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About this investment trust

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

The Company aims to provide capital growth, primarily through investment in a focused portfolio constructed from a combination of the securities of large, mid and small capitalisation European companies, together with some investment in the developing markets of Europe.

Why choose it?

Europe is a rich source of innovation and dynamic capitalism. Active management can uncover its most exciting companies. The Trust invests in global brand leaders, plus smaller companies focused on niche, high growth areas. The Trust looks for high quality, well-capitalised companies with strong management teams that can create real value for shareholders over time. 

Suited to…

This Trust is designed for investors looking to invest in a selection of Europe’s highest quality, fastest-growing companies, irrespective of their size and geography. They must be willing to take on some additional risk to grow their capital over the long term.

BlackRock Greater Europe Investment Trust FAQs

  • The BlackRock Greater Europe Investment Trust aims to achieve capital growth by investing in a focused portfolio of securities from large, mid and small capitalisation European companies, along with some investment in the developing markets of Europe. The experienced management team focuses on identifying high-quality firms with the potential for long-term value creation. The Trust is suited for investors seeking exposure to Europe’s dynamic and innovative companies, emphasising both global brand leaders and smaller companies in niche, high-growth areas.

  • Stefan Gries and Alexandra Dangoor are co-managers of BlackRock Greater Europe Investment Trust.

    Stefan is Head of the European Equity team in BlackRock’s Portfolio Management Group, with extensive experience managing various European portfolios. Stefan is also co-manager on the European Absolute return (long/short) portfolios, as well as on Pan-European and Europe ex-UK long-only portfolios.

    Alexandra joined the BlackRock Fundamentals European Equity Team in 2019. She also holds research responsibilities within the team’s financials research pod, focused on European banks and insurers.

  • Dividends from the BlackRock Greater Europe Investment Trust are declared and paid out semi-annually. Interim dividend payments are made in May with final dividend payments being made in December.

  • We believe there are reasons to be positive about European equities. Firstly, there’s valuation. We consider European stocks currently offer attractive value for investors looking to take advantage of the 2022 market fluctuations and tap into enduring trends, particularly the move towards a net-zero future.

    Additionally, investing in European equities offers the benefit of targeting resilient companies poised to navigate inflation and economic slowdowns successfully. Emphasising dividends, with over 70% of European companies planning to reinstate or increase them, provides a key source of return. We seek mature, cash-generating companies with proven business models and strong financials across sectors, which present an attractive investment opportunity.

    Europe hosts numerous top-tier companies, strategically positioned to support global governments in achieving their net-zero omissions objectives. Themes like infrastructure, automation, and the shift to electric vehicles are well represented in the BlackRock Greater Europe portfolio, making European equities an attractive prospect for long-term returns amid evolving market conditions.

  • The BlackRock Greater Europe Investment Trust provides an all-around solution for investing in large, mid and small-cap European businesses. The Trust taps into Europe’s innovation and dynamic capitalism, actively seeking out its most promising companies. With a portfolio including global brand leaders and smaller firms focusing on niche, high-growth areas, the Trust encompasses high-quality and well-capitalised companies with strong management, aiming to create lasting shareholder value. The BlackRock Greater Europe Investment Trust is suited to investors seeking exposure to Europe’s top-quality, fast-growing companies, regardless of size or location, and to those willing to take on additional risk for long-term capital growth.

Image of Citywire award logoImage of Icya Winner Europe logoImage of Kepler Growth rating logo

Citywire: As at 16 November 2021.
Investment Week: As at 18 November 2021.
Kepler Rating: As at 1 January 2022.

What are the risks?

  • Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.
  • Overseas investment will be affected by movements in currency exchange rates.
  • Emerging market investments are usually associated with higher investment risk than developed market investments. Therefore the value of these investments may be unpredictable and subject to greater variation.
  • Investment strategies, such as borrowing, used by the Trust can result in even larger losses suffered when the value of the underlying investments fall.
  • The Trust’s investments may have low liquidity which often causes the value of these investments to be less predictable. In extreme cases, the Trust may not be able to realise the investment at the latest market price or at a price considered fair.

