Half-year Report

BLACKROCK GREATER EUROPE INVESTMENT TRUST PLC

LEI:  5493003R8FJ6I76ZUW55

Half yearly financial announcement of results in respect of the six months ended 28 February 2021
 

PERFORMANCE RECORD

	As at  28 February  2021	As at  31 August  2020	Change  %
Net assets (£000)1	443,404	387,861	14.3
Net asset value per ordinary share (pence)	519.22	459.97	12.9
Ordinary share price (mid-market) (pence)	526.00	447.00	17.7
Premium/(discount) to cum income net asset value2	1.3%	-2.8%
FTSE World Europe ex UK Index	1,583.05	1,467.97	7.8
	========	========	========
Performance (with dividends reinvested)
Net asset value per share2	14.0%	16.9%
Ordinary share price2	18.8%	18.0%
FTSE World Europe ex UK Index	7.8%	0.7%
	========	========	========

	For the six  months ended  28 February  2021	For the six  months ended  29 February  2020	Change  %
Revenue
Net profit after taxation (£000)	460	473	-2.7
Revenue profit per ordinary share (pence)3	0.54	0.56	-3.6
Dividend (pence)
Interim dividend	1.75	1.75	-
	========	========	========

¹    The change in net assets reflects the ordinary shares issued from treasury, buyback of shares into treasury, market movements and dividends paid.
²  Alternative Performance Measures, see Glossary in the Half Yearly Financial Report.
³  Further details are given in the Glossary in the Half Yearly Financial Report.

CHAIRMAN’S STATEMENT

OVERVIEW
The past six months has been a very successful period for your Company. This is so notwithstanding that the enormous disruption brought on by the COVID-19 pandemic in 2020 continued throughout the six-month period. Following a relaxation of lockdowns over the summer, European countries struggled to contain outbreaks of the virus and rising infection rates resulted in continued, new or tightened lockdowns since autumn, with a negative impact on economic growth. However, in November 2020 markets rose significantly, primarily driven by positive data on the effectiveness of vaccines against the COVID-19 infection. Since then, world equities appear to have been on a firmer footing with the distribution of vaccines providing hope for some return to normality, although the rollout of vaccines in Europe has been slow and lockdowns remain in place.

PERFORMANCE
With the pandemic delivering a significant test for portfolio managers, it is very pleasing to report that over the six months to 28 February 2021, the Company’s net asset value per share (NAV) returned 14.0%, again outperforming the FTSE World Europe ex UK Index which returned 7.8%. Over the same period, the Company’s share price returned 18.8% (all percentages calculated in sterling terms with dividends reinvested). This was achieved notwithstanding a strengthening of sterling against most currencies in the markets in which investments are held. Further information on investment performance is given in the Investment Manager’s Report.

Since the period end to 21 April 2021, the Company’s NAV has increased by 9.5% compared with a rise in the FTSE World Europe ex UK Index of 8.1% over the same period.

REVENUE EARNINGS AND DIVIDENDS
The Company’s revenue return per share for the six-month period ended 28 February 2021 amounted to 0.54p compared with 0.56p for the corresponding period in 2020, a decrease of 3.6%. Due to the COVID-19 pandemic and its economic effects, some companies have cut or cancelled their dividend payments and this is likely to continue while economic activity resumes and balance sheets are mended. Accordingly, the Board’s intention is to pay a flat dividend at the half year stage, utilising its revenue reserve where necessary. The majority of the Company’s income typically is generated in the second half of the year.

The Board has declared an interim dividend of 1.75p (2020: 1.75p) per share. The dividend will be paid on 4 June 2021 to shareholders on the Company’s register on 7 May 2021, the ex-dividend date being 6 May 2021.

TENDER OFFERS
The Directors of the Company have the discretion to make semi-annual tender offers at the prevailing NAV, less 2%, for up to 20% of the issued share capital in May and November of each year. The Board announced on 15 September 2020 that it had decided not to proceed with a tender offer in November 2020 and on 24 March 2021 that the tender offer in May 2021 would not be implemented.

Over the six-month period ended 28 February 2021, the Company’s shares traded at an average discount to NAV of 1.7% compared to a discount of 2.0% to NAV, the price at which any tender offer would be made. More recently the shares have typically traded at a premium to NAV. The Board therefore concluded that it was not in the interests of shareholders as a whole to implement the latest semi-annual tender offer. At 28 February 2021, the shares were trading at a premium of 1.3%.

SHARE ISSUES
I am pleased to report, as I indicated above, that since the end of December the Company’s shares have, for the most part, traded at a premium rating and in the period to 28 February 2021, 1,075,000 shares were reissued from treasury at an average price of 542.42p per share for a total gross consideration of £5,831,000. Since the period end, and up to the date of this report, the Company has reissued a further 1,910,000 shares at an average price of 556.94p per share. All share issuance was carried out at a premium to NAV. The prices at which these shares have been issued also represent a substantial premium to the prices originally paid for them by the Company.

OUTLOOK
The distribution of vaccines is critical to supporting economic recovery in Europe. If European Union (EU) countries are able to ensure a faster rollout of vaccinations, a better control of the pandemic and an easing of lockdown measures, the EU economy is likely to rebound, driven by pent-up consumer demand. European household savings have increased sharply in 2020 following stay-at-home directives and furlough schemes and, as some degree of normalcy returns, a boost to consumer spending is likely to follow.

Continued monetary and fiscal support is also important and the European Central Bank has recently provided a commitment to maintain easy financing conditions. The EU Recovery Fund should also deliver an unprecedented level of investment in the coming years. Around €750 billion in funds will be released to member nations, including a significant portion earmarked to help Europe transition to a net-zero emission economy.

Active management has been crucial in the period under review and our Portfolio Managers have served investors well. The key has been to invest in resilient companies that can thrive not only in a crisis, but in all market conditions. The Portfolio Managers’ view is long term and they will continue to look for companies with specific characteristics that enable them to deliver long-term growth whatever the economic weather.

ERIC SANDERSON
23 April 2021

INVESTMENT MANAGER’S REPORT

OVERVIEW
The Company’s share price and underlying NAV rose over the last six months to 28 February 2021. In this period, the Company’s share price increased by 18.8% and the underlying NAV by 14.0%. By way of comparison, the FTSE World Europe ex UK Index returned 7.8% during the same period.

