 
investment risk. 
 
OBJECTIVE 
The Company's objective is to maximise total returns to shareholders through a 
worldwide portfolio of mining and metal securities. The Board recognises the 
importance of dividends to shareholders in achieving that objective, in 
addition to capital returns. 
 
STRATEGY, BUSINESS MODEL AND INVESTMENT POLICY 
Strategy 
The Company invests in accordance with the objective given above. The Board is 
collectively responsible to shareholders for the long-term success of the 
Company and is its governing body. There is a clear division of responsibility 
between the Board and BlackRock Fund Managers Limited (the Manager). Matters 
reserved for the Board include setting the Company's strategy, including its 
investment objective and policy, setting limits on gearing (both bank 
borrowings and the effect of derivatives), capital structure, governance and 
appointing and monitoring of the performance of service providers, including 
the Manager. 
 
Business model 
The Company's business model follows that of an externally managed investment 
trust. Therefore, the Company does not have any employees and outsources its 
activities to third-party service providers including the Manager who is the 
principal service provider. In accordance with the Alternative Investment Fund 
Managers' Directive (AIFMD) the Company is an Alternative Investment Fund 
(AIF). BlackRock Fund Managers Limited is the Company's Alternative Investment 
Fund Manager. 
 
The management of the investment portfolio and the administration of the 
Company have been contractually delegated to the Manager who in turn (with the 
permission of the Company) has delegated certain investment management and 
other ancillary services to BlackRock Investment Management (UK) Limited (the 
Investment Manager). The Manager, operating under guidelines determined by the 
Board, has direct responsibility for the decisions relating to the day-to-day 
running of the Company and is accountable to the Board for the investment, 
financial and operating performance of the Company. 
 
The Company delegates fund accounting services to the Investment Manager, which 
in turn sub-delegates these services to The Bank of New York Mellon 
(International) Limited (BNYM) (the Fund Accountant) and also sub-delegates 
registration services to the Registrar, Computershare Investor Services PLC. 
Other service providers include the Depositary (also BNYM). Details of the 
contractual terms with these service providers and more details of 
sub-delegation arrangements in place governing custody services are set out in 
the Directors' Report in the Annual Report and Financial Statements. 
 
Investment policy 
The Company's investment policy is to provide a diversified investment in 
mining and metal securities worldwide. While the policy is to invest 
principally in quoted securities, the Company's investment policy includes 
investing in royalties derived from the production of metals and minerals as 
well as physical metals. Up to 10% of gross assets may be held in physical 
metals. 
 
In order to achieve its objective, it is intended that the Group will normally 
be fully invested, which means at least 90% of the gross assets of the Company 
and its subsidiary will be invested in stocks, shares, royalties and physical 
metals. However, if such investments are deemed to be overvalued, or if the 
Manager finds it difficult to identify attractively priced opportunities for 
investment, then up to 25% of the Group's assets may be held in cash or cash 
equivalents. Risk is spread by investing in a number of holdings, many of which 
themselves are diversified businesses. 
 
The Group may occasionally utilise derivative instruments such as options, 
futures and contracts for difference, if it is deemed that these will, at a 
particular time or for a particular period, enhance the performance of the 
Group in the pursuit of its objectives. The Company is also permitted to enter 
into stock lending arrangements. 
 
As approved by shareholders in August 2013, the Group may invest in any single 
holding of quoted or unquoted investments that would represent up to 20% of 
gross assets at the time of acquisition. Although investments are principally 
in companies listed on recognised stock exchanges, the Company may invest up to 
20% of the Group's gross assets in investments other than quoted securities. 
Such investments include unquoted royalties, equities or bonds. In order to 
afford the Company the flexibility of obtaining exposure to metal and mining 
related royalties, it is possible that, in order to diversify risk, all or part 
of such exposure may be obtained directly or indirectly through a holding 
company, a fund or another investment or special purpose vehicle, which may be 
quoted or unquoted. The Board will seek the prior approval of shareholders to 
any unquoted investment in a single company, fund or special purpose vehicle or 
any single royalty which represents more than 10% of the Group's assets at the 
time of acquisition. 
 
In March 2015 the Board refined the guidelines associated with the Company's 
royalty strategy and proposed to maintain the 20% maximum exposure to royalties 
but the royalty/unquoted portfolio should itself deliver diversification across 
operator, country and commodity. To this end, new investments into individual 
royalties/unquoted investments should not exceed circa 3% of gross assets at 
the time of investment. Total exposure to any single operator, including other 
issued securities such as debt and/or equity, where greater than 30% of that 
operator's revenues come from the mine over which the royalty lies, must also 
not be greater than 3% at the time of investment. In addition, the guidelines 
require that the Investment Manager must, at the time of investment, manage 
total exposure to a single operator, via reducing exposure to listed securities 
if they are also held in the portfolio, in a timely manner where royalties/ 
unquoted investments are revalued upwards. In the jurisdictions where statutory 
royalties are possible (in countries where mineral rights are privately owned) 
these will be preferred and in respect of contractual royalties (a contractual 
obligation entered into by the operator and typically unsecured) the valuation 
must take into account the higher credit risk involved. Board approval will 
continue to be required for all royalty/unquoted investments. 
 
While the Company may hold shares in other listed investment companies 
(including investment trusts), the Company will not invest more than 15% of the 
Group's gross assets in other UK listed investment companies. 
 
The Group's financial statements are maintained in sterling. Although many 
investments are denominated and quoted in currencies other than sterling, the 
Board does not intend to employ a hedging strategy against fluctuations in 
exchange rates. 
 
No material change will be made to the investment policy without shareholder 
approval. 
 
Gearing 
The Investment Manager believes that tactical use of gearing can add value from 
time to time. This gearing is typically in the form of an overdraft or 
short-term loan facility, which can be repaid at any time or matched by cash. 
The level and benefit of gearing is discussed and agreed with the Board 
regularly. The Company may borrow up to 25% of the Group's net assets. The 
maximum level of gearing used during the year was 15.6% and, at the financial 
reporting date, net gearing (calculated as borrowings less cash and cash 
equivalents as a percentage of net assets) stood at 12.3% of shareholders' 
funds (2019: 11.7%). For further details on borrowings refer to note 14 in the 
Financial Statements and the Alternative Performance Measure in the Glossary in 
the Annual Report and Financial Statements. 
 
Portfolio analysis 
Information regarding the Company's investment exposures is contained within 
the ten largest investments, the investments listed and portfolio analysis all 
detailed above. Further information regarding investment risk and activity 
throughout the year can be found in the Investment Manager's Report above. 
 
As at 31 December 2020, the investment in the OZ Minerals Brazil Royalty was 
held at Directors' valuation, representing a total of £19,753,000 
(US$27,002,000) (2019: £15,790,000 (US$20,918,000)). Unquoted investments can 
prove to be more risky than listed investments. 
 
Continuation vote 
As agreed by shareholders in 1998, an ordinary resolution for the continuation 
of the Company is proposed at each Annual General Meeting. Despite the turmoil 
in markets due to the COVID-19 pandemic, 2020 was a solid year with mining 
companies continuing down the path of capital discipline, balance sheets in 
strong shape and earnings and dividends rising. The Directors remain confident 
on the value available in the sector and therefore recommend that shareholders 
vote in support of the Company's continuation. 
 
Performance 
Details of the Company's performance for the year are given in the Chairman's 
Statement above. The Investment Manager's Report includes a review of the main 
developments during the year, together with information on investment activity 
within the Company's portfolio. 
 
Results and dividends 
The results for the Company are set out in the Consolidated Statement of 
Comprehensive Income. The total profit for the year, after taxation, was £ 
216,515,000 (2019: £114,066,000) of which £35,451,000 (2019: £39,561,000) is 
revenue profit. 
 
It is the Board's intention to distribute substantially all of the Company's 
available income. The Directors recommend the payment of a final dividend as 
set out in the Chairman's Statement. Dividend payments/payable for the year 
ended 31 December 2020 amounted to £35,543,000 (2019: £38,496,000). 
 
Future prospects 
The Board's main focus is to maximise total returns over the longer term 
through investment in mining and metal assets. The outlook for the Company is 
discussed in both the Chairman's Statement and the Investment Manager's Report. 
 
Social, community and human rights issues 
As an investment trust with no employees, the Company has no direct social or 
community responsibilities or impact on the environment. However, the Company 
believes that it is in shareholders' interests to consider human rights issues 
and environmental, social and governance factors when selecting and retaining 
investments. Details of the Company's policy on socially responsible investment 
are set out in the Annual Report and Financial Statements. 
 
Modern slavery act 
As an investment vehicle the Company does not provide goods or services in the 
normal course of business and does not have customers. Accordingly, the 
Directors consider that the Company is not required to make any slavery or 
human trafficking statement under the Modern Slavery Act 2015. In any event, 
the Board considers the Company's supply chains, dealing predominantly with 
professional advisers and service providers in the financial services industry, 
to be low risk in relation to this matter. 
 
Directors, gender representation and employees 
The Directors of the Company are set out in the Directors' Biographies in the 
Annual Report and Financial Statements. The Board consists of three male 
Directors and two female Directors. The Company does not have any executive 
employees. 
 
Key performance indicators 
At each Board meeting, the Directors consider a number of performance measures 
to assess the Company's success in achieving its objectives. The key 
performance indicators (KPIs) used to measure the progress and performance of 
the Company over time and which are comparable to other investment trusts are 
set out below. As indicated in the footnote to the table, some of these KPIs 
fall within the definition of 'Alternative Performance Measures' under guidance 
issued by the European Securities and Markets Authority (ESMA) and additional 
information explaining how these are calculated is set out in the Glossary in 
the Annual Report and Financial Statements. 
 
Additionally, the Board regularly reviews the performance of the portfolio, as 
well as the net asset value and share price of the Company and compares this 
against various companies and indices. Information on the Company's performance 
is given in the Chairman's Statement. 
 
                                                                        Year Year ended 
                                                                      ended           31 
                                                                          31   December 
                                                                   December        2019 
                                                                       2020 
 
Net asset value total return1, 2                                      31.8%       17.2% 
 
Share price total return1, 2                                          46.7%       19.4% 
 
Discount to net asset value2                                           2.7%       11.6% 
 
Revenue earnings per share                                           20.40p      22.46p 
 
Total dividends per share                                            20.30p      22.00p 
 
Ongoing charges2, 3                                                   0.99%       1.02% 
 
Ongoing charges on gross assets2, 4                                   0.87%       0.89% 
 
                                                                   ========    ======== 
 
1     This measures the Company's NAV and share price total return, which 
assumes dividends paid by the Company have been reinvested. 
 
2     Alternative Performance Measures, see Glossary in the Annual Report and 
Financial Statements. 
 
3        Ongoing charges represent the management fee and all other operating 
expenses, excluding finance costs, direct transaction costs, custody 
transaction charges, VAT recovered, taxation and certain non-recurring items, 
as a % of average daily net assets. 
 
4        Ongoing charges based on gross assets represent the management fee and 
all other operating expenses, excluding finance costs, direct transaction 
costs, custody transaction charges, VAT recovered, taxation and certain 
non-recurring items, as a % of average daily gross assets. Gross assets are 
calculated based on net assets during the year before the deduction of the bank 
overdraft and loans. Ongoing charges based on gross assets are considered to be 
an appropriate performance measure as management fees are payable on gross 
assets only in the event of an increase in NAV on a quarter-on-quarter basis. 
 
Principal risks 
The Company is exposed to a variety of risks and uncertainties. As required by 
the 2018 UK Corporate Governance Code (the UK Code), the Board has put in place 
a robust ongoing process to identify, assess and monitor the principal risks 
and emerging risks. A core element of this process is the Company's risk 
register which identifies the risks facing the Company and assesses the 
likelihood and potential impact of each risk and the quality of controls 
operating to mitigate it. A residual risk rating is then calculated for each 
risk based on the outcome of the assessment. 
 
The risk register, its method of preparation and the operation of key controls 
in BlackRock's and other third-party service providers' systems of internal 
control, are reviewed on a regular basis by the Audit & Management Engagement 
Committee. In order to gain a more comprehensive understanding of BlackRock's 
and other third-party service providers' risk management processes and how 
these apply to the Company's business, BlackRock's internal audit department 
provides an annual presentation to the Audit Committee chairmen of the 
BlackRock investment trusts setting out the results of testing performed in 
relation to BlackRock's internal control processes. The Audit & Management 
Engagement Committee also periodically receives and reviews internal control 
reports from BlackRock and the Company's service providers. 
 
The Board has undertaken a robust assessment of both the principal and emerging 
risks facing the Company, including those that would threaten its business 
model, future performance, solvency or liquidity. The COVID-19 pandemic has 
given rise to unprecedented challenges for businesses across the globe and the 
Board has taken into consideration the risks posed to the Company by the crisis 
and incorporated these into the Company's risk register. The threat of climate 
change has also reinforced the importance of more sustainable practices and 
environmental responsibility. 
 
Emerging risks are considered by the Board as they come into view and are 
incorporated into the existing review of the Company's risk register. They were 
also considered as part of the annual evaluation process. Additionally, the 
Manager considers emerging risks in numerous forums and the Risk and 
Quantitative Analysis team produces an annual risk survey. Any material risks 
of relevance to the Company through the annual risk survey will be communicated 
to the Board. 
 
The Board will continue to assess these risks on an ongoing basis. In relation 
to the UK Code, the Board is confident that the procedures that the Company has 
put in place are sufficient to ensure that the necessary monitoring of risks 
and controls has been carried out throughout the reporting period. 
 
The principal risks and uncertainties faced by the Company during the financial 
year, together with the potential effects, controls and mitigating factors, are 
set out in the following table. 
 
Principal Risk                              Mitigation/Control 
 
Counterparty 
The potential loss that the Company could   Due diligence is undertaken before 
incur if a counterparty is unable (or       contracts are entered into and exposures 
unwilling) to perform on its commitments.   are diversified across a number of 
                                            counterparties. 
 
                                            The Depositary is liable for restitution 
                                            for the loss of financial instruments held 
                                            in custody unless able to demonstrate the 
                                            loss was a result of an event beyond its 
                                            reasonable control. 
 
Investment performance 
The returns achieved are reliant primarily  To manage this risk the Board: 
upon the performance of the portfolio. 
                                            ·        regularly reviews the Company's 
The Board is responsible for:               investment mandate and long-term strategy; 
                                            ·        has set investment restrictions 
·        deciding the investment strategy   and guidelines which the Investment Manager 
to fulfil the Company's objective; and      monitors and regularly reports on; 
·        monitoring the performance of the  ·        receives from the Investment 
Investment Manager and the implementation   Manager a regular explanation of stock 
of the investment strategy.                 selection decisions, portfolio exposure, 
                                            gearing and any changes in gearing, and the 
An inappropriate investment policy may lead rationale for the composition of the 
to:                                         investment portfolio; 
                                            ·        monitors and maintains an adequate 
·        underperformance compared to the   spread of investments in order to minimise 
reference index;                            the risks associated with particular 
·        a reduction or permanent loss of   countries or factors specific to particular 
capital; and                                sectors, based on the diversification 
·        dissatisfied shareholders and      requirements inherent in the investment 
reputational damage.                        policy; 
                                            ·        receives and reviews regular 
                                            reports showing an analysis of the 
                                            Company's performance against other 
                                            indices, including the performance of major 
                                            companies in the sector; and 
                                            ·        has been assured that the 
                                            Investment Manager has training and 
                                            development programmes in place for its 
                                            employees and its recruitment and 
                                            remuneration packages are developed in 
                                            order to retain key staff. 
 
