Publication of monthly factsheet

RNS Number : 9360L

Utilico Emerging Markets Trust PLC

18 May 2022

 

18 May 2022

UTILICO EMERGING MARKETS TRUST PLC

(LEI Number: 2138005TJMCWR2394O39)

Publication of monthly factsheet

The latest monthly factsheet for Utilico Emerging Markets Trust plc ("UEM" or the "Company") will shortly be available through the Company's website at:

https://www.uemtrust.co.uk/investor-relations/factsheet-archive

Monthly commentary

PERFORMANCE

UEM's NAV total return in the month of April increased by 0.6%, again ahead of the MSCI Emerging Markets total return Index ("MSCI") which decreased by 1.4% in Sterling terms during the period.

Markets in April remained volatile, still affected by the Russian war with Ukraine which endures will little resolution on the horizon. The ongoing lockdowns in China further added to the pressure on the already disrupted global supply chain, as the country persists with its zero-Covid-19 policy. In addition, the weaker economic data emerging from the US was discouraging whilst inflationary pressures persisted resulting in Jerome Powell, chairman of the Federal Reserve indicating a more aggressive path of interest rate increases is on the horizon.

Markets clearly reflected this nervousness with most emerging markets firmly down during the month. The Brazilian Bovespa was down by 10.1%, the Mexican Bolsa down by 9.1%, whilst the Chinese Shanghai Composite was down by 6.3%. The developed markets indices failed to fare any better with the S&P Index down 8.8% and Dow Jones down 4.9%, albeit the FTSE 100 managed to buck the trend ending the month up 0.4% despite the UK economy slowing more than expected and inflation continuing to edge higher with the consumer price index hitting its highest level since 1992 at 7.0%.

The weaker UK data resulted in Sterling performing poorly in the month of April, depreciating against most currencies, down 4.6% against the US Dollar (partially due to the strong performance of the US Dollar), down 4.5% against the Hong Kong Dollar and down 3.8% against the Indian Rupee. Sterling did strengthen in April against the Chilean Peso by 3.4% and was marginally up against the Australian Dollar by 0.8%.

The Brent Crude oil price continued to benefit over the month, up 1.3% on the back of ongoing concerns around energy supplies due to the geopolitical issues with Russia, whilst industrial metal prices such as copper fell 7.5% prompted by slower economic growth and Covid-19 lockdowns in China.

PORTFOLIO

There was only one change to the constituents of the top thirty holdings in the portfolio in April with China Gas Holdings replacing Engie Energia Chile partly due to relative performance as well as an increased position in China Gas.

April witnessed some strong performance during the month with Orizon up 14.2%, driven by the closing of Estre's acquisition and the market strong upward revision of Orizon's EBITDA expectations. Link Net was also up by 6.8%, helped along by a stronger Indonesian market and Power Grid Corporation of India was up by 6.0%.

Given the market volatility and uncertainty, April also saw some significant decliners, with the Korean internet services provider Naver Corp down 15.9% partly due to weaker than expected financial results but also down due to a reaction to NASDAQ weakness. Rumo, the Brazilian rail based logistic operator was also down 11.8% for the month, affected by market concerns about Rumo's operating in a higher inflationary environment, despite posting solid 1Q22 results. China Everbright Greentech was down 8.9% due to concerns over the impact on waste volumes from the broader potential China economic slowdown.

Purchases during the month for the portfolio amounted to £3.9m and realisations totalled £8.0m

DEBT

UEM's bank debt remained at EUR 28.0m as at the end of April, with the corresponding liability in Sterling terms decreasing marginally from £23.7m to £23.5m.

OTHER

UEM's share price ended March at 225.50p, up 0.7% over the month, with the discount to NAV narrowing marginally to 11.8%. UEM continued to take advantage of weakness in April and bought back 0.7m shares at an average price of 220.36p.

Name of contact and telephone number for enquiries:

ICM Investment Management Limited  [phone]

Charles Jillings / Alastair Moreton

Montfort Communications

Gay Collins, Pippa Bailey  [phone]

[e-mail]

 

END

 

 

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