Portfolio Update

BLACKROCK WORLD MINING TRUST plc
All information is at 31 July 2016 and unaudited.
Performance at month end with net income reinvested
		One			Three				One	Three		Five
		Month			Months				Year	Years		Years
Net asset value		11.2%			22.6%				39.9%	-17.5%		-51.9%
Share price		9.0%			17.6%				31.3%	-23.4%		-50.0%
Euromoney Global Mining Index		11.3%			19.3%				43.6%	-2.7%		-41.7%
(Total return)
Sources: BlackRock, Euromoney Global Mining Index, Datastream
At month end
Net asset value including income*:								351.43p
Net asset value capital only:								344.68p
*Includes net revenue of 6.30p
Share price:								294.50p
Discount to NAV**:								16.2%
Total assets:								£691.7m
Net yield***:								6.1%
Net gearing:								12.9%
Ordinary shares in issue:								176,455,242
Ordinary shares held in treasury:								16,556,600
Ongoing charges****:								1.2%
** Discount to NAV including income. *** Based on an interim dividend of 4.00p in respect of the year ending 31 December 2016 and a final dividend of 14.00p in respect of the year ended 31 December 2015. **** Calculated as a percentage of average net assets and using expenses, excluding finance costs for the year ended 31 December 2015.
Sector	% Total					Country Analysis					% Total
	Assets										Assets
Diversified	33.8					Global					51.8
Gold	25.1					Latin America					16.2
Copper	18.9					Australasia					10.2
Silver & Diamonds	15.8					Canada					8.5
Industrial Minerals	3.6					Other Africa					8.2
Nickel	3.3					Emerging Europe					3.4
Zinc	0.5					South Africa					2.4
Other	0.2					Indonesia					0.3
Iron ore	0.1					Tanzania					0.3
Net current liabilities	(1.3)					Net current liabilities					(1.3)
	-----										-----
	100.0										100.0
	=====										=====
Ten Largest Investments
Company				% Total Assets
Rio Tinto				8.2
First Quantum Minerals				8.0
BHP Billiton				8.0
Fresnillo				5.5
Lundin Mining				4.8
Glencore				3.9
Newcrest Mining				3.6
Norilsk Nickel				3.3
Sociedad Minera Cerro Verde				3.3
Newmont Mining				3.2

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

Performance

Global equity markets rebounded over the month as the immediate shock from the Brexit vote dissipated. The MSCI World Index rose by 4.2%, in line with the S&P 500 (3.6%). China, the largest consumer of mined commodities, printed its Q2 GDP at 6.7% which was in line with market expectations and recent PMI data shows some stability in manufacturing amid diminishing deflationary pressures. While there was some noise around property and the government’s focus on cooling down measures, the market appeared to be cautiously optimistic on the data during the month. Elsewhere, stronger US data alleviated recession fears but has not changed the technical backdrop of US rates as the global hunt for yield, ageing demographics and political uncertainty remains to the fore. This continues to provide an anchor, keeping long term interest rates low however, the market is pricing in higher probabilities of a September or December Fed hike versus a few months ago.

This provided a constructive environment for the mined commodities with copper, zinc and nickel finishing the month up by 1.6%, 4.5% and 6.7% respectively. The bulk commodities also trended higher as thermal coal, coking coal and iron ore rose by 16.5%, 10.3% and 9.1% respectively. The commodity price strength we have seen year to date will likely lead to analyst earnings upgrades over the coming months.

During the month the Company’s overweight position in copper performance aided performance with First Quantum & Lundin Mining up by 24% and 25%, versus, the copper price +1.6% during the month. In addition Fresnillo the world’s largest silver producer, continued to perform well on the back of rising silver and gold prices. During the month we increased exposure to iron ore producer Vale on the back of strengthening iron ore prices and the potential for further asset sales to be announced, while taking profits in a number of precious metals companies that have performed very strongly year to date.

Among the Company’s unquoted investments, on 1 July 2016 Avanco Resources successfully declared commercial production at its Antas Copper Mine following exceptional commissioning and ramp-up performance. During the first half of 2016, Avanco produced 3,720t of copper in concentrate and 2,611oz of gold, with the Company earning £478,000 during the period. Avanco continues to progress studies on the development plan for its second asset Pedra Branca, with a ‘decision to mine’ to be made during the second half of the year. In June, Avanco provided an updated resource for the Pedra Branca East orebody of 10.5Mt at 2.8% Cu and 0.7g/t gold, making it significantly larger than Antas North.

Strategy and Outlook

Price moves in the mining sector year to date, albeit off an unsustainably low base, have been reminiscent of the times of strong global demand growth and raw material constraints, neither of which have been a feature of present market conditions. Weaker growth in the developed economies, poor figures from some emerging markets and continuing oversupply in the mined commodities appeared to catch up with this recent rally, ultimately leading to a pull-back.

However, the miners have continued to make progress and whilst supply can be sticky for a number of reasons a cash negative operation cannot persist indefinitely. We have seen the first of the long-awaited supply cuts announced but mined commodity prices will need to remain at current levels or move lower before we see real momentum in cuts. In light of this, we expect to see companies further reduce capital spending and operating costs in the second half of the year in order to bolster their balance sheets.

All data points are in US dollar terms unless stated otherwise

16 August 2016

ENDS

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