BlackRock Greater Europe Investment Trust Plc – Portfolio Update


The information contained in this press release is correct as of February 28, 2023. Information on the Company’s current Net Asset Values ​​can be found on the London Stock Exchange website at:



All information relates to February 28, 2023 and is unaudited.

Performance at month-end with net income reinvested

Net Asset Value (basic) 2.0% 9.0% 3.2% 45.6% 654.1%
stock price 3.0% 8.9% -1.4% 43.4% 626.0%
FTSE World Europe ex UK 0.9% 7.0% 10.0% 37.1% 379.7%

Sources: BlackRock and Datastream

At the end of the month

Net asset value (principal only): 549.49p
Net asset value (including income): 549.54p
Stock price: 523.00p
Discount to NAV (incl. income): 4.8%
Net gearing: 4.6%
Net return1: 1.3%
Total assets (incl. income): £555.0m
Common shares issued2: 101.000.161
Ongoing charges3: 0.98%

1 Based on an interim dividend of 1.75p per share and a final dividend of 4.85p per share for the year ended 31 August 2022.
2 Excluding 16,928,777 treasury shares.
3 The Company’s Ongoing Charges are calculated as a percentage of average daily net assets using the management fee and all other operating expenses excluding finance costs, direct transaction costs, custody transaction fees, VAT refund, taxation, reversal of prior year expenses and certain non-recurring items for the financial year as of August 31, 2022.

sector analysis Total Assets (%)
Industry 23.5
health care 20.8
Consumer Discretionary 20.3
technology 20.0
finance 8.2
consumer goods 4.4
basic materials 3.1
Current Net Debt -0.3
country analysis Total Assets (%)
France 21.0
Switzerland 19.1
Netherlands 17.7
Denmark 16.6
Italy 6.7
Great Britain 6.5
Sweden 5.0
Belgium 3.2
Spain 2.3
Germany 1.2
Ireland 1.0
Current Net Debt -0.3
Top 10 Holdings country fund %
Novo Nordisk Denmark 8.9
LVMH Moët Hennessy France 7.8
ASML Netherlands 6.7
RELX Great Britain 5.4
Lonza Group Switzerland 5.1
DSV Panalpina Denmark 4.5
Hermes International France 4.0
Sika Switzerland 3.6
Saffron France 3.3
KBC Group Belgium 3.3

Commenting on the markets, Stefan Gries, representative of the Investment Manager said:

During the month, the company’s NAV was up 2.0% and its share price was up 3.0%. For comparison, the FTSE World Europe ex UK Index returned 0.9% over the period.

After a strong start to the year, European equities also had a positive February, showing more resilience than other asset classes, although markets seemed to lack direction. Strong macro data and ongoing US CPI data prompted markets to price out US interest rate cuts for this year. A few more rate hikes are expected in Europe, which should not pose any major problems for the companies in our portfolio given the relatively low level of debt.

We are now approaching the end of the fourth quarter earnings season and can report that the majority of our companies have beaten expectations that the market has been too aggressively downgrading. After four quarters of concerns about a recession in Europe and a year into a significant rate hike cycle, we continue to see many companies delivering decent results and consumers more resilient than expected.

As mentioned above, markets saw little direction in February, reflected in market leadership: telecoms, financials and industrials delivered the strongest returns, while real estate, technology and healthcare were down in absolute terms.

The company outperformed its benchmark index on stock selection, although sector allocation was slightly negative. At the sector level, a higher allocation to industrials as well as lower allocations to consumer staples and real estate contributed positively to performance.

The company’s overweight to both technology and healthcare was negative, although in both cases this was significantly offset by strong stock selection. An underweight to financials detracted from relative returns.

The strongest relative contribution came from the healthcare sector. Lonza shares, in particular, continued to recover from their 2022 low after the company held a year-round conference call in late January. While the 2023 forecast was lighter than we anticipated, some conservatism is likely to be assumed in the numbers and the market appears to be looking forward to 2024, when management will report high levels of transparency in the startup of growth projects and greater effective use of assets speaks. The company also increased its dividend and announced a CHF 2 billion share buyback program over the next 24 months. Elsewhere, owning a position in Novo Nordisk and not Roche also contributed to returns.

During the month, DSV was the top performer after delivering strong 2022 results and a better 2023 outlook versus consensus expectations. The markets had priced in weaker macro data and falling freight rates. While that may be the case, DSV manages its cost base extremely efficiently and tends to manage conservatively. Despite the share price weakness throughout 2022, the company reported a 33% increase in gross profit for the year, with all businesses making positive contributions.

A number of the portfolio’s semiconductor exposed companies continued to perform well. BE Semiconductor reported strong order intake in the fourth quarter with orders worth €180 million versus a consensus of €130 million, up 39%. ASMi shares also continued to rise after good gains in the previous month. Within financials, a position in KBC was among the best performers as the sector benefited from strong results and buoyant prospects for earnings growth and returns on capital. Not holding Banco Santander and BBVA detracted from relative returns.

The main detractor was our holding in Chemometec after a series of disappointing half-year results, leading to lower full-year sales expectations. The cell therapy instrument maker saw orders fall, particularly in the North American market, which was impacted by subdued investment sentiment and resulting weaker demand from capital-sensitive developers. However, EBITDA has held up well, and the company has delivered an impressive margin of 63% and 57% over the past two quarters. While we do not believe the long-term opportunity has changed materially, the extent of the slowdown was unexpected and we remain in regular discussions with management.

Elsewhere, Adyen saw share price weakness after a rather cautious full-year forecast. This resulted in a downgrade in earnings expectations for this year, primarily due to increased spending plans as the company intends to increase spending on talent hiring, which we believe will drive future growth prospects and provide an attractive return on investment over time will offer.


We expect equity markets to remain volatile in the near term as macro uncertainty remains high. Going forward, it will be important to see if inflation falls to a level that the market can handle. As energy prices have fallen there is reason to hope that this can be achieved. Clarity on the end rate of this rate hike cycle would likely be enough to shift attention back to corporate fundamentals – the ultimate driver of long-term stock returns.

The market is prescient and at some point will start contemplating what a recovery might look like. For now, European stocks remain underowned and valuations are low. Some areas of the market, particularly within the cyclical sectors, have suffered significant downgrades and signs of economic optimism such as easing inflation or a possible reopening of China could help close some of these valuation gaps.

While there are a number of unknowns from a macro perspective, we see opportunities for attractive returns in select areas.

Corporate balance sheets are in decent shape and in much better shape than in previous downturns. Many companies in Europe have spent the last decade deleveraging their balance sheets and interest coverage is significantly higher than during the global financial crisis or other previous periods associated with deep recessions or sustained bear markets. Corporate spending intentions also remain healthy, and that spending is often associated with transformational investments.

Finally, long-term structural trends and high tax spending via the Recovery Fund, the Green Deal and the REPowerEU plan in Europe can drive demand for years to come, for example in areas such as infrastructure, automation, innovation in pharmaceuticals and the shift to electric vehicles, digitization or decarbonization . We believe the portfolio is well aligned with many of these structural spending streams.

March 13, 2023


For updated information, enter www.blackrock.com/uk/brge on the web, “BLRKINDEX” on Reuters, “BLRK” on Bloomberg, or “8800” on Topic 3 (ICV terminal). Neither the content of the Manager’s website, nor the content of any website accessible via hyperlinks on the Manager’s website (or any other website), is incorporated into or constitutes a part of this notice.

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