Over the six months to the end of August 2015 BlackRock Smaller Companies’ net asset value increased by 9.0% to 1039.98p per share, outperforming its benchmark (the Numis Smaller Companies plus AIM (excluding Investment Companies) Index) by 6.6%. The Company’s share price increased by 14.0% to 925.5p per share over the same period. The FTSE 100 Index fell by 10.1% over the period, the FTSE 250 Index (excluding Investment Companies) fell by 0.5% and the FTSE AIM Index by 2.8%. The Board is declaring an interim dividend of 7.0p per share (2014:
5.5p per share).
The manager says the largest positive contributors to stock selection during the period were holdings in CVS Group, Betfair Group, Fevertree Drinks and Topps Tiles.
CVS Group, the UK’s leading provider of integrated veterinary services, has continued to see strong trading with total revenues up by 17.0%, like-for-like revenues up by 6.8% and earnings per share up by 30% in its year ended 30 June
2015. It also continues to consolidate market share, acquiring 29 surgeries during the period. Betfair Group announced a good trading update, with revenue for the period to 31 July 2015 up by 15% despite strong comparatives. In addition the company announced a merger with Paddy Power, which was well received by markets.
Shares in Fevertree Drinks continued to be in demand as the company delivered on high growth expectations; interim revenues for the six months to 30 June 2015 were up by 62% and EBITDA was up by 68% with all areas performing strongly. Fevertree Drinks’ share price rose by 105% during the period. Topps Tiles announced interim results for the six months to 28 March 2015 showing like-for-like revenue growth of 5.3% and earnings per share growth of 14%.
The largest detractor from relative outperformance during the period was Northbridge Industrial Services. The company is being impacted by the decline in the oil price which in turn is affecting their loadbank rental operations in Singapore and Dubai, and their oil tools business in Australia. Forecasts have been substantially reduced.
Sector allocation benefited most from their overweight position in housebuilders and underweight position in oil and gas producers.
BRSC : Good first half for BlackRock Smallers