Legal and regulatory compliance 
The Company has been approved by HM Revenue The Investment Manager monitors investment 
& Customs as an investment trust, subject   movements, the level and type of forecast 
to continuing to meet the relevant          income and expenditure and the amount of 
eligibility conditions, and operates as an  proposed dividends to ensure that the 
investment trust in accordance with Chapter provisions of Chapter 4 of Part 24 of the 
4 of Part 24 of the Corporation Tax Act     Corporation Tax Act 2010 are not breached. 
2010. As such, the Company is exempt from   The results are reported to the Board at 
capital gains tax on the profits realised   each meeting. 
from the sale of its investments. 
                                            Compliance with the accounting rules 
Any breach of the relevant eligibility      affecting investment trusts are also 
conditions could lead to the Company losing carefully and regularly monitored. 
investment trust status and being subject 
to corporation tax on capital gains         The Company Secretary, Manager and the 
realised within the Company's portfolio. In Company's professional advisers provide 
such event, the investment returns of the   regular reports to the Board in respect of 
Company may be adversely affected.          compliance with all applicable rules and 
                                            regulations. The Board and the Manager also 
Any serious breach could result in the      monitor changes in government policy and 
Company and/or the Directors being fined or legislation which may have an impact on the 
the subject of criminal proceedings or the  Company. 
suspension of the Company's shares which 
would in turn lead to a breach of the 
Corporation Tax Act 2010. 
 
Amongst other relevant laws, the Company is 
required to comply with the provisions of 
the Companies Act 2006, the Alternative 
Investment Fund Managers' Directive, the UK 
Listing Rules, Disclosure Guidance and 
Transparency Rules and the Market Abuse 
Regulation. 
 
Market 
Market risk arises from volatility in the   The Board considers the diversification of 
prices of the Company's investments. It     the portfolio, asset allocation, stock 
represents the potential loss the Company   selection and levels of gearing on a 
might suffer through realising investments  regular basis and has set investment 
in the face of negative market movements.   restrictions and guidelines which are 
                                            monitored and reported on by the Investment 
Changes in general economic and market      Manager. 
conditions, such as currency exchange 
rates, interest rates, rates of inflation,  The Board monitors the implementation and 
industry conditions, tax laws, political    results of the investment process with the 
events and trends, can also substantially   Investment Manager. 
and adversely affect the securities and, as 
a consequence, the Company's prospects and  The Board also recognises the benefits of a 
share price.                                closed-end fund structure in extremely 
                                            volatile markets such as those experienced 
Market risk includes the potential impact   with the COVID-19 pandemic. Unlike 
of events which are outside the Company's   open-ended counterparts, closed-end funds 
control, such as the COVID-19 pandemic.     are not obliged to sell-down portfolio 
                                            holdings at low valuations to meet 
Companies operating in the sectors in which liquidity requirements for redemptions. 
the Company invests may be impacted by new  During times of elevated volatility and 
legislation governing climate change and    market stress, the ability of a closed-end 
environmental issues, which may have a      fund structure to remain invested for the 
negative impact on their valuation and      long term enables the Portfolio Managers to 
share price.                                adhere to disciplined fundamental analysis 
                                            from a bottom-up perspective and be ready 
                                            to respond to dislocations in the market as 
                                            opportunities present themselves. 
 
                                            The Portfolio Managers spend a considerable 
                                            amount of time understanding the 
                                            environmental, social and governance (ESG) 
                                            risks and opportunities facing companies 
                                            and industries in the portfolio. They use 
                                            ESG information when conducting research 
                                            and due diligence on new investments and 
                                            again when monitoring investments in the 
                                            portfolio. 
 
Operational 
In common with most other investment trust  Due diligence is undertaken before 
companies, the Company has no employees.    contracts are entered into with third-party 
The Company therefore relies on the         service providers. Thereafter, the 
services provided by third parties and is   performance of the provider is subject to 
dependent on the control systems of the     regular review and reported to the Board. 
Manager and BNYM (the Depositary, Custodian 
and Fund Accountant) which maintain the     The Board reviews on a regular basis an 
Company's assets, dealing procedures and    assessment of the fraud risks that the 
accounting records.                         Company could potentially be exposed to and 
                                            also a summary of the controls put in place 
The security of the Company's assets,       by the Manager, Depositary, Custodian, Fund 
dealing procedures, accounting records and  Accountant and Registrar specifically to 
adherence to regulatory and legal           mitigate these risks. 
requirements depend on the effective 
operation of the systems of these           Most third-party service providers produce 
third-party service providers. There is a   internal control reports to provide 
risk that a major disaster, such as floods, assurance regarding the effective operation 
fire, a global pandemic, or terrorist       of internal controls as reported on by 
activity, renders the Company's service     their reporting accountants. These reports 
providers unable to conduct business at     are provided to the Audit & Management 
normal operating effectiveness.             Engagement Committee for review. The 
                                            Committee would seek further 
Failure by any service provider to carry    representations from service providers if 
out its obligations to the Company could    not satisfied with the effectiveness of 
have a material adverse effect on the       their control environment. 
Company's performance. Disruption to the 
accounting, payment systems or custody      The Company's assets are subject to a 
records (including cyber security risk)     strict liability regime and, in the event 
could prevent the accurate reporting and    of a loss of assets, the Depositary must 
monitoring of the Company's financial       return assets of an identical type or the 
position.                                   corresponding amount, unless able to 
                                            demonstrate the loss was a result of an 
                                            event beyond its reasonable control. 
 
                                            The Board reviews the overall performance 
                                            of the Manager, Investment Manager and all 
                                            other third-party service providers on a 
                                            regular basis and compliance with the 
                                            Investment Management Agreement annually. 
 
                                            The Board also considers the business 
                                            continuity arrangements of the Company's 
                                            key service providers on an ongoing basis 
                                            and reviews these as part of its review of 
                                            the Company's risk register. In respect of 
                                            the unprecedented and emerging risks posed 
                                            by the COVID-19 pandemic in terms of the 
                                            ability of service providers to function 
                                            effectively, the Board has received reports 
                                            from key service providers setting out the 
                                            measures that they have put in place to 
                                            address the crisis, in addition to their 
                                            existing business continuity framework. 
                                            Having considered these arrangements and 
                                            reviewed service levels since the crisis 
                                            has evolved, the Board is confident that a 
                                            good level of service has and will be 
                                            maintained. 
 
Financial 
The Company's investment activities expose  Details of these risks are disclosed in 
it to a variety of financial risks which    note 18 to the Financial Statements in the 
include market risk, counterparty credit    Annual Report and Financial Statements, 
risk, liquidity risk and the valuation of   together with a summary of the policies for 
financial instruments.                      managing these risks. 
 
In the view of the Board, there have not been any changes to the fundamental 
nature of these risks and these principal risks and uncertainties are equally 
applicable for the current financial year. 
 
Viability statement 
In accordance with Provision 31 of the 2018 UK Corporate Governance Code, the 
Directors have assessed the prospects of the Company over a longer period than 
the twelve months referred to by the 'Going Concern' guidelines. 
 
The Board is cognisant of the uncertainty surrounding the potential duration of 
the COVID-19 pandemic, its impact on the global economy and the prospects for 
many of the Company's portfolio holdings. Notwithstanding this crisis, and 
given the factors stated below, the Board expects the Company to continue for 
the foreseeable future and has therefore conducted this review for a period of 
three years. This is generally the investment holding period investors consider 
while investing in the mining sector. 
 
In its assessment of the viability of the Company, the Directors have noted 
that: 
 
·        the Company invests predominantly in highly liquid, large listed 
companies so its assets are readily realisable and provide a level of cash 
receipts in the form of interest and dividends; 
 
·        the Company invests in mining companies with long life assets; 
 
·        the Company continues to meet its financial covenants in respect of 
its borrowing facilities; 
 
·        the Company's forecasts for revenues, expenses and liabilities are 
relatively stable and it has largely fixed overheads which comprise a small 
percentage of net assets (0.99%); and 
 
·        the business model should remain attractive for much longer than three 
years, unless there is significant economic or regulatory change. 
 
The Company will undertake its annual continuation vote at the forthcoming 
Annual General Meeting and the Board has reviewed the potential impact that 
this may have on the Company's viability. The Board is confident that the 
continuation vote will be passed and have prepared the viability statement 
under this assumption. 
 
The Directors have also reviewed: 
 
·        the impact of a significant fall in commodity markets on the value of 
the Company's investment portfolio, factoring in the impact of the recent 
volatility related to the COVID-19 pandemic; 
 
·        the ongoing relevance of the Company's investment objective, business 
model and investment policy in the current environment; and 
 
·        the level of demand for the Company's shares. 
 
The Board has also considered a number of other factors, including: 
 
·        portfolio liquidity in light of the COVID-19 pandemic on global market 
liquidity. As at 1 March 2021, 97.5% of the portfolio was estimated as being 
capable of being liquidated within three to five days; 
 
·        the Company's revenue and expense forecasts in light of the COVID-19 
pandemic and its anticipated impact on dividend income and market valuations. 
The Board is confident that the Company's business model remains viable and 
that there are sufficient resources to meet all liabilities as they fall due 
for the period under review; 
 
·        the principal risks and uncertainties as set out above and is 
confident that the Company has appropriate controls and processes in place to 
manage these and to maintain its operating model, even given the challenges 
posed by COVID-19; 
 
·        the operational resilience of the Company and its key service 
providers and their ability to continue to provide a good level of service for 
the foreseeable future; 
 
·        the effectiveness of business continuity plans in place for the 
Company and key service providers; and 
 
·        the level of income generated by the Company and future income 
forecasts. 
 
Based on the results of their analysis, the Directors have concluded that there 
is a reasonable expectation that the Company will continue in operation and 
meet its liabilities as they fall due over the period of their assessment. 
 
Section 172 statement: Promoting the success of the Company 
New regulations (The Companies (Miscellaneous Reporting) Regulations) require 
directors of large companies to explain more fully how they have discharged 
their duties under section 172(1) of the Companies Act 2006 in promoting the 
success of their companies for the benefit of members as a whole. This includes 
the likely consequences of their decisions in the longer term and how they have 
taken wider stakeholders' needs into account. 
 
The enhanced disclosure that follows covers how the Board has engaged with and 
understands the views of stakeholders and how stakeholders' needs have been 
taken into account, the outcome of this engagement and the impact that it has 
had on the Board's decisions. The Board considers the main stakeholders in the 
Company to be the Manager, Investment Manager and the shareholders. In addition 
to this, the Board considers investee companies and key service providers of 
the Company to be stakeholders; the latter comprise the Company's Custodian, 
Depositary, Registrar and Broker. 
 
                                     Stakeholders 
 
Shareholders          Manager and           Other key service     Investee companies 
                      Investment Manager    providers 
 
Continued shareholder The Board's main      In order for the      Portfolio holdings 
support and           working relationship  Company to function   are ultimately 
engagement are        is with the Manager,  as an investment      shareholders' assets 
critical to the       who is responsible    trust with a listing  and the Board 
continued existence   for the Company's     on the premium        recognise the 
of the Company and    portfolio management  segment of the        importance of good 
the successful        (including asset      official list of the  stewardship and 
delivery of its       allocation, stock and Financial Conduct     communication with 
long-term strategy.   sector selection) and Authority (FCA) and   investee companies in 
The Board is focused  risk management, as   trade on the London   meeting the Company's 
on fostering good     well as ancillary     Stock Exchange's      investment objective 
working relationships functions such as     (LSE) main market for and strategy. The 
with shareholders and administration,       listed securities,    Board monitors the 
on understanding the  secretarial,          the Board relies on a Manager's stewardship 
views of shareholders accounting and        diverse range of      arrangements and 
in order to           marketing services.   advisors for support  receives regular 
incorporate them into The Manager has       in meeting relevant   feedback from the 
the Board's strategy  sub-delegated         obligations and       Manager in respect of 
and objective in      portfolio management  safeguarding the      meetings with the 
maximising total      to the Investment     Company's assets. For management of 
returns to            Manager. Successful   this reason, the      investee companies. 
shareholders through  management of         Board consider the 
a worldwide portfolio shareholders' assets  Company's Custodian, 
of mining and metal   by the Investment     Depositary, Registrar 
securities.           Manager is critical   and Broker to be 
                      for the Company to    stakeholders. The 
                      successfully deliver  Board maintains 
                      its investment        regular contact with 
                      strategy and meet its its key external 
                      objective. The        service providers and 
                      Company is also       receives regular 
                      reliant on the        reporting from them 
                      Manager as AIFM to    through the Board and 
                      provide support in    Committee meetings, 
                      meeting relevant      as well as outside of 
                      regulatory            the regular meeting 
                      obligations under the cycle. 
                      AIFMD and other 
                      relevant legislation. 
 
 
 
Area of Engagement    Issue                 Engagement            Impact 
 
Investment mandate    The Board has         The Board worked      The portfolio 
and objective         responsibility to     closely with the      activities undertaken 
                      shareholders to       Investment Manager    by the Investment 
                      ensure that the       throughout the year   Manager can be found 
                      Company's portfolio   in further developing in their Report. The 
                      of assets is invested investment strategy   Company has been 
                      in line with the      and underlying        building exposure to 
                      stated investment     policies, not simply  longer dated growth 
                      objective and in a    for the purpose of    opportunities that 
                      way that ensures an   achieving the         have significant 
                      appropriate balance   Company's investment  potential, as well as 
                      between spread of     objective but in the  quality growth 
                      risk and portfolio    interests of          companies where that 
                      returns.              shareholders and      growth translates 
                                            future investors.     into growth on a 
                                                                  value per share 
                                                                  basis. 
 
Responsible ownership More than ever, the   The Board believes    The Board and the 
                      importance of good    that responsible      Investment Manager 
                      governance and        investment and        believes there is 
                      sustainability        sustainability are    likely to be a 
                      practices are key     integral to the       positive correlation 
                      factors in making     longer-term delivery  between strong ESG 
                      investment decisions. of the Company's      practices and 
                      Climate change is     success. The Board    investment 
                      becoming a defining   works closely with    performance over 
                      factor in companies'  the Investment        time. It is 
                      long-term prospects   Manager to regularly  especially vital in 
                      across the investment review the Company's  mining given the long 
                      spectrum with         performance,          investment cycle and 
                      significant and       investment strategy   its ability to impact 
                      lasting implications  and underlying        a company maintaining 
                      for economic growth   policies to ensure    its social licence to 
                      and prosperity. The   that the Company's    operate. ESG is one 
                      mining industries in  investment objective  of the many factors 
                      which the Company's   continues to be met   that we look at and 
                      investment universe   in an effective,      site visits to 
                      operate are facing    responsible and       companies' mines 
                      ethical and           sustainable way in    provide valuable 
                      sustainability issues the interests of      insights into their 
                      that cannot be        shareholders and      ESG practices. 
                      ignored by asset      future investors. 
                      managers and                                BlackRock has stated 
                      investment companies  The Investment        that, as part of its 
                      alike.                Manager's approach to commitment to 
                                            the consideration of  sustainability, it 
                                            ESG factors in        will divest any 
                                            respect of the        investment in 
                                            Company's portfolio,  companies that derive 
                                            as well as the        more than 25% of 
                                            Investment Manager's  revenues from thermal 
                                            engagement with       coal production from 
                                            investee companies to all discretionary 
                                            encourage the         active investment 
                                            adoption of           portfolios. During 
                                            sustainable business  the year under 
                                            practices which       review, the Company 
                                            support long-term     has had minimal 
                                            value creation, are   exposure to companies 
                                            kept under review by  whose principal 
                                            the Board. The Board  activity is the 
                                            also expects to be    extraction of thermal 
                                            informed by the       coal. 
                                            Investment Manager of 
                                            any sensitive voting  Within the parameters 
                                            issues involving the  of the Company's 
                                            Company's             existing investment 
                                            investments.          policy, the 
                                            Environmental issues  Investment Manager is 
                                            were prominent in the continuing to look 
                                            engagement, as was    for opportunities to 
                                            executive pay and the deploy capital in 
                                            re-election of        growth investments 
                                            directors in          that should benefit 
                                            portfolio companies.  from the demand for 
                                                                  'green' materials. It 
                                            The Investment        is likely that this 
                                            Manager reports to    area will become a 
                                            the Board in respect  more significant part 
                                            of its ESG policies   of the portfolio. 
                                            and how these are 
                                            integrated into the 
                                            investment process; a 
                                            summary of 
                                            BlackRock's approach 
                                            to ESG and 
                                            sustainability is set 
                                            out in the Annual 
                                            Report and Financial 
                                            Statements. The 
                                            Investment Manager's 
                                            engagement and voting 
                                            policy is detailed in 
                                            the Annual Report and 
                                            Financial Statements 
                                            and on the BlackRock 
                                            website. 
 
