Final Results

BlackRock World Mining Trust plc

Annual Results Announcement

for the year ended 31 December 2015

Financial Highlights

Attributable to ordinary shareholders	31 December 2015	31 December 2014	Change %
Assets
Net assets (£’000)	377,313	624,674	-39.6
Net asset value per ordinary share	212.83p	352.35p	-39.6
– with income reinvested			-35.3
	----------	----------	---------
Ordinary share price (mid-market)	181.00p	310.35p	-41.7
– with income reinvested			-37.0
	----------	----------	---------
Euromoney Global Mining Index	255.94	405.41	-36.9
Discount to net asset value	15.0%	11.9%
	======	======	=====

	For the year ended  31 December 2015	For the year ended  31 December 2014	Change %
Revenue
Net revenue return after taxation (£’000)	32,744	37,452	-12.6
Revenue return per ordinary share	18.47p	21.13p	-12.6
Dividend per ordinary share
– Interim	7.00p	7.00p	–
– Final	14.00p	14.00p	–
	----------	----------	--------
Total dividends paid and payable	21.00p	21.00p	–
	======	======	=====

Chairman’s statement

OVERVIEW

The last few years have been extremely challenging for commodity markets. A combination of slowing global economic growth and oversupply have continued to put substantial downward pressure on many commodities. Weakness has been largely driven by the deceleration in China’s economy, which had its lowest growth rate for 25 years in 2015.

Movements in the U.S. dollar and the collapse of the oil price have also intensified pressure on commodity prices. The dollar’s strong upward momentum has reduced global liquidity and led to some tightening in financial conditions. OPEC’s decision to keep oil production at near-record levels in an already oversupplied market has also unsettled investors and the decline in the oil price has spilled over into other industrial commodities, including iron ore, copper and coal.

PERFORMANCE

Absolute performance has once again been disappointing over the twelve months to 31 December 2015, with the Company’s net asset value (NAV) per share declining by 35.3% and the share price falling by 37.0%. The Company’s NAV marginally outperformed its benchmark, the Euromoney Global Mining Index, which decreased by 36.9% in the reporting period (all percentages calculated in sterling terms with income reinvested).

Since the year end and up until the close of business on 25 February 2016, the Company’s NAV has increased by 11.4% compared with a rise of 14.1% in the benchmark index.

REVENUE RETURN AND DIVIDENDS

The Company’s revenue return per share for the year to 31 December 2015 amounted to 18.47p compared with 21.13p for the previous year, representing a decrease of 12.6%. As discussed at the interim stage, the Board is prepared to use some of the Company’s retained revenue reserves this year to maintain the dividend and, accordingly, the Directors are recommending the payment of a final amount of 14.00p per share for the year ended 31 December 2015 (2014: 14.00p). This, together with the interim dividend of 7.00p per share (2014: 7.00p), makes a total of 21.00p per share (2014: 21.00p). The final payment will be made on 6 May 2016 to shareholders on the Company’s register on 29 March 2016, the ex dividend date being 24 March 2016.

Over recent months a number of underlying mining companies have announced reduced or cancelled dividends. Key holdings in the Company, BHP Billiton and Rio Tinto, have cut dividends by 75% and 50% respectively, which has significantly reduced the Company’s income for 2016. However, shareholders will recall that due to a deliberate strategy to diversify its sources of income, approximately 50% of the Company’s revenue has historically been derived from dividend payments with the majority of the balance sourced from bonds and option writing. At the time of writing these other areas look likely to be less volatile than the significant falls seen in company dividends. Furthermore, we expect to receive royalty payments in 2016 as Avanco brings its new mine into production during the first half of the year. Whilst these income sources provide important diversification at a time of continued uncertainty in the sector, shareholders should nevertheless expect a lower dividend in 2016 than the previous year. It remains the Company’s intention to fully distribute all of the income available and the Board will be closely monitoring income to determine appropriate payments for the future.

DISCOUNT

The discount of the Company’s share price to the underlying net asset value per share finished the year under review at 15.0% on a cum income basis having stood at 11.9% at the start of the year. During the course of the year, the average discount was 10.6% with a range between 6.2% to 15.5%. The shares were trading at a discount of 20.4% as at the close of business on 25 February 2016.

At the Company’s Annual General Meeting held on 29 April 2015, the Directors were granted authority to purchase up to 14.99% of the Company’s issued share capital, excluding treasury shares, for cancellation or for holding in treasury. The decision as to whether to purchase the Company’s shares is addressed regularly in Board discussions, but during the year ended 31 December 2015 the Company did not buy back any shares. Whilst share buy backs are one method of addressing discount levels, in recent years the Board has believed that the most sustainable way to close the share price discount was to place much greater emphasis on seeking to generate additional demand for the shares by increasing dividend distributions. Mining sector weakness has clearly impacted this strategy but dividends remain key to discount management (although not at the expense of potential capital growth).

The Board will continue to consider on a regular basis whether share purchases should be made and is prepared to use its share buy back powers if a wide discount to NAV persists. To provide maximum flexibility, the Board is proposing that the Company’s existing authority to buy back up to 14.99% of the Company’s issued share capital, excluding treasury shares, be renewed at the forthcoming Annual General Meeting.

CONTINUATION OF THE COMPANY

As agreed by shareholders in 1998, an ordinary resolution for the continuation of the Company is proposed at each Annual General Meeting. Following market weakness in the mining sector in recent years, we see classic signs typical of the low point in the sector. In particular, the industry is taking action to return commodities into balance, and the sector trades at an attractive valuation relative to the broader market. The sector should respond positively and your Board therefore recommends that shareholders vote in support of the Company’s continuation.

THE BOARD

After serving as a Director since 2003, Ian Barby will be retiring at the conclusion of the forthcoming Annual General Meeting. On behalf of the Board, I would like to take this opportunity to thank Ian for his wise counsel and invaluable contribution over this period. It is also my intention to step down as Chairman of the Company following the Annual General Meeting on 28 April 2016. The Senior Independent Director is currently leading the process to identify my successor.

INVESTMENT MANAGEMENT FEE

In October the Board announced that, following discussions with its Manager, agreement had been reached on a revised fee basis. Effective from 1 October 2015, the management fee (which includes all services provided by BlackRock) was reduced to 0.8% of the Company’s gross assets. Where the Company invests in other investment or cash funds managed by BlackRock, any underlying fee is rebated.

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, 28 April 2016 at 11.30 a.m. Details of the business of the meeting are set out in the Notice of Meeting on pages 81 to 84 of the Annual Report and Financial Statements. The meeting will include a presentation by the Portfolio Managers on the Company’s performance and the outlook for the year ahead.

OUTLOOK

The outlook for commodity prices remains subdued. A stronger U.S. dollar, lower oil prices and continued low growth inflation, all of which have weighed on commodities over the last year, are likely to remain headwinds for performance in 2016. Since the peak of the mining cycle in 2011, the industry has responded to lower commodity prices through cost cutting, capital expenditure reductions, asset sales and restructuring, although there is undoubtedly more to follow.

Whilst some companies continue to produce in volume, maintaining downward pressure on prices, there are some signs for optimism. The fall in prices forces companies to cut costs and loss making production which should strengthen balance sheets, bring supply into line with demand and help commodity markets rebalance over time. At the same time, valuations are becoming more attractive and present an interesting investment opportunity. The winners will be those who emerge leaner and more efficient when sentiment recovers. The Company’s Investment Manager is focused on capturing such opportunities in the portfolio through detailed analysis and on the ground research. In current markets an active, stock selective approach remains critical to ensuring our future success.

A W Lea
Chairman
29 February 2016

STRATEGIC REPORT

The Directors present the Strategic Report of the Company for the year ended 31 December 2015.

PRINCIPAL ACTIVITY

The Company carries on business as an investment trust. Its principal activity is portfolio investment and that of its subsidiary, BlackRock World Mining Investment Company Limited (the Group), is investment dealing.

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 the Manager. Matters 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.

The management of the investment portfolio and the administration of the Company have been contractually delegated to the Manager. The Manager, operating under an investment management agreement, 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.

Other service providers include the Depositary, BNY Mellon Trust & Depositary (UK) Limited. The Company also delegates fund accounting services to BlackRock Investment Management (UK) Limited (BIM (UK)), which in turn sub-delegates these services to Bank of New York Mellon (International) Limited and also sub-delegates registration services to the Registrar, Computershare Investor Services PLC.

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.

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.

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 addition, 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.

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 18.5% and, at the financial reporting date, net gearing (calculated as borrowings less cash as a percentage of net assets) stood at 12.2% of shareholders’ funds (2014: 11.7%). For further details on borrowings refer to note 14 on page 59 of the Annual Report and Financial Statements.

No material change will be made to the investment policy without shareholder approval.

PORTFOLIO ANALYSIS

As at 31 December 2015, three investments were held at Directors’ valuation (including one unquoted investment in the Banro gold-linked preference share) representing a total of £18,790,000 (2014: £24,089,000). The investment in Avanco Resources, the Banro gold-linked preference share and Ivanhoe Mines are held at Directors’ valuation. Unquoted investments can prove to be more risky than listed investments.

Information regarding the Company’s investment exposures is contained within the ten largest investments, the investments listing, and the portfolio analysis. Further information regarding investment risk and activity throughout the year can be found in the Investment Manager’s Report.

PERFORMANCE

In the year to 31 December 2015, the Company’s net asset value per share (NAV) declined by 35.3% compared with a decrease in the Euromoney Global Mining Index of 36.9%. The Company’s share price fell by 37.0% over the same period (all figures calculated in sterling terms with income reinvested).

RESULTS AND DIVIDENDS

The results for the Company are set out in the Consolidated Statement of Comprehensive Income. The total loss for the year, after taxation, was £210,131,000 (2014: loss of £223,442,000) of which £32,744,000 (2014: £37,452,000) is revenue profit.

