Portfolio Update

BLACKROCK WORLD MINING TRUST plc  (LEI - LNFFPBEUZJBOSR6PW155)
All information is at 28 February 2018 and unaudited.
Performance at month end with net income reinvested
		One			Three				One	Three		Five
		Month			Months				Year	Years		Years
Net asset value		-1.3%			8.1%				9.6%	43.8%		-14.8%
Share price		-0.8%			6.1%				13.7%	51.3%		-9.4%
Euromoney Global Mining Index		-1.8%			9.1%				9.1%	36.8%		-2.7%
(Total return)
Sources: BlackRock, Euromoney Global Mining Index, Datastream
At month end
Net asset value including income1:								442.50p
Net asset value capital only:								435.12p
1 Includes net revenue of 7.38p
Share price:								394.50p
Discount to NAV2:								10.8%
Total assets:								£902.2m
Net yield3:								4.0%
Net gearing:								15.9%
Ordinary shares in issue:								176,455,242
Ordinary shares held in treasury:								16,556,600
Ongoing charges4:								1.00%
2 Discount to NAV including income. 3 Based on quarterly interim dividends of 3.00p per share declared on 4 May 2017, 10 August 2017 and 10 November 2017 and a final quarterly dividend of 6.60p per share in respect of the year ended 31 December 2017. 4 Calculated as a percentage of average net assets and using expenses, excluding finance costs, for the year ended 31 December 2017.
Sector	% Total					Country Analysis					% Total
	Assets										Assets
Diversified	50.4					Global					64.3
Copper	20.6					Latin America					11.5
Gold	13.8					Australasia					10.2
Silver & Diamonds	6.9					Other Africa					6.2
Industrial Minerals	6.7					Canada					5.1
Zinc	1.5					USA					1.0
Aluminium	0.3					India					0.6
Iron Ore	0.1					South Africa					0.6
Net current liabilities	-0.3					Russia					0.4
	-----					Kazakhstan					0.4
	100.0					Net current liabilities					-0.3
	=====										-----
											100.0
											=====
Ten Largest Investments
Company				% Total Assets
Rio Tinto				10.7
Glencore				8.6
BHP Billiton				8.4
Vale				8.0
First Quantum Minerals				7.8
Teck Resources				6.1
Sociedad Minera Cerro Verde				3.7
Newmont Mining				2.9
South32				2.6
Lundin Mining				2.5

Commenting on the markets, Evy Hambro and Olivia Markham, representing the Investment Manager noted:

Performance

The Company’s NAV decreased by 1.3% in February, outperforming its benchmark, the Euromoney Global Mining Index, which decreased by 1.8%.

The mining sector performed strongly from December to mid-January, but suffered some weakness during February. Wider market volatility contributed to this weakness following expectations that the US Federal Reserve may increase interest rates further given positive economic data in the form of jobs and wage growth. US CPI inflation data was also stronger than expected pushing yields on US government bonds higher.

Mining companies have enjoyed a strong reporting season where we have been encouraged to see management teams consistently concentrate on balance sheet repair, with little new capital expenditure announced, and returning cash to shareholders through dividends and buybacks being a key focus. Whilst companies have noted modest cost inflation, partly linked to the stronger oil prices, profit margins remain strong with commodity prices also increasing. The US announced a review of the impact from steel and aluminium imports with recommendations for new import tariffs to be implemented of 25% on steel and 10% on aluminium. The US imports approximately 30% of its steel consumption and 90% of its aluminium consumption. We see relatively limited impact on iron ore as the majority of US steel production uses recycled steel. In the base metals space, zinc and copper prices fell by 3.3% and 2.6% respectively, whilst nickel rose by 1.4%. Gold and silver prices fell 1.7% and 4.6% respectively whilst in bulk commodities the iron ore and coking coal prices rose 10%.

Strategy and Outlook

After two strong years, investors that have not been exposed to mining may now be questioning if they have missed the opportunity. We are, however, still a long way below the peak in 2011 and the sector continues to trade at a significant valuation discount to broader equity markets. Meanwhile, the miners are trading on very attractive cash flow multiples with Glencore, BHP Billiton and Rio Tinto all currently trading at forward free cash flow yields of around 10% for example. For the mined commodities, in most cases, we believe they look reasonably fairly priced and so our base case is that they remain relatively range-bound at current levels which sees healthy profitability for the sector. Crucially, however, mining equities are still pricing in commodity prices well below current spot prices and, as such, we are constructive on the shares but neutral the commodities themselves. Many still distrust the miners, expecting them to make the same mistakes of the past in terms of poor capital discipline. Our view though is that the pain of the recent down-cycle is still too fresh in the minds of management teams for this to become a widespread issue in the near-term. We have begun to see moderate increases in sustaining capex announced but we believe for the most part these have been necessary increases rather than indicative of a widespread return to poor capital discipline.

All data points are in US dollar terms unless stated otherwise.

14 March 2018

ENDS

Latest information is available by typing www.brwmplc.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.