Shareholders          Continued shareholder The Board is          The Board values any 
                      support and           committed to          feedback and 
                      engagement are        maintaining open      questions from 
                      critical to the       channels of           shareholders ahead of 
                      continued existence   communication and to  and during Annual 
                      of the Company and    engage with           General Meetings in 
                      the successful        shareholders. The     order to gain an 
                      delivery of its       Company welcomes and  understanding of 
                      long-term strategy.   encourages attendance their views and will 
                                            and participation     take action when and 
                                            from shareholders at  as appropriate. 
                                            its Annual General    Feedback and 
                                            Meetings.             questions will also 
                                            Shareholders will     help the Company 
                                            have the opportunity  evolve its reporting, 
                                            to meet the Directors aiming to make 
                                            and Investment        reports more 
                                            Manager and to        transparent and 
                                            address questions to  understandable. 
                                            them directly. The 
                                            Investment Manager    Feedback from all 
                                            will also provide a   substantive meetings 
                                            presentation on the   between the 
                                            Company's performance Investment Manager 
                                            and the outlook for   and shareholders will 
                                            the mining sector.    be shared with the 
                                                                  Board. The Directors 
                                            The Annual Report and will also receive 
                                            Half Yearly Financial updates from the 
                                            Report are available  Company's broker and 
                                            on the BlackRock      Kepler, marketing 
                                            website and are also  consultants, on any 
                                            circulated to         feedback from 
                                            shareholders either   shareholders, as well 
                                            in printed copy or    as share trading 
                                            via electronic        activity, share price 
                                            communications. In    performance and an 
                                            addition, regular     update from the 
                                            updates on            Investment Manager. 
                                            performance, monthly 
                                            factsheets, the daily Portfolio holdings 
                                            NAV and other         are ultimately 
                                            information are also  shareholders' assets 
                                            published on the      and the Board 
                                            website at            recognise the 
                                            blackrock.com/uk/     importance of good 
                                            brwm.                 stewardship and 
                                                                  communication with 
                                            Unlike trading        investee companies in 
                                            companies, one-to-one meeting the Company's 
                                            shareholder meetings  investment objective 
                                            normally take the     and strategy. The 
                                            form of a meeting     Board monitors the 
                                            with the Investment   Manager's stewardship 
                                            Manager as opposed to arrangements and 
                                            members of the Board. receives regular 
                                            The Company's         feedback from the 
                                            willingness to enter  Investment Manager in 
                                            into discussions with respect of meetings 
                                            institutional         with the management 
                                            shareholders is also  of portfolio 
                                            demonstrated by the   companies. 
                                            programmes of 
                                            institutional 
                                            presentations by the 
                                            Investment Manager. 
                                            If shareholders wish 
                                            to raise issues or 
                                            concerns with the 
                                            Board, they are 
                                            welcome to do so at 
                                            any time. The 
                                            Chairman is available 
                                            to meet directly with 
                                            shareholders 
                                            periodically to 
                                            understand their 
                                            views on governance 
                                            and the Company's 
                                            performance where 
                                            they wish to do so. 
                                            He may be contacted 
                                            via the Company 
                                            Secretary whose 
                                            details are given in 
                                            the Annual Report and 
                                            Financial Statements. 
 
Discount management   The Board recognises  The Board monitors    The Board continues 
                      the importance to     the Company's         to monitor the 
                      shareholders that the discount on an        Company's discount to 
                      market price of the   ongoing basis and     NAV and will look to 
                      Company's shares      receives regular      buy back shares if it 
                      should not trade at   updates from the      is deemed to be in 
                      either a significant  Manager and the       the interests of 
                      discount or premium   Company's Broker      shareholders as a 
                      to the NAV.           regarding the level   whole. The Company 
                                            of discount. The      participates in a 
                                            Board believes that   focused investment 
                                            the best way of       trust sales and 
                                            maintaining the share marketing initiative 
                                            rating at an optimal  operated by the 
                                            level over the long   Manager on behalf of 
                                            term is to create     the investment trusts 
                                            demand for the shares under its management. 
                                            in the secondary      Further details are 
                                            market. To this end,  set out in the Annual 
                                            the Investment        Report and Financial 
                                            Manager is devoting   Statements. 
                                            considerable effort 
                                            to broadening the     During the year, the 
                                            awareness of the      Company's discount 
                                            Company, particularly narrowed 
                                            to wealth managers    significantly. The 
                                            and to the wider      Company's average 
                                            retail market.        discount for the year 
                                                                  to 31 December 2020 
                                            In addition, the      was 11.3% and, since 
                                            Board has worked      February 2021, the 
                                            closely with the      shares have been 
                                            Manager to develop    trading at a premium 
                                            the Company's         to NAV. 
                                            marketing strategy, 
                                            with the aim of 
                                            ensuring effective 
                                            communication with 
                                            existing shareholders 
                                            and to attract new 
                                            shareholders to the 
                                            Company in order to 
                                            improve liquidity in 
                                            the Company's shares 
                                            and to sustain the 
                                            share rating of the 
                                            Company. 
 
Service levels of     The Board             The Manager reports   All performance 
third-party providers acknowledges the      to the Board on the   evaluations were 
                      importance of         Company's performance performed on a timely 
                      ensuring that the     on a regular basis.   basis and the Board 
                      Company's principal   The Board carries out concluded that all 
                      suppliers are         a robust annual       third-party service 
                      providing a suitable  evaluation of the     providers, including 
                      level of service,     Manager's             the Manager and 
                      including the         performance, their    Investment Manager, 
                      Investment Manager in commitment and        were operating 
                      respect of investment available resources.  effectively and 
                      performance and                             providing a good 
                      delivering on the     The Board performs an level of service. 
                      Company's investment  annual review of the 
                      mandate; the          service levels of all The Board has 
                      Custodian and         third-party service   received updates in 
                      Depositary in respect providers and         respect of business 
                      of their duties       concludes on their    continuity planning 
                      towards safeguarding  suitability to        from the Company's 
                      the Company's assets; continue in their     Manager, Custodian, 
                      the Registrar in its  role. The Board       Depositary, Fund 
                      maintenance of the    receives regular      Accountant, Registrar 
                      Company's share       updates from the      and Printer and is 
                      register and dealing  AIFM, Depositary,     confident that 
                      with investor         Registrar and Brokers arrangements are in 
                      queries; and the      on an ongoing basis.  place to ensure a 
                      Company's Brokers in                        good level of service 
                      respect of the        In light of the       will continue to be 
                      provision of advice   challenges presented  provided despite the 
                      and acting as a       by the COVID-19       impact of the 
                      market maker for the  pandemic to the       COVID-19 pandemic. 
                      Company's shares.     operation of 
                                            businesses across the 
                                            globe, the Board has 
                                            worked closely with 
                                            the Manager to gain 
                                            comfort that relevant 
                                            business continuity 
                                            plans are operating 
                                            effectively for all 
                                            of the Company's key 
                                            service providers. 
 
Board composition     The Board is          All Directors are     As at the date of 
                      committed to ensuring subject to a formal   this report, the 
                      that its own          evaluation process on Board was comprised 
                      composition brings an an annual basis (more of three men and two 
                      appropriate balance   details and the       women. No Director 
                      of knowledge,         conclusions of the    has a tenure in 
                      experience and        2020 evaluation       excess of nine years. 
                      skills, and that it   process are given in  Details of each 
                      is compliant with     the Annual Report and Directors' 
                      best corporate        Financial             contribution to the 
                      governance practice   Statements). All      success and promotion 
                      under the UK Code,    Directors stand for   of the Company are 
                      including guidance on re-election by        set out in the 
                      tenure and the        shareholders          Directors' Report in 
                      composition of the    annually.             the Annual Report and 
                      Board's committees.                         Financial Statements 
                                            Shareholders may      and details of the 
                                            attend the Annual     Directors' 
                                            General Meeting and   biographies can be 
                                            raise any queries in  found in the Annual 
                                            respect of Board      Report and Financial 
                                            composition or        Statements. 
                                            individual Directors 
                                            in person or may      The Directors are not 
                                            contact the Company   aware of any issues 
                                            Secretary or the      that have been raised 
                                            Chairman using the    directly by 
                                            details provided in   shareholders in 
                                            the Annual Report and respect of Board 
                                            Financial Statements  composition in the 
                                            with any issues.      year under review. 
 
                                            The Board undertook a The Board appointed 
                                            review of succession  Ollie Oliveira as a 
                                            planning arrangements Director of the 
                                            and identified the    Company with effect 
                                            need for a new        from 3 February 2020. 
                                            Director. The         Colin Buchan retired 
                                            Nomination Committee  as a Director on 30 
                                            agreed the selection  April 2020. 
                                            criteria and the 
                                            method of selection, 
                                            recruitment and 
                                            appointment, Board 
                                            diversity, including 
                                            gender, were 
                                            carefully considered 
                                            when establishing the 
                                            criteria. The 
                                            services of an 
                                            external search 
                                            consultant, Norman 
                                            Broadbent Group PLC, 
                                            as well as the 
                                            Directors' range of 
                                            contacts, were used 
                                            to identify potential 
                                            candidates. 
 
Sustainability and our ESG policies 
 
The importance of considering ESG when investing in the Natural Resources 
Sector 
 
Environmental                Social                        Corporate governance 
 
Mines will inevitably have   BlackRock believes it is      As with all companies, good 
an impact on the local       vital that natural resources  corporate governance is 
environment. Key is how      companies maintain their      critical for natural 
companies manage this        social licence to operate. By resources companies. In 
process ensuring the         this, BlackRock means that    conjunction with the 
benefits are appropriately   companies maintain broad      BlackRock Investment 
shared amongst all           acceptance from their         Stewardship team, the 
stakeholders. The negative   employees, stakeholders,      portfolio management team 
impact on the market         local communities and the     actively engages with 
capitalisation of companies  national government. The      companies on a wide range of 
such as BHP and Vale, after  portfolio management team's   governance issues including 
the Samarco and Brumadinho   site visits to companies'     board independence, 
tailings dam failures,       assets provide them with      executive compensation, 
highlights the key role that valuable insight into these   shareholder protection and 
ESG has on share price       issues which often cannot be  timely disclosure. 
performance.                 properly understood from 
                             company reports. 
As set out in more detail 
below, BlackRock will be 
aligning its engagement and 
stewardship priorities to UN 
Sustainable Development 
Goals and is committed to 
voting against management to 
the extent that they have 
not demonstrated sufficient 
progress in how they manage 
these environmental impacts 
and operating events. 
 
The Board's approach 
Environmental, social and governance (ESG) issues can present both 
opportunities and threats to long-term investment performance. The Company's 
investment universe comprises sectors that are likely to be highly impacted by 
increasing regulation as a result of climate change and other social and 
governance factors. These ethical and sustainability issues cannot be ignored 
and your Board has appointed a Manager that applies the highest standards of 
ESG practice. Effective engagement with management is, in most cases, the most 
constructive way of driving meaningful change in the behaviour of investee 
company management. However, as a general approach the Company will not invest 
in companies which have high ESG risks and no plans to address existing 
deficiencies. Where the Board is not satisfied that an investee company is 
taking steps to address matters of an ESG nature, it may discuss with the 
Manager how this situation might be resolved, including potentially by a full 
disposal of shares. 
 
BlackRock's approach to sustainable investing 
Sustainability is BlackRock's standard for investing, based on the investment 
conviction that integrating sustainability can help investors build more 
resilient portfolios and achieve better long term, risk-adjusted returns. 
 
BlackRock believes that climate change is now a defining factor in companies' 
long-term prospects and that it will have a significant and lasting impact on 
economic growth and prosperity. BlackRock believes that climate risk now 
equates to investment risk and this will drive a profound reassessment of risk 
and asset values as investors seek to react to the impact of climate policy 
changes. This in turn is likely to drive a significant reallocation of capital 
away from traditional carbon intensive industries over the next decade. 
 
In January 2020, with this transition in mind, BlackRock outlined how it was 
making sustainability integral to the way BlackRock manage risk, generate 
alpha, build portfolios and pursue investment stewardship, in order to help 
improve investment outcomes for clients. 
 
By December 2020, BlackRock announced that the following key achievements had 
been made in progress towards its goals, including: 
 
·        Ensuring that 100% of active portfolios are ESG-integrated; 
 
·        Launching a new database (Aladdin Climate) to set a new standard for 
climate data and analytics; 
 
·        Intensifying the investment stewardship focus on sustainability; 
 
·        Joining Climate Action 100+, a natural progression in BlackRock's work 
to advance sustainable business practices aligned with the Task Force on 
Climate-related Financial Disclosures (TCFD); and 
 
·        Establishing nearly a hundred new sustainable BlackRock funds in 2020, 
helping to increase access and provide investors with greater choice. 
 
A detailed summary of the actions taken by BlackRock in 2020 on making 
sustainability the new standard for investing can be found at https:// 
www.blackrock.com/corporate/ literature/publication/ 
our-2020-sustainability-actions.pdf 
 
BlackRock also announced in January 2021 that it was committed to supporting 
the goal of 'net zero' (building an economy that emits no more carbon dioxide 
than it removes from the atmosphere) by 2050 (the scientifically-established 
threshold necessary to keep global warming well below 2ºC). BlackRock is taking 
a number of steps to help investors prepare their portfolios for a net zero 
world, including capturing opportunities created by the net zero transition. 
Key actions targeted by BlackRock for 2021 include: 
 
Measurement and Transparency 
 
·        Publishing the proportion of BlackRock assets under management that 
are currently aligned to net zero, and announcing an interim target on the 
proportion of BlackRock assets under management that will be aligned to net 
zero in 2030, for markets with sufficiently reliable data; and 
 
·        Through Aladdin Climate, helping more investors manage and meet their 
climate objectives by tracking investment portfolios' trajectories toward net 
zero, and helping to catalyse increasingly robust and standardised climate data 
and metrics to better serve the industry. 
 
Investment Management 
 
·        Incorporating the impacts of climate change into BlackRock's capital 
market assumptions, the cornerstone for portfolio construction at BlackRock; 
 
·        Implementing a 'heightened-scrutiny model' in BlackRock's active 
portfolios as a framework and for managing securities that pose significant 
climate risk; and 
 
·        Helping BlackRock's clients benefit from opportunities created by the 
energy transition, from investments in electric cars to clean energy to 
energy-efficient housing. 
 
Stewardship 
 
·        Using investment stewardship to ensure the companies that BlackRock 
invests in on behalf of clients are mitigating climate risk and considering the 
opportunities presented by the net zero transition; 
 
·        Asking companies to disclose a business plan aligned with the goal of 
limiting global warming to well below 2ºC, consistent with achieving net zero 
global greenhouse gas emissions by 2050; and 
 
·        Increasing the role of votes on shareholder proposals in BlackRock's 
stewardship efforts around sustainability. 
 