It is the Board’s intention to distribute the maximum dividend possible in terms of earnings each year. The Directors recommend the payment of a final dividend as set out in the Chairman’s Statement. Dividend payments for the year ended 31 December 2015 (including the interim dividend) amount to £37,230,000 (2014: £37,230,000).

KEY PERFORMANCE INDICATORS

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 those reported by other investment trusts are set out as follows:

	Year ended  31 December 2015	Year ended  31 December 2014
Net asset value per share	212.83p	352.35p
Share price	181.00p	310.35p
Discount to net asset value	15.0%	11.9%
Revenue earnings per share	18.47p	21.13p
Ongoing charges1	1.2%	1.4%
1.  Ongoing charges represent the management fee and all other operating expenses, excluding finance costs and taxation, as a % of average shareholders’ funds.

The Board monitors the above KPIs on a regular basis. Additionally, it regularly reviews a number of indices and ratios to understand the impact on the Company’s relative performance of the various components such as asset allocation and stock selection. For further details refer to the Investment Manager’s Report.

DISCOUNT

Details of the Company’s share price discount to NAV are given in the Chairman’s Statement.

PRINCIPAL RISKS

The principal risks faced by the Company are set out below. The Board has put in place a robust process to assess and monitor these risks. A core element of this is the Company’s risk register. This 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. This approach allows the effect of any mitigating procedures to be reflected in the final assessment.

The risk register, its method of preparation and the operation of key controls in the Manager’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 the Manager’s and other third party service providers’ risk management processes and how these apply to the Company’s business, the Audit & Management Engagement Committee periodically receives presentations from BlackRock’s Internal Audit and Risk & Quantitative Analysis teams and reviews Service Organisation Control (SOC 1) reports from the Company’s service providers.

In relation to the 2014 update to the UK Corporate Governance Code, the Board is comfortable 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 Board will continue to assess the principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity, on an ongoing basis.

The current risk register includes 50 risks. 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 below.

Investment Performance

Principal Risk

Returns achieved are reliant primarily upon the performance of the portfolio.

An inappropriate investment policy may lead to underperformance compared to the benchmark index, a loss of capital and dissatisfied shareholders.

Mitigation/Control 

To manage this risk the Board:

• regularly reviews the Company’s investment mandate and long term strategy;

• has set investment restrictions and guidelines which the Investment Manager monitors and regularly reports on;

• receives from the Investment Manager a regular explanation of stock selection decisions, portfolio exposure, gearing and any changes in gearing and the rationale for the composition of the investment portfolio;

• monitors and mandates an adequate spread of investments in order to minimise the risks associated with particular countries or factors specific to particular sectors, based on the diversification requirements inherent in the investment policy;

• receives and reviews regular reports showing an analysis of the Company’s performance against the Euromoney Global Mining Index and other similar indices, including the performance of major companies in the sector; and

• ensures 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.

Market

Principal Risk

Market risk arises from volatility in the prices of the Company’s investments. It represents the potential loss the Company might suffer through realising investments in the face of negative market movements.

Changes in general economic and market conditions, such as interest rates, rates of inflation, industry conditions, tax laws, political events and trends can also substantially and adversely affect the securities and, as a consequence, the Company’s prospects and share price.

Mitigation/Control 

The Board considers the diversification of the portfolio, asset allocation, stock selection, and levels of gearing on a regular basis and has set investment restrictions and guidelines which are monitored and reported on by the Investment Manager. The Board monitors the implementation and results of the investment process with the Investment Manager.

Counterparty

Principal Risk

The potential loss that the Company could incur if a counterparty is unable (or unwilling) to perform on its commitments.

Mitigation/Control 

Due diligence is undertaken before contracts are entered into and exposures are diversified across a number of counterparties.

The Depositary is now 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.

Income/dividend

Principal Risk

Low earnings in the underlying portfolio and any adverse change in the tax treatment of dividends or interest received by the Company, including as a result of withholding taxes or exchange controls imposed by jurisdictions in which the Company invests, may reduce the level of dividends received by shareholders.

Mitigation/Control 

The Board monitors this risk through the receipt of detailed income forecasts and considers the level of income at each meeting.

The Company has built up revenue reserves which can be drawn upon as required.

The Investment Manager has the ability to write options (within set parameters) which generate additional income.

Operational

Principal Risk

In common with most other investment trust companies, the Company has no employees. The Company therefore relies on the services provided by third parties and is dependent on the control systems of the Manager, BNY Mellon Trust & Depositary (UK) Limited (the Depositary) and the Bank of New York Mellon (International) Limited, who maintain the Company’s assets, dealing procedures and accounting records. The security of the Company’s assets, dealing procedures, accounting records and adherence to regulatory and legal requirements depend on the effective operation of the systems of these third party service providers.

Failure by any service provider to carry out its obligations could have a material adverse effect on the Company’s performance. Disruption to the accounting, payment systems or custody records could prevent the accurate reporting and monitoring of the Company’s financial position.

Mitigation/Control 

Due diligence is undertaken before contracts are entered into with third party service providers. Thereafter, the performance of the provider is subject to regular review and reported to the Board.

Third party service providers produce Service Organisation Control (SOC 1) reports to provide assurance regarding the effective operation of internal controls as reported on by their reporting accountants. These reports are provided to the Audit & Management Engagement Committee.

The Company’s assets are subject to a strict liability regime and, in the event of a loss of assets, the Depositary must return assets of an identical type or the 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.

Financial

Principal Risk

The Company’s investment activities expose it to a variety of financial risks which include market risk, counterparty credit risk, liquidity risk and the valuation of financial instruments.

Mitigation/Control 

Details of these risks are disclosed in note 18 on pages 61 to 72 of the Annual Report and Financial Statements, together with a summary of the policies for managing these risks.

Legal & Compliance

Principal Risk

The Company has been accepted by HM Revenue & Customs as an investment trust, subject to continuing to meet the relevant eligibility conditions. It operates as an investment trust in accordance with Chapter 4 of Part 24 of the Corporation Tax Act 2010. As such, the Company is exempt from capital gains tax on the profits realised from the sale of its investments.

Any breach of the relevant eligibility conditions could lead to the Company losing investment trust status and being subject to corporation tax on capital gains realised within the Company’s portfolio.

Any serious breach could result in the Company and/or the Directors being fined or the subject of criminal proceedings or the suspension of the Company’s shares which would in turn lead to a breach of the Corporation Tax Act 2010.

The Company is required to comply with the provisions of the Companies Act 2006, the Alternative Investment Fund Managers’ Directive and the UK Listing Rules and Disclosure Rules.

Mitigation/Control 

The Investment Manager monitors investment movements, the level and type of forecast income and expenditure and the amount of proposed dividends to ensure that the provisions of Chapter 4 of Part 24 of the Corporation Tax Act 2010 are not breached. The results are reported to the Board at each meeting. Compliance with the accounting rules affecting investment trusts are also carefully and regularly monitored.

The Company Secretary, the Manager and the Company’s professional advisers provide regular reports to the Board in respect of compliance with all applicable rules and regulation. The Board and the Manager also monitor changes in government policy and legislation which may have an impact on the Company.

Marketing

Principal Risk

Marketing efforts are inadequate or do not comply with relevant regulatory requirements. There is a failure to communicate adequately with shareholders or reach out to potential new shareholders resulting in reduced demand for the Company’s shares and a widening of the discount.

Mitigation/Control 

The Board reviews marketing strategy and initiatives and the Manager is required to provide regular updates on progress. BlackRock has a dedicated investment trust sales team visiting both existing and potential clients on a regular basis. Data on client meetings and issues raised are provided to the Board on a regular basis.

All investment trust marketing documents are subject to appropriate review and authorisation.

VIABILITY STATEMENT

In accordance with provision C.2.2 of the UK Corporate Governance Code, the Directors have assessed the prospects of the Company for a period of three years. This is generally the investment holding period investors consider while investing in the natural resources companies 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 provides a level of cash receipts in the form of interest and dividends;

• the Company invests in mining companies with long life assets;

• the Company’s forecasts for revenues, expenses and liabilities are relatively stable and it has largely fixed overheads which comprise a very small percentage of net assets (1.2%); and

• notwithstanding the fall in the Company’s NAV, the business model should remain attractive for much longer than three years, unless there is further 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 Company’s principal risks and uncertainties as set out above;

• the potential impact of the continuation of the fall in commodity equity markets and on the value of the Company’s investment portfolio and underlying dividend income;

• 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 Directors reviewed the assumptions and considerations underpinning the Company’s existing going concern assertion which are based on:

• processes for monitoring costs;

• key financial ratios;

• evaluation of risk management controls;

• compliance with the investment objective;

• portfolio risk profile;

• share price discount to NAV;

• gearing; and

• counterparty exposure and liquidity risk.

Based on the results of their analysis, the Directors have concluded that there is a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the period of their assessment.

FUTURE PROSPECTS

The Board’s main focus is to maximise total returns over the longer term through investment in mining and metal assets. Whilst sentiment is currently affected by U.S. dollar strength, global growth and geo political concerns, China has traditionally been a key driver behind resource demand. However, uncertainties behind the size and nature of demand level, along with volatile markets elsewhere, make accurate forecasting difficult. 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 environmental, social and governance factors, and human rights issues, when selecting and retaining investments. Details of the Company’s policy on socially responsible investment are set out on page 36 of the Annual Report and Financial Statements.

DIRECTORS, GENDER REPRESENTATION AND EMPLOYEES

The Directors of the Company on 31 December 2015, all of whom held office throughout the year, are set out in the governance structure and Directors’ biographies on page 24 of the Annual Report and Financial Statements. The Board currently consists of six male Directors and one female Director. The Company does not have any employees; therefore there are no disclosures to be made in that respect.

The information set out on pages 13 to 23 of the Annual Report and Financial Statements, including the Investment Manager’s Report, forms part of this Strategic Report. The Strategic Report was approved by the Board at its meeting on 29 February 2016.