The beginning of the period experienced renewed fears of another COVID-19 wave as infection rates rose following the summer. However, European equities rallied sharply following positive vaccine data releases in November from Pfizer, Moderna and AstraZeneca, as well as the promise that vaccination programmes would start at the end of the year.

Since then we have seen the market largely trading around high level macro narratives regarding the re-opening of economies, vaccine rollouts and efficacy data, a likely earnings recovery, as well as inflationary pressures and interest rate moves. In particular, more cyclical, operationally levered parts of the market such as banks, airlines, auto manufacturers and oil & gas have performed strongly in light of increasing confidence in the re-opening and in anticipation of a substantial earnings recovery. On the flip side, previous ‘COVID-19 beneficiaries’ were used as a funding source by investors.

PORTFOLIO
The Company outperformed the reference index over the six-month period, driven by strong stock selection, while sector allocation was also positive. In particular, the Company’s underweight to defensive areas of the market, as well as select opportunities within ‘value’ areas such as banks, and the positioning within both consumer areas and the semiconductor space proved successful. The most recent earnings season has been positive for the majority of stocks in the Company’s portfolio and we remain optimistic that we can see some solid upgrades this year driven by the re-opening of economies, a strong global consumer and weaker comparative bases over the next few quarters.

The technology sector was the largest contributor to relative returns. The Company’s holdings in the semiconductor market, including ASML, BE Semiconductor and Infineon Technologies, drove strong outperformance as we witnessed end market acceleration through trends such as the growing penetration of electric vehicles and a stronger than expected smart phone cycle. Especially within the automotive end market, several clients have noted shortages in semiconductor components, confirming a real tightness in the market.

Also, within the technology sector, a positive contribution came from industrial and software conglomerate Hexagon, which specialises in the provision of geo-mapping and monitoring software and sensors, as well as plant management and automation systems. Management feedback remains encouraging as the company continues to see strength across the board in China, as well as a speedy recovery in the North American market.

The Company saw a positive contribution from a number of stocks exposed to continued strength in consumer spending. A holding in Allegro aided returns. This Polish e-commerce platform, selling both international and local brands, enjoyed a strong share price performance after going public in early October. While the stock has seen volatility in recent weeks due to threats of Amazon entering the Polish market, we believe the group’s growth prospects remain strong over the medium to long-term as online penetration in the Polish retail market remains relatively low.

Similarly, our holding in Russian e-commerce company Ozon Holdings contributed positively. Ozon Holdings is the most recognised e-commerce brand in what is still an under-developed e-commerce market. We believe that as the infrastructure is rolled out, the Russian e-commerce market has potential to follow a similar growth path that we have seen in other markets. The most recent Q4 and 2020 full-year numbers were extremely strong, showing growth accelerating across all business segments. Elsewhere within the consumer space, luxury brand Hermès International, which continued to benefit from the outstanding resilience of the high-end consumer, aided returns.

Whilst a lower allocation to financials was negative, this was more than offset by strong stock selection. In particular, our position in Russian Sberbank rose strongly against the backdrop of a healthy risk environment, benefiting from the strength of more cyclical sectors. This stock was held for its fundamental attractions, including the potential for earnings upgrades, its cheap valuation and a high dividend yield. Following its rally in December, the stock hit our price target and we exited the position. KBC Groep also participated in the financials rally, which led us to trim our position size as we were left with less upside to fair value. Finally, not owning large defensive benchmark constituents like Nestlé, Roche, Novartis and Sanofi also contributed positively to returns.

Negative attribution came from a number of stocks that saw a degree of profit taking after having been unaffected by the COVID-19 crisis or benefiting from it earlier in the year and now sold off in the recovery and re-opening trade. Other detractors included stocks where the investment case has not played out yet. The first bucket includes Danish listed beverage provider Royal Unibrew, which performed strongly during the crisis but experienced some profit taking towards the end of the period despite posting solid results. The company highlighted share gains made across most regions and categories, as well as its disciplined cost control, which had been highly beneficial in COVID-19 times. We would highlight that while this stock did not participate in the market rally in recent months, it is also likely to benefit from the vaccine rollout given its exposure to consumers, restaurants and festivals, which are all likely to pick up with economies normalising. Elsewhere, shares in Lonza Group fell, suffering profit taking after having seen strong performance throughout most of 2020.

Other detractors included the Company’s investment in software group SAP. The company published weaker than expected results and cut its revenue and profit forecasts for this year in response to depressed business spending due to the virus. Importantly, SAP updated medium-term targets, essentially pushing them out by circa two years in part to reflect the disruption caused by COVID-19. We had been expecting the management team to update its strategic targets in light of COVID-19 but were left surprised by the extent of the revision to forecasts. As a result, we reduced our position in SAP to reflect slightly lower levels of conviction near-term.

While our overall positioning in the industrials sector was successful, a holding in Kingspan detracted from returns. Shares fell as one of Kingspan’s insulation products was found to have been used on Grenfell Tower, which tragically burned down in London in June 2017. Kingspan’s product accounted for less than 5% of insulation material on the tower, however Kingspan had no involvement in the construction, nor did they recommend use of its product during construction. While the official inquiry into the event led to weakness in Kingspan shares, we take comfort from the fact that Kingspan has introduced a set of changes tightening control of product testing, marketing and distribution by establishing a new code of conduct, a newly created role of Head of Compliance and Certification and other divisional management changes. Importantly, this incident also appeared to have no impact on operations outside of the UK.

Elsewhere, not owning a number of cyclical stocks such as Siemens, Daimler, Banco Santander or BBVA also detracted. Whilst a number of these lower quality businesses have seen earnings upgrades and a degree of rerating, we see little fundamental reason to own these companies over any meaningful timeframe.

While the portfolio’s turnover remained low, the industrials sector saw the highest allocation increase during the period. For example, we added Switzerland-based VAT Group to the Company, which focuses on designing and producing vacuum valves for semiconductor, display and solar panel manufacturing. We believe this company will benefit from its growing end markets, best in class returns and the potential for continued market share gains.

We also started a new position in Epiroc, a leading provider of equipment and services for the mining and infrastructure industries. This business appears well-positioned to capitalise on the strong recovery in mining capex expected to come through over the next three to five years. Its services enable mining operations to become more sustainable, as more and more of its products become battery powered over time. With demand levels high, strong momentum in orders and a management team focused on executing its well-defined strategy, we see Epiroc continuing to do well in a recovery environment.