Useful information

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

Fees & Charges

Annual Expenses as at Date: 31/08/2023

Ongoing Charge: 0.98% 

Management Fee Summary: BlackRock receives an annual management fee of 0.85% per annum of the Company’s net asset value on assets up to £350 million and 0.75% per annum of net asset value on assets thereafter.

  • ISIN: GB00B01RDH75

    Sedol: B01RDH7

    Bloomberg: BRGE LN

    Reuters: BRGE.L

    LSE code: BRGE

  • Name of Company: BlackRock Fund Managers Limited

    Telephone: 020 7743 3000

    Email: cosec@blackrock.com

    Website: www.blackrock.com/uk

    Correspondence Address: Investor Services,

    BlackRock Investment Management (UK) Limited,

    12 Throgmorton Avenue,

    London

    EC2N 2DL

    Name of Registrar: Computershare PLC

    Registered Office: 12 Throgmorton Avenue,

    London

    EC2N 2DL

    Registrar Telephone: +44 (0)370 707 1163

    Place of Registration: England

    Registered Number: 5142459

  • Year End: 31 August

    Results Announced: April (half yearly), October (final)

    AGM: November/December

    Dividends Paid: May (interim), December (annual)

Latest company announcements

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

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To receive email alert notifications once an update to the Trust occurs, please sign up and select the updates you would like to receive via The Association of Investment Companies website here.

The Board’s approach to ESG

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

The Board believes that responsible investment and sustainability are integral to the longer-term delivery of the Company’s success. The Board works closely with the Investment Manager to regularly review the Company’s performance, investment strategy and underlying policies to ensure that the Company’s investment objective continues to be met in an effective, responsible and sustainable way in the interests of shareholders and future investors.

Sustainable investing: BlackRock’s approach

Sustainability is BlackRock’s standard for investing, based on the investment conviction that integrating sustainability can help investors build more resilient portfolios and achieve better long term, risk-adjusted returns. BlackRock believes that climate change is a defining factor in companies’ long-term prospects and that it will have a significant and lasting impact on economic growth and prosperity. BlackRock believes that climate risk equates to investment risk and this will drive a profound reassessment of risk and asset values as investors seek to react to the impact of climate policy changes. This in turn is likely to drive a significant reallocation of capital away from traditional carbon intensive industries over the next decade.

ESG: integration into BlackRock’s investment management process

Environmental, Social and Governance (ESG) investing is often used interchangeably with the term “sustainable investing.” BlackRock has identified sustainable investing as being the overall framework and ESG as a data toolkit for identifying and informing our solutions. BlackRock has defined ESG Integration as the practice of incorporating material ESG information and consideration of sustainability risks into investment decisions in order to enhance risk-adjusted returns. BlackRock recognises the relevance of material ESG information across all asset classes and styles of portfolio management. ESG information and sustainability risks are included as a consideration in investment research, portfolio construction, portfolio review and investment stewardship processes. The Investment Manager considers ESG insights and data, including sustainability risks, within the total set of information in its research process and makes a determination as to the materiality of such information in its investment process. ESG insights are not the sole consideration when making investment decisions. The Investment Manager’s evaluation of ESG data may be subjective and could change over time in light of emerging sustainability risks or changing market conditions. This approach is consistent with the Investment Manager’s regulatory duty to manage the Company in accordance with its investment objective and policy and in the best interests of the Company’s investors. The Investment Manager’s Risk and Quantitative Analysis group will review portfolios to ensure that sustainability risks are considered regularly alongside traditional financial risks, that investment decisions are taken in light of relevant sustainability risks and that decisions exposing portfolios to sustainability risks are deliberate, and the risks diversified and scaled according to the investment objectives of the Company.