By order of the Board
BlackRock Investment Management (UK) Limited
Company Secretary
29 February 2016

TRANSACTIONS WITH THE AIFM AND THE INVESTMENT MANAGER

BlackRock Fund Managers Limited (BFM) was appointed as the Company’s Alternative Investment Fund Manager (AIFM) with effect from 2 July 2014. BlackRock Investment Management (UK) Limited (BIM (UK)) continues to act as the Company’s Investment Manager under the delegation agreement with BFM.

The investment management fee due to BFM for the year ended 31 December 2015 amounted to £5,312,000 (2014: £10,493,000). At the year end, £1,952,000 (2014: £2,061,000) was outstanding in respect of the management fees.

In addition to the above services, BlackRock has provided marketing services. The total fees paid or payable for these services for the year ended 31 December 2015 amounted to £17,000 excluding VAT (2014: £256,000 excluding VAT) after adjusting for the over accrual of £126,000 for the previous year. Marketing fees of £143,000 were outstanding as at 31 December 2015 (2014: Â£299,000).

RELATED PARTY TRANSACTIONS

The Board consists of seven 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 seven members of the Board hold shares in the Company. Mr Lea holds 12,000 ordinary shares, Mr Barby 25,000 ordinary shares, Mr Buchan 29,000 ordinary shares, Mr Cheyne 24,000 ordinary shares, Mr Cockerill 28,136 ordinary shares, Mr Edey 7,000 ordinary shares and Ms Mosely 7,400 ordinary shares. The amount of Directors’ fees outstanding at 31 December 2015 was £19,375 (2014: £19,375).

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 under IFRS as adopted by the European Union.

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 these 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 as adopted by the European Union, subject to any material departures disclosed and explained in the financial statements;

• provide additional disclosures when compliance with the specific requirements in IFRS as adopted by the European Union is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the Group 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 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 at the date of this report, whose names are listed on page 24 of 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 as adopted by the European Union, 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 2014 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 on pages 37 to 40 of 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 2015, 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
A W Lea
Chairman
29 February 2016

Investment manager’s report

Portfolio performance

This year saw the sector venture further into uncharted territory resulting in 2015 being not only the fifth negative year in a row for the Company, but also the second worst annual return with the net asset value (NAV) falling by 35.3% and the share price by 37.0%. Similar to the previous year, the majority of this fall happened in the second half of the year as investors revised their commodity price assumptions downwards on the back of further weakness in demand and a reluctance from the mining companies to cut enough supply. Like a set of dominos falling in a row, the commodity price falls triggered EBITDA falls which in turn increased the prospect of indebted companies not being able to meet covenants on their debt. In this environment, share prices took the full force of such fears given equity investors would have the most to lose.

We know that it is small comfort, but the Company managed to deliver an excess return in NAV terms during the year by falling less than the Euromoney Global Mining Index which fell by 36.9%. The outperformance was due to a range of factors, of which the largest was a core holding in Norilsk Nickel, as well as gold producer Northern Star Resources, whose assets are located in countries where the domestic currency weakened relative to the U.S. dollar. Performance was also helped by avoiding companies that had no plan to escape the prospect of debt issues. These positives were in part offset by the overweight in copper producers, an underweight in the larger gold companies and an underweight in the aluminium producers.

Mining sector overview

In 2015, the market was dominated by huge moves in commodity prices and exchange rates on the back of the surging trade weighted dollar. These two factors were inextricably linked throughout the year. The relative weakness in the dollar in the first five months caused some commodity prices to shun the overall downward trend, for example copper and oil. However, from June onwards, commodity prices sank as the dollar resumed its upward move based on the overwhelming view that the Federal Reserve would raise rates for the first time since 2006. Copper and oil joined the pack moving lower and those commodity prices that had already fallen rapidly fell further. The downdraft in prices left market forecasts out of touch with the spot price reality and the gap that opened up was soon overwhelming. Credit rating agency debt warnings and downgrades became commonplace in the sector and many companies have been left with debt trading well into junk territory. In some cases the collapse in share prices has left companies looking at huge dilution to existing shareholders; for example, Lonmin raised money during the year at 1p per share versus the £33 per share offer from Xstrata in 2007!

The link between the dollar and commodity prices has delivered some benefits to a select group of miners as the dollar strength has caused many ‘producer currencies’ to weaken massively. Allocating capital to companies that have assets in ‘producer countries’ such as Australia, Canada, Brazil, Mexico, Russia and others, has been a key strategy within the Company for the last few years. It has helped to offset part of the fall in U.S. dollar commodity prices by reducing local costs in dollar terms. The table below highlights the scale of the moves in exchange rates for ‘producer countries’ relative to the dollar.

	Currency moves in 2015 vs U.S. Dollar
	Sterling	Euro	Australian  Dollar	Canadian  Dollar	Chinese  Yuan	Brazilian  Real	South  African  Rand	Russian  Ruble
1 year return	-5.4%	-10.2%	-10.9%	-19.1%	-4.6%	-47.0%	-33.7%	-25.5%
Spot at 31 December 2015	1.47	1.09	0.73	1.38	6.49	3.96	15.47	72.52
	========	========	========	========	========	========	========	========

Source: Bloomberg.

Another factor helping companies to protect margins has been the general cost deflation across the industry. The reduced level of activity within the mining sector caused a drop in demand for just about everything – from explosives to people and equipment. In addition, the cost of consumables such as diesel and steel has dropped. This combination has helped some companies to shelter from the price falls, and in some cases profit from the moves, but it was far from enough to deliver positive share price returns. The scale of the fall this year, as mentioned previously, was the second worst in the 22 year history of the Company and the sector still faces the huge challenge of repaying the debt that was taken on to fund the capital investment and M&A adventures undertaken during the boom years.

Despite the negative background there is cause for hope as some companies have recognised the immediate challenges that they face. Those that moved quicker than others to sell assets, issue equity, pay down debt and have delivered on credible plans, have been rewarded with relative outperformance. Then there are the rest. These companies were reluctant to believe that things would deteriorate and they took comfort in having large undrawn revolving credit facilities in place offering them cheap access to liquidity. The ensuing collapse in the value of their equity during the year and a shift from a sellers-market for asset divestiture to one in favour of the buyer has left them like debt-ridden zombies with limited flexibility to restructure their balance sheet. Thankfully, the Company avoided some of the biggest losers in this space and this added to relative returns but it failed to avoid all of them. It remains to be seen whether investors have the conviction to back much needed refinancing packages and they will probably demand that existing shareholders suffer significant dilution.

Base metals

In 2015 it was a clean sweep of negative moves for the base metal sector. Nickel was the largest faller with the price dropping by 41.8% and the year-on-year average price just under 30% lower. Despite this, Norilsk Nickel, the world’s largest producer of nickel and one of the Company’s largest holdings was one of the best performing equities in 2015. This was due to three factors: relative balance sheet strength, aggressive cost cutting and the collapse of the Ruble. These factors allowed the company to preserve margins relative to others and the free cash flow was distributed to shareholders leading to significant outperformance relative to the sector.

SELECTED COMMODITY PRICE CHANGES DURING 2015

	Price  31  December  2015	%  change  over  12  months	%  change  average  2015  vs.  2014
Uranium US$/lb	34.25	-3.5%	+10.1%
Gold US$/oz	1,062.4	-10.5%	-8.4%
Zinc US$/lb	0.72	-26.5%	-10.7%
Aluminium US$/lb	0.68	-17.8%	-10.9%
Lead US$/lb	0.82	-2.5%	-14.7%
Silver US$/lb	13.855	-12.0%	-17.7%
Copper US$/lb	2.13	-26.1%	-19.7%
Platinum US$/oz	868	-28.0%	-23.9%
Tin US$/lb	6.62	-24.9%	-26.6%
Nickel US$/lb	3.98	-41.8%	-29.8%
Hard Coking Coal (US$/t)	77	-30.8%	-22.8%
Thermal Coal (US$/t)	51.9	-19.9%	-16.6%
Iron Ore – fines 62% Fe China Import US$/t	42	-37.8%	-44.1%
Lithium Carbonate CIF into China spot 99% (US$/t)	15,789	161.5%	+29.9%
Potash (US$/t)	265	-28.4%	-7.4%
Baltic Freight Rate Index US$	478	-38.9%	-35.5%
Sources: Datastream and Bloomberg.

On the negative side of returns, the Company’s exposure to copper producers detracted from performance. The 19.7% fall in the average price, year-on-year, meant that cash flows were down sharply and share price performance was very negative. This happened in two phases. During the first half of the year copper prices held up relative to the group and this boded well for outperformance but, post the summer and the general weakness in demand for all commodities, copper fell sharply leaving companies little time to react. Freeport McMoRan Copper & Gold was forced to issue equity in two on-market tranches during the year. Other companies, such as Anglo American, First Quantum Minerals, Glencore and Barrick Gold, initiated asset sale strategies but buyers were restricted by both a desire to buy only the best assets and to keep balance sheet liquidity intact. By the year end, there was an even longer list of copper assets for sale and valuations for mines were falling in line with the market. Barrick had the most success by managing to sell half of its Zaldivar mine to Antofagasta on terms that look beneficial to the seller over the buyer.

Gold & precious metals

It was a volatile year for gold which finished the period down 10.5% in U.S. dollar terms (-5.1% in sterling terms), outperforming base metals, bulk commodities and oil during the year. Precious metals started the year strongly, reaching a high of US$1,300/oz in January, with the market acutely focused on a possible Greek exit. This trend subsequently reversed, bottoming at US$1,050/oz in December with the U.S. Federal Reserve indicating that it would raise rates by 25 basis points which saw the U.S. dollar hit a 12½ year high. Much of the debate in gold circles during the year focused on how gold would perform in a Fed tightening cycle. Typically, gold performs poorly as interest rates rise; however, given expectations of a slow tightening cycle, lack of inflation and long term rates remaining low, gold has the potential to see a relief rally particularly for those concerned about the strength of the global economy.