Integration of ESG into BlackRock's investment management process 
As well as the initiatives set out above, as part of BlackRock's structured 
investment process, ESG risks and opportunities are considered within the 
portfolio management team's fundamental analysis of companies and industries. 
The team aims to assess financial materiality in relation to ESG via data 
insights integrated into the team's standard research templates shown in the 
BlackRock ESG Risk Window. The Risk Window, using MSCI data, flags any 
stock-specific concerns allowing investors to investigate them further. It 
screens for ESG metrics through over 400 single data points and ranks potential 
risks from High to Managed. BlackRock's portfolio management teams also have 
access to other data sources such as RepRisk or SustainAnalytics to complement 
the Risk Window. BlackRock's unparalleled access to company management allows 
it to engage on these issues through questioning management teams and 
conducting site visits. BlackRock looks to understand how management approaches 
ESG risks and opportunities and the potential impact this may have on company 
financials. 
 
The BlackRock Investment Stewardship team (BIS) promotes sound corporate 
governance and sustainable business practices to help maximize long-termshareholder value for BlackRock's clients. BIS does this in three ways: 
engaging with companies, using BlackRock's vote, and promoting thought 
leadership. Through this combination of quantitative and qualitative 
assessment, BlackRock ensures that its understanding of the portfolio's 
investments is thorough, reliable and up to date. The portfolio management 
team's understanding of ESG issues is further supported by BlackRock's 
Sustainable Investment team (BSI). BSI looks to advance ESG research and 
integration, active engagement and the development of sustainable investment 
solutions across the firm. BlackRock believes ESG issues have important 
financial impacts over the long term. 
 
The sustainable investing effort is embedded into BlackRock's culture from the 
top down through the belief that a company's ability to manage ESG matters 
demonstrate the leadership and good governance that is essential to 
sustainable, long-term growth. 
 
Investment stewardship 
BIS plays a fundamental role in the activation of BlackRock's purpose of 
helping more and more people experience financial well-being. As a fiduciary, 
BlackRock has a responsibility to its clients to make sure companies are 
adequately managing and disclosing ESG risks and opportunities that can impact 
their ability to generate long-term financial performance and to hold them 
accountable through BlackRock's vote if they are not. 
 
BlackRock's BIS team has been focusing on sustainability issues for years. Each 
year, the BIS team prioritises its work around several engagement themes that 
it believes will encourage sound governance practices and deliver sustainable 
long-term financial performance for BlackRock clients. For each engagement 
priority, BIS provides a high level, globally relevant 'Key Performance 
Indicator' (KPI) so companies are aware of BlackRock's expectations. 
 
In 2020, BIS put an increased focus on ESG-related issues and relevant 
disclosures, given the growing impact of these issues on long-term value 
creation. To that end, BIS made an explicit ask that companies align their 
disclosures to the TCFD framework and the Sustainability Accounting Standards 
Board (SASB) standards. This includes each investee company's plan for 
operating under a scenario where the Paris Agreement's goal of limiting global 
warming to less than two degrees is fully realised, as expressed by the TCFD 
guidelines. BlackRock is greatly encouraged by the progress it has seen over 
the past year - a 363% increase in SASB disclosures and more than 1,700 
organisations expressing support for the TCFD. 
 
As reported in the BIS 2020 annual report, in the year from 1 July 2019 to 30 
June 2020, BIS held over 3,000 engagements globally with over 2,000 companies 
covering 61% by value of BlackRock's clients' equity investments. In terms of 
voting, BIS voted at approximately 16,200 shareholder meetings and on 153,000 
proposals. Voting is how BIS holds companies accountable when they fall short 
of expectations. BIS might vote against directors or other management proposals 
or might vote to support a shareholder proposal. BIS views holding directors 
accountable as one of the most effective ways to encourage change at a company. 
Given the groundwork already laid through past engagements and the growing 
investment risks surrounding sustainability, BIS will be increasingly disposed 
to vote against the re-election of directors when companies have not made 
sufficient progress. In the year to 30 June 2020, BIS opposed the re-election 
of over 5,100 directors, more than ever before, sending a strong signal of 
concern when companies did not make sufficient progress on issues that are 
central to long-term value creation. BIS raised questions on board quality, 
taking voting action against directors for lack of independence on the board, 
insufficient board diversity and overcommitment. BIS also held directors to 
account for not meeting expectations on climate risk management or disclosures 
and for management and compensation policies inconsistent with sustainable 
long-term financial performance. BIS also sees voting on shareholder proposals 
playing an increasingly important role in BlackRock's stewardship efforts 
around sustainability. Accordingly, where BIS agrees with the intent of a 
shareholder proposal addressing a material business risk, and if BIS determines 
that management could do better in managing and disclosing that risk, BIS will 
support the proposal. BIS may also support a proposal if management is on track 
but BIS believes that voting in favour might accelerate their progress. As a 
long-term investor, BIS has historically engaged to explain its views on an 
issue and given management ample time to address it. However, given the need 
for urgent action on many business relevant sustainability issues, BIS will be 
more likely to support a shareholder proposal without waiting to assess the 
effectiveness of engagement. 
 
As the past year has only intensified BlackRock's conviction that 
sustainability risk, and climate risk in particular, is investment risk, BIS is 
continuing to increase its focus on how sustainability-related factors are 
impacting a company's ability to generate shareholder returns. As detailed in 
the 2021 BIS Stewardship Expectations report and the BIS commentary on Climate 
Risk and Transition to a Low-Carbon Economy, BIS expects companies to disclose 
a business plan aligned with the goal of limiting global warming to well below 
2ºC, consistent with achieving net zero global greenhouse gas (GHG) emissions 
by 2050. These disclosures are essential to helping investors assess a 
company's ability to transition its business to a low-carbon world and to 
capture value-creation opportunities created by the climate transition. This 
report can be found at https://www.blackrock.com/corporate/literature/ 
publication/our-2021-stewardship-expectations.pdf. 
 
BlackRock is also committed to transparency in terms of disclosure on its 
engagement with companies and voting rationales. More details about BlackRock 
Investment Stewardship can be found on BlackRock's website at www.blackrock.com 
/corporate/about-us/investment-stewardship. In terms of its own reporting, 
BlackRock believes that the SASB provides a clear set of standards for 
reporting sustainability information across a wide range of issues, from labour 
practices to data privacy to business ethics. For evaluating and reporting 
climate-related risks, as well as the related governance issues that are 
essential to managing them, the TCFD provides a valuable framework. 
 
BlackRock recognises that reporting to these standards requires significant 
time, analysis, and effort. BlackRock's own SASB-aligned disclosure is 
available on its website at www.blackrock.com/corporate/literature/ 
continuousdisclosure-and-important-information/ 
blackrock-2019-sasb-disclosure.pdf and BlackRock published a detailed 
TCFD-aligned report on its 2020 activities. More information on BlackRock's 
policies on Corporate Sustainability can be found on BlackRock's website at 
www.blackrock.com/corporate/sustainability. 
 
BY ORDER OF THE BOARD 
CAROLINE DRISCOLL 
FOR AND ON BEHALF OF 
BLACKROCK INVESTMENT MANAGEMENT (UK) LIMITED 
Company Secretary 
4 March 2021 
 
TRANSACTIONS WITH THE INVESTMENT MANAGER AND AIFM 
 
BlackRock Fund Managers Limited (BFM) provides management and administration 
services to the Company under a contract which is terminable on six months' 
notice. BFM has (with the Company's consent) delegated certain portfolio and 
risk management services, and other ancillary services to BlackRock Investment 
Management (UK) Limited (BIM (UK)). Further details of the investment 
management contract are disclosed in the Directors' Report in the Annual Report 
and Financial Statements. 
 
The investment management fee due for the year ended 31 December 2020 amounted 
to £6,405,000 (2019: £6,480,000). At the year end, £2,064,000 (2019: £ 
1,714,000) was outstanding in respect of management fees. 
 
In addition to the above services, BlackRock has provided the Group with 
marketing services. The total fees paid or payable for these services for the 
year ended 31 December 2020 amounted to £152,000 excluding VAT (2019: £159,000 
excluding VAT). Marketing fees of £55,000 were outstanding as at 31 December 
2020 (2019: £50,000). 
 
The ultimate holding company of the Manager and the Investment Manager is 
BlackRock, Inc. a company incorporated in Delaware USA. During the period, PNC 
Financial Services Group, Inc. (PNC) was a substantial shareholder in 
BlackRock, Inc. PNC did not provide any services to the Company during the 
financial year ended 31 December 2019 and the period up to 11 May 2020, when 
PNC announced its intent to sell its investment in BlackRock, Inc. through a 
registered offering and related buyback by BlackRock, Inc. 
 
RELATED PARTY TRANSACTIONS 
 
The Board consists of five non-executive Directors all of whom are considered 
to be independent by the Board. None of the Directors has a service contract 
with the Company. The Chairman receives an annual fee of £45,000, the Chairman 
of the Audit & Management Engagement Committee/Senior Independent Director 
receives an annual fee of £37,500, and each other Director receives an annual 
fee of £30,000. All five members of the Board hold shares in the Company. Mr 
Cheyne 24,000 ordinary shares, Mr Edey 20,000 ordinary shares, Ms Lewis 5,362 
ordinary shares, Ms Mosely 7,400 ordinary shares and Mr Oliveira 18,000 
ordinary shares. The amount of Directors' fees outstanding at 31 December 2020 
was £14,375 (2019: £14,375). 
 
STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RESPECT OF THE ANNUAL REPORT AND 
FINANCIAL STATEMENTS 
 
The Directors are responsible for preparing the Annual Report and Financial 
Statements in accordance with applicable law and regulations. Company law 
requires the Directors to prepare financial statements for each financial year. 
Under that law, the Directors are required to prepare the financial statements 
in accordance with International Financial Reporting Standards (IFRS) adopted 
pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union 
and in conformity with the requirements of the Companies Act 2006. 
 
Under Company law, the Directors must not approve the financial statements 
unless they are satisfied that they give a true and fair view of the state of 
affairs of the Group and Company and of the profit or loss of the Group for 
that period. In preparing those financial statements, the Directors are 
required to: 
 
·        present fairly the financial position, financial performance and cash 
flows of the Group and Company; 
 
·        select suitable accounting policies in accordance with IAS 8: 
Accounting Policies, Changes in Accounting Estimates and Errors and then apply 
them consistently; 
 
·        present information, including accounting policies, in a manner that 
provides relevant, reliable, comparable and understandable information; 
 
·        make judgements and estimates that are reasonable and prudent; 
 
·        state whether the financial statements have been prepared in 
accordance with IFRS adopted pursuant to Regulation (EC) No 1606/2002 as it 
applies in the European Union and in conformity with the requirements of the 
Companies Act 2006, subject to any material departures disclosed and explained 
in the financial statements; 
 
·        provide additional disclosures when compliance with the specific 
requirements in accordance with IFRS adopted pursuant to Regulation (EC) No 
1606/2002 as it applies in the European Union and in conformity with the 
requirements of the Companies Act 2006 is insufficient to enable users to 
understand the impact of particular transactions, other events and conditions 
on the Group's and Company's financial position and financial performance; and 
 
·        prepare the financial statements on the going concern basis unless it 
is inappropriate to presume that the Group and Company will continue in 
business. 
 
The Directors are responsible for keeping adequate accounting records that are 
sufficient to show and explain the Group's and Company's transactions and 
disclose with reasonable accuracy at any time the financial position of the 
Group and Company and enable them to ensure that the financial statements 
comply with the Companies Act 2006. 
 
They are also responsible for safeguarding the assets of the Company and hence 
for taking reasonable steps for the prevention and detection of fraud and other 
irregularities. 
 
The Directors are also responsible for preparing the Strategic Report, 
Directors' Report, the Directors' Remuneration Report, the Corporate Governance 
Statement and the Report of the Audit & Management Engagement Committee in 
accordance with the Companies Act 2006 and applicable regulations, including 
the requirements of the Listing Rules and the Disclosure Guidance and 
Transparency Rules. The Directors have delegated responsibility to the Manager 
for the maintenance and integrity of the Company's corporate and financial 
information included on the BlackRock website. Legislation in the United 
Kingdom governing the preparation and dissemination of financial statements may 
differ from legislation in other jurisdictions. 
 
Each of the Directors, whose names are listed in the Annual Report and 
Financial Statements, confirm to the best of their knowledge that: 
 
·        the financial statements, which have been prepared in accordance with 
IFRS adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the 
European Union and in conformity with the requirements of the Companies Act 
2006, give a true and fair view of the assets, liabilities, financial position 
and net return of the Group and Company; and 
 
·        the Strategic Report contained in the Annual Report and Financial 
Statements includes a fair review of the development and performance of the 
business and the position of the Group and Company, together with a description 
of the principal risks and uncertainties that it faces. 
 
The 2018 UK Corporate Governance Code also requires Directors to ensure that 
the Annual Report and Financial Statements are fair, balanced and 
understandable. In order to reach a conclusion on this matter, the Board has 
requested that the Audit & Management Engagement Committee advise on whether it 
considers that the Annual Report and Financial Statements fulfil these 
requirements. The process by which the Committee has reached these conclusions 
is set out in the Audit & Management Engagement Committee's Report in the 
Annual Report and Financial Statements. As a result, the Board has concluded 
that the Annual Report and Financial Statements for the year ended 31 December 
2020, taken as a whole, are fair, balanced and understandable and provide the 
information necessary for shareholders to assess the Group's and Company's 
position, performance, business model and strategy. 
 
FOR AND ON BEHALF OF THE BOARD 
DAVID CHEYNE 
Chairman 
4 March 2021 
 
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEARED 31 DECEMBER 
2020 
 
                                           Revenue         Revenue         Capital         Capital           Total           Total 
                                              2020            2019            2020            2019            2020            2019 
                             Notes           £'000           £'000           £'000           £'000           £'000           £'000 
 
Income from investments          3          31,507          40,880               -               -          31,507          40,880 
held at fair value through 
profit or loss 
 
Other income                     3           7,964           5,634               -               -           7,964           5,634 
 
                                    --------------  --------------  --------------  --------------  --------------  -------------- 
 
Total revenue                               39,471          46,514               -               -          39,471          46,514 
 
                                          ========        ========        ========        ========        ========        ======== 
 
Net profit on investments                        -               -         183,667          77,517         183,667          77,517 
held at fair value through 
profit or loss 
 
Net profit on foreign                            -               -           2,431           3,230           2,431           3,230 
exchange 
 
                                    --------------  --------------  --------------  --------------  --------------  -------------- 
 
Total                                       39,471          46,514         186,098          80,747         225,569         127,261 
 
                                          ========        ========        ========        ========        ========        ======== 
 
Expenses 
 
Investment management fee        4          (1,546)         (1,564)         (4,859)         (4,916)         (6,405)         (6,480) 
 
Other operating expenses         5            (997)         (1,030)            (18)            (20)         (1,015)         (1,050) 
 
                                    --------------  --------------  --------------  --------------  --------------  -------------- 
 
Total operating expenses                    (2,543)         (2,594)         (4,877)         (4,936)         (7,420)         (7,530) 
 
                                          ========        ========        ========        ========        ========        ======== 
 
Net profit on ordinary                      36,928          43,920         181,221          75,811         218,149         119,731 
activities before finance 
costs and taxation 
 
Finance costs                    6            (424)           (896)         (1,272)         (2,683)         (1,696)         (3,579) 
 
                                    --------------  --------------  --------------  --------------  --------------  -------------- 
 
Net profit on ordinary                      36,504          43,024         179,949          73,128         216,453         116,152 
activities before taxation 
 
                                          ========        ========        ========        ========        ========        ======== 
 
Taxation                                    (1,053)         (3,463)          1,115           1,377              62          (2,086) 
 
Profit for the year                         35,451          39,561         181,064          74,505         216,515         114,066 
 
                                    --------------  --------------  --------------  --------------  --------------  -------------- 
 
Earnings per ordinary            8           20.40           22.46          104.22           42.30          124.62           64.76 
share (pence) 
 
                                          ========        ========        ========        ========        ========        ======== 
 
The total column of this statement represents the Group's Statement of 
Comprehensive Income, prepared in accordance with international accounting 
standards in conformity with the requirements of the Companies Act 2006. The 
supplementary revenue and capital columns are both prepared under guidance 
published by the Association of Investment Companies (AIC). All items in the 
above statement derive from continuing operations. No operations were acquired 
or discontinued during the year. All income is attributable to the equity 
holders of the Group. 
 