Also, within industrials, we added Marel which manufactures and services advanced processing systems for the poultry, meat and fish industries. As the clear market leader, Marel’s strategy is to consolidate and standardise a highly fragmented food processing industry. Demand for its solutions appears well under-pinned, not just by rapidly increasing demand for higher protein food sources in developing countries, but also by strong underlying trends towards higher automation and greater food safety. With close to 25% of the business owned by the CEO, we see our shareholders' interests well aligned with those of the business.

Within health care, we moved capital to ChemoMetec which is a Danish capital equipment company specialising in the development, production and sale of high-quality equipment used for counting and analysing cells in a broad range of settings. This investment case is supported by a large addressable market, offering opportunities for rapid revenue growth at a high gross margin whilst being run by a very competent management team.

Over the period we also added to positions in some of our favoured companies where we see increased opportunity for upside. For example, we topped up our position in Amadeus IT Group, the travel and tourism industry’s leading transaction systems provider, as we now have greater confidence that we should see a return of travel to more normal levels sooner than consensus is currently pricing in. Our allocation to financials decreased slightly as we sold out of Sberbank and reduced KBC Groep following a strong rally in the financials sector, as mentioned above.

Our exposure to Emerging Europe increased over the period. At one point it represented 9.6% of the portfolio and currently stands at 7.9%.

OUTLOOK
We see recent market strength persisting over the coming months, as vaccine rollouts progress and the strength of the global consumer shines through. Higher inflation may be on the horizon in the near term, but we expect these effects to be transitory and for central banks to remain accommodative.

Whilst we see this as being a supportive backdrop for equities overall, a high degree of selectivity remains warranted for the long-term investor given the lack of pricing power in many areas of the market. We remain focused on the fundamentals and retain our core exposure to companies with predictable business models, higher than average returns on capital, strong cash flow conversions and opportunities to reinvest that cash flow into future growth projects at high incremental returns.

STEFAN GRIES AND SAM VECHT
BLACKROCK INVESTMENT MANAGEMENT (UK) LIMITED
23 April 2021

TEN LARGEST INVESTMENTS

1 + ASML (2020: 2nd)
Technology company
Market value: £35,577,000
Share of investments: 7.5%

ASML is a Dutch company which specialises in the supply of photolithography systems for the semiconductor industry. The company is at the forefront of technological change and invests in leading research and development to capture the structural growth opportunity supported by growth in mobile devices and microchip components. The high barriers to entry within the industry give ASML a protected position with strong pricing power allowing growth in margins whilst they continue to innovate. The company has strong management who aim to create long-term value for the business whilst returning excess cash to shareholders.

2 - Sika (2020: 1st)
Industrial company
Market value: £25,227,000
Share of investments: 5.3%

Sika is a Swiss speciality chemical company with a leading position in both construction chemicals and in bonding agents for the automotive industry. Sika has proprietary technology within adhesives, which has an increasing array of applications as technology advances. The company benefits from structural drivers of urbanisation and has exposure to multiple points in the construction cycle including new infrastructure projects, as well as maintenance or refurbishment of existing buildings. It is also likely to benefit from the EU Recovery Fund which will channel funds towards sustainable infrastructure projects. Sika’s decentralised structure of subsidiaries and strong culture of new product innovation continues to drive pricing power.

3 + Kering (2020: 5th)
Consumer services company
Market value: £23,943,000
Share of investments: 5.0%

Kering is a French luxury group owning brands such as Gucci, Yves Saint Laurent and Bottega Veneta. We believe Kering is one of the winners in a ‘winner takes all’ market given the strength and resilience of its brands. This position is cemented by its best in class e-commerce offering, which in combination with a rejuvenated product portfolio has enabled Kering to capture the imagination of global millennials. We believe Kering remains an extremely well-positioned company with a strong balance sheet that offers optionality for both increased shareholder returns, as well as value accretive deals. In the near term, we think the brand can benefit from a few new launches around its 100th anniversary this year.

4 = Lonza Group (2020: 4th)
Health care company
Market value: £23,096,000
Share of investments: 4.9%

Lonza Group is a Swiss biotechnology and speciality chemicals company. Lonza Group has established itself as one of the leading contract manufacturers of high-end biological drugs, as well as cell and gene therapy. Overall, we see those end markets growing at double digit rates well into 2025 and beyond, which leaves Lonza Group well placed to deliver attractive growth in earnings and cash flows regardless of the prevailing macro-economic environment.

5 + DSV Panalpina (2020: 8th)
Industrial company
Market value: £22,569,000
Share of investments: 4.8%

DSV Panalpina is a Danish freight forwarding company with a strong acquisitive history and an excellent management team and company culture. Their success in making acquisitions has been facilitated by their strong IT platform which drives operational efficiencies leading to high conversion margins. In 2019 DSV took over Swiss peer Panalpina in its largest ever acquisition which they have been integrating successfully.

6 = Novo Nordisk (2020: 6th)
Health care company
Market value: £21,624,000
Share of investments: 4.6%

Novo Nordisk is a Danish multinational pharmaceutical company which is a leader in diabetes care. We expect growth in earnings and cash flows driven by demand for ‘Ozempic’ which treats Diabetes type 2 and there is potential for their products to help tackle obesity. Overall, we believe Novo Nordisk offers attractive long-term growth potential at high returns and sector leading cash flow conversion with any excess cash being returned to shareholders.

7 = Royal Unibrew (2020: 7th)
Consumer goods company
Market value: £19,506,000
Share of investments: 4.1%

Royal Unibrew is a brewing and beverage company based in Denmark. Through a number of well-timed acquisitions, the group has transformed itself into a multi-beverage company offering attractive growth in soft drink niches at high returns, with significant potential to export their brands with strong European heritage into international markets.

8 + Safran (2020: 11th)
Industrials company
Market value: £15,739,000
Share of investments: 3.3%

Safran is a French multinational supplier of systems and equipment for aerospace, defence and security. The industry is emerging from a heavy investment period in new planes and engines and we see Safran as well placed to benefit from continued strength in its best in class after-market business, as well as strong execution in its LEAP engine programme which should drive growth for the next five to ten years. In the near term, we think the shares can benefit from a rerating as and when restrictions for travel lift.