As in 2014, there was generally a lack of investor interest in gold with small net ETF outflows for the year. Investors who loaded up on gold as the market began to take off in 2010 have now largely exited the market with changes in the holdings of physically-backed gold ETFs having limited influence on the gold price during 2015. The second half of the year witnessed a pick-up in physical volumes which was led by Indian and Chinese jewellery demand in line with seasonal strength, but also stimulated by the lower gold price. According to the World Gold Council, jewellery demand is expected to have risen by +5% in 2015 to 2,100 tonnes and remained the largest source of overall demand. Investment demand via bar and coin was also strong with official coin sales +111% year-on-year in Q3 2015, the strongest level of U.S. coin demand since the global financial crisis. The devaluation of the Chinese Yuan in August is also potentially supportive for gold, with Chinese investors looking to protect against further currency risk. Central banks continue to be net gold buyers with Russia remaining a large buyer of the metal. During Q3 2015, China reported its official gold holdings for the first time since April 2009. At 1,658 tonnes, China’s gold holdings were up by 604 tonnes from the last reported figure but were far below the market’s expectations for around 3,000 tonnes and this put pressure on the price. From a supply perspective, overall supply plateaued up 1% year-on-year (Q3-15 vs Q3-14). The lack of reinvestment into growth projects across the industry has seen forecast mine supply growth decline in recent years with overall mine supply expected to decline from 2016.

Gold equities, as measured by the FTSE Gold Mines Index, fell by 21.4% in U.S. dollar terms (16.9% in sterling terms), outperforming the industrial miners. There was a significant dispersion in returns across gold equities, with companies with heavily indebted balance sheets faring worse than those with stronger balance sheets. The fall in the gold price saw a number of companies look to deleverage via asset sales; the most notable was Barrick Gold which successfully delivered on its target of reducing debt by US$3 billion. The pick-up in M&A activity created a number of interesting opportunities for some of the small to mid-size gold companies. These companies have been able to acquire assets successfully and add value through refocusing on exploration and stripping out costs that are typically associated with a larger company. The portfolio’s holding in Australian-based gold producer Northern Star was one of the largest contributors to performance during the year having successfully acquired assets from Newmont and Barrick.

Unlike the last two years, silver performed in line with gold, falling by 12.0% (in U.S. dollar terms). While the performance of the two metals was similar, it is interesting to note that the gold to silver ratio has been persistently high over the last year exceeding 70 versus a historical ratio of around 60. The bulk of the Company’s silver exposure is through its holding in Fresnillo and its parent company, Industrias Penoles. Of the other precious metals, platinum and palladium ended the year down by 28.0% and 29.3% respectively (in U.S. dollar terms). The industry continues to be challenged by growing supply (despite a significant percentage of the industry being loss making), declining global auto sales and a new question mark around the demand for diesel vehicles following the Volkswagen scandal around emissions tests. The Company’s portfolio has no exposure to platinum, with an indirect exposure to palladium via its holding in Norilsk Nickel, the world’s largest palladium producer.

Diamond exposure in the portfolio increased year-on-year with additions to holdings in Petra Diamonds (via listed debt) and Dominion Diamonds. Total exposure to the diamond sector ended the year at over 4% of the portfolio. Rough diamond prices came under pressure in 2015, declining by an average of 15%, mirroring the last major shakeout in the diamond market in 2011/2012 when prices fell by 20%. Measures taken by the industry (principally by DeBeers) to reduce production helped support prices; however, inventory held by polishers and dealers remains elevated with prices likely to remain under pressure until excess inventory is sold.

Bulk commodities

Weakness across all three ‘steel intensive’ sectors in China – property, infrastructure and industry, saw global crude steel demand decline by 3.5% in 2015, the first decline in global steel consumption since 2009. Weakness in China’s domestic economy saw the world’s largest consumer and producer of steel meaningfully increase its level of steel exports, putting downward pressure on steel prices globally. Despite positive forecasts from major iron ore producer Rio Tinto, which expects China to grow its steel output to one billion tonnes by 2030 (from approximately 840Mt today), much debate this year has focused on whether China has now reached peak steel demand.

Weakness in steel demand saw the iron ore market come under significant pressure with the average iron ore price declining by 44.1% year-on-year. The market faces a number of challenges with a falling cost curve, declining demand and new low cost supply entering the market as major iron ore producers complete expansion projects committed to at the top of the cycle. The decline in the iron ore price has seen a significant amount of Chinese domestic production, as well as material from smaller producers, exit the market. The industry is on a ‘race to the bottom’, aggressively lowering operating costs, with weaknesses in the oil price, Australian dollar, Brazilian Real, as well as volume growth, resulting in a close to 50% reduction in unit operating costs since the peak for the major producers BHP Billiton, Rio Tinto and Vale.

The market is anticipated to remain oversupplied next year and this is likely to see the iron ore price remain around current prices, or move lower, to continue to force production out of the market. While the major producers are still generating decent margins, the amount of cash generated from their iron ore divisions has declined materially in recent years putting pressure on dividends. The Company’s portfolio had minimal exposure to pure play iron ore producers throughout the year.

The metallurgical coal market faced similar challenges to that of the iron ore market – flattening and falling cost curves, as well as weak demand, forcing prices lower. At current prices, only select Australian, Russian and U.S. producers are making a margin. Long considered the marginal producer in the contestable metallurgical coal market, Chinese domestic supply has also been stronger than expected. In the absence of higher demand, higher cost U.S. production needs to be cut to return the market to balance. However, the modus operandi has been for heavily indebted miners to choose to burn cash and sell down inventory, before filing for Chapter 11 bankruptcy protection and restructuring their debt. While there are a number of companies which are likely to be forced down this route in 2016, mines often continue to operate but with different owners, with little production actually exiting the market.

Thermal coal prices have been falling for almost five years. Declining consumption growth in China has seen the country continue to reduce its imports of thermal coal and this has placed downward pressure on the seaborne market. In an effort to protect its massively indebted and cash flow negative coal industry, China has brought in a number of protectionist measures such as import restrictions and tax cuts. In addition, the growing recognition of the need to address climate change, has seen a number of major economies commit to reduce their use of thermal coal and focus on energy efficiency and alternative energy sources. The Company’s portfolio ended the year with no pure play thermal coal exposure, exiting our position in China Shenhua during the second half of 2015.

Industrial metals

Unlike most commodities, the lithium sector has seen strong demand, constrained supply and a rally in prices with the Chinese lithium carbonate price rising +161.5% in 2015. Future demand looks set to be strong, driven by the growing uptake in lithium batteries, particularly via electric cars and static storage. Albermarle, one of the leading producers of lithium, forecasts demand to rise by approximately four times over the next decade. While these predictions appear very bullish, they do highlight the potential for future demand growth. Over the last five years, electric vehicles have grown significantly and appear on the tipping point for mainstream adoption. In addition, a number of large companies are building lithium battery factories, most notably Tesla’s Gigafactory, which has the potential to transform the industry. During 2015, we initiated a position in Albemarle, a large U.S. based specialty metals company with lithium assets around the world.

Royalties and illiquid investments

4.4% of the Company’s portfolio is invested in unquoted investments. These, and any future investments, will be managed in line with the guidelines set by the Board as outlined to shareholders in the last Annual Report.

Banro gold-linked linked preference share

The Company’s portfolio has a 2.5% exposure to a gold-linked preference share issued by Canadian listed gold company Banro Corporation. The preference share provides exposure to the gold price and production growth. The principal value moves in line with the gold price and the coupon ranges between 10% and 15% depending on Banro’s overall level of production. Since the Company purchased the preference share in April 2013, the Company has received a total of US$6.6 million in dividends, with deferred dividends expected to be received in the first half of 2016.

Following a challenging 2014, we are pleased to report that Banro successfully delivered on a number of milestones during the year. The company’s primary mine Twangiza delivered record production +38% year-on-year, operating ahead of design capacity. Namoya the company’s second asset continued to ramp-up during the year declaring commercial production on 1 January 2016. Overall, the company produced 183,369 ounces of gold in 2015. This is expected to further increase in 2016 as production from Namoya builds. In addition, the company successfully completed a US$90 million financing in February 2015 with Gramercy Funds Management to address near term liquidity needs.

As the gold price continued to weaken, Banro has sought to raise additional capital, signing definitive agreements with a Chinese mining investment fund, Resource FinanceWorks, for US$98.75 million financing at the end of 2015. The transaction is subject to regulatory approval, with Banro targeting closure of the deal in the first quarter of 2016. The transaction consists of a US$67.5 million stream over the Twangiza asset; a US$22.5 million term loan facility maturing in November 2016; and a US$8.75 million private placement of 50 million Banro shares plus 2.5 million warrants. In addition to general corporate and working capital purposes, the proceeds from the transaction will be used to meet remaining coupon payments on Banro’s senior secured notes which mature in 2017, to repay local debt and outstanding dividends owed on the preference shares, and to expand crushing facilities at Twangiza.

As at the end of the year, the Board in conjunction with a recommendation from the BlackRock Pricing Committee, has applied a 30% discount to the valuation of the gold-linked preference share. This discount is consistent with the level of the discount to par value that the senior secured notes have traded at during the second half of 2015 and reflective of Banro’s tight liquidity position at the year end. The Company reduced its exposure to Banro’s senior secured notes throughout the year, exiting the holding prior to the year end.

Avanco royalty contract

In October 2013, the Company signed a non-binding memorandum of understanding with Avanco Resources for a contractual royalty covering its exploration licenses within the world-class mineral district of Carajas in Brazil. A binding royalty agreement was subsequently signed in July 2014. In return for US$12 million the Company will receive 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 that will be produced from their Antas North and Pedra Branca (Stage 1 and Stage 2) licenses. In addition, there will be a flat 2% royalty over all metals produced from any other discoveries within Avanco’s licence area as at the time of the agreement.