BlackRock’s approach to ESG integration is to broaden the total amount of information the Investment Manager considers with the aim of improving investment analysis and understanding the likely impact of sustainability risks on the Company’s investments. The Investment Manager assesses a variety of economic and financial indicators, which may include ESG data and insights, to make investment decisions appropriate for the Company objectives. This can include relevant third-party insights or data, internal research or engagement commentary and input from BlackRock Investment Stewardship.

ESG integration does not change the Company’s investment objective or constrain the Investment Manager’s investable universe and does not mean that an ESG investment strategy or exclusionary screens has been or will be adopted by the Company. Similarly, ESG integration does not determine the extent to which the Company may be impacted by sustainability risks.

Investment stewardship

BlackRock undertakes investment stewardship engagements and proxy voting with the goal of protecting and enhancing the long-term value of clients’ investments for relevant asset classes. In our experience, sustainable financial performance and value creation are enhanced by sound governance practices, including risk management oversight, board accountability and compliance with regulations. We focus on board composition, effectiveness and accountability as a top priority. In our experience, high standards of corporate governance are the foundations of board leadership and oversight. We engage to better understand how boards assess their effectiveness and performance, as well as their position on director responsibilities and commitments, turnover and succession planning, crisis management and diversity. For further details regarding BlackRock’s work on investment stewardship please refer to the website here.

Fund manager commentary

31 January 2024

Comments from the portfolio managers

Please note that the commentary below includes historic information in respect of performance data in respect of portfolio investments, index performance data and the Company’s NAV performance.

The figures shown relate to past performance. Past performance is not a reliable indicator of current or future results.

During the month, the Company’s NAV rose by 1.4% and the share price was up by 0.5%. For reference, the FTSE World Europe ex UK Index returned 0.3% during the period.

Europe ex UK markets were slightly up during January, although markets were on a roller coaster: initial weakness in January following incredibly strong markets during Q4 2023, was soon replaced by a number of strong earnings reports from European and US large/ mega cap stocks, as well as evidence of a strong underlying economy. US jobs reports that were published during the month showed a tight labour market and strong wage growth in December.

The start of the earnings season has so far shown robust earnings but generally mixed guidance for the year. As at the time of writing, we have not seen concerning profit warnings with implications for wider industries. So far, banks reports have also shown limited losses in the system which is encouraging. Many analysts had cut expectations going into the earnings season which, together with a degree of short covering, has so far resulted in some extreme share price moves on better-than-expected results.

Market performance was driven by technology, health care and telecommunications whilst utilities, materials and real estate were the worst performers in January. The Company outperformed its reference index during the month, driven by positive sector allocation.

In sector terms, the Company benefited from its overweight to the technology sector which delivered some very promising individual results. Our zero weight in utilities also aided relative returns as the sector struggled given a collapse in gas prices, as well as concerns around the pace of the renewables build-out. Lower weights towards materials, consumer staples and real estate were also positive.

The health care sector was the strongest contributor to relative returns during the month, largely driven by positions in Novo Nordisk and Lonza. Novo Nordisk delivered Q4 results, beating consensus expectations with sales 4% ahead and earnings per share (EPS) 5% ahead. Company issued guidance for 2024 suggests sales and earnings before interest and taxes will grow in the mid 20% range. While growth has been impressive over the past year, we believe we are still in the early stages of growth potential here, as prescription trends required to meet consensus is undemanding in our view while the use of GLP-1 drugs in other categories such as diabetes, cardiovascular, liver disease, and potentially Alzheimer’s, provides further growth opportunities. Ultimately, we still think the stock can continue to deliver upgrades through 2024.

Lonza delivered a strong set of results, reporting better than expected sales and margins for the full year 2023. Most notably, the company reiterated 2024 guidance and mid-term margin targets which alleviated market concerns of potential downgrades. The company also announced the replacement of the current chairman which was positively welcomed by the market. We retain conviction on the medium to long-term investment case for the company and see the developments as positive, whilst the company works to rebuild trust with the market and the ability to execute on their strategy.