The Group does not have any other comprehensive income. The profit for the year 
disclosed above represents the Group's total comprehensive income. 
 
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31 DECEMBER 2020 
 
                                         Called           Share         Capital 
                                       up share         premium      redemption         Special         Capital         Revenue 
                                        capital         account         reserve         reserve        reserves         reserve           Total 
Group                     Notes           £'000           £'000           £'000           £'000           £'000           £'000           £'000 
 
For the year ended 31 
December 2020 
 
At 31 December 2019                       9,651         127,155          22,779         108,601         447,806          41,118         757,110 
 
Total comprehensive 
income: 
 
Net profit for the year                       -               -               -               -         181,064          35,451         216,515 
 
Transactions with 
owners, recorded 
directly to equity: 
 
Ordinary shares            9,10               -               -               -          (4,573)              -               -          (4,573) 
purchased into treasury 
 
Share purchase costs       9,10               -               -               -             (36)              -               -             (36) 
 
Dividends paid1               7               -               -               -               -               -         (38,191)        (38,191) 
 
                                 --------------  --------------  --------------  --------------  --------------  --------------  -------------- 
 
At 31 December 2020                       9,651         127,155          22,779         103,992         628,870          38,378         930,825 
 
                                       ========        ========        ========        ========        ========        ========        ======== 
 
For the year ended 31 
December 2019 
 
At 31 December 2018                       9,651         127,155          22,779         114,147         373,301          38,562         685,595 
 
Total comprehensive 
income: 
 
Net profit for the year                       -               -               -               -          74,505          39,561         114,066 
 
Transactions with 
owners, recorded 
directly to equity: 
 
Ordinary shares                               -               -               -          (5,512)              -               -          (5,512) 
purchased into treasury 
 
Share purchase costs                          -               -               -             (34)              -               -             (34) 
 
Dividends paid2               7               -               -               -               -               -         (37,005)        (37,005) 
 
                                 --------------  --------------  --------------  --------------  --------------  --------------  -------------- 
 
At 31 December 2019                       9,651         127,155          22,779         108,601         447,806          41,118         757,110 
 
                                       ========        ========        ========        ========        ========        ========        ======== 
 
1        The final dividend of 10.00p per share for the year ended 31 December 
2019, declared on 27 February 2020 and paid on 7 May 2020; 1st interim dividend 
of 4.00p per share for the year ended 31 December 2020, declared on 30 April 
2020 and paid on 26 June 2020; 2nd interim dividend of 4.00p per share for the 
year ended 31 December 2020, declared on 19 August 2020 and paid on 25 
September 2020 and 3rd interim dividend of 4.00p per share for the year ended 
31 December 2020, declared on 12 November 2020 and paid on 18 December 2020. 
 
2        The final dividend of 9.00p per share for the year ended 31 December 
2018, declared on 28 February 2019 and paid on 10 May 2019; 1st interim 
dividend of 4.00p per share for the year ended 31 December 2019, declared on 2 
May 2019 and paid on 28 June 2019; 2nd interim dividend of 4.00p per share for 
the year ended 31 December 2019, declared on 20 August 2019 and paid on 1 
October 2019 and 3rd interim dividend of 4.00p per share for the year ended 31 
December 2019, declared on 14 November 2019 and paid on 20 December 2019. 
 
For information on the Company's distributable reserves, please refer to note 
17 in the Annual Report and Financial Statements. 
 
PARENT COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE YEARED 31 DECEMBER 
2020 
 
                                         Called           Share         Capital 
                                       up share         premium      redemption         Special         Capital         Revenue 
                                        capital         account         reserve         reserve        reserves         reserve           Total 
Company                   Notes           £'000           £'000           £'000           £'000           £'000           £'000           £'000 
 
For the year ended 31 
December 2020 
 
At 31 December 2019                       9,651         127,155          22,779         108,601         454,613          34,311         757,110 
 
Total comprehensive 
income: 
 
Net profit for the year                       -               -               -               -         179,934          36,581         216,515 
 
Transactions with 
owners, recorded 
directly to equity: 
 
Ordinary shares            9,10               -               -               -          (4,573)              -               -          (4,573) 
purchased into treasury 
 
Share purchase costs       9,10               -               -               -             (36)              -               -             (36) 
 
Dividends paid1               7               -               -               -               -               -         (38,191)        (38,191) 
 
                                 --------------  --------------  --------------  --------------  --------------  --------------  -------------- 
 
At 31 December 2020                       9,651         127,155          22,779         103,992         634,547          32,701         930,825 
 
                                       ========        ========        ========        ========        ========        ========        ======== 
 
For the year ended 31 
December 2019 
 
At 31 December 2018                       9,651         127,155          22,779         114,147         380,486          31,377         685,595 
 
Total comprehensive 
income: 
 
Net profit for the year                       -               -               -               -          74,127          39,939         114,066 
 
Transactions with 
owners, recorded 
directly to equity: 
 
Ordinary shares                               -               -               -          (5,512)              -               -          (5,512) 
purchased into treasury 
 
Share purchase costs                          -               -               -             (34)              -               -             (34) 
 
Dividends paid2               7               -               -               -               -               -         (37,005)        (37,005) 
 
                                 --------------  --------------  --------------  --------------  --------------  --------------  -------------- 
 
At 31 December 2019                       9,651         127,155          22,779         108,601         454,613          34,311         757,110 
 
                                       ========        ========        ========        ========        ========        ========        ======== 
 
1        The final dividend of 10.00p per share for the year ended 31 December 
2019, declared on 27 February 2020 and paid on 7 May 2020; 1st interim dividend 
of 4.00p per share for the year ended 31 December 2020, declared on 30 April 
2020 and paid on 26 June 2020; 2nd interim dividend of 4.00p per share for the 
year ended 31 December 2020, declared on 19 August 2020 and paid on 25 
September 2020 and 3rd interim dividend of 4.00p per share for the year ended 
31 December 2020, declared on 12 November 2020 and paid on 18 December 2020. 
 
2        The final dividend of 9.00p per share for the year ended 31 December 
2018, declared on 28 February 2019 and paid on 10 May 2019; 1st interim 
dividend of 4.00p per share for the year ended 31 December 2019, declared on 2 
May 2019 and paid on 28 June 2019; 2nd interim dividend of 4.00p per share for 
the year ended 31 December 2019, declared on 20 August 2019 and paid on 1 
October 2019 and 3rd interim dividend of 4.00p per share for the year ended 31 
December 2019, declared on 14 November 2019 and paid on 20 December 2019. 
 
For information on the Company's distributable reserves, please refer to note 
17 in the Annual Report and Financial Statements. 
 
CONSOLIDATED AND PARENT COMPANY STATEMENTS OF FINANCIAL POSITION AS AT 31 
DECEMBER 2020 
 
                                                           31 December 2020                31 December 2019 
 
                                                             Group         Company           Group         Company 
                                             Notes           £'000           £'000           £'000           £'000 
 
Non current assets 
 
Investments held at fair value through                   1,045,818       1,052,996         845,777         851,732 
profit or loss 
 
Current assets 
 
Other receivables                                            6,837           6,837           4,626           4,626 
 
Cash collateral held with brokers                            2,943           2,943             431             431 
 
Cash and cash equivalents                                      309             309           1,399              39 
 
                                                    --------------  --------------  --------------  -------------- 
 
Total current assets                                        10,089          10,089           6,456           5,096 
 
                                                          ========        ========        ========        ======== 
 
Total assets                                             1,055,907       1,063,085         852,233         856,828 
 
                                                          ========        ========        ========        ======== 
 
Current liabilities 
 
Other payables                                              (5,545)         (6,613)         (4,003)         (5,071) 
 
Derivative financial liabilities held at                      (587)           (587)           (314)           (314) 
fair value through profit or loss 
 
Bank overdraft                                             (16,317)        (22,427)            (99)         (3,626) 
 
Bank loans                                                (102,418)       (102,418)        (90,583)        (90,583) 
 
                                                    --------------  --------------  --------------  -------------- 
 
Total current liabilities                                 (124,867)       (132,045)        (94,999)        (99,594) 
 
                                                    --------------  --------------  --------------  -------------- 
 
Total assets less current liabilities                      931,040         931,040         757,234         757,234 
 
                                                          ========        ========        ========        ======== 
 
Non current liabilities 
 
Deferred taxation liability                                   (215)           (215)           (124)           (124) 
 
                                                    --------------  --------------  --------------  -------------- 
 
Net assets                                                 930,825         930,825         757,110         757,110 
 
                                                          ========        ========        ========        ======== 
 
Equity attributable to equity holders 
 
Called up share capital                          9           9,651           9,651           9,651           9,651 
 
Share premium account                           10         127,155         127,155         127,155         127,155 
 
Capital redemption reserve                      10          22,779          22,779          22,779          22,779 
 
Special reserve                                 10         103,992         103,992         108,601         108,601 
 
Capital reserves: 
 
At 1 January                                               447,806         454,613         373,301         380,486 
 
Net profit for the year                                    181,064         179,934          74,505          74,127 
 
                                                10         628,870         634,547         447,806         454,613 
 
Revenue reserve: 
 
At 1 January                                                41,118          34,311          38,562          31,377 
 
Net profit for the year                                     35,451          36,581          39,561          39,939 
 
Dividends paid                                             (38,191)        (38,191)        (37,005)        (37,005) 
 
                                                10          38,378          32,701          41,118          34,311 
 
                                                    --------------  --------------  --------------  -------------- 
 
Total equity                                               930,825         930,825         757,110         757,110 
 
                                                          ========        ========        ========        ======== 
 
Net asset value per ordinary share (pence)       8          536.34          536.34          433.17          433.17 
 
                                                          ========        ========        ========        ======== 
 
CONSOLIDATED AND PARENT COMPANY CASH FLOW STATEMENTS FOR THE YEARED 31 
DECEMBER 2020 
 
                                                            31 December 2020                31 December 2019 
 
 
 
                                                              Group         Company           Group         Company 
                                                              £'000           £'000           £'000           £'000 
 
Operating activities 
 
Net profit before taxation                                  216,453         216,453         116,152         116,152 
 
Add back finance costs                                        1,696           1,696           3,579           3,579 
 
Net profit on investments held at fair                     (182,539)       (182,536)        (76,960)        (77,141) 
value through profit or loss (including 
transaction costs) 
 
Net profit on foreign exchange                               (2,431)         (2,431)         (3,230)         (3,230) 
 
Sales of investments held at fair value                     360,288         359,062         377,210         377,210 
through profit or loss 
 
Purchases of investments held at fair value                (377,517)       (377,517)       (367,499)       (367,499) 
through profit or loss 
 
Decrease/(increase) in other receivables                        618             618          (2,058)         (2,058) 
 
Increase in other payables                                      268             268             268             270 
 
Increase in amounts due from brokers                         (2,902)         (2,902)           (118)           (118) 
 
Increase/(decrease) in amounts due to                          2,473          2,473         (13,713)        (13,713) 
brokers 
 
Net movement in cash collateral held with                    (2,512)         (2,512)            219             219 
brokers 
 
                                                           ========        ========        ========        ======== 
 
Net cash inflow from operating activities                    13,895          12,672          33,850          33,671 
before taxation 
 
                                                           ========        ========        ========        ======== 
 
Taxation paid                                                (1,038)         (1,038)         (2,035)         (2,035) 
 
Taxation on investment income included                       (1,664)         (1,664)           (124)           (124) 
within gross income 
 
Prior year corporation tax refund                             2,687           2,687               -               - 
 
                                                           ========        ========        ========        ======== 
 
Net cash inflow from operating activities                    13,880          12,657          31,691          31,512 
 
                                                           ========        ========        ========        ======== 
 
Financing activities 
 
Drawdown/(repayment) of loans                                15,016          15,016         (20,000)        (20,000) 
 
Interest paid                                                (1,772)         (1,772)         (3,815)         (3,815) 
 
Payments for ordinary shares purchased into                  (5,455)         (5,455)         (4,632)         (4,632) 
treasury 
 
Share purchase costs paid                                       (36)            (36)            (32)            (32) 
 
Dividends paid                                              (38,191)        (38,191)        (37,005)        (37,005) 
 
                                                           ========        ========        ========        ======== 
 
Net cash outflow from financing activities                  (30,438)        (30,438)        (65,484)        (65,484) 
 
                                                           ========        ========        ========        ======== 
 
Decrease in cash and cash equivalents                       (16,558)        (17,781)        (33,793)        (33,972) 
 
Cash and cash equivalents at start of the                     1,300          (3,587)         35,501          30,793 
year 
 
Effect of foreign exchange rate changes                        (750)           (750)           (408)           (408) 
 
                                                     --------------  --------------  --------------  -------------- 
 
Cash and cash equivalents at end of year                    (16,008)        (22,118)          1,300          (3,587) 
 
                                                           ========        ========        ========        ======== 
 
Comprised of: 
 
Cash and cash equivalents                                       309             309           1,399              39 
 
Bank overdraft                                              (16,317)        (22,427)            (99)         (3,626) 
 
                                                     --------------  --------------  --------------  -------------- 
 
                                                            (16,008)        (22,118)          1,300          (3,587) 
 
                                                           ========        ========        ========        ======== 
 
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARED 31 DECEMBER 2020 
 
1. PRINCIPAL ACTIVITY 
The principal activity of the Company is that of an investment trust company 
within the meaning of section 1158 of the Corporation Tax Act 2010. The Company 
was incorporated on 28 October 1993 and this is the 27th Annual Report. 
 
The principal activity of the subsidiary, BlackRock World Mining Investment 
Company Limited, is investment dealing. 
 
2. ACCOUNTING POLICIES 
The principal accounting policies adopted by the Group and Company have been 
applied consistently, other than where new policies have been adopted and are 
set out below. 
 
(a) Basis of preparation 
The Group and Parent Company financial statements have been prepared under the 
historic cost convention modified by the revaluation of certain financial 
assets and financial liabilities held at fair value through profit or loss and 
in accordance with International Financial Reporting Standards (IFRS) adopted 
pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union 
and in conformity with the requirements of the Companies Act 2006. The Company 
has taken advantage of the exemption provided under section 408 of the 
Companies Act 2006 not to publish its individual Statement of Comprehensive 
Income and related notes. All of the Group's operations are of a continuing 
nature. 
 
Insofar as the Statement of Recommended Practice (SORP) for investment trust 
companies and venture capital trusts issued by the Association of Investment 
Companies (AIC) in October 2019, is compatible with IFRS adopted pursuant to 
Regulation (EC) No 1606/2002 as it applies in the European Union and in 
conformity with the requirements of the Companies Act 2006, the financial 
statements have been prepared in accordance with guidance set out in the SORP. 
 
Substantially all of the assets of the Group consist of securities that are 
readily realisable and, accordingly, the Directors believe that the Group has 
adequate resources to continue in operational existence for the foreseeable 
future. Consequently, the Directors have determined that it is appropriate for 
the financial statements to be prepared on a going concern basis. The Directors 
have considered any potential impact of the COVID-19 pandemic and the 
mitigation measures which key service providers, including the Manager, have in 
place to maintain operational resilience on the going concern of the Company. 
The Directors have reviewed compliance with the covenants associated with the 
bank overdraft facility, loan facility, income and expense projections and the 
liquidity of the investment portfolio in making their assessment. 
 
The Group's financial statements are presented in sterling, which is the 
functional currency of the Group and the currency of the primary economic 
environment in which the Group operates. All values are rounded to the nearest 
thousand pounds (£'000) except where otherwise indicated. 
 