9 = RELX (2020: 9th)
Consumer services company
Market value: £15,572,000
Share of investments: 3.3%

RELX is a multinational information and analytics company which has high barriers to entry in most of its divisions, including scientific publishing. The capital light business model allows for a high rate of cash flow conversion with repeatable revenues built on subscription-based models. The business also benefits from the structurally increasing usage of data globally, which supports their data analytics business.

10 = Hexagon (2020: 10th)
Technology company
Market value: £14,763,000
Share of investments: 3.1%

Hexagon is a Swedish industrial and software conglomerate. The business specialises in the provision of geo-mapping and monitoring software and sensors, as well as plant management and automation systems. Its products have applications in diverse end markets including smart phones, mining automation, construction surveying and agriculture optimisation.

All percentages reflect the value of the holding as a percentage of total investments.

Together, the ten largest investments represent 45.9% of the Company’s portfolio (31 August 2020: 50.5%).

PORTFOLIO ANALYSIS AS AT 28 FEBRUARY 2021

	%  France	%  Switzerland	%  Ireland	%  Germany	%  Sweden	%  Netherlands	%  Denmark	%  Belgium	%  Finland	%  Spain	%  Italy	%  Central  Eastern  Europe &  other	%  Portfolio  28.02.21	%  Portfolio  31.08.20	FTSE World  Europe  ex UK  28.02.21
Basic Materials	–	–	–	–	–	2.5	–	–	–	–	–	1.3	3.8	3.5	5.5
Consumer Goods	2.3	–	–	2.1	–	–	4.1	–	–	–	1.7	–	10.2	11.1	17.6
Consumer Services	5.0	–	–	–	–	–	–	–	–	–	–	5.3	10.3	9.2	4.5
Financials	–	1.7	–	–	–	–	–	1.1	–	–	2.2	1.2	6.2	8.5	18.1
Health Care	–	7.2	–	–	–	–	6.8	–	–	0.6	1.5	–	16.1	17.6	15.3
Industrials	4.6	7.3	1.5	–	3.2	3.0	4.8	–	–	–	–	–	24.4	18.4	17.9
Oil & Gas	–	–	–	–	–	–	–	–	2.3	–	–	1.9	4.2	3.8	4.2
Technology	1.4	–	–	3.9	3.1	10.3	2.6	–	–	2.0	–	1.5	24.8	26.0	9.5
Telecommunications	–	–	–	–	–	–	–	–	–	–	–	–	–	1.9	2.7
Utilities	–	–	–	–	–	–	–	–	–	–	–	–	–	–	4.7
% Portfolio 28.02.21	13.3	16.2	1.5	6.0	6.3	15.8	18.3	1.1	2.3	2.6	5.4	11.2	100.0	–	–
% Portfolio 31.08.20	12.2	14.5	2.2	10.0	5.6	12.2	18.8	2.3	2.3	2.5	5.9	11.5	–	100.0	–
FTSE World Europe ex UK 28.02.21	21.2	19.0	0.4	19.1	7.3	9.3	4.8	1.9	2.9	5.2	4.4	4.5	–	–	100.0
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Percentages in the table above are a % of total investments.

INVESTMENTS AS AT 28 FEBRUARY 2021

	Country  of operation	Market value  £000	% of  investments
Technology
ASML	Netherlands	35,577	7.5
Hexagon	Sweden	14,763	3.1
BE Semiconductor	Netherlands	13,166	2.8
Netcompany Group	Denmark	12,343	2.6
Infineon Technologies	Germany	10,890	2.3
Amadeus IT Group	Spain	9,431	2.0
SAP	Germany	7,642	1.6
Allegro	Poland	7,002	1.5
Dassault Systèmes	France	6,845	1.4
		--------------	--------------
		117,659	24.8
		========	========
Industrials
Sika	Switzerland	25,227	5.3
DSV Panalpina	Denmark	22,569	4.8
Safran	France	15,739	3.3
Atlas Copco	Sweden	10,580	2.2
VAT Group	Switzerland	9,237	2.0
Adyen	Netherlands	7,889	1.7
Kingspan	Ireland	7,330	1.5
ALD	France	6,314	1.3
Marel	Netherlands	6,031	1.3
Epiroc	Sweden	4,867	1.0
		--------------	--------------
		115,783	24.4
		========	========
Health Care
Lonza Group	Switzerland	23,096	4.9
Novo Nordisk	Denmark	21,624	4.6
Straumann Holding	Switzerland	10,979	2.3
DiaSorin	Italy	7,128	1.5
ChemoMetec	Denmark	6,140	1.3
Chr. Hansen	Denmark	4,255	0.9
Grifols	Spain	3,242	0.6
		--------------	--------------
		76,464	16.1
		========	========
Consumer Services
Kering	France	23,943	5.0
RELX	United Kingdom	15,572	3.3
Ozon Holdings	Russia	9,552	2.0
		--------------	--------------
		49,067	10.3
		========	========
Consumer Goods
Royal Unibrew	Denmark	19,506	4.1
Hermès International	France	11,110	2.3
Adidas	Germany	9,913	2.1
Ferrari	Italy	7,802	1.7
		--------------	--------------
		48,331	10.2
		========	========
Financials
FinecoBank	Italy	10,415	2.2
Partners Group	Switzerland	7,917	1.7
KBC Groep	Belgium	5,371	1.1
Bank Pekao	Poland	4,093	0.9
Alpha Bank	Greece	1,482	0.3
		--------------	--------------
		29,278	6.2
		========	========
Oil & Gas
Neste	Finland	11,148	2.3
Lukoil	Russia	9,021	1.9
		--------------	--------------
		20,169	4.2
		========	========
Basic Materials
IMCD	Netherlands	12,057	2.5
ICL Group	Israel	6,212	1.3
		--------------	--------------
		18,269	3.8
		========	========
Total investments		475,020	100.0
		========	========

All investments are in ordinary shares unless otherwise stated. The total number of investments held at 28 February 2021 was 42 (31 August 2020: 38).

Industry classifications in the table above are based on the Industrial Classification Benchmark standard for categorisation of companies by industry and sector.

As at 28 February 2021, the Company did not hold any equity interests comprising more than 3% of any company’s share capital.

INTERIM MANAGEMENT REPORT AND RESPONSIBILITY STATEMENT

The Chairman’s Statement and the Investment Manager’s Report give details of the important events which have occurred during the period and their impact on the financial statements.

PRINCIPAL RISKS AND UNCERTAINTIES
The principal risks faced by the Company can be divided into various areas as follows:

· Counterparty;

· Investment performance;

· Legal & Compliance;

· Market;

· Operational;

· Financial; and

· Marketing.

