Last checked at 29 Aug 2007 16:24
MERRILL LYNCH GREATER EUROPE INVESTMENT TRUST plc
All information is at 31 July 2007 and unaudited.
Performance at month end with net income reinvested
One Three One Since launch Month Months Year (20Sep04) Net asset value -3.5% -0.5% 19.8% 89.7% Share price -1.1% -2.9% 19.0% 79.0% FTSE World Europe ex UK -3.2% -2.0% 21.5% 78.2%
Sources: BlackRock and Datastream.
At month end Net asset value (capital only): 182.05p Net asset value (including income): 185.21p Includes net revenue of 3.16p Share price: 174.50p
Discount to NAV (capital only): 4.1% Discount to NAV (including income): 5.8%
Gearing: 10.4% Net yield: 1.2% Total assets: ‚£240.9m Ordinary shares in issue: 119,843,969 Benchmark Sector Analysis Total Assets Index Country Analysis Total Assets (%) (%) (%) Financials 27.2 31.9 Germany 24.0 Basic Materials 11.5 6.0 France 13.8 Telecommunications 10.2 5.8 Switzerland 10.4 Healthcare 9.9 6.6 Italy 8.2 Consumer Goods 9.3 13.5 Spain 7.5 Industrials 8.1 12.7 Turkey 4.8 Oil & Gas 7.1 6.4 Netherlands 4.5 Utilities 7.0 7.4 Greece 4.5 Consumer Services 4.8 5.3 Finland 4.4 Other Investments 3.2 - Emerging Europe 3.0 Technology 1.8 4.4 Russia 2.2 Net current liabilities (0.1) - Norway 2.1 Israel 2.0 Austria 1.9 Sweden 1.8 Ireland 1.7 Poland 1.2 Cyprus 1.0 Luxembourg 0.9 UK 0.2 Net current liabilities (0.1) ----- ----- ----- 100.0 100.0 100.0 ----- ----- -----
Ten Largest Equity Investments
Company Country of Risk Bayer Germany BlackRock Eurasian Frontiers Hedge Fund Emerging Europe DaimlerChrysler Germany Intesa Sanpaolo Italy Nokia Finland Novartis Switzerland OTE (Hellenic Telecommunications) Greece Roche Switzerland Siemens Germany Telefonica Spain Commenting on the markets, James Macmillan, representing the Investment Manager noted:
European equity markets experienced marked volatility in July as global financial markets were dominated by headlines relating to credit concerns,
specifically those associated with US sub-prime lending. The FTSE World Europe
ex UK (net) declined 3.2% in GBP terms as investors were unnerved by a widening
of credit spreads resulting in a rapid re-pricing of risk across the market and
fears that problems in sub-prime could spread to other areas of credit.
Performance in Emerging Europe was positive, mainly due to sound performance in
the first part of the month; the MSCI Emerging Europe returned 3.3%. The Company's NAV returned -3.5% during July underperforming the reference
index by 0.3%. The contribution from the Emerging Europe region was beneficial
with strong performance especially in Turkey and Poland. The use of flexible
gearing was negative and the Company suffered from being positively geared in a falling market.
During the month the best performing holdings were mainly found in Emerging Europe and the Company's holdings in the BlackRock Eurasian Frontiers Hedge
Fund, along with Turkish companies Ipek Matbaccilik and Reysas Tasimaclik, made
a positive contribution to performance. Other strong performing stocks
included Italian Bank Intesa and German do-it-yourself retailer Praktiker Bau
along with selected holdings in more defensively orientated sectors such as
telecoms and pharmaceuticals. The stocks which detracted from performance were
mainly found in the more cyclically orientated sectors such as automobiles and
capital goods and included steel pipe maker Vallourec, industrial conglomerate
Siemens, and car manufacturer Renault. During the month the Company reduced its exposure to the energy sector by taking profits in Hungarian and Polish refiners PKN and MOL. There were no other significant transactions.
The Company continues to have a bias towards financials, through banks, along
with pharmaceuticals, materials and utilities. Exposure to Emerging Europe increased during the month to finish at 13.2%, with the largest country
exposures being Turkey and Russia, along with the BlackRock Eurasian Frontiers
Hedge Fund which provides diversified exposure to the region. During the month
the Company decreased its net market exposure to 110.4% in response to increased market volatility. We remain positive on the prospects for European and Emerging European
equities. Despite increased market volatility and recent problems emerging in
US credit we expect global economic growth to remain at long term trend levels
and the US to experience a slowdown rather than a hard landing. The second
quarter results season has continued to show corporate strength, with earnings
growth and profits driven by strong domestic demand, as well as robust global
export demand from China and emerging markets. We believe a combination of strong earnings growth and attractive valuations should allow the market to
make progress against what may be a more challenging international backdrop.
Latest Latest information is available by typing www.blackrock.co.uk/its on the
internet, "BLRKINDEX" on Reuters, "BLRK" on Bloomberg or "8800" on Topic 3 (ICV terminal). 29 August 2007
MERRILL LYNCH GREATER EUROPE INVESTMENT TRUST PLC