Interim Management Statement

RNS Number : 6139E

Baker Steel Resources Trust Ltd

08 April 2011

 



 BAKER STEEL RESOURCES TRUST LTD

www.bakersteelresourcestrust.com

March 2011 Quarterly Factsheet

At 31 March  2011	Price / Index Level	% Change in Quarter	% Change from Inception
Net Asset Value (pence/share)	106.2	+9.6%	+8.5%*
Diluted Net Asset Value (pence/share)	105.1	+8.5%	+7.4%*
Ordinary Share Price (pence/share)	93.5	+19.1%	-6.5%**
Subscription Share Price (pence/share)	18.5	+19.4%	n/a
MSCI World Index	343.64	+3.9%	+11.5%†
HSBC Global Mining Index	1603.76	-1.0%	+23.3%†
CRB Index	359.43	+8.0%	+31.6%†
Chinese Domestic Iron Ore – Hebei/Tangshan (US$/t)	221	+2.8%	+15.1%†
Copper (US$/t)	9413.25	-2.5%	+26.3%†
Gold (US$/oz)	1432.30	+0.8%	+22.6%†

     Source: Bloomberg                                                       † closing 27/4/10, **Issue price 28/4/10, * NAV 30/4/10 

This document constitutes an interim management statement for the period from 1 January 2011 to 8 April 2011 (the "Period"). Financial information has been drawn up as at 31/3/2011. There have been no material changes since that date. NAV performance from 31/12/2010 relates to the unaudited 31/12/2010 NAV published on 10/1/2011.

