BlackRock Smaller Companies Trust targets long-term capital growth through investment in smaller UK-quoted companies.
BlackRock Smaller Companies Trust (BRSC) targets long-term capital growth through investment in smaller UK-quoted companies, with up to 50% in Aim-quoted holdings.
Roland Arnold (pictured above) was appointed sole manager in June 2019, having worked closely with his predecessor Mike Prentis since 2005. He will continue to employ a combination of top-down and bottom-up analysis, and to focus on finding cash-generative companies with strong managements, strong market positions, strong balance sheets, good track records and exciting long-term growth potential. Holdings are typically initiated with a stake of 0.25% to 0.5% of the trust’s assets and allowed to grow up to 2% as the manager gains insight and confidence.
BRSC’s portfolio ended February with 122 holdings, down from 156 a year earlier following the sale of holdings in which conviction had weakened. Many holdings are market-leading global businesses and as a result around half the portfolio’s revenues originate overseas. Two-thirds of the portfolio is in companies capitalised at less than £600 million.
Net asset value total returns last year were -4.8%, compared to the 5.7% fall in BRSC’s benchmark, the Numis Smaller Companies plus Aim (ex ICs) index. Total dividends were 20% up at 31.2p and share price total returns were 2.4%. Year-end gearing was down from 9.8% to 4.9%. Total ongoing charges stood at 0.7%. BRSC outperformed its benchmark and raised its dividend in each of the 16 years Mike Prentis was manager.
BlackRock Smaller Companies