Within consumer, LVMH reported better-than-expected Q4 results. Sentiment around the shares had been negative since last summer due to evidence around deteriorating demand trends and concerns around operating deleverage. Yet, the key Fashion and Leather Goods division grew by 9% organically during the last quarter of the year and revenue for the group was up by 10%. Cost control was also impressive with margins improving year-on-year despite headwinds.

A number of semiconductor-exposed businesses were also amongst the best performers. ASML’s stellar results boosted the whole sector: Europe’s largest tech stock reported record profits during Q4 with net profit up by 9%, as well as the highest ever order book of more than €9bn in new orders. Demand for capex in the industry is improving and supports 2025 guidance, whilst ASML retain a conservative outlook for 2024. Secular tailwinds appear intact. Whilst high, valuations remain reasonable considering ASML is one of the most attractive large cap tech names.

ASML’s update also moved shares in ASMi higher. Elsewhere in the sector, however, shares in STMicro dropped. STMicro is a highly cyclical company where demand is largely driven by the automotive industry and industrial segments. Weakening news flow around electric vehicle (EV) demand in developed markets and a decline in orders from the industrials sector, particularly reflecting China weakness, challenged the stock during the month. Whilst revenue is likely to fall this year, we expect all STMicro key markets to recover going into 2025. Valuations are extremely low at 10x P/E. Not owning Infineon was helpful as the company is also highly exposed to the auto industry which continues to see a slowdown.

Finally, a position in Sika was the largest detractor to relative returns after the company gave an update on Q4 sales and revenues which missed consensus expectations. The weaker results highlighted a new risk with their America’s business slowing and driving downgrades to EPS. With a full valuation and consensus estimates priced for perfection, we have rethought the active weight of this position in the context of the portfolio’s overall exposure to construction.

Outlook

We remain fairly constructive on European equities as the set-up should be positive: inflation is on a downwards trajectory and the economy appears relatively robust. Eurozone inflation figures have fallen and whilst there may be volatility in month-to-month data, the economy can handle these levels of inflation. This also means that we have come to, or are close to, peak rates and at some point, it is fair to assume interest rates will come down. We have already started to see a positive impact on falling mortgage rates in many European countries.

The corporate sector in Europe is healthy. There is limited corporate debt, margins are strong, there is no need for major layoffs and the end of destocking across most industries is in sight. This in turn is good news for the consumer: a supply chain and energy crisis that is largely done, combined with high employment numbers and falling inflation suggest that the cost-of-living crisis has cooled off. This puts the region in a much better position compared to one year ago.

Nevertheless, the asset class has been under-owned ever since the Russian invasion of Ukraine in February 2022. As always in Europe, it is key to remain selective. Assessing the economy from the bottom-up can uncover areas for greater optimism than traditional economic indicators may suggest. Our regular contact with management teams helps us understand whether the direction of earnings and cashflows on a medium to long-term view for the companies in our portfolio remains on track.

Long-term structural trends and large amounts of fiscal spending via the Recovery fund, Green Deal and the REPowerEU plan in Europe can also drive demand for years to come, for example in areas such as infrastructure, automation, innovation in medicines, the shift to electric vehicles, digitization or decarbonisation. Valuations are attractive versus history and especially versus US equities. Overall, evidence of a resilient consumer, healthy corporate sector and decent outlooks underpinned by green stimulus, give us confidence that many of the companies in our portfolio can continue to weather the storm.

Unless otherwise stated all data is sourced from BlackRock as of 31 December 2023.

Any opinions or forecasts represent an assessment of the market environment at a specific time and is not intended to be a forecast of future events or a guarantee of future results.

This information should not be relied upon by the reader as research, investment advice or a recommendation.

Risk: Reference to the names of each company in this communication is merely for explaining the investment strategy, and should not be construed as investment advice or investment recommendation of those companies.

Portfolio manager biography

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested.