Review At the end of March, Baker Steel Resources Trust Limited ("BSRT" or "the Company") was 86.7% invested. During the quarter the NAV per share rose 9.6% largely due to an increase in the value of Ivanhoe Nickel & Platinum Ltd ("Ivanplats") following a discovery at its South African nickel/platinum project and as Ivanplats considers a listing later this year.  Following a strong second half of 2010, markets for commodities and mining equities paused for breath with the HSBC Global Mining Index falling 1.0% during the first quarter 2011. During the quarter the Company made one significant addition to its portfolio, investing a net US$5.1 million in a company which holds an interest in a Russian silver project with substantial mineral resources under JORC guidelines ("Silver Russian"). The Company is currently under confidentiality provisions whilst Silver Russian progresses towards a listing, anticipated through a reverse takeover. Significant operational progress was made during the quarter at several of the companies in which BSRT is invested. South American Ferro Metals ("SAFM") announced the commissioning of the beneficiation plant at its Ponto Verde Iron Ore Mine in Brazil with production increasing steadily towards its design rate of 60,000 tonnes per month. SAFM also achieved the production milestone for the A Class performance shares held by BSRT, and accordingly these shares were converted into ordinary shares. During the period, Ferrous Resources announced that it had achieved a number of important milestones in developing its fully integrated iron ore project in Brazil including the grant of two key licences for the installation of the Viga Mine and for a port terminal. Production of iron ore has commenced and Ferrous has stated that it remains on schedule to achieve its target of exporting 25 million tonnes of iron ore per annum from 2014. Outlook It is anticipated that a major theme for 2011 will be the increase in IPOs in the gold and mining sectors. The strong performance of listed mining shares in 2010 and continuing strength in commodity prices means that the market is increasingly receptive to new listed opportunities.  However, unlisted companies are likely to continue to face difficulties raising finance, as investors continue to opt for more liquid investments, presenting the Fund with some good value opportunities from those companies not yet ready to list.	Investment Objective To seek capital growth over the long term through a focused global portfolio consisting principally of the equities, or related instruments, of natural resources companies. Investment Strategy Investing predominantly in attractively valued private companies with strong development projects and focused management and also in listed securities to exploit value inherent in market inefficiencies. Asset Allocation Unlisted Equities               £52.9 M      75.4 % Listed Equities                    £  7.9 M      11.3 % Net Cash &                           £  9.3 M      13.3 % Equivalents                           Net Assets                            £70.1 M Gearing:                                       NIL Shares in Issue Trading:              The London Stock Exchange Ordinary:                                           66,030,632 Code:                                                           BSRT ISIN                                             GG00B6686L20 Subscription:                                    13,197,051 Code:                                                         BSRW ISIN                                           GG00B64WLC23 Financial Calendar Listing Date:                                28 April 2010 Year End:                                     31 December Interims:                                                August Finals                                                         April
LargestInvestments (at  31 March 2011) Ivanhoe Nickel and Platinum Limited                                                 25.2% NAV A private company with a major copper project in the Democratic Republic of Congo and a platinum/nickel project in South Africa. Ferrous Resources Limited                                                                    16.3% NAV A private company with five iron ore projects in Brazil. It has Joint Ore Resource Committee ("JORC") resources of 4.5 billion tonnes of iron ore at an average grade of 33.52% Fe. Gobi Coal & Energy Limited                                                                    9.3% NAV A private company with three and coking coal projects in Mongolia with a JORC compliant resource of 322 million tonnes. Ironstone Resources Limited                                                                  7.6% NAV A private company with an iron ore/vanadium project in Canada. It has a NI-43-101 compliant resource of 203 million tonnes of iron ore at an average grade of 33% Fe.  South American Ferro Metals Limited ("SAFM")                                  5.8% NAV A company listed on the Australian Stock Exchange whose main asset is the Ponto Verde iron ore project in Brazil. Copperbelt Minerals Limited                                                                   4.8% NAV A private company with a 68% interest in the Deziwa Copper-Cobalt Project in the Democratic Republic of Congo. Silver Russian                                                                                               4.5% NAV A private company which holds an interest in a Russian silver project with substantial mineral resources under JORC guidelines. Forbes & Manhattan Coal Corporation (Forbes Coal)        3.9% NAV A coal producer listed on the Toronto Stock Exchange with two mines in South Africa containing total reported resources of 106 million tonnes. First Coal Corporation                                                                               3.9% NAV A private company with a coking and PCI coal project in British Columbia, Canada, containing NI-43-101 compliant resources of 78 million tonnes of coal.  The remainder of the Portfolio (excluding cash) comprises seven holdings totalling 5.4% NAV. Further information is available on BSRT's website: www.bakersteelresourcestrust.com	Investment Manager Baker Steel Capital Managers LLP Investment Advisers AWR Capital Rock Capital Partners Ltd Management Fees Monthly:                                   1/12 of 1.75% of                                        Market Capitalisation Performance: 15% of NAV growth (if over 8% p.a. compound hurdle rate, with high watermark) Board Howard Myles (Chairman) Ed Flood Charles Hansard Clive Newall Chris Sherwell Joint Brokers RBC Capital Markets [phone] Winterflood Investment Trusts [phone] Contact: Baker Steel Capital Managers LLP 86 Jermyn Street, London SW1Y 6JD [phone] [e-mail]  Baker Steel Resources Trust Ltd is incorporated in Guernsey Registration Number: 51576 Arnold House, St Julian's Avenue,          St Peter Port, Guernsey
Important Information This document is issued and approved by Baker Steel Capital Managers LLP (authorised and regulated by the Financial Services Authority). The information contained in this document  is not intended to and does not constitute an offer, solicitation, inducement, invitation or commitment to purchase, subscribe to, provide or sell any securities, service or product or to provide any recommendations which should be relied upon for financial, securities, investment or other advice or to take any decision based on such information. Individual advice should be sought from legal, financial, personal and other advisors before making any investment or financial decision or purchasing any financial, securities or investment-related service or product. As a registered collective investment scheme, shares in Baker Steel Resources Trust Ltd are not permitted to be directly offered to the public in Guernsey but may be offered to regulated entities in Guernsey or offered to the public by entities appropriately licensed under the Protection of Investors (Bailiwick of Guernsey) Law 1987 as amended.

 

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