IFRS standards that have recently been adopted: 
Amendments to IFRS 3 - definition of a business (effective 1 January 2020). 
This amendment revises the definition of a business. According to feedback 
received by the International Accounting Standards Board, application of the 
current guidance is commonly thought to be too complex and it results in too 
many transactions qualifying as business combinations. The standard has been 
endorsed by the EU. The adoption of this standard has had no impact on the 
financial statements of the Group. 
 
Amendments to IAS 1 and IAS 8 - definition of material (effective 1 January 
2020). The amendments to IAS 1, 'Presentation of Financial Statements', and IAS 
8, 'Accounting Policies, Changes in Accounting Estimates and Errors', and 
consequential amendments to other IFRSs require companies to: 
 
(i)      use a consistent definition of materiality throughout IFRSs and the 
Conceptual Framework for Financial Reporting; 
 
(ii)     clarify the explanation of the definition of material; and 
 
(iii)    incorporate some of the guidance of IAS 1 about immaterial 
information. 
 
This standard has been endorsed by the EU. The adoption of this standard has 
had no impact on the financial statements of the Group. 
 
Amendments to IFRS 9, IAS 39 and IFRS 7 - interest rate benchmark reform 
(effective 1 January 2020). These amendments provide certain reliefs in 
connection with the interest rate benchmark reform. The reliefs relate to hedge 
accounting and have the effect that the Inter Bank Offer Rate (IBOR) reform 
should not generally cause hedge accounting to terminate. However, any hedge 
ineffectiveness should continue to be recorded in the income statement. Given 
the pervasive nature of hedges involving IBOR based contracts, the reliefs will 
affect companies in all industries. 
 
This standard has been endorsed by the EU. The adoption of this standard has 
had no impact on the financial statements of the Group as it does not hedge. 
 
IFRS standards that have yet to be adopted: 
A number of new standards, amendments to standards and interpretations are 
effective for the annual periods beginning on or after 1 January 2021 and have 
not been adopted early in preparing these financial statements (major changes 
and new standards issued are detailed below), as these are not expected to have 
any effect on the measurement of the amounts recognised in the financial 
statements of the Group. 
 
IFRS 17 - insurance contracts (effective 1 January 2021). This standard 
replaces IFRS 4, which currently permits a wide variety of practices in 
accounting for insurance contracts. IFRS 17 will fundamentally change the 
accounting by all entities that issue insurance contracts and investment 
contracts with discretionary participation features. The standard has not been 
endorsed by the EU. This standard is unlikely to have any impact on the Group 
as it has no insurance contracts. 
 
(b) Basis of consolidation 
The Group's financial statements are made up to 31 December each year and 
consolidate the financial statements of the Company and its wholly owned 
subsidiary, which is registered and operates in England and Wales, BlackRock 
World Mining Investment Company Limited (together 'the Group'). The subsidiary 
company is not considered an investment entity. 
 
Subsidiaries are consolidated from the date of their acquisition, being the 
date on which the Company obtains control, and continue to be consolidated 
until the date that such control ceases. The financial statements of 
subsidiaries used in the preparation of the consolidated financial statements 
are based on consistent accounting policies. All intra-group balances and 
transactions, including unrealised profits arising therefrom, are eliminated. 
 
(c) Presentation of the Statement of Comprehensive Income 
In order to better reflect the activities of an investment trust company and in 
accordance with guidance issued by the AIC, supplementary information which 
analyses the Consolidated Statement of Comprehensive Income between items of a 
revenue and a capital nature has been presented alongside the Consolidated 
Statement of Comprehensive Income. 
 
(d) Segmental reporting 
The Directors are of the opinion that the Group is engaged in a single segment 
of business being investment business. 
 
(e) Income 
Dividends receivable on equity shares are recognised as revenue for the year on 
an ex-dividend basis. Where no ex-dividend date is available, dividends 
receivable on or before the year end are treated as revenue for the year. 
Provision is made for any dividends and interest income not expected to be 
received. Special dividends, if any, are treated as a capital or a revenue 
receipt depending on the facts or circumstances of each particular case. The 
return on a debt security is recognised on a time apportionment basis so as to 
reflect the effective yield on the debt security. Interest income and deposit 
interest is accounted for on an accruals basis. 
 
Options may be purchased or written over securities held in the portfolio for 
generating or protecting capital returns, or for generating or maintaining 
revenue returns. Where the purpose of the option is the generation of income, 
the premium is treated as a revenue item. Where the purpose of the option is 
the maintenance of capital, the premium is treated as a capital item. 
 
Option premium income is recognised as revenue evenly over the life of the 
option contract and included in the revenue column of the Consolidated 
Statement of Comprehensive Income unless the option has been written for the 
maintenance and enhancement of the Group's investment portfolio and represents 
an incidental part of a larger capital transaction, in which case any premia 
arising are allocated to the capital column of the Consolidated Statement of 
Comprehensive Income. 
 
Royalty income from contractual rights is measured at the fair value of the 
consideration received or receivable where the Investment Manager can reliably 
estimate the amount, pursuant to the terms of the agreement. Royalty income 
from contractual rights received comprise of a return of income and a return of 
capital based on the underlying cost of the contract and, accordingly, the 
return of income element is taken to the revenue account and the return of 
capital element is taken to the capital account. These amounts are disclosed in 
the Consolidated Statement of Comprehensive Income within income from 
investments and gains/losses on investments held at fair value through profit 
or loss, respectively. 
 
The useful life of the contractual rights will be determined by reference to 
the contractual arrangements, the planned mine life on commencement of mining 
and the underlying cost of the contractual rights will be revalued on a 
systematic basis using the units of production method over the life of the 
contractual rights which is estimated using available estimated proved and 
probable reserves specifically associated with the mine. The Investment Manager 
relies on public disclosures for information on proven and probable reserves 
from the operators of the mine. Amortisation rates are adjusted on a 
prospective basis for all changes to estimates of the life of contractual 
rights and iron ore reserves. These are disclosed in the Consolidated Statement 
of Comprehensive Income within gains/losses on investments held at fair value 
through profit or loss. 
 
Where the Group has elected to receive its dividends in the form of additional 
shares rather than in cash, the cash equivalent of the dividend is recognised 
as income. Any excess in the value of the shares received over the amount of 
the cash dividend is recognised in capital. 
 
Underwriting commission receivable is taken into account on an accruals basis. 
 
(f) Expenses 
All expenses, including finance costs, are accounted for on an accruals basis. 
Expenses have been charged wholly to the revenue column of the Consolidated 
Statement of Comprehensive Income, except as follows: 
 
·        expenses which are incidental to the acquisition or sale of an 
investment are charged to the capital column of the Consolidated Statement of 
Comprehensive Income. Details of transaction costs on the purchases and sales 
of investments are disclosed within note 10 to the financial statements in the 
Annual Report and Financial Statements; 
 
·        expenses are treated as capital where a connection with the 
maintenance or enhancement of the value of the investments can be demonstrated; 
and 
 
·        the investment management fee and finance costs have been allocated 
75% to the capital column and 25% to the revenue column of the Consolidated 
Statement of Comprehensive Income in line with the Board's expectations of the 
long term split of returns, in the form of capital gains and income, 
respectively, from the investment portfolio. 
 
(g) Taxation 
The tax expense represents the sum of the tax currently payable and deferred 
tax. The tax currently payable is based on the taxable profit for the year. 
Taxable profit differs from net profit as reported in the Consolidated 
Statement of Comprehensive Income because it excludes items of income or 
expenses that are taxable or deductible in other years and it further excludes 
items that are never taxable or deductible. The Group's liability for current 
tax is calculated using tax rates that were applicable at the balance sheet 
date. 
 
Where expenses are allocated between capital and revenue, any tax relief in 
respect of the expenses is allocated between capital and revenue returns on the 
marginal basis using the Company's effective rate of corporation tax for the 
accounting period. 
 
Deferred taxation is recognised in respect of all temporary differences that 
have originated but not reversed at the financial reporting date, where 
transactions or events that result in an obligation to pay more tax in the 
future or right to pay less tax in the future have occurred at the financial 
reporting date. This is subject to deferred taxation assets only being 
recognised if it is considered more likely than not that there will be suitable 
profits from which the future reversal of the temporary differences can be 
deducted. Deferred taxation assets and liabilities are measured at the rates 
applicable to the legal jurisdictions in which they arise. 
 
(h) Investments held at fair value through profit or loss 
In accordance with IFRS 9, the Group classifies its investments at initial 
recognition as held at fair value through profit or loss and are managed and 
evaluated on a fair value basis in accordance with its investment strategy and 
business model. 
 
All investments, including contractual rights, are initially and subsequently 
measured at fair value through profit or loss. Purchases of investments are 
recognised on a trade date basis. Contractual rights are recognised on the 
completion date, where a purchase of the rights is under a contract, and are 
initially measured at fair value excluding transaction costs. Sales of 
investments are recognised at the trade date of the disposal. 
 
The fair value of the financial investments is based on their quoted bid price 
at the financial reporting date, without deduction for the estimated future 
selling costs. This policy applies to all current and non current asset 
investments held by the Group. 
 
The gains and losses from changes in fair value of contractual rights are taken 
to the Consolidated Statement of Comprehensive Income and arise as a result of 
the revaluation of the underlying cost of the contractual rights, changes in 
commodity prices and changes in estimates of proven and probable reserves 
specifically associated with the mine. 
 
Under IFRS, the investment in the subsidiary in the Company's Statement of 
Financial Position is fair valued which is deemed to be the net asset value of 
the subsidiary. Changes in the value of investments held at fair value through 
profit or loss and gains and losses on disposal are recognised in the 
Consolidated Statement of Comprehensive Income as 'Net profits or losses on 
investments held at fair value through profit or loss'. Also included within 
the heading are transaction costs in relation to the purchase or sale of 
investments. 
 
For all financial instruments not traded in an active market, the fair value is 
determined by using various valuation techniques. Valuation techniques include 
market approach (i.e., using recent arm's length market transactions adjusted 
as necessary and reference to the current market value of another instrument 
that is substantially the same) and the income approach (i.e., discounted cash 
flow analysis and option pricing models making as much use of available and 
supportable market data as possible). Where no reliable fair value can be 
estimated for such instruments, they are carried at cost subject to any 
provision for impairment. See note 2(q) below. 
 
(i) Options 
Options are held at fair value based on the bid/offer prices of the options 
written to which the Group is exposed. The value of the option is subsequently 
marked-to-market to reflect the fair value of the option based on traded 
prices. Where the premium is taken to revenue, an appropriate amount is shown 
as capital return such that the total return reflects the overall change in the 
fair value of the option. When an option is exercised the gain or loss is 
accounted for as a capital gain or loss. Any cost on closing out an option is 
transferred to revenue along with any remaining unamortised premium. 
 
(j) Other receivables and other payables 
Other receivables and other payables do not carry any interest and are 
short-term in nature and are accordingly stated on an amortised cost basis. 
 
(k) Dividends payable 
Under IFRS, final dividends should not be accrued in the financial statements 
unless they have been approved by shareholders before the financial reporting 
date. Interim dividends should not be accrued in the financial statements 
unless they have been paid. 
 
Dividends payable to equity shareholders are recognised in the Consolidated and 
Parent Company Statements of Changes in Equity. 
 
(l) Foreign currency translation 
Transactions involving foreign currencies are converted at the rate ruling at 
the date of the transaction. Foreign currency monetary assets and liabilities 
and non monetary assets held at fair value are translated into sterling at the 
rate ruling on the financial reporting date. Foreign exchange differences 
arising on translation are recognised in the Consolidated Statement of 
Comprehensive Income as a revenue or capital item depending on the income or 
expense to which they relate. For investment transactions and investments held 
at the year end, denominated in a foreign currency, the resulting gains or 
losses are included in the profit/(loss) on investments held at fair value 
through profit or loss in the Consolidated Statement of Comprehensive Income. 
 
(m) Cash and cash equivalents 
Cash comprises cash in hand, bank overdrafts and on demand deposits. Cash 
equivalents are short-term, highly liquid investments that are readily 
convertible to known amounts of cash and that are subject to an insignificant 
risk of changes in value. Bank overdrafts are shown separately on the 
Consolidated and Parent Company Statements of Financial Position. 
 
(n) Bank borrowings 
Bank overdrafts and loans are recorded as the proceeds received. Finance 
charges, including any premium payable on settlement or redemption and direct 
issue costs, are accounted for on an accruals basis in the Consolidated 
Statement of Comprehensive Income using the effective interest rate method and 
are added to the carrying amount of the instrument to the extent that they are 
not settled in the period in which they arise. 
 
(o) Offsetting 
Financial assets and financial liabilities are offset and the net amount 
reported in the Consolidated and Parent Company Statements of Financial 
Position if there is a currently enforceable legal right to offset the 
recognised amounts and there is an intention to settle on a net basis, or to 
realise the asset and settle the liability simultaneously. 
 
(p) Share repurchases and share reissues 
Shares repurchased and subsequently cancelled - share capital is reduced by the 
nominal value of the shares repurchased and the capital redemption reserve is 
correspondingly increased in accordance with section 733 of the Companies Act 
2006. The full cost of the repurchase is charged to the special reserve. 
 
Shares repurchased and held in treasury - the full cost of the repurchase is 
charged to the special reserve. 
 
Where treasury shares are subsequently reissued: 
 
·        amounts received to the extent of the repurchase price are credited to 
the special reserve; and 
 
·        any surplus received in excess of the repurchase price is taken to the 
share premium account. 
 
(q) Critical accounting estimates and judgements 
The Group makes estimates and assumptions concerning the future. The resulting 
accounting estimates and assumptions will, by definition, seldom equal the 
related actual results. Estimates and judgements are regularly evaluated and 
are based on historical experience and other factors, including expectations of 
future events that are believed to be reasonable under the circumstances. The 
estimates and assumptions that have a significant risk of causing a material 
adjustment to the carrying amounts of assets and liabilities within the next 
financial year are addressed below. 
 
Fair value of unquoted financial instruments 
When the fair values of financial assets and financial liabilities recorded in 
the Consolidated and Parent Company Statements of Financial Position cannot be 
derived from active markets, their fair value is determined using a variety of 
valuation techniques that include the use of valuation models. 
 
(a)     The fair value of the OZ Minerals contractual rights was assessed by an 
independent valuer with a recognised and relevant professional qualification. 
The inputs to these models are taken from observable markets where possible, 
but where this is not feasible, estimation is required in establishing fair 
values. The estimates include considerations of production profiles, commodity 
prices, cash flows and discount rates. Changes in assumptions about these 
factors could affect the reported fair value of financial instruments in the 
Consolidated and Parent Company Statements of Financial Position and the level 
where the instruments are disclosed in the fair value hierarchy. To assess the 
significance of a particular input to the entire measurement, the external 
valuer performs sensitivity analysis. 
 
(b)     The investment in the subsidiary company was valued based on the net 
assets of the subsidiary company, which is considered appropriate based on the 
nature and volume of transactions in the subsidiary company. 
 
The key assumptions used to determine the fair value of the unquoted financial 
instruments and sensitivity analyses are provided in note 18(d) in the Annual 
Report and Financial Statements. 
 