Stefan Gries is co-manager of BlackRock Greater Europe Investment Trust plc. He is head of the European Equity team within the Fundamental Equity division of BlackRock’s Portfolio Management Group. He is co-manager on the European Absolute return (long/short) portfolios, as well as on Pan European and Europe ex UK long-only portfolios. Prior to joining BlackRock in 2008, Stefan spent two years at Scottish Widows Investment Partnership where he completed a two-year graduate programme. Since joining BlackRock, he has worked both as a portfolio manager and as an analyst covering, at various times, energy, pharmaceuticals and insurance on behalf of the European Equity team. He earned an MA in economics and Spanish from the University of St. Andrews in 2005.

Alexandra Dangoor is co-manager of BlackRock Greater Europe Investment Trust plc. Alexandra also has research responsibilities within the team’s financials research pod focused on the European banks and insurers. Alexandra joined the BlackRock Fundamental European Equity Team in 2019 after two years on BlackRock’s graduate rotation programme, where she was an analyst in the Natural Resources and European Equity teams. Alexandra earned a BSc degree in Mathematics and Economics at Bristol University, graduating in 2015, and an MSc in Investment and Wealth Management at Imperial College Business School, graduating in 2016. 

Stefan Gries
Portfolio Manager
Alexandra Dangoor
Portfolio Manager

Board of directors

All the Directors are non-executive and independent of the Investment Manager. The Board as a whole constitutes the Audit and Management Engagement Committee.

Eric Sanderson (appointed April 2013) (Chairman) is a chartered accountant and a banker and was chief executive of British Linen Bank from 1989 to 1997 and a member of the management board of Bank of Scotland in his role as head of group treasury operations from 1997 to 1999. He was formerly chairman of MyTravel Group PLC, MWB Group Holdings, Dunedin Fund Managers Limited and Schroder UK Mid Cap Fund plc. He is presently chairman of JPMorgan Emerging Europe, Middle East & Africa Securities Limited.

Peter Baxter (appointed April 2015) has over 30 years’ experience in the investment management industry. He is an executive director of Snowball Impact Management Ltd, a social impact investment organisation, a non-executive director of Civitas Social Housing plc, and a trustee of Trust for London, and was a member of the Financial Reporting Council’s Conduct Committee. Previously he was chief executive of Old Mutual Asset Managers (UK) Ltd and worked for Schroders and Hill Samuel in a variety of investment roles.

Paola Subacchi (appointed July 2017) (Senior Independent Director) is an economist, writer and commentator on the functioning and governance of the international financial and monetary system. She is Professor of International Economics and Chair of the Advisory Board, Global Policy Institute, Queen Mary University of London, visiting professor at the University of Bologna, non-executive director of Scottish Mortgage Investment Trust PLC as well as Founder of Essential Economics Ltd. She writes regularly on Project Syndicate.

Ian Sayers (appointed February 2022) (Chairman of the Audit and Management Engagement Committee) is the former Chief Executive of the Association of Investment Companies (AIC), which he became in 2010 on his promotion from Deputy Director General. Prior to that, he was the AIC’s Technical Director, advising members on areas such as taxation, accounting, company law and regulation, as well as having a key role in its public affairs activity. He qualified as a chartered accountant and chartered tax advisor.

Sapna Shah (appointed 12 December 2023) has 20 years of investment banking experience advising UK companies, including listed REITs and investment companies, on IPOs, equity capital market transactions and mergers and acquisitions. She is a non-executive director of The Association of Investment Companies and a consultant at Panmure Gordon Limited. Prior to this she held senior investment banking roles at UBS AG, Oriel Securities (now Stifel Nicolaus Europe) and Cenkos Securities. She is currently a non-executive director of Supermarket Income REIT plc and BioPharma Credit PLC.

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Investment strategies targeting growth and income
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Over 29 years of proven experience running investment trusts (Dec 2021)
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Unparalleled research capabilities and experienced stock pickers
Contact
To get in touch contact us on:
Telephone: 020 7743 3000
Email: cosec@blackrock.com