The Board reported on the principal risks and uncertainties faced by the Company in the Annual Report and Financial Statements for the year ended 31 August 2020. A detailed explanation can be found in the Strategic Report on pages 29 to 32 and in note 15 on pages 86 to 92 of the Annual Report and Financial Statements which are available on the website maintained by BlackRock at blackrock.com/uk/brge.

GOING CONCERN
The Board is mindful of the uncertainty surrounding the potential duration of the COVID-19 pandemic and its impact on the global economy, the Company’s assets and the potential for the level of revenue derived from the portfolio to reduce versus the prior year. The Portfolio Managers will continue to review the composition of the Company’s portfolio and to be pro-active in taking investment decisions.

The Directors, having considered the nature and liquidity of the portfolio, the Company’s investment objective and the Company’s projected income and expenditure, are satisfied that the Company has adequate resources to continue in operational existence for the foreseeable future and is financially sound. The Board believes that the Company and its key third-party service providers have in place appropriate business continuity plans and these services have continued to be supplied without interruption throughout the COVID-19 pandemic.

The Company has a portfolio of investments which are predominantly readily realisable and is able to meet all its assets and income generated from these assets. Accounting revenue and expense forecasts are maintained and reported to the Board regularly and it is expected that the Company will be able to meet all its obligations. Borrowings under the overdraft facility shall at no time exceed £52 million or 15% of the Company’s net asset value (whichever is the lower) and this covenant was complied with during the period.

Based on the above, the Board is satisfied that it is appropriate to continue to adopt the going concern basis in preparing the financial statements. Ongoing charges for the year ended 31 August 2020 were 1.01% of net assets and it is expected that this is unlikely to change significantly going forward.

RELATED PARTY DISCLOSURE AND TRANSACTIONS WITH THE MANAGER
BlackRock Fund Managers Limited (BFM) was appointed as the Company’s Alternative Investment Fund Manager (AIFM) with effect from 2 July 2014. 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)). Both BFM and BIM (UK) are regarded as related parties under the Listing Rules. Details of the fees payable are set out in notes 4 and 11 below. The related party transactions with the Directors are set out in note 10 below.

DIRECTORS’ RESPONSIBILITY STATEMENT
The Disclosure Guidance and Transparency Rules (DTR) of the UK Listing Authority require the Directors to confirm their responsibilities in relation to the preparation and publication of the Interim Management Report and Financial Statements.

The Directors confirm to the best of their knowledge that:

· the condensed set of financial statements contained within the Half Yearly Financial Report has been prepared in accordance with applicable UK Accounting Standards and the Accounting Standards Board’s Statement ‘Half Yearly Financial Reports’; and

· the Interim Management Report, together with the Chairman’s Statement and Investment Manager’s Report, include a fair review of the information required by 4.2.7R and 4.2.8R of the FCA’s Disclosure Guidance and Transparency Rules.

This Half Yearly Financial Report has not been audited or reviewed by the Company’s auditor.

The Half Yearly Financial Report was approved by the Board on 23 April 2021 and the above responsibility statement was signed on its behalf by the Chairman.

ERIC SANDERSON
FOR AND ON BEHALF OF THE BOARD
23 April 2021

INCOME STATEMENT FOR THE SIX MONTHS ENDED 28 FEBRUARY 2021

		Six months ended 28 February 2021 (unaudited)			Six months ended 29 February 2020 (unaudited)			Year ended 31 August 2020 (audited)
	Notes	Revenue  £000	Capital  £000	Total  £000	Revenue  £000	Capital  £000	Total  £000	Revenue  £000	Capital  £000	Total  £000
Gains/(losses) on investments held at fair value through profit or loss		–	53,538	53,538	–	(2,539)	(2,539)	–	54,642	54,642
Gains/(losses) on foreign exchange		–	967	967	–	4	4	–	(2,088)	(2,088)
Income from investments held at fair value through profit or loss	3	1,369	–	1,369	1,167	–	1,167	4,682	–	4,682
Other income	3	–	–	–	12	–	12	96	–	96
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Total income/(losses)		1,369	54,505	55,874	1,179	(2,535)	(1,356)	4,778	52,554	57,332
		========	========	========	========	========	========	========	========	========
Expenses
Investment management fee	4	(352)	(1,410)	(1,762)	(288)	(1,152)	(1,440)	(585)	(2,340)	(2,925)
Other operating expenses	5	(372)	(9)	(381)	(346)	(3)	(349)	(566)	(8)	(574)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Total operating expenses		(724)	(1,419)	(2,143)	(634)	(1,155)	(1,789)	(1,151)	(2,348)	(3,499)
		========	========	========	========	========	========	========	========	========
Net profit/(loss) on ordinary activities before finance costs and taxation		645	53,086	53,731	545	(3,690)	(3,145)	3,627	50,206	53,833
Finance costs (expense)/written back		(28)	(112)	(140)	(10)	(40)	(50)	237	(120)	117
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Net profit/(loss) on ordinary activities before taxation		617	52,974	53,591	535	(3,730)	(3,195)	3,864	50,086	53,950
		========	========	========	========	========	========	========	========	========
Taxation (charge)/credit		(157)	–	(157)	(62)	–	(62)	1,912	–	1,912
		--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------	--------------
Net profit/(loss) on ordinary activities after taxation	7	460	52,974	53,434	473	(3,730)	(3,257)	5,776	50,086	55,862
		========	========	========	========	========	========	========	========	========
Earnings/(loss) per ordinary share (pence)	7	0.54	62.75	63.29	0.56	(4.42)	(3.86)	6.85	59.36	66.21
		========	========	========	========	========	========	========	========	========

The total column of this statement represents the Company’s profit and loss account. 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 period. All income is attributable to the equity holders of the Company.

The net profit/(loss) on ordinary activities for the period disclosed above represents the Company’s total comprehensive income/(loss).

STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 28 FEBRUARY 2021

	Notes	Called  up share  capital  £000	Share  premium  account  £000	Capital  redemption  reserve  £000	Special  reserve  £000	Capital  reserves  £000	Revenue  reserve  £000	Total  £000
For the six months ended 28 February 2021 (unaudited)
At 31 August 2020		110	–	130	47,339	329,341	10,941	387,861
Total comprehensive income:
Net profit for the period		–	–	–	–	52,974	460	53,434
Transactions with owners, recorded directly to equity:
Ordinary shares issued from treasury		–	3,373	–	2,458	–	–	5,831
Share issue costs		–	–	–	(12)	–	–	(12)
Dividends paid1	6	–	–	–	–	–	(3,710)	(3,710)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------
At 28 February 2021		110	3,373	130	49,785	382,315	7,691	443,404
		========	========	========	========	========	========	========
For the six months ended 29 February 2020 (unaudited)
At 31 August 2019		110	–	130	48,845	279,255	10,102	338,442
Total comprehensive income:
Net (loss)/profit for the period		–	–	–	–	(3,730)	473	(3,257)
Transactions with owners, recorded directly to equity:
Ordinary shares purchased into treasury		–	–	–	(1,498)	–	–	(1,498)
Share purchase costs		–	–	–	(8)	–	–	(8)
Dividends paid2	6	–	–	–	–	–	(3,461)	(3,461)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------
At 29 February 2020		110	–	130	47,339	275,525	7,114	330,218
		========	========	========	========	========	========	========
For the year ended 31 August 2020 (audited)
At 31 August 2019		110	–	130	48,845	279,255	10,102	338,442
Total comprehensive income:
Net profit for the year		–	–	–	–	50,086	5,776	55,862
Transactions with owners, recorded directly to equity:
Ordinary shares purchased into treasury		–	–	–	(1,498)	–	–	(1,498)
Share purchase costs		–	–	–	(8)	–	–	(8)
Dividends paid3	6	–	–	–	–	–	(4,937)	(4,937)
		--------------	--------------	--------------	--------------	--------------	--------------	--------------
At 31 August 2020		110	–	130	47,339	329,341	10,941	387,861
		========	========	========	========	========	========	========

¹  Final dividend paid in respect of the year ended 31 August 2020 of 4.40p per share was declared on 22 October 2020 and paid on 9 December 2020.
²  Final dividend paid in respect of the year ended 31 August 2019 of 4.10p per share was declared on 22 October 2019 and paid on 10 December 2019.
³  Interim dividend paid in respect of the year ended 31 August 2020 of 1.75p per share was declared on 27 April 2020 and paid on 10 June 2020. Final dividend paid in respect of the year ended 31 August 2019 of 4.10p per share was declared on 22 October 2019 and paid on 10 December 2019.

The transaction costs incurred on the acquisition of investments amounted to £63,000 for the six months ended 28 February 2021 (six months ended 29 February 2020: £73,000; year ended 31 August 2020: £138,000). Costs relating to the disposal of investments amounted to £38,000 for the six months ended 28 February 2021 (six months ended 29 February 2020: £13,000; year ended 31 August 2020: £61,000). All transaction costs have been included within capital reserves.

The share premium account and capital redemption reserve are not distributable profits under the Companies Act 2006. The special reserve may be used as distributable profits for all purposes and, in particular, for the repurchase by the Company of its ordinary shares and for payment as dividends. In accordance with the Company’s Articles of Association, net capital reserves may be distributed by way of the repurchase by the Company of its ordinary shares and for payment as dividends.

BALANCE SHEET AS AT 28 FEBRUARY 2021

	Notes	28 February  2021  (unaudited)  £000	29 February  2020  (unaudited)  £000	31 August  2020  (audited)  £000
Fixed assets
Investments held at fair value through profit or loss		475,020	354,261	409,802
Current assets
Debtors		2,281	2,372	1,871
Cash and cash equivalents		–	–	141
		--------------	--------------	--------------
Total current assets		2,281	2,372	2,012
		========	========	========
Creditors – amounts falling due within one year
Bank overdraft		(31,538)	(18,918)	(21,817)
Other creditors		(2,359)	(7,497)	(2,136)
		--------------	--------------	--------------
Total current liabilities		(33,897)	(26,415)	(23,953)
		========	========	========
Net current liabilities		(31,616)	(24,043)	(21,941)
		========	========	========
Net assets		443,404	330,218	387,861
		========	========	========
Capital and reserves
Called up share capital	8	110	110	110
Share premium account		3,373	–	–
Capital redemption reserve		130	130	130
Special reserve		49,785	47,339	47,339
Capital reserves		382,315	275,525	329,341
Revenue reserve		7,691	7,114	10,941
		--------------	--------------	--------------
Total shareholders’ funds		443,404	330,218	387,861
		========	========	========
Net asset value per ordinary share (pence)	7	519.22	391.61	459.97
		========	========	========

STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 28 FEBRUARY 2021

	Six months  ended  28 February  2021  (unaudited)  £000	Six months  ended  29 February  2020  (unaudited)  £000	Year ended  31 August  2020  (audited)  £000
Operating activities
Net profit/(loss) on ordinary activities before taxation	53,591	(3,195)	53,950
Add back finance costs expense/(written back)	140	50	(117)
(Gains)/losses on investments held at fair value through profit or loss	(53,538)	2,539	(54,642)
(Gains)/losses on foreign exchange	(967)	(4)	2,088
Sales of investments held at fair value through profit or loss	53,760	47,577	121,281
Purchases of investments held at fair value through profit or loss	(66,578)	(60,019)	(135,627)
Decrease/(increase) in debtors	389	(224)	(351)
Increase/(decrease) in other creditors	223	(810)	(872)
Taxation on investment income	(291)	(62)	(653)
Interest paid	(140)	(50)	(150)
Refund of UK corporation tax	–	–	1,461
Refund of withholding tax reclaims	686	148	392
	--------------	--------------	--------------
Net cash used in operating activities	(12,725)	(14,050)	(13,240)
	========	========	========
Financing activities
Ordinary shares purchased into treasury	–	(1,498)	(1,498)
Ordinary shares issued from treasury	5,618	–	–
Share reissue/purchase costs	(12)	(8)	(8)
Dividends paid	(3,710)	(3,461)	(4,937)
	--------------	--------------	--------------
Net cash used in financing activities	1,896	(4,967)	(6,443)
	========	========	========
Decrease in cash and cash equivalents	(10,829)	(19,017)	(19,683)
Cash and cash equivalents at the beginning of the period/year	(21,676)	95	95
Effect of foreign exchange rate changes	967	4	(2,088)
	--------------	--------------	--------------
Cash and cash equivalents at the end of the period/year	(31,538)	(18,918)	(21,676)
	========	========	========
Comprised of:
Cash at bank	–	–	141
Bank overdraft	(31,538)	(18,918)	(21,817)
	========	========	========
	(31,538)	(18,918)	(21,676)
	========	========	========

NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 28 FEBRUARY 2021

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.