Given the development style nature of the royalty, drawdown was conditional on Avanco achieving a number of milestones to de-risk the Company’s royalty exposure. These conditions (achieved in the first half of 2015) included the publication of a JORC compliant reserve statement, the receipt of a mining license for Stage 1 and securing debt financing for the project. Delays in securing debt financing from a syndicate of Brazilian banks during 2014, saw the company announce and complete an equity raising during the first half of 2015. As a result, their Antas North (Stage 1) copper mine is fully financed into production. This places Avanco in an advantageous position of being fully financed, debt free and unhedged as it enters production.

As of the end of the year, the Company has invested US$8 million of its US$12 million commitment, with the remaining US$4 million expected to be invested during the first quarter of 2016. Construction of the Antas North open pit mine continues to progress well, with commissioning of the operation targeted during Q1 2016. The project remains on time and on budget with pre-stripping well advanced, plant earthworks and civils complete, power connected to site and electrical installation underway. The project is initially targeting annual production of 12,000 tonnes of copper in concentrate and 7,000 ounces of gold, increasing to 15,000 tonnes of copper by 2018. Ongoing weakness in the Brazilian Real is expected to lower the U.S. dollar denominated capital expenditure budget (including contingency and working capital) of US$60 million and should also reduce operating costs with a significant amount of costs denominated in local currency.

Further upside potential is available via the Pedra Branca underground project which is also covered by the royalty. Pedra Branca is significantly larger than Antas with a current copper resource of 454,000 tonnes and 363,000 ounces of gold. Avanco is targeting copper production from the project of approximately 35,000 tonnes per annum. The project has good infrastructure and is close to its existing Antas mine. The company will continue to focus on early stage development studies and resource drilling, with further details to be released during 2016.

Fixed income securities

The Company continues to have a significant part of the portfolio allocated to fixed income securities. As at the end of 2015, the Company had 12.9% of the portfolio in corporate debt. First Quantum debt made up the largest exposure to a single issuer at 5.8% of the Company’s portfolio.

Derivatives activity

The Company sometimes holds positions in derivatives contracts with virtually all the activity focused on selling either puts or calls in order to increase or decrease position sizes and take advantage of high prices paid for exposure to volatility. These derivative positions, which are small in comparison with the size of the Company, usually have the effect of obliging us to buy or sell stock or futures at levels we believe are attractive. During 2015, we primarily focused on writing short dated options to maximise the price paid for the implied volatility and at the same time minimise the duration of the exposure in keeping them short dated. This was done mostly by the selling of covered calls, but in some cases we also sold puts where we felt valuation levels were sufficiently attractive. Both strategies worked well during the year and income from option writing increased year-on-year. At the end of 2015, the Company had two option positions with time still to run and they both expired worthless in January.

Gearing

At 31 December 2015, the Company had gearing, net of group cash, amounting to £46.1 million, representing 12.2% of net assets. For the most part this gearing has been drawn down against the higher yielding mining company corporate bonds and is predominantly denominated in the same currency as the bonds. Gearing, 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 during the medium to long term.

Outlook and strategy for 2016

This time last year we were worried that weakness in demand might cause the recent falls in commodity prices to accelerate further and make it difficult for companies to maintain the level of dividends being forecast by the market. In the second half of 2015 this happened and companies now face the challenge of dealing with the debt they had taken on to fund investments during the good times. Working out how this problem is to be tackled will be key to delivering good performance in 2016. We expect there to be a large dispersion in performance between those that have plans and those that either do not or are unable to produce one as it is ‘too late’ for them. Our intent is obviously to back the former and avoid the latter. In addition, we expect precious metal companies, mainly gold producers, to outperform broader commodity producers if the U.S. interest rate cycle goes into reverse. Lastly, we have been building exposure to industrial commodities versus base metals and we expect to add to this strategy during the year.

2016 is likely to be characterized yet again by high levels of volatility and this should allow the Company to increase revenue from selling options to the market. If we can build on this source of income during the year then it will go some way to softening the blow from cuts to mining company dividends. It is our hope that during 2016 common sense prevails and mining companies start to cut production so that supply and demand begin to return to balance. If mining companies fail to act, then commodity prices are likely to remain lower for longer.

Evy Hambro and Olivia Markham
BlackRock Investment Management (UK) Limited
29 February 2016

Ten largest investments as at 31 December 2015

Set out below is a brief description by the Investment Manager of the Company’s ten largest investments.

BHP Billiton: 11.3% (2014: 10.8%) is the world’s largest mining company by market cap. The company is an important global player in a number of commodities including iron ore, copper, coal, manganese, aluminium, diamonds and uranium. The company is the only sizeable holding in the portfolio with significant oil and gas assets. During the first half of 2015 the company completed the demerger of a series of smaller non-core assets into a new company South32. Samarco, a joint venture operated by mining majors BHP Billiton and Vale suffered a collapse in its tailings dam in November 2015. Tragically this resulted in the loss of lives and significant environmental damage. Uncertainty around the size of the environmental liability, as well as oil price weakness, put pressure on the company towards the end of the year.

Rio Tinto: 10.7% (2014: 10.8%) is the world’s second largest mining company by market cap. It has interests over a broad range of metals and minerals including iron ore, aluminium, copper, coal, industrial minerals, gold and uranium. The company has recently completed the infrastructure expansion of its world class Pilbara iron operations to 360mtpa.

First Quantum Minerals*+: 6.7% (2014: 8.6%) is an integrated copper producer whose principal operating assets are in Zambia, but also with nickel assets in Australia and Finland. First Quantum is in the midst of a significant expansion of its business comprising six major projects, most notable the Cobre Panama mine in Panama. During the first half of 2015, the company raised C$1.25 billion in fresh equity to de-risk the balance sheet through its heavy investment phase. Further weakness in the copper price has seen the company take further action to protect the balance sheet, with further asset sales expected in 2016. The Company holds both the equity and the senior unsecured debt.

Lundin Mining*#: 5.3% (2014: 4.6%) is a base metals producer with operations in Chile, Europe and the U.S. In addition, it holds a 24% minority stake in the Tenke copper-cobalt mine in the DRC. In October 2014, the company announced that it had agreed to purchase Freeport McMoRan’s 80% interest in the Candelaria copper mine in Chile for US$1.8 billion. To fund this purchase, the company raised US$674 million in equity and issued US$1 billion of senior secured notes. During the second half of 2015, the company announced an updated mine plan for the asset resulting in higher production between 2016 and 2019 which was well received by the market. The Company holds both the equity and the 7.875% senior secured notes due 2022.

Norilsk Nickel: 5.0% (2014: 3.4%) is the world’s largest nickel and palladium producer and also with significant platinum and copper production. It is a Russian company whose core assets are located in northern Siberia, within the Arctic Circle. Despite nickel and palladium price weakness during 2015, the company has benefited from the significant weakening in the Russian Ruble, which has seen the company continue to generate strong cash flow supporting its attractive dividend.

Fresnillo: 4.5% (2014: 3.0%) is a Mexican based precious metals mining company incorporated in the United Kingdom and headquartered in Mexico City. Fresnillo is the world’s largest producer of silver and Mexico’s second largest gold miner. The company has a strong exploration focus and organic growth pipeline targeting growth to 65moz silver and 750koz of gold by 2018.

Glencore: 3.8% (2014: 8.4%) is a diversified miner with activities in mining, smelting, refining, processing and marketing of metals and minerals, energy products and agricultural products globally. In addition, the company provides financing, logistics, marketing and purchasing services to producers and consumers of commodities. During the year, the company took a number of actions outlining a plan to reduce US$13 billion of net debt.

Sociedad Minera Cerro Verde: 3.8% (2014: 3.6%) is a copper and molybdenum operation in Peru operated by Freeport McMoRan Copper & Gold where they maintain a 53.6% ownership in the company. In 2013, construction activities commenced on the US$4.4 billion large-scale expansion of the asset to triple production at the concentrator facilities and provide an incremental 600mlbs of copper and 15mlbs of molybdenum from 2016.

Hudbay Minerals: 2.8% (2014: 2.3%) is a Canadian mining company with operations, development properties and exploration activities across the Americas focused on the production of base and precious metals. The company has spent the last few years investing in the Lalor and Constancia projects, with Constancia achieving commercial production during 2015. In addition, Hudbay acquired the Rosemont project via its acquisition of Augusta Resources in 2014, to complement its growth profile in the long term. The company holds both the equity and the 9.5% senior unsecured notes due 2020.

Potash Corporation of Saskatchewan: 2.7% (2014: nil) is a Canadian based company and the world’s largest fertilizer company by capacity, producing the three primary crop nutrients: potash, nitrogen and phosphate. The company has operations and business interests in seven countries and plays an important role in helping the world grow the food it needs. The company is part-owner of Canpotex, which manages all potash exporting from Saskatchewan, Canada.

* Includes fixed interest securities. + 0.9% in equity; 5.8% fixed interest. # 2.0% in equity; 2.9% fixed interest All percentages reflect the value of the holding as a percentage of total investments. Percentages in brackets represent the value of the holding as at 31 December 2014. Together, the ten largest investments represent 56.6% of total investments (31 December 2014: 60.6%).

