TIDMUEM
RNS Number : 3315Q
Utilico Emerging Markets Trust PLC
17 February 2023
17 February 2023
UTILICO EMERGING MARKETS TRUST PLC
(LEI Number: 2138005TJMCWR2394O39)
Publication of monthly factsheet
The latest monthly factsheet for Utilico Emerging Markets Trust
plc ("UEM" or the "Company") will shortly be available through the
Company's website at:
https://www.uemtrust.co.uk/investor-relations/factsheet-archive
Monthly commentary
PERFORMANCE
UEM's NAV total return increased by 4.1% in January, which was
behind the MSCI Emerging Markets total return Index which was up by
5.9% in Sterling terms for the period.
Markets were mostly upbeat in January, helped by improved
sentiment on China's re-opening and indications that inflation was
easing across many major economies. In the US headline CPI fell to
6.5% from 7.1%, with the Federal Bank hinting at a nearing of the
end of the rate increase cycle, helping propel the S&P 500
Index which was up by 6.2% in the month. European markets were even
stronger, with the Eurostoxx up 9.7% as the Eurozone PMI hit a
seven-month high.
EM benefitted from the risk-on environment. In China the
manufacturing PMI surprised positively at 50.1 in January, up from
47.0 in December 2022, hitting expansionary territory after four
months of sequential contraction. The service sector also jumped,
as several large cities announced that Covid virus caseloads had
peaked mid-month, prompting many to travel and socialise in the
Lunar New Year celebrations. According to the Ministry of Culture
and Tourism spending during the holiday recovered by 30% from a
year ago. Hong Kong's Hang Seng Index was up 10.4% and the Shanghai
Composite rose by 5.4% in January.
In Brazil, President Lula unsettled markets with statements on
enhancing social programs, loosening the fiscal regime and
inflation targets, and questioning the independence of the Central
Bank. Bolsanaro-supporting protesters stormed the Congress in the
country's capital. Against this turbulent backdrop, the Bovespa
still managed a 3.4% gain. Meanwhile, the markets in Mexico,
Vietnam and Korea performed strongly, with the Mexico Bolsa up
12.6%, the Ho Chi Minh Index up 10.3%, and the Kospi up 8.4%.
Indian markets notably underperformed, with the Sensex falling
2.1% in January. This was mainly due to the release of a
short-sellers research report into the Adani group companies,
alleging share price manipulation and accounting fraud. At the time
of the report UEM's only direct exposure to an Adani entity was a
small position in Adani Ports which has subsequently been
exited.
Sterling was mixed, strengthening 2.3% against the US Dollar and
1.4% versus the Indian Rupee, but weakening 1.3% against the
Brazilian Real, 4.0% versus the Chilean Peso, and 1.3% against the
Mexican Peso.
PORTFOLIO
The majority of investments in UEM's portfolio posted share
price increases during January, with one change to the top thirty
as Vamos re-entered as its share price rose by 15.7%, replacing
TAV. In Brazil there were robust share price performances for
Santos, up 12.9%, and Orizon, up 14.4%, recovering off of recent
lows. UEM's Mexican airport investments appreciated strongly, with
OMA and GAP's share prices up 14.9% and 16.1% respectively. Both
companies posted continued strong recoveries in passenger numbers,
with GAP guiding for double-digit revenue and EBITDA growth in
2023.
Elsewhere, notable performances were delivered by China Datang
Renewables, with its share price up by 11.7%, Kunlun Energy up
11.0%, and KINX up 16.1%. It was pleasing to see Inpost continue to
deliver good results, beating consensus with volumes up 23% in Q4.
Inpost's share price was up by 12.2% over the month.
Modest positive share price movements were seen elsewhere, with
FPT up 8.9%, China Gas up 7.0%, MyEG up 5.8% and CITIC Telecom up
5.3%. Only five investments in the top thirty saw share price
declines, all of which were comparatively modest - as evidenced by
the worst performance being Telelink