2. BASIS OF PREPARATION
The Financial Statements of the Company are prepared on a going concern basis in accordance with Financial Reporting Standard 104 Interim Financial Reporting (FRS 104) applicable in the United Kingdom and Republic of Ireland and the revised Statement of Recommended Practice - 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' (SORP) issued by the Association of Investment Companies (AIC) in October 2019 and the provisions of the Companies Act 2006.

The accounting policies and estimation techniques applied for the condensed set of financial statements are as set out in the Company’s Annual Report and Financial Statements for the year ended 31 August 2020.

3. INCOME

	Six months  ended  28 February  2021  (unaudited)  £000	Six months  ended  29 February  2020  (unaudited)  £000	Year ended  31 August  2020  (audited)  £000
Investment income:
UK dividends	–	–	472
Overseas dividends	1,346	1,104	4,147
Overseas special dividends	23	63	63
	--------------	--------------	--------------
	1,369	1,167	4,682
	========	========	========
Other income:
Interest on corporation tax refund	–	–	80
Interest on withholding tax reclaims	–	12	16
	–	12	96
	--------------	--------------	--------------
Total income	1,369	1,179	4,778
	========	========	========

Dividends and interest received in cash during the period amounted to £1,369,000 and £nil respectively (six months ended 29 February 2020: £850,000 and £12,000; year ended 31 August 2020: £3,651,000 and £96,000).

No special dividends have been recognised in capital during the period (six months ended 29 February 2020: £nil; year ended 31 August 2020: £nil).

4. INVESTMENT MANAGEMENT FEE

	Six months ended  28 February 2021  (unaudited)			Six months ended  29 February 2020  (unaudited)			Year ended  31 August 2020  (audited)
	Revenue  £000	Capital  £000	Total  £000	Revenue  £000	Capital  £000	Total  £000	Revenue  £000	Capital  £000	Total  £000
Investment management fee	352	1,410	1,762	288	1,152	1,440	585	2,340	2,925
	========	========	========	========	========	========	========	========	========

The investment management fee is levied quarterly, based on 0.85% per annum of net asset value on the last day of each month. The investment management fee is allocated 80% to capital reserves and 20% to the revenue reserve.

5. OTHER OPERATING EXPENSES

	Six months  ended  28 February  2021  (unaudited)  £000	Six months  ended  29 February  2020  (unaudited)  £000	Year  ended  31 August  2020  (audited)  £000
Broker fees	23	24	48
Custody fees	29	26	50
Depositary fees	23	17	36
Audit fees	25	15	34
Legal fees	13	12	24
Registrars’ fees	38	38	80
Directors’ emoluments	63	64	131
Marketing fees	53	47	111
Postage and printing fees	19	32	64
Tax agent fees	18	18	36
AIC fees	12	13	26
Professional fees	9	5	15
Write back of prior year expenses	–	–	(156)
Other administration costs	47	35	67
	--------------	--------------	--------------
	372	346	566
	========	========	========
Allocated to capital
Custody transaction charges	9	3	8
	--------------	--------------	--------------
	381	349	574
	========	========	========

6. DIVIDENDS
The Directors have declared an interim dividend of 1.75p per share for the period ended 28 February 2021, payable on 4 June 2021 to shareholders on the register on 7 May 2021. The total cost of the dividend based on 87,308,101 ordinary shares in issue at 23 April 2021 was £1,528,000 (29 February 2020: £1,476,000).

In accordance with FRS 102, Section 32 ‘Events After the End of the Reporting Period’, the interim dividend payable on the ordinary shares has not been included as a liability in the financial statements, as interim dividends are only recognised when they have been paid.

7. EARNINGS AND NET ASSET VALUE PER ORDINARY SHARE
Revenue and capital returns per share and net asset value per share are shown below and have been calculated using the following:

	Six months  ended  28 February  2021  (unaudited)	Six months  ended  29 February  2020  (unaudited)	Year  ended  31 August  2020  (audited)
Net revenue profit attributable to ordinary shareholders (£000)	460	473	5,776
Net capital profit/(loss) attributable to ordinary shareholders (£000)	52,974	(3,730)	50,086
	--------------	--------------	--------------
Total profit/(loss) attributable to ordinary shareholders (£000)	53,434	(3,257)	55,862
	========	========	========
Total shareholders’ funds (£000)	443,404	330,218	387,861
	========	========	========
Earnings per share
The weighted average number of ordinary shares in issue during the period, on which the return per ordinary share was calculated was:	84,431,258	84,415,871	84,368,978
The actual number of ordinary shares in issue at the period end, on which the net asset value per ordinary share was calculated was:	85,398,101	84,323,101	84,323,101
Calculated on weighted average number of ordinary shares:
Revenue profit (pence)	0.54	0.56	6.85
Capital profit/(loss) (pence)	62.75	(4.42)	59.36
	--------------	--------------	--------------
Total profit/(loss) (pence)	63.29	(3.86)	66.21
	========	========	========

	As at  28 February  2021  (unaudited)	As at  29 February  2020  (unaudited)	As at  31 August  2020  (audited)
Net asset value per share (pence)	519.22	391.61	459.97
Ordinary share price (pence)	526.00	379.00	447.00
	========	========	========

There are no dilutive securities at 28 February 2021 (29 February 2020: nil; 31 August 2020: nil).

8. CALLED UP SHARE CAPITAL

(unaudited)	Ordinary  shares  number	Treasury  shares  number	Total  shares  number	Nominal  value  £000
Allotted, called up and fully paid share capital comprised:
Ordinary shares of 0.1p each
At 31 August 2020	84,323,101	26,005,837	110,328,938	110
Ordinary shares issued from treasury	1,075,000	(1,075,000)	–	–
	-----------------	-----------------	-----------------	-----------------
At 28 February 2021	85,398,101	24,930,837	110,328,938	110
	==========	==========	==========	==========

During the six months ended 28 February 2021, 1,075,000 ordinary shares were issued from treasury for a total consideration, including expenses, of £5,819,000. No shares were issued from treasury in the periods of the six months ended 29 February 2020 and the year ended 31 August 2020. Since the period end and up to the date of this report, a further 1,910,000 shares have been reissued from treasury for a total consideration, including expenses, of £10,638,000.