Investments as at 31 December 2015

	Main  geographical  exposure	Market  value  £’000	%  of  investments
Diversified
BHP Billiton	Global	48,203	11.3
Rio Tinto	Global	45,517	10.7
Lundin Mining*	Global	22,542	5.3
Norilsk Nickel	Russia	21,287	5.0
Norilsk Nickel Call Option 15/01/16	Russia	(47)	-
Glencore	Global	16,267	3.8
Hudbay Minerals*	Global	11,721	2.7
Boliden	Sweden	5,762	1.3
Boliden call option 15/01/16	Sweden	(114)	-
African Rainbow Minerals	South Africa	1,118	0.3
Vale 0% 29/9/49#	Global	453	0.1
		--------	--------
		172,709	40.5
		--------	--------
Copper
First Quantum Minerals*	Global	28,567	6.7
Sociedad Minera Cerro Verde	Peru	16,232	3.8
Avanco Resources*#~	Brazil	15,638	3.7
Nevsun Resources	Eritrea	10,203	2.4
OZ Minerals	Australia	8,223	1.9
Antofagasta	Chile	3,284	0.8
Aurubis	Global	2,370	0.6
Freeport-McMoRan Copper & Gold	Global	2,290	0.5
Reservoir Minerals	Serbia	1,475	0.3
Katanga Mining	DRC	769	0.2
Ivanhoe Mines#	DRC	259	0.1
		--------	--------
		89,310	21.0
		--------	--------
Gold
Northern Star Resources	Australia	11,321	2.6
Banro+#	DRC	10,576	2.5
Randgold Resources	Africa	10,525	2.5
Franco-Nevada	Global	7,111	1.7
Newcrest Mining	Australia	6,723	1.6
Eldorado Gold	Global	5,993	1.4
AngloGold Ashanti	South Africa	3,848	0.9
Gold Fields	South Africa	3,745	0.9
Agnico Eagle Mines	Canada	3,553	0.8
G-Resources	Indonesia	2,607	0.6
Shanta Gold convertible	Tanzania	2,546	0.6
OceanaGold	Global	2,458	0.6
Metals X	Australia	1,523	0.4
Independence	Australia	1,173	0.3
Minas Buenaventura	Peru	1,034	0.2
Stratex International	Turkey	464	0.1
		--------	--------
		75,200	17.7
		--------	--------
Silver & Diamonds
Fresnillo	Mexico	19,429	4.5
Petra Diamonds*	South Africa	8,425	2.0
Tahoe Resources	Global	7,600	1.8
Dominion Diamond	Canada	6,896	1.6
Industrias Penoles	Mexico	6,258	1.5
Mountain Province Diamonds	Canada	3,562	0.8
Lucara Diamond	Botswana	3,118	0.7
Sierra Metals	Peru	852	0.2
Volcan	Peru	237	0.1
		--------	--------
		56,377	13.2
		--------	--------
Industrial Minerals
Potash Corporation of Saskatchewan	Canada	11,623	2.7
Iluka Resources	Australia	10,591	2.5
Albemarle	Global	5,699	1.3
		--------	--------
		27,913	6.5
		--------	--------
Aluminium
Alumina	Australia	2,057	0.5
		--------	--------
		2,057	0.5
		--------	--------
Other
Nyrstar	Global	883	0.2
Western Areas	Australia	747	0.2
Sociedad Minera El Brocal^	Peru	288	0.1
Bindura Nickel	Zimbabwe	33	-
		--------	--------
		1,951	0.5
		--------	--------
Iron Ore
Equatorial Resources	Republic of Congo	407	0.1
		--------	--------
		407	0.1
		--------	--------
Portfolio		425,924	100.0
		========	========
*              Includes fixed interest investments. #              Investments held at Directors’ valuation. +              Includes Banro gold-linked preference share. ^              Includes rights holdings. ~              Includes mining royalty contract.

All investments are in equity shares unless otherwise stated.

The total number of investments as at 31 December 2015 (including options classified as liabilities on the balance sheet) was 56 (31 December 2014: 64).

As at 31 December 2015, the Company held equity interests in two companies comprising more than 3% of a company’s share capital as follows: Stratex International and Avanco Resources.

Portfolio analysis as at 31 December 2015

COMMODITY EXPOSURE*

	BlackRock World Mining Trust plc 2015	BlackRock World Mining Trust plc 2014	Euromoney Global Mining Index 2015
Platinum	0.0	0.4	1.1
Coal	0.0	3.2	5.7
Iron Ore	0.1	1.1	0.8
Aluminium	0.5	1.0	2.9
Industrial Minerals	6.5	2.0	0.8
Silver & Diamonds	13.2	8.2	5.0
Gold	17.7	12.2	23.4
Copper	21.0	23.0	9.5
Diversified	40.5	47.6	45.5
Other	0.5	1.3	5.3

GEOGRAPHICAL EXPOSURE*

2015	%
Global	48.7
Latin America	14.9
Australia	10.0
Africa (ex SA)	9.1
Other***	7.3
Canada	5.9
South Africa	4.1

2014	%
Global	54.8
Latin America	12.5
Other**	9.3
Africa (ex SA)	7.7
Australia	6.1
Canada	4.5
South Africa	4.4
USA	0.7

* Based on the principal commodity exposure and place of operation of each investment.

** Consists of Guatemala, Indonesia, People’s Republic of China, Russia, Serbia, Sweden and Turkey.

*** Consists of Indonesia, Russia, Serbia, Sweden and Turkey.

Consolidated statement of comprehensive income for the year ended 31 December 2015

	Notes	Revenue  2015  £’000	Revenue  2014  £’000	Capital  2015  £’000	Capital  2014  £’000	Total  2015  £’000	Total  2014  £’000
Income from investments held at fair value through profit or loss	3	30,503	37,051	-	-	30,503	37,051
Other income	3	8,742	9,244	-	-	8,742	9,244
		--------	--------	--------	--------	--------	--------
Total revenue		39,245	46,295	-	-	39,245	46,295
		--------	--------	--------	--------	--------	--------
Losses on investments held at fair value through profit or loss		-	-	(236,061)	(248,160)	(236,061)	(248,160)
Realised losses on foreign exchange		-	-	(2,942)	(5,163)	(2,942)	(5,163)
		--------	--------	--------	--------	--------	--------
Total		39,245	46,295	(239,003)	(253,323)	(199,758)	(207,028)
		--------	--------	--------	--------	--------	--------
Expenses
Investment management fee	4	(1,328)	(2,623)	(3,984)	(7,870)	(5,312)	(10,493)
Other operating expenses	5	(1,030)	(1,030)	(13)	(15)	(1,043)	(1,045)
		--------	--------	--------	--------	--------	--------
Total operating expenses		(2,358)	(3,653)	(3,997)	(7,885)	(6,355)	(11,538)
		--------	--------	--------	--------	--------	--------
Net profit/(loss) before finance costs and taxation		36,887	42,642	(243,000)	(261,208)	(206,113)	(218,566)
		--------	--------	--------	--------	--------	--------
Finance costs	6	(288)	(407)	(864)	(1,223)	(1,152)	(1,630)
		--------	--------	--------	--------	--------	--------
Net profit/(loss) on ordinary activities before taxation		36,599	42,235	(243,864)	(262,431)	(207,265)	(220,196)
		--------	--------	--------	--------	--------	--------
Taxation		(3,855)	(4,783)	989	1,537	(2,866)	(3,246)
		--------	--------	--------	--------	--------	--------
Profit/(loss) for the year		32,744	37,452	(242,875)	(260,894)	(210,131)	(223,442)
		--------	--------	--------	--------	--------	--------
Earnings/(loss) per ordinary share	8	18.47p	21.13p	(137.00p)	(147.16p)	(118.53p)	(126.03p)
		========	========	========	========	========	========

The total column of this statement represents the Consolidated Statement of Comprehensive Income, prepared in accordance with International Financial Reporting Standards (IFRS), as adopted by the European Union. 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 BlackRock World Mining Trust plc. There were no minority interests.

The net loss of the Company for the year was £210,131,000 (2014: net loss of £223,442,000).

The Group does not have any other comprehensive income. The net profit/(loss) for the year disclosed above represents the Group’s comprehensive income/(loss).

Statements of changes in equity for the year ended 31 December 2015

Group	Note	Ordinary  share  capital  £’000	Share  premium  account  £’000	Special  reserve  £’000	Capital  redemption  reserve  £’000	Capital  reserves  £’000	Revenue  reserve  £’000	Total  £’000
For the year ended 31 December 2015
At 31 December 2014		9,651	127,155	116,471	22,779	297,897	50,721	624,674
Total comprehensive income:
Net (loss)/profit for the year		–	–	–	–	(242,875)	32,744	(210,131)
Transactions with owners, recorded directly to equity:
Dividends paid	7	–	–	–	–	–	(37,230)	(37,230)
		--------	--------	--------	--------	--------	--------	--------
At 31 December 2015		9,651	127,155	116,471	22,779	55,022	46,235	377,313
		========	========	========	========	========	========	========
For the year ended 31 December 2014
At 31 December 2013		9,651	127,155	116,471	22,779	558,791	50,499	885,346
Total comprehensive income:
Net (loss)/profit for the year		–	–	–	–	(260,894)	37,452	(223,442)
Transactions with owners, recorded directly to equity:
Dividends paid	7	–	–	–	–	–	(37,230)	(37,230)
		--------	--------	--------	--------	--------	--------	--------
At 31 December 2014		9,651	127,155	116,471	22,779	297,897	50,721	624,674
		========	========	========	========	========	========	========

Company	Note	Ordinary  share  capital  £’000	Share  premium  account  £’000	Special  reserve  £’000	Capital  redemption  reserve  £’000	Capital  reserves  £’000	Revenue  reserve  £’000	Total  £’000
For the year ended 31 December 2015
At 31 December 2014		9,651	127,155	116,471	22,779	309,346	39,272	624,674
Total comprehensive income:
Net (loss)/profit for the year		–	–	–	–	(246,842)	36,711	(210,131)
Transactions with owners, recorded directly to equity:
Dividends paid	7	–	–	–	–	–	(37,230)	(37,230)
		--------	--------	--------	--------	--------	--------	--------
At 31 December 2015		9,651	127,155	116,471	22,779	62,504	38,753	377,313
		========	========	========	========	========	========	========
For the year ended 31 December 2014
At 31 December 2013		9,651	127,155	116,471	22,779	569,705	39,585	885,346
Total comprehensive income:
Net (loss)/profit for the year		–	–	–	–	(260,359)	36,917	(223,442)
Transactions with owners, recorded directly to equity:
Dividends paid	7	–	–	–	–	–	(37,230)	(37,230)
		--------	--------	--------	--------	--------	--------	--------
At 31 December 2014		9,651	127,155	116,471	22,779	309,346	39,272	624,674
		========	========	========	========	========	========	========