3. INCOME 
 
                                                                          2020     2019 
                                                                         £'000    £'000 
 
Investment income: 
 
UK dividends                                                            12,328   11,817 
 
UK special dividends                                                         -    4,402 
 
Overseas dividends                                                      12,133   11,394 
 
Overseas special dividends                                                 538    2,249 
 
Income from contractual rights (OZ Minerals Royalty)                     1,800    1,541 
 
Income from Vale debentures                                              2,304    3,708 
 
Income from fixed income investments                                     2,510    5,769 
 
Less provision for doubtful debts                                         (106)       - 
 
                                                                       ======== ======== 
 
 
                                                                        31,507   40,880 
 
                                                                       ======== ======== 
 
 
Other income: 
 
Option premium income                                                    8,765    6,008 
 
Deposit interest                                                             7      106 
 
Interest on corporation tax refund                                         293        - 
 
Stock lending income                                                        27       77 
 
Loss on investment dealing in the subsidiary                            (1,128)    (557) 
 
                                                                       ======== ======== 
 
 
                                                                         7,964    5,634 
 
                                                                       ======== ======== 
 
 
Total income                                                            39,471   46,514 
 
                                                                       ======== ======== 
 
 
During the year, the Group received option premium income in cash totalling £ 
8,821,000 (2019: £5,986,000) for writing put and covered call options for the 
purposes of revenue generation. Option premium income is amortised evenly over 
the life of the option contract and accordingly, during the year, option 
premiums of £8,765,000 (2019: £6,008,000) were amortised to revenue. At 31 
December 2020, there were two (2019: five) open positions with an associated 
liability of £587,000 (2019: £314,000). 
 
Dividends and interest received in cash during the year amounted to £25,363,000 
and £3,421,000 (2019: £27,581,000 and £8,252,000) respectively. 
 
Special dividends amounting to £34,000 (2019: £5,229,000) have been recognised 
in capital during the year and included within investment gains. 
 
4. INVESTMENT MANAGEMENT FEE 
 
                                                         2020                                            2019 
 
                                           Revenue         Capital           Total         Revenue         Capital           Total 
                                             £'000           £'000           £'000           £'000           £'000           £'000 
 
Investment management fee                    1,546           4,859           6,405           1,564           4,916           6,480 
 
                                    --------------  --------------  --------------  --------------  --------------  -------------- 
 
Total                                        1,546           4,859           6,405           1,564           4,916           6,480 
 
                                          ========        ========        ========        ========        ========        ======== 
 
The investment management fee (which includes all services provided by 
BlackRock) is 0.8% of the Company's net assets. However, in the event that the 
NAV per share increases on a quarter-on-quarter basis, the fee will then be 
paid on gross assets for the quarter. During the year £5,907,000 (2019: £ 
5,888,000) of the investment management fee was generated from net assets and £ 
498,000 (2019: £592,000) from the gearing effect on gross assets due to the 
quarter-on-quarter increase in the NAV per share during the year as below: 
 
                                             Cum income        Quarterly    Gearing effect 
                                          NAV per share         increase/                on 
Quarter end                                     (pence)        (decrease)   management fees 
                                                                       %           (£'000) 
 
31 December 2019                                 433.17                -                 - 
 
31 March 2020                                    307.48            (29.0)                - 
 
30 June 2020                                     428.24            +39.3               113 
 
30 September 2020                                456.18             +6.5               183 
 
31 December 2020                                 536.34            +17.6               202 
 
                                               ========         ========          ======== 
 
The daily average of the net assets under management during the year ended 31 
December 2020 was £748,853,000 (2019: £733,356,000). The fee is allocated 25% 
to the revenue column and 75% to the capital column of the Consolidated 
Statement of Comprehensive Income. 
 
There is no additional fee for company secretarial and administration services. 
 
5. OTHER OPERATING EXPENSES 
 
                                                                                 2020            2019 
                                                                                £'000           £'000 
 
Allocated to revenue 
 
Custody fee                                                                       105             114 
 
Auditors' remuneration: 
 
- audit services                                                                   39              36 
 
- non-audit services1                                                               8               7 
 
Registrar's fee                                                                    86              88 
 
Directors' emoluments2                                                            183             190 
 
Broker fees                                                                        24              24 
 
Depositary fees                                                                    74              63 
 
Marketing fees                                                                    152             159 
 
Stock exchange fees                                                                21              19 
 
Legal and professional fees                                                        40              43 
 
Bank facility fees3                                                                72              75 
 
AIC Fees                                                                           17              22 
 
FCA Fee                                                                            20              18 
 
Directors' insurance                                                               14              14 
 
Directors' search fees                                                             13              26 
 
Printing and postage fees                                                          41              45 
 
Other administrative costs                                                        106              87 
 
Write back of prior year expenses4                                                (18)              - 
 
                                                                       --------------  -------------- 
 
                                                                                  997           1,030 
 
                                                                             ========        ======== 
 
Allocated to capital 
 
Custody transaction charges5                                                       18              20 
 
                                                                       --------------  -------------- 
 
                                                                                1,015           1,050 
 
                                                                             ========        ======== 
 
 
 
                                                                          2020     2019 
 
The Company's ongoing charges6, calculated as a percentage of average    0.99%    1.02% 
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 were: 
 
                                                                       ======== ======== 
 
 
The Company's ongoing charges6, calculated as a percentage of average    0.87%    0.89% 
daily gross 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 were: 
 
                                                                       ======== ======== 
 
 
1     Fees paid to the auditor for non-audit services of £7,540 excluding VAT 
(2019: £6,580) relate to the review of the half yearly financial statements. 
 
2        Details of the Directors' emoluments are given in the Directors' 
Remuneration Report in the Annual Report and Financial Statements. Emoluments 
include taxable benefits for reimbursement of expenses. The Company has no 
employees. 
 
3     There is a 4 basis point facility fee chargeable on the full loan 
facility amount whether drawn or undrawn. 
 
4        Relates to prior year accrual for broker fees written back during the 
year. 
 
5        These relate to costs charged by the custodian on sale and purchase 
trades. 
 
6     Alternative Performance Measures, see Glossary in the Annual Report and 
Financial Statements. 
 
6. FINANCE COSTS 
 
                                                         2020                                            2019 
 
                                           Revenue         Capital           Total         Revenue         Capital          Total 
                                             £'000           £'000           £'000           £'000           £'000          £'000 
 
Interest on bank loans                         409           1,229           1,638             889           2,662          3,551 
 
Interest on bank overdraft                      15              43              58               7              21             28 
 
                                    --------------  --------------  --------------  --------------  --------------  ------------- 
 
Total                                          424           1,272           1,696             896           2,683          3,579 
 
                                          ========        ========        ========        ========        ========       ======== 
 
7. DIVIDS 
 
                                                                                  2020            2019 
                                             Record date  Payment date           £'000           £'000 
 
Final dividend of 10.00p per share for the       20 March   7 May 2020          17,361          15,870 
year ended 31 December 2019 (2018: 9.00p)           2020 
 
1st interim dividend of 4.00p per share for  29 May 2020  26 June 2020           6,944           7,053 
the year ended 31 December 2020 (2019: 
4.00p) 
 
2nd interim dividend of 4.00p per share for     28 August  25 September          6,944           7,052 
the year ended 31 December 2020 (2019:              2020          2020 
4.00p) 
 
3rd interim dividend of 4.00p per share for   20 November   18 December          6,942           7,030 
the year ended 31 December 2020 (2019:              2020          2020 
4.00p) 
 
                                                                        --------------  -------------- 
 
                                                                                38,191          37,005 
 
                                                                              ========        ======== 
 
The total dividends payable in respect of the year ended 31 December 2020 which 
form the basis of section 1158 of the Corporation Tax Act 2010 and section 833 
of the Companies Act 2006, and the amounts proposed, meet the relevant 
requirements as set out in this legislation. 
 
Dividends paid, proposed or declared on equity shares: 
 
                                                                                 2020            2019 
                                                                                £'000           £'000 
 
1st interim dividend of 4.00p per share for the year ended 31 December          6,944           7,053 
2020 (2019: 4.00p) 
 
2nd interim dividend of 4.00p per share for the year ended 31 December          6,944           7,052 
2020 (2019: 4.00p) 
 
3rd interim dividend of 4.00p per share for the year ended 31 December          6,942           7,030 
2020 (2019: 4.00p) 
 
Final interim dividend of 8.30p per share for the year ended 31                14,713          17,361 
December 2020 (2019: final dividend 10.00p)1 
 
                                                                       --------------  -------------- 
 
                                                                               35,543          38,496 
 
                                                                             ========        ======== 
 
1        Based on 177,270,814 ordinary shares in issue on 4 March 2021. 
 
8. CONSOLIDATED EARNINGS AND NET ASSET VALUE PER ORDINARY SHARE 
 
                                                                                 2020            2019 
 
Net revenue profit attributable to ordinary shareholders (£'000)               35,451          39,561 
 
Net capital profit attributable to ordinary shareholders (£'000)              181,064          74,505 
 
                                                                       --------------  -------------- 
 
Total profit attributable to ordinary shareholders (£'000)                    216,515         114,066 
 
                                                                             ========        ======== 
 
Equity shareholders' funds (£'000)                                            930,825         757,110 
 
The weighted average number of ordinary shares in issue during the        173,740,499     176,135,318 
year, on which the earnings per ordinary share was calculated was: 
 
The actual number of ordinary shares in issue at the year end, on         173,550,814     174,784,727 
which the net asset value per ordinary share was calculated was: 
 
Earnings per share 
 
Revenue earnings per share (pence)                                              20.40           22.46 
 
Capital profit per share (pence)                                               104.22           42.30 
 
                                                                       --------------  -------------- 
 
Total profit per share (pence)                                                 124.62           64.76 
 
                                                                             ========        ======== 
 
 
 
                                                                    As at        As at 
                                                                        31 31 December 
                                                                 December         2019 
                                                                     2020 
 
Net asset value per ordinary share (pence)                         536.34       433.17 
 
Ordinary share price (pence)                                       522.00       383.00 
 
                                                                 ========     ======== 
 
There were no dilutive securities at the year end. 
 
9. CALLED UP SHARE CAPITAL 
 
                                                             Number of                                                  Nominal 
                                                       ordinary shares           Treasury              Total              value 
                                                                                   shares             shares              £'000 
 
Allotted, called up and fully paid share capital 
comprised: 
 
Ordinary shares of 5p each 
 
At 31 December 2019                                        174,784,727         18,227,115        193,011,842              9,651 
 
Shares purchased into treasury                              (1,233,913)         1,233,913                  -                  - 
 
                                                     -----------------  -----------------  -----------------  ----------------- 
 
At 31 December 2020                                        173,550,814         19,461,028        193,011,842              9,651 
 
                                                            ==========         ==========         ==========         ========== 
 
During the year 1,233,913 shares were bought back and transferred to treasury 
for a total consideration of £4,609,000 (2019: 1,545,515 shares were bought 
back and transferred to treasury for a total consideration of £5,546,000). 
 
Since the year end, the Company has reissued 3,720,000 ordinary shares from 
treasury for a total gross consideration of £21,896,000. 
 
10. RESERVES 
 
                                                                                                          Capital 
                                                                                                          reserve 
                                                                                          Capital      arising on 
                                                                                          reserve     revaluation 
                                             Share        Capital                      arising on              of 
                                           premium     redemption         Special     investments     investments         Revenue 
                                           account        reserve         reserve            sold            held         reserve 
Group                                        £'000          £'000           £'000           £'000           £'000           £'000 
 
At 31 December 2019                        127,155          22,779         108,601         281,550         166,256          41,118 
 
Movement during the year: 
 
Total comprehensive income: 
 
Net capital (loss)/profit for the                -               -               -          (4,161)        185,225               - 
year 
 
Net revenue profit for the year                  -               -               -               -               -          35,451 
 
Transactions with owners recorded 
directly to equity: 
 
Ordinary shares purchased into                   -               -          (4,573)              -               -               - 
treasury 
 
Share purchase costs                             -               -             (36)              -               -               - 
 
Dividends paid                                   -               -               -               -               -         (38,191) 
 
                                    --------------  --------------  --------------  --------------  --------------  -------------- 
 
At 31 December 2020                        127,155          22,779         103,992         277,389         351,481          38,378 
 
                                          ========        ========        ========        ========        ========        ======== 
 
 
 
                                                                                       Distributable reserves* 
 
                                                                                                           Capital 
                                                                                                           reserve 
                                                                                           Capital      arising on 
                                                                                           reserve     revaluation 
                                             Share         Capital                      arising on              of 
                                           premium      redemption         Special     investments     investments         Revenue 
                                           account         reserve        reserve*           sold*           held*         reserve* 
Company                                      £'000           £'000           £'000           £'000           £'000          £'000 
 
At 31 December 2019                        127,155          22,779         108,601         280,610         174,003          34,311 
 
Movement during the year: 
 
Total comprehensive income: 
 
Net capital (loss)/profit for the                -               -               -          (4,722)        184,656               - 
year 
 
Net revenue profit for the year                  -               -               -               -               -          36,581 
 
Transactions with owners recorded 
directly to equity: 
 
Ordinary shares purchased into                   -               -          (4,573)              -               -               - 
treasury 
 
Share purchase costs                             -               -             (36)              -               -               - 
 
Dividends paid                                   -               -               -               -               -         (38,191) 
 
                                    --------------  --------------  --------------  --------------  --------------  -------------- 
 
At 31 December 2020                        127,155          22,779         103,992         275,888         358,659          32,701 
 
                                          ========        ========        ========        ========        ========        ======== 
 
Pursuant to a resolution of the Company passed at an Extraordinary General 
Meeting on 13 January 1998 and following the Company's application to the Court 
for cancellation of its share premium account, the Court approval was received 
on 27 January 1999 and £157,633,000 was transferred from the share premium 
account to a special reserve which is a distributable reserve. 
 
The share premium account and capital redemption reserve are not distributable 
profits under the Companies Act 2006. In accordance with ICAEW Technical 
Release 02/17BL on Guidance on Realised and Distributable Profits under the 
Companies Act 2006, the special reserve and capital reserve (excluding capital 
reserves of £9,601,000 on revaluation of unquoted investments and subsidiary) 
may be used as distributable profits for all purposes and, in particular, the 
repurchase by the Company of its ordinary shares and for payments as dividends. 
In accordance with the Company's Articles of Association, net capital returns 
may be distributed by way of dividend. The £358,659,000 of capital reserve 
arising on the revaluation of investments is subject to fair value movements 
and may not be readily realisable at short notice, as such it may not be 
entirely distributable. 
 
The reserves of the subsidiary company are not distributable until distributed 
as a dividend to the Company. 
 
11. VALUATION OF FINANCIAL INSTRUMENTS 
Financial assets and financial liabilities are either carried in the 
Consolidated and Parent Company Statements of Financial Position at their fair 
value (investment and derivatives) or at an amount which is a reasonable 
approximation of fair value (due from brokers, dividends and interest 
receivable, due to brokers, accruals, cash at bank and bank overdrafts). IFRS 
13 requires the Group to classify fair value measurements using a fair value 
hierarchy that reflects the significance of inputs used in making the 
measurements. The valuation techniques used by the Group are explained in the 
accounting policies note 2(h) to the Financial Statements in the Annual Report 
and Financial Statements. 
 
Categorisation within the hierarchy has been determined on the basis of the 
lowest level input that is significant to the fair value measurement of the 
relevant asset. 
 
The fair value hierarchy has the following levels: 
 
Level 1 - Quoted market price for identical instruments in active markets 
A financial instrument is regarded as quoted in an active market if quoted 
prices are readily available from an exchange, dealer, broker, industry group, 
pricing service or regulatory agency and those prices represent actual and 
regularly occurring market transactions on an arm's length basis. The Group 
does not adjust the quoted price for these instruments. 
 
Level 2 - Valuation techniques using observable inputs 
This category includes instruments valued using quoted prices for similar 
instruments in markets that are considered less than active, or other valuation 
techniques where all significant inputs are directly or indirectly observable 
from market data. 
 
Valuation techniques used for non-standardised financial instruments such as 
options, currency swaps and other over-the-counter derivatives include the use 
of comparable recent arm's length transactions, reference to other instruments 
that are substantially the same, discounted cash flow analysis, option pricing 
models and other valuation techniques commonly used by market participants 
making the maximum use of market inputs and relying as little as possible on 
entity specific inputs. 
 