During the six months ended 28 February 2021, no shares were repurchased. During the six months ended 29 February 2020 and the year ended 31 August 2020, 390,000 shares were repurchased and held in treasury for a total consideration, including expenses, of £1,506,000.

9. FINANCIAL RISKS AND VALUATION OF FINANCIAL INSTRUMENTS
The Company’s investment activities expose it to the various types of risk which are associated with the financial instruments and markets in which it invests. The risks are substantially consistent with those disclosed in the previous annual financial statements with the exception of those outlined below.

Market risk arising from price risk
An outbreak of an infectious respiratory illness caused by a novel coronavirus known as COVID-19 has developed into a global pandemic and has resulted in travel restrictions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in health care service preparation and delivery, prolonged quarantines, cancellations, supply chain disruptions, and lower consumer demand, as well as general concern and uncertainty. The impact of COVID-19 has adversely affected the economies of many nations across the entire global economy, individual issuers and capital markets, and could continue to extents that cannot necessarily be foreseen. In addition, the impact of infectious illnesses in emerging market countries may be greater due to generally less established health care systems. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty.

Valuation of financial instruments
Financial assets and financial liabilities are either carried in the Balance Sheet at their fair value (investments) or at an amount which is a reasonable approximation of fair value (due from brokers, dividends and interest receivable, due to brokers, accruals, cash and cash equivalents and overdrafts). Section 34 of FRS 102 requires the Company 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 Company are explained in the accounting policies note on page 78 of the Annual Report and Financial Statements for the year ended 31 August 2020.

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 and regularly 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 Company 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 active, or other valuation techniques where all significant inputs are directly or indirectly observable from market data.

Level 3 – Valuation techniques using significant unobservable inputs
This category includes all instruments where the valuation technique includes inputs not based on 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. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a Level 3 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.

The table below is the analysis of the Company’s financial instruments measured at fair value at the balance sheet date.

Financial assets at fair value through profit or loss at 28 February 2021 (unaudited)	Level 1  £000	Level 2  £000	Level 3  £000	Total  £000
Equity investments	475,020	–	–	475,020
	========	========	========	========

Financial assets at fair value through profit or loss at 29 February 2020 (unaudited)	Level 1  £000	Level 2  £000	Level 3  £000	Total  £000
Equity investments	354,261	–	–	354,261
	========	========	========	========

Financial assets at fair value through profit or loss at 31 August 2020 (audited)	Level 1  £000	Level 2  £000	Level 3  £000	Total  £000
Equity investments	409,802	–	–	409,802
	========	========	========	========

There were no transfers between levels for financial assets and financial liabilities during the period/year recorded at fair value as at 28 February 2021, 29 February 2020 and 31 August 2020. The Company did not hold any Level 3 securities throughout the six month period ended 28 February 2021 (six month period ended 29 February 2020: £nil; year ended 31 August 2020: £nil).

10. RELATED PARTY DISCLOSURE
The Board consists of four 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 £41,000, the Chairman of the Audit and Management Engagement Committee receives an annual fee of £32,500 and each of the other Directors receives an annual fee of £28,000.

As at 28 February 2021, the following members of the Board held shares in the Company: Eric Sanderson held 4,000 ordinary shares, Peter Baxter held 5,000 ordinary shares and Paola Subacchi held 5,500 ordinary shares.

Since the period end and up to the date of this report there have been no changes in Directors’ holdings.

The transactions with the AIFM and Investment Manager are stated in note 11.

11. TRANSACTIONS WITH THE MANAGER AND THE INVESTMENT MANAGER
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 on pages 39 and 40 in the Annual Report and Financial Statements for the year ended 31 August 2020.

The investment management fee due for the six months ended 28 February 2021 amounted to £1,762,000 (six months ended 29 February 2020: £1,440,000; year ended 31 August 2020: £2,925,000).

At 28 February 2021, £1,762,000 was outstanding in respect of the investment management fee (six months ended 29 February 2020: £1,440,000; year ended 31 August 2020: £1,484,000).

In addition to the above services, BIM (UK) provided the Company with marketing services. The total fees paid or payable for these services for the six months ended 28 February 2021 amounted to £53,000 excluding VAT (six months ended 29 February 2020: £47,000; year ended 31 August 2020: £111,000). Marketing fees of £126,000 excluding VAT were outstanding at 28 February 2021 (29 February 2020: £117,000; 31 August 2020: £181,000).

The ultimate holding company of the Manager and the Investment Manager is BlackRock, Inc. a company incorporated in Delaware USA.

12. CONTINGENT LIABILITIES
There were no contingent liabilities at 28 February 2021 (29 February 2020: £nil; 31 August 2020: £nil).

13. PUBLICATION OF NON STATUTORY ACCOUNTS
The financial information contained in this half yearly report does not constitute statutory accounts as defined in Section 435 of the Companies Act 2006. The financial information for the six months ended 28 February 2021 and 29 February 2020 has not been audited.

The information for the year ended 31 August 2020 has been extracted from the latest published audited financial statements, which have been filed with the Registrar of Companies. The report of the auditor on those accounts contained no qualification or statement under Sections 498 (2) or (3) of the Companies Act 2006.

14. ANNUAL RESULTS
The Board expects to announce the annual results for the year ending 31 August 2021 in early November 2021. Copies of the annual results announcement can be obtained from the Secretary on 020 7743 3000 or [e-mail]. The Annual Report should be available by November 2021 with the Annual General Meeting being held in December 2021.

12 Throgmorton Avenue
London
EC2N 2DL

23 April 2021

For further information please contact:

Melissa Gallagher, Co-Head, Closed End Funds, BlackRock Investment Management (UK) Limited – 020 7743 3893

Stefan Gries, Fund Manager, BlackRock Investment Management (UK) Limited – 020 7743 3000

Emma Phillips, Media & Communications, BlackRock Investment Management (UK) Limited – Tel:  [phone]

Press enquires:

Ed Hooper, Lansons Communications
Tel:  [phone]
E-mail:  [e-mail] or [e-mail]

END

The Half Yearly Financial Report will also be available on the BlackRock website at www.blackrock.com/uk/brge. Neither the contents of the Manager’s website nor the contents of any website accessible from hyperlinks on the Manager’s website (or any other website) is incorporated into, or forms part of, this announcement.