Statements of financial position as at 31 December 2015

	Notes	2015  Group  £’000	2015  Company  £’000	2014  Group  £’000	2014  Company  £’000
Non current assets
Investments held at fair value through profit or loss		426,085	435,067	695,322	708,271
Deferred tax asset		–	–	449	449
		--------	--------	--------	--------
		426,085	435,067	695,771	708,720
		--------	--------	--------	--------
Current assets
Cash and cash equivalents		13,223	5,307	31,054	19,825
Collateral pledged for written option contracts		1,340	1,277	1,684	1,620
Other receivables		3,797	3,797	6,002	5,332
		--------	--------	--------	--------
		18,360	10,381	38,740	26,777
		--------	--------	--------	--------
Total assets		444,445	445,448	734,511	735,497
		--------	--------	--------	--------
Current liabilities
Other payables		(6,254)	(7,257)	(3,494)	(4,480)
Derivative instruments – written options		(161)	(161)	(285)	(285)
Bank loans and overdrafts		(60,708)	(60,708)	(106,047)	(106,047)
		--------	--------	--------	--------
		(67,123)	(68,126)	(109,826)	(110,812)
		--------	--------	--------	--------
Total assets less current liabilities		377,322	377,322	624,685	624,685
		--------	--------	--------	--------
Non current liabilities
Deferred tax liabilities		(9)	(9)	(11)	(11)
		--------	--------	--------	--------
Net assets		377,313	377,313	624,674	624,674
		========	========	========	========
Equity attributable to equity holders
Ordinary share capital	9	9,651	9,651	9,651	9,651
Share premium account	10	127,155	127,155	127,155	127,155
Special reserve	10	116,471	116,471	116,471	116,471
Capital redemption reserve	10	22,779	22,779	22,779	22,779
Capital reserves	10	55,022	62,504	297,897	309,346
Revenue reserve	10	46,235	38,753	50,721	39,272
		--------	--------	--------	--------
Total equity		377,313	377,313	624,674	624,674
		========	========	========	========
Net asset value per ordinary share	8	212.83p	212.83p	352.35p	352.35p
		========	========	========	========

Cash flow statements for the year ended 31 December 2015

	2015  Group  £’000	2015  Company  £’000	2014  Group  £’000	2014  Company  £’000
Operating activities
Loss before taxation*	(207,265)	(207,273)	(220,196)	(220,343)
Add back interest paid	1,152	1,152	1,630	1,630
Losses on investments held at fair value through profit or loss including transaction costs	236,061	240,028	248,160	247,625
Net losses on foreign exchange	2,942	2,942	5,163	5,163
Sales of investments held at fair value through profit or loss	230,407	230,407	336,903	336,903
Purchases of investments held at fair value through profit or loss	(197,355)	(197,355)	(294,254)	(294,254)
Decrease /(increase) in other receivables	2,187	1,517	(2,495)	(1,825)
Decrease in amounts due from brokers	18	18	2,787	2,787
Net movement in cash collateral pledged with counterparties	344	343	(392)	(328)
Increase/(decrease) in amounts due to brokers	2,714	2,714	(1,346)	(1,346)
Decrease in other payables	(191)	(166)	(18,473)	(18,477)
	--------	--------	--------	--------
Net cash inflow from operating activities before interest and taxation	71,014	74,327	57,487	57,535
	--------	--------	--------	--------
Interest paid	(1,242)	(1,242)	(1,619)	(1,619)
Taxation paid	(441)	(441)	(236)	(233)
Taxation on overseas income	(1,651)	(1,651)	(1,578)	(1,578)
	--------	--------	--------	--------
Net cash inflow from operating activities before financing activities	67,680	70,993	54,054	54,105
	--------	--------	--------	--------
Financing activities
Repayment of loan	(48,305)	(48,305)	(693)	(693)
Dividends paid	(37,230)	(37,230)	(37,230)	(37,230)
	--------	--------	--------	--------
Net cash outflow from financing activities	(85,535)	(85,535)	(37,923)	(37,923)
	--------	--------	--------	--------
(Decrease)/increase in cash and cash equivalents	(17,855)	(14,542)	16,131	16,182
	--------	--------	--------	--------
Effect of foreign exchange rate changes	24	24	(338)	(338)
	--------	--------	--------	--------
Change in cash and cash equivalents/(debt)	(17,831)	(14,518)	15,793	15,844
Cash and cash equivalents at start of the year	31,054	19,825	15,261	3,981
	--------	--------	--------	--------
Cash and cash equivalents at end of year	13,223	5,307	31,054	19,825
	========	========	========	========
Comprised of:
Cash and cash equivalents	13,223	5,307	31,054	19,825
	========	========	========	========
*  Includes dividends and interest received in the year of £25,713,000 and £6,634,000 (2014: £26,634,000 and £7,231,000) respectively.

Notes to the financial statements

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 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 are set out below.

(a) Basis of preparation

The Group and Parent Company financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and as applied in accordance with the provisions 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 income statement 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), revised in November 2014, is compatible with IFRS, the financial statements have been prepared in accordance with guidance set out in the SORP.

Substantially, all of the assets of the Group and Company 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 Group’s and the Company’s financial statements are presented in sterling, which is the functional currency of the Group and the Company 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.

A number of new standards, amendments to standards and interpretations are effective for annual periods beginning on or after 1 January 2016 and have not been applied in preparing these financial statements (major changes and new standards issued are detailed below). None of these are expected to have a significant effect on the measurement of the amounts recognised in the financial statements of the Group.

IFRS 9 – Financial Instruments (2014) replaces IAS 39 and deals with a package of improvements including principally a revised model for classification and measurement of financial instruments, a forward looking expected loss impairment model and a revised framework for hedge accounting. In terms of classification and measurement the revised standard is principles based depending on the business model and nature of cash flows. Under this approach, instruments are measured at either amortised cost or fair value, though the standard retains the fair value option allowing designation of debt instruments at initial recognition to be measured at fair value. The standard is effective from 1 January 2018 with earlier application permitted but has not yet been endorsed by the European Commission. The Group does not plan to early adopt this standard and expects the eventual impact to be insignificant for its current investment portfolio, which is substantially comprised of quoted equities.

Amendments to IFRS 10, IFRS 12 and IAS 28 (amendments to IFRS 12 are effective 1 January 2016, a date is to be determined for IFRS 10 and IAS 28) are in relation to applying the consolidation exception for investment entities. The Group does not expect the eventual impact of these amendments to be significant.

Amendments to IAS 1 (effective 1 January 2016) require changes to the presentation of financial instruments. The amendment is not expected to have a significant effect on the measurement of amounts recognised in the financial statements of the Company.

Amendments to IAS 12 – Recognition of deferred tax assets for unrealised losses (effective 1 January 2017). The amendment is not expected to have a significant effect on the measurement of amounts recognised in the financial statements of the Company.

IFRS 14 – Regulatory Deferral Accounts (effective 1 January 2016) allows first time IFRS adopters to continue to account for ‘regulatory deferral account balances’ in accordance with previous GAAP. The Company has no such accounts and, therefore, the provisions of the standard are not applicable.

IFRS 15 – Revenue from Contracts with Customers (effective 1 January 2018) specifies how and when an entity should recognise revenue and enhances the nature of revenue disclosures. Given the nature of the Company’s revenue streams from financial instruments, the provisions of this standard are not expected to have a material impact.

IFRS 16 – Leases (effective 1 January 2019). The Company does not enter into lease agreements, therefore the provisions of this standard are not applicable.

(b) Basis of consolidation

The consolidated financial statements are made up to 31 December each year and incorporate the financial statements of the Company and its wholly-owned subsidiary, BlackRock World Mining Investment Company Limited. 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 Consolidated Statement of Comprehensive Income

In order to reflect better 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 on an ex-dividend basis. Where no ex-dividend date is available, dividends receivable on or before the period end are treated as revenue for the year. Provision is made for any dividends 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. Underwriting commissions, stock lending income and interest income are recognised on an accruals basis.

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.

Option premia 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 Company’s investment portfolio and represents an incidental part of a larger capital transaction, in which case any premium arising are allocated to the capital column of the Consolidated Statement of Comprehensive Income. When an option is closed out or exercised the gain or loss is accounted for as capital.

(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 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 in note 10 on page 58 of the Annual Report and Financial Statements;

• 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 expected long term split of returns, in the form of capital gains and income, respectively, from the investment portfolio;

• expenses are treated as capital where a connection with the maintenance or enhancement of the value of the investments can be demonstrated.

 (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 period. Taxable profit differs from net profit as reported in the Statements 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 taxation in the future or right to pay less taxation 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

The Company’s investments, including contractual rights, are classified as held at fair value through profit or loss in accordance with IAS 39 – ‘Financial Instruments: Recognition and Measurement’ and are managed and evaluated on a fair value basis in accordance with its investment strategy.

All investments, including contractual rights, are designated upon initial recognition as held 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 is initially measured at fair value excluding transaction costs. The sales of assets are recognised at the trade date of the disposal. Proceeds are measured at fair value, which is regarded as the proceeds of sale less any transaction costs.

The fair value of the financial investments is based on their quoted bid price at the financial reporting date, without deduction for the estimated selling costs. For all financial instruments not traded in an active market, the fair value is determined by using valuation techniques deemed by the Board to be appropriate in the circumstances. Valuation techniques include the 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).

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 fair 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 ‘Gains or losses on investments held at fair value through profit or loss ’. Also included within this heading are transaction costs in relation to the purchase or sale of investments.

(i) Offsetting

Financial assets and financial liabilities are offset and the net amount reported in the 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.

(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 at their nominal value.