Over-the-counter derivative option contracts have been classified as Level 2 
investments as their valuation has been based on market observable inputs 
represented by the underlying quoted securities to which these contracts expose 
the Group. 
 
Level 3 - Valuation techniques using significant unobservable inputs 
This category includes all instruments where the valuation technique includes 
inputs not based on observable market data and these inputs could have a 
significant impact on the instrument's valuation. 
 
This category also includes instruments that are valued based on quoted prices 
for similar instruments where significant entity determined adjustments or 
assumptions are required to reflect differences between the instruments and 
instruments for which there is no active market. The Investment Manager 
considers observable data to be that market data that is readily available, 
regularly distributed or updated, reliable and verifiable, not proprietary, and 
provided by independent sources that are actively involved in the relevant 
market. 
 
The level in the fair value hierarchy within which the fair value measurement 
is categorised in its entirety is determined on the basis of the lowest level 
input that is significant to the fair value measurement. 
 
Assessing the significance of a particular input to the fair value measurement 
in its entirety requires judgement, considering factors specific to the asset 
or liability. The determination of what constitutes 'observable' inputs 
requires significant judgement by the Investment Manager. 
 
Valuation process and techniques for Level 3 valuations 
The Directors engage a mining consultant, an independent valuer with a 
recognised and relevant professional qualification, to conduct a periodic 
valuation of the contractual rights and the fair value of the contractual 
rights is assessed with reference to relevant factors. At the reporting date 
the income streams from contractual rights have been valued on the net present 
value of the pre-tax cash flows discounted at a rate the external valuer 
considers reflects the risk associated with the project. The valuation model 
uses discounted cash flow analysis which incorporates both observable and 
non-observable data. Observable inputs include assumptions regarding current 
rates of interest and commodity prices. Unobservable inputs include assumptions 
regarding production profiles, price realisations, cost of capital and discount 
rates. In determining the discount rate to be applied, the external valuer 
considers the country and sovereign risk associated with the project, together 
with the time horizon to the commencement of production and the success or 
failure of projects of a similar nature. To assess the significance of a 
particular input to the entire measurement, the external valuer performs a 
sensitivity analysis. The external valuer has undertaken an analysis of the 
impact of using alternative discount rates on the fair value of contractual 
rights. 
 
This investment in contractual rights is reviewed regularly to ensure that the 
initial classification remains correct given the asset's characteristics and 
the Group's investment policies. The contractual rights are initially 
recognised using the transaction price as the best evidence of fair value at 
acquisition and are subsequently measured at fair value, taking into 
consideration the relevant IFRS 13 requirements. In arriving at their estimates 
of market values, the valuers have used their market knowledge and professional 
judgement. The Group classifies the fair value of this investment as Level 3. 
 
Valuations are the responsibility of the Directors of the Company. In arriving 
at a final valuation, the Directors consider the independent valuer's report, 
the significant assumptions used in the fair valuation and the review process 
undertaken by BlackRock's Pricing Committee. The valuation of unquoted 
investments is performed on a quarterly basis by the Portfolio Managers and 
reviewed by the Pricing Committee of the Investment Manager. On a quarterly 
basis the Portfolio Managers will review the valuation of the contractual 
rights and inputs for significant changes. A valuation of contractual rights is 
performed annually by an external valuer, SRK Consulting (UK) Limited, and 
reviewed by the Pricing Committee of the Investment Manager. The valuations are 
also subject to quality assurance procedures performed within the Pricing 
Committee. On a semi-annual basis, after the checks above have been performed, 
the Investment Manager presents the valuation results to the Directors. This 
includes a discussion of the major assumptions used in the valuations. There 
were no changes in valuation techniques during the year. 
 
Fair values of financial assets and financial liabilities 
The table below sets out fair value measurements using the IFRS 13 fair value 
hierarchy. 
 
Financial assets/(liabilities) at fair value through        Level 1         Level 2         Level 3           Total 
profit or loss at                                             £'000           £'000           £'000           £'000 
31 December 2020 - Group 
 
Assets: 
 
Equity investments                                          935,805           2,811               -         938,616 
 
Fixed income securities                                      42,773          44,676               -          87,449 
 
Investment in contractual rights                                  -               -          19,753          19,753 
 
                                                     --------------  --------------  --------------  -------------- 
 
Total assets                                                978,578          47,487          19,753       1,045,818 
 
                                                     --------------  --------------  --------------  -------------- 
 
Liabilities: 
 
Derivative financial instruments - written options                -            (587)              -            (587) 
 
                                                     --------------  --------------  --------------  -------------- 
 
Total                                                       978,578          46,900          19,753       1,045,231 
 
                                                           ========        ========        ========        ======== 
 
 
 
Financial assets/(liabilities) at fair value through        Level 1         Level 2         Level 3           Total 
profit or loss at                                             £'000           £'000           £'000           £'000 
31 December 2019 - Group 
 
Assets: 
 
Equity investments                                          761,242               -               -         761,242 
 
Fixed income securities                                      38,646          30,099               -          68,745 
 
Investment in contractual rights                                  -               -          15,790          15,790 
 
                                                     --------------  --------------  --------------  -------------- 
 
Total assets                                                799,888          30,099          15,790         845,777 
 
                                                     --------------  --------------  --------------  -------------- 
 
Liabilities: 
 
Derivative financial instruments - written options                -            (314)               -           (314) 
 
                                                     --------------  --------------  --------------  -------------- 
 
Total                                                       799,888          29,785          15,790         845,463 
 
                                                           ========        ========        ========        ======== 
 
 
 
Financial assets/(liabilities) at fair value through        Level 1         Level 2         Level 3           Total 
profit or loss at                                             £'000           £'000           £'000           £'000 
31 December 2020 - Company 
 
Assets: 
 
Equity investments                                          935,805           2,811           7,178         945,794 
 
Fixed income securities                                      42,773          44,676               -          87,449 
 
Investment in contractual rights                                  -               -          19,753          19,753 
 
                                                     --------------  --------------  --------------  -------------- 
 
Total assets                                                978,578          47,487          26,931       1,052,996 
 
                                                     --------------  --------------  --------------  -------------- 
 
Liabilities: 
 
Derivative financial instruments - written options                -            (587)              -            (587) 
 
                                                     --------------  --------------  --------------  -------------- 
 
Total                                                       978,578          46,900          26,931       1,052,409 
 
                                                           ========        ========        ========        ======== 
 
 
 
Financial assets/(liabilities) at fair value through        Level 1         Level 2         Level 3            Total 
profit or loss                                                £'000           £'000           £'000            £'000 
31 December 2019 - Company 
 
Assets: 
 
Equity investments                                          758,889               -           8,308         767,197 
 
Fixed income securities                                      38,646          30,099               -          68,745 
 
Investment in contractual rights                                  -               -          15,790          15,790 
 
                                                     --------------  --------------  --------------  -------------- 
 
Total assets                                                797,535          30,099          24,098         851,732 
 
                                                     --------------  --------------  --------------  -------------- 
 
Liabilities: 
 
Derivative financial instruments - written options                 -           (314)              -            (314) 
 
                                                     --------------  --------------  --------------  -------------- 
 
Total                                                       797,535          29,785          24,098         851,418 
 
                                                           ========        ========        ========        ======== 
 
A reconciliation of fair value measurement in Level 3 is set out below. 
 
Level 3 Financial assets at fair value through profit or loss                    2020            2019 
At 31 December - Group                                                          £'000           £'000 
 
Opening fair value                                                             15,790          18,513 
 
Total profit or loss included in net profit on investments in the 
Consolidated Statement of Comprehensive Income: 
 
- assets held at the end of the year                                            3,963          (2,723) 
 
                                                                       --------------  -------------- 
 
Closing balance                                                                19,753          15,790 
 
                                                                             ========        ======== 
 
 
 
Level 3 Financial assets at fair value through profit or loss                    2020            2019 
At 31 December - Company                                                        £'000           £'000 
 
Opening fair value                                                             24,098          27,199 
 
Total profit or loss included in net profit on investments in the 
Consolidated Statement of Comprehensive Income: 
 
- assets held at the end of the year                                            2,833          (3,101) 
 
                                                                       --------------  -------------- 
 
Closing balance                                                                26,931          24,098 
 
                                                                             ========        ======== 
 
The Level 3 valuation process and techniques used are explained in the 
accounting policies in note 2(h). A more detailed description of the techniques 
is found in the Annual Report and Financial Statements under 'Valuation process 
and techniques'. 
 
Quantitative information of significant unobservable inputs - Level 3 - Group 
and Company 
 
                                               2020     2019     Valuation   Unobservable 
Description                                   £'000    £'000     technique          input 
 
OZ Minerals Brazil Royalty                   19,753   15,790     Discounted    Discounted 
                                                                cash flows         rate - 
                                                                                 weighted 
                                                                                  average 
                                                                                  cost of 
                                                                                  capital 
                                                                             Average gold 
                                                                                      and 
                                                                            copper prices 
 
Investment in subsidiary company              7,178    8,308    Net assets     Net assets 
 
                                            ======== ======== 
 
 
Sensitivity analysis to significant changes in unobservable inputs within Level 
3 hierarchy 
The significant unobservable inputs used in the fair value measurement 
categorised within Level 3 of the fair value hierarchy, together with an 
estimated quantitative sensitivity analysis, as at 31 December 2020 are as 
shown below. 
 
                                                                   Estimated     Impact on 
Description                                              Input   sensitivity    fair value 
                                                                       used1 
 
OZ Minerals Brazil Royalty                       Discount rate     2020 - 1%  2020 - £1.1m 
                                                    - weighted 
                                                  average cost 
                                                    of capital     2019 - 1%  2019 - £0.8m 
 
                                                  Average gold    2020 - 10%  2020 - £1.4m 
                                                    and copper 
                                                        prices    2019 - 10%  2019 - £2.2m 
 
 
1     The sensitivity analysis refers to a percentage amount added or deducted 
from the input and the effect this has on the fair value. 
 
The sensitivity impact on fair value is calculated based on the sensitivity 
estimates set out by the independent valuer in its report on the valuation of 
contractual rights. Significant increases/(decreases) in estimated commodity 
prices and discount rates in isolation would result in a significantly higher/ 
(lower) fair value measurement. Generally, a change in the assumption made for 
the estimated value is accompanied by a directionally similar change in the 
commodity prices and discount rates. 
 
12. TRANSACTIONS WITH THE INVESTMENT MANAGER AND AIFM 
BlackRock Fund Managers Limited (BFM) provides management and administration 
services to the Company under a contract which is terminable on six months' 
notice. BFM has (with the Company's consent) delegated certain portfolio and 
risk management services, and other ancillary services to BlackRock Investment 
Management (UK) Limited (BIM (UK)). Further details of the investment 
management contract are disclosed in the Directors' Report in the Annual Report 
and Financial Statements. 
 
The investment management fee due for the year ended 31 December 2020 amounted 
to £6,405,000 (2019: £6,480,000). At the year end, £2,064,000 (2019: £ 
1,714,000) was outstanding in respect of management fees. 
 
In addition to the above services, BlackRock has provided the Group with 
marketing services. The total fees paid or payable for these services for the 
year ended 31 December 2020 amounted to £152,000 excluding VAT (2019: £159,000 
excluding VAT). Marketing fees of £55,000 were outstanding as at 31 December 
2020 (2019: £50,000). 
 
The ultimate holding company of the Manager and the Investment Manager is 
BlackRock, Inc. a company incorporated in Delaware USA. During the period, PNC 
Financial Services Group, Inc. (PNC) was a substantial shareholder in 
BlackRock, Inc. PNC did not provide any services to the Company during the 
financial year ended 31 December 2019 and the period up to 11 May 2020, when 
PNC announced its intent to sell its investment in BlackRock, Inc. through a 
registered offering and related buyback by BlackRock, Inc. 
 
13. RELATED PARTY DISCLOSURE 
Directors' emoluments 
At the date of this report, the Board consists of five non-executive Directors, 
all of whom are considered to be independent of the Manager by the Board. 
 
Disclosures of the Directors' interests in the ordinary shares of the Company 
and fees and expenses payable to the Directors are set out in the Directors' 
Remuneration Report in the Annual Report and Financial Statements. As at 31 
December 2020 £14,375 (2019: £14,375) was outstanding in respect of Directors' 
fees. 
 
Significant Holdings 
The following investors are: 
 
a.      funds managed by the BlackRock Group or are affiliates of BlackRock 
Inc. ("Related BlackRock Funds") or 
 
b.      investors (other than those listed in (a) above) who held more than 20% 
of the voting shares in issue in the Company and are as a result, considered to 
be related parties to the Company ("Significant Investors"). 
 
As at 31 December 2020 
 
                             Total % of shares held by      Number of Significant 
Total % of shares held by    Significant Investors who are  Investors who are not 
Related BlackRock Funds      not affiliates of BlackRock    affiliates of BlackRock 
                             Group or BlackRock, Inc.       Group or BlackRock, Inc. 
 
2.45                         n/a                            n/a 
 
As at 30 December 2019 
 
                             Total % of shares held by      Number of Significant 
Total % of shares held by    Significant Investors who are  Investors who are not 
Related BlackRock Funds      not affiliates of BlackRock    affiliates of BlackRock 
                             Group or BlackRock, Inc.       Group or BlackRock, Inc. 
 
1.99                         n/a                            n/a 
 
14. CONTINGENT LIABILITIES 
There were no contingent liabilities at 31 December 2020 (2019: nil). 
 
15. PUBLICATION OF NON STATUTORY ACCOUNTS 
 
The financial information contained in this announcement does not constitute 
statutory accounts as defined in the Companies Act 2006. The Annual Report and 
Financial Statements for the year ended 31 December 2020 will be filed with the 
Registrar of Companies after the Annual General Meeting. 
 
The figures set out above have been reported upon by the auditor, whose report 
for the year ended 31 December 2020 contains no qualification or statement 
under section 498(2) or (3) of the Companies Act 2006. 
 
The comparative figures are extracts from the audited financial statements of 
BlackRock World Mining Trust plc and its subsidiary for the year ended 31 
December 2019, which have been filed with the Registrar of Companies. The 
report of the auditor on those financial statements contained no qualification 
or statement under section 498 of the Companies Act 2006. 
 
16. ANNUAL REPORT AND FINANCIAL STATEMENTS 
 
Copies of the Annual Report and Financial Statements will be published shortly 
and will be available from the registered office, c/o The Secretary, BlackRock 
World Mining Trust plc, 12 Throgmorton Avenue, London EC2N 2DL. 
 
17. ANNUAL GENERAL MEETING 
 
The Annual General Meeting of the Company will be held at 12 Throgmorton 
Avenue, London EC2N 2DL on Thursday, 29 April 2021 at 11.30 a.m. 
 
ENDS 
 
The Annual Report and Financial Statements will also be available on the 
BlackRock website at www.blackrock.co.uk/brwm. Neither the contents of the 
website nor the contents of any website accessible from hyperlinks on the 
website (or any other website) is incorporated into, or forms part of, this 
announcement. 
 
For further information, please contact: 
 
Simon White, Managing Director, Closed End Funds, BlackRock Investment 
Management (UK) Limited - Tel:  020 7743 5284 
 
Evy Hambro, Fund Manager, BlackRock Investment Management (UK) Limited - Tel: 
020 7743 4511 
 
Emma Phillips, Media & Communications, BlackRock Investment Management (UK) 
Limited - Tel:  020 7743 2922 
 
Press enquires: 
 
Ed Hooper, Lansons Communications 
 
Tel:  020 7294 3620 
 
E-mail:  BlackRockInvestmentTrusts@lansons.com or EdH@lansons.com 
 
4 March 2021 
 
 
12 Throgmorton Avenue 
London EC2N 2DL 
 
 
 
END 
 
 

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