Portfolio Update

The information contained in this release was correct as at 28 February 2021. Information on the Company’s up to date net asset values can be found on the London Stock Exchange Website at:

https://www.londonstockexchange.com/exchange/news/market-news/market-news-home.html. 

BLACKROCK GREATER EUROPE INVESTMENT TRUST PLC (LEI - 5493003R8FJ6I76ZUW55)
All information is at 28 February 2021 and unaudited.

Performance at month end with net income reinvested
 

	One Month	Three Months	One Year	Three Years	Launch (20 Sep 04)
Net asset value (undiluted)	1.4%	2.6%	34.5%	57.1%	596.5%
Net asset value* (diluted)	1.4%	3.0%	34.4%	57.0%	596.8%
Share price	-0.4%	5.6%	40.9%	67.8%	613.2%
FTSE World Europe ex UK	0.3%	0.3%	14.4%	17.9%	300.3%

* Diluted for treasury shares and subscription shares.
Sources: BlackRock and Datastream
 

At month end

Net asset value (capital only):	518.73p
Net asset value (including income):	519.25p
Net asset value (capital only)1:	518.73p
Net asset value (including income)1:	519.25p
Share price:	526.00p
Premium to NAV (including income):	1.3%
Premium to NAV (including income)1:	1.3%
Net gearing:	7.1%
Net yield2:	1.2%
Total assets (including income):	£443.4m
Ordinary shares in issue3:	85,398,101
Ongoing charges4:	1.0%

1  Diluted for treasury shares.
2  Based on an interim dividend of 1.75p per share and a final dividend of 4.40p per share for the year ended 31 August 2020.
3  Excluding 24,930,837 shares held in treasury.
4  Calculated as a percentage of average net assets and using expenses, excluding interest costs, after relief for taxation, for the year ended 31 August 2020.

Sector Analysis Total Assets (%) Technology 24.8 Industrials 24.4 Health Care 16.1 Consumer Services 10.3 Consumer Goods 10.2 Financials 6.2 Oil & Gas 4.3 Basic Materials 3.8 Net Current Liabilities -0.1 ----- 100.0 =====

Country Analysis Total Assets (%) Denmark 18.4 Switzerland 16.0 Netherlands 15.9 France 13.3 Sweden 6.4 Germany 6.0 Italy 5.3 Russia 3.9 United Kingdom 3.3 Spain 2.7 Poland 2.4 Finland 2.3 Ireland 1.5 Israel 1.3 Belgium 1.1 Greece 0.3 Net Current Liabilities -0.1 ----- 100.0 =====

Top 10 holdings	Country	Fund%
ASML	Netherlands	7.5
Sika	Switzerland	5.3
Kering	France	5.0
Lonza Group	Switzerland	4.9
DSV	Denmark	4.8
Novo Nordisk	Denmark	4.6
Royal Unibrew	Denmark	4.1
Safran	France	3.3
RELX	United Kingdom	3.3
Hexagon	Sweden	3.1

Commenting on the markets, Stefan Gries, representing the Investment Manager noted:

During the month, the Company’s NAV rose by 1.4% and the share price slightly fell by 0.4%. For reference, the FTSE World Europe ex UK Index returned 0.3% during the period.

Europe ex UK markets were slightly up in February. With bond yields rising, we have particularly seen the cyclical and value areas of the equity market outperform more defensive assets. Financials, industrials and oil & gas led the market, while utilities and health care fell during the month. The travel industry also continued to recover as the UK announced a potential route out of the lockdown leading to optimism around holiday bookings picking up.

The Company outperformed the reference index, driven by our pro-cyclical positioning, as well as a robust earnings season for many of our holdings. Stock selection was particularly strong, while sector allocation was also positive.

In sector terms, the Company’s lower allocation to defensive sectors such as telecommunications aided returns, as did a higher allocation to industrials. An underweight to utilities was also positive, as we saw a slight unwind of the renewables trade over the last few weeks which led to share price weakness in the sector. Investors have become increasingly worried that the sector is seeing additional competition from oil majors entering the wind and solar markets which could adversely impact returns. An underweight allocation to financials detracted during the month. 

Strong contribution came from the industrials sector. DSV was the top performer during the month as guidance from the company led to modest upgrades, whilst DSV’s longer-term targets set out a path for higher profitability as conversion margins increase.

Elsewhere within industrials, aerospace company Safran contributed to returns as the travel industry performed well following the above-mentioned announcement by the UK government regarding the potential for foreign travel to resume by the second half of May. Russian e-commerce company Ozon also continued to perform strongly, reporting extremely strong Q4 and 2020 full-year numbers, with growth accelerating across all business segments.

Within financials, Italian asset gatherer Finecobank was amongst the top performers reporting strong trading and robust inflows into its brokerage business. However, not owning banks including BNP Paribas, Banco Santander and ING detracted from returns.

Elsewhere, not owning defensive assets such as Nestlé, Roche and Novartis contributed positively to returns. On the flip side, several of our defensively positioned holdings including RELX and DiaSorin underperformed the market.

At the end of the period, the Company had a higher allocation than the reference index towards technology, industrials, consumer services and health care. The Company had a neutral weighting towards oil & gas and underweight allocation to consumer goods, financials, utilities, basic materials and telecoms.

Outlook

In a tumultuous year, European equity markets ended 2020 with relative strength. We see this strength persisting into 2021 aided by better virus testing capabilities, a successful vaccine rollout and a resilient global consumer, alongside continued accommodative fiscal and monetary policy. This market recovery is unlikely to be equal across all sectors: some companies still lack pricing power and are unable to reinstate dividends; others, however, such as travel exposed stocks, could see a meaningfully brighter 2021. Inflation may be on the horizon, but rates will likely remain low. A period of prolonged negative real rates and higher nominal growth is needed to allow governments globally to work their way out of the post pandemic debt overhang. We see this as being a supportive backdrop for equities overall.

22 March 2021

ENDS

Latest information is available by typing www.brgeplc.co.uk on the internet, "BLRKINDEX" on Reuters, "BLRK" on Bloomberg or "8800" on Topic 3 (ICV terminal).  Neither the contents of the Manager’s website nor the contents of any website accessible from hyperlinks on the Manager’s website (or any other website) is incorporated into, or forms part of, this announcement.