(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 Statements of Changes in Equity and have become a liability of the Group when they have been approved by shareholders in the case of a final dividend, or paid in the case of an interim dividend.

(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 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 losses 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 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.

(n) Bank borrowings

Bank overdrafts and loans are recorded as the proceeds received. Finance charges, including any premia 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) Derivatives

Derivatives are classified as financial instruments at fair value through profit or loss held for trading and are initially recognised at fair value. The derivatives are subsequently held at fair value based on the bid/offer prices of the options written to which the Group and Company are 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 closed out or exercised the gain or loss is accounted for as a capital gain or loss.

(p) 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 financial instruments

When the fair values of financial assets and financial liabilities recorded in the 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. The fair value of 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 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. The key assumptions used to determine the fair value of the contractual rights and sensitivity analyses are provided in note 18 of the Annual Report and Financial Statements.

3. Income

	2015  £’000	2014  £’000
Investment income:
UK listed dividends	9,782	8,911
Overseas listed dividends	14,460	16,651
Special dividends	71	3,602
Income from contractual rights	–	485
Fixed interest income	6,190	7,402
	--------	--------
	30,503	37,051
	--------	--------
Other income:
Option premiums	8,647	8,007
Deposit interest	26	26
Profit on futures	25	670
Stock lending income	44	–
Underwriting commission and other income	–	541
	--------	--------
	8,742	9,244
	--------	--------
Total income	39,245	46,295
	========	========
Total income comprises:
Dividends	24,313	29,164
Deposit interest	26	26
Option premiums	8,647	8,007
Income from contractual rights	–	485
Fixed interest income	6,190	7,402
Profit on futures	25	670
Stock lending income	44	–
	--------	--------
Other income	–	541
	========	========
	39,245	46,295
	========	========

The Company considers the treatment of premium arising on option transactions on a case-by-case basis. During the year ended 31 December 2015, the Company received option premiums of £8,503,000 (2014: £8,247,000). Options written for income purposes are credited to the revenue column of the Consolidated Statement of Comprehensive Income and recognised evenly over the life of the option contracts and amounted to £8,647,000 (2014: £8,007,000).

4. Management fee

		2015			2014
	Revenue  £’000	Capital  £’000	Total  £’000	Revenue  £’000	Capital  £’000	Total  £’000
Investment management fee	1,328	3,984	5,312	2,623	7,870	10,493
	========	========	========	========	========	========

Until 31 March 2015 the investment management fee was levied quarterly at a rate of 1.3% per annum, based on the value of gross assets on the last day of each quarter.

Between 1 April 2015 and 30 June 2015, the management fee was:

• 1.10% on the first £500 million of gross assets

• 0.70% on the next £500 million

• 0.40% on gross assets above £1 billion

Between 1 July 2015 and 30 September 2015 the annual management fee was:

• 1.20% on the first £500 million of gross assets

• 1.00% on the next £500 million

• 0.85% on gross assets above £1 billion

With effect from 1 October 2015 the annual management fee was reduced to 0.80% of gross assets.

75% of the management fees are allocated to the capital column and 25% to the revenue column of the Consolidated Statement of Comprehensive Income.

5. Other expenses

	2015  £’000	2014  £’000
Allocated to revenue
Custody fee	90	109
Auditors’ remuneration:
– audit services	29	28
– other assurance services*	6	6
Registrar’s fee	72	72
Directors’ emoluments**	256	225
Broker fees	269	30
Depositary fees	62	46
Marketing fees***	17	256
Other administrative costs	229	258
	--------	--------
	1,030	1,030
	--------	--------
Allocated to capital
	--------	--------
Transaction charges	13	15
	--------	--------
	1,043	1,045
	========	========
	2015	2014
The Company’s ongoing charges, calculated as a percentage of average net assets and using expenses, excluding finance costs and taxation were:	1.2%	1.4%
	========	========
*  Fees paid to the auditor for other assurance services of £6,500 excluding VAT (2014: £6,250) relate to the review of the half yearly financial statements. **  Details of the Directors emoluments are given in the Directors’ Remuneration Report on page 31 of the Annual Report and Financial Statements. The emoluments of Ian Cockerill, a non-executive Director, who was also the highest paid Director, were £51,280 (2014: £39,243). Emoluments include taxable benefits for reimbursement of expenses. ***  After adjusting for the over accrual of £126,000 for the previous year.

6. Finance costs

		2015			2014
	Revenue  £’000	Capital  £’000	Total  £’000	Revenue  £’000	Capital  £’000	Total  £’000
Interest on bank loans	271	812	1,083	405	1,218	1,623
Interest on bank overdrafts	17	52	69	2	5	7
	--------	--------	--------	--------	--------	--------
Total	288	864	1,152	407	1,223	1,630
	====	===	====	===	====	====

7. Dividends

Under IFRS, final dividends are not recognised until they are approved by shareholders, and special and interim dividends are not recognised until they are paid. They are also debited directly to reserves. Amounts recognised as distributable to ordinary shareholders for the period to 31 December were debited to the revenue reserve. These amounts are as follows:

	2015  £’000	2014  £’000
Interim ordinary dividend in respect of the year ended 31 December 2015 of 7.00p per share, declared on 13 August 2015 and paid on 18 September 2015	12,410	12,410
Final ordinary dividend in respect of the year ended 31 December 2014 of 14.00p per share, approved by shareholders on 29 April 2015 and paid on 8 May 2015	24,820	24,820
	--------	--------
	37,230	37,230
	=====	======

The total dividends payable in respect of the year 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.

	2015  £’000	2014  £’000
Dividends paid or proposed on equity shares:
Interim ordinary dividend paid of 7.00p (2014: 7.00p)	12,410	12,410
Proposed final ordinary dividend of 14.00p per share (2014: 14.00p)*	24,820	24,820
	--------	--------
	37,230	37,230
	--------	--------
*  Based on 177,287,242 (2014: 177,287,242) ordinary shares.

8. Consolidated 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:

	2015	2014
Net revenue profit attributable to ordinary shareholders (£’000)	32,744	37,452
Net capital loss attributable to ordinary shareholders (£’000)	(242,875)	(260,894)
	--------	--------
Total loss attributable to ordinary shareholders (£’000)	(210,131)	(223,442)
	========	========
Equity shareholders' funds (£’000)	377,313	624,674
	========	========
The weighted average number of ordinary shares in issue during the year, on which the return per ordinary share was calculated was:	177,287,242	177,287,242
The actual number of ordinary shares in issue at the year end, on which the net asset value per ordinary share was calculated was:	177,287,242	177,287,242
	--------	--------
Revenue earnings per share	18.47p	21.13p
Capital loss per share	(137.00p)	(147.16p)
	--------	--------
Total loss per share	(118.53p)	(126.03p)
	--------	--------
Net asset value per share	212.83p	352.35p
Ordinary share price (mid-market)	181.00p	310.35p
	========	========

9. Share capital

	Ordinary  shares  number  (nominal)	Treasury  shares  number  (nominal)	Total  shares	£’000
Allotted, called up and fully paid share capital comprised:
Ordinary shares of 5p each
At 1 January 2015	177,287,242	15,724,600	193,011,842	9,651
	--------	--------	--------	--------
At 31 December 2015	177,287,242	15,724,600	193,011,842	9,651
	========	========	========	========

During the year no shares (2014: nil) were repurchased.

10. Reserves

Group	Share  premium  account  £’000	Special  reserve  £’000	Capital  redemption  reserve  £’000	Capital  reserve  - arising  on  investments  sold  £’000	Capital  reserve - arising  on  investments  held  £’000	Revenue  reserve  £’000
At 1 January 2015	127,155	116,471	22,779	418,642	(120,745)	50,721
Movement during the year:
Total comprehensive income:
(Losses)/profit for the year	–	–	–	(106,646)	(136,229)	32,744
Transactions with owners:
Dividends paid	–	–	–	–	–	(37,230)
	--------	--------	--------	--------	--------	--------
At 31 December 2015	127,155	116,471	22,779	311,996	(256,974)	46,235
	========	========	========	========	========	========

Company	Share  premium  account  £’000	Special  reserve  £’000	Capital  redemption  reserve  £’000	Capital  reserve  – arising  on  investments  sold  £’000	Capital  reserve  – arising  on  investments  held  £’000	Revenue  reserve  £’000
At 1 January 2015	127,155	116,471	22,779	418,642	(109,296)	39,272
Movement during the year:
Total comprehensive income:
(Losses)/profit for the year	–	–	–	(106,646)	(140,196)	36,711
Transactions with owners:
Dividends paid	–	–	–	–	–	(37,230)
	--------	--------	--------	--------	--------	--------
At 31 December 2015	127,155	116,471	22,779	311,996	(249,492)	38,753
	======	======	=====	======	======	======

The net revenue profit before distribution dealt with in the financial statements of the parent company was £36,711,000 (2014: £36,917,000). As permitted under section 408 of the Companies Act 2006, the Statement of Comprehensive Income of the parent company is not presented as part of these financial statements.

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 the repurchase by the Company of its ordinary shares. Under the Company’s Articles, the Company is permitted to distribute accumulated realised capital profits in the form of dividends.

11. Contingent liabilities

There were no contingent liabilities at 31 December 2015 (2014: nil).

12. 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 2015 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 2015 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 2014, 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.

13. 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.

14. Annual General Meeting

The Annual General Meeting of the Company will be held at 12 Throgmorton Avenue, London EC2N 2DL on Thursday, 28 April 2016 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:

Mark Johnson, Head of Closed End Funds, BlackRock Investment Management (UK) Limited – Tel:  [phone]

Evy Hambro, Fund Manager, BlackRock Investment Management (UK) Limited – Tel:  [phone]

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

Press Enquiries:

Lucy Horne, Lansons Communications – Tel:  [phone]
E-mail:  [e-mail]

29 February 2016
12 Throgmorton Avenue
London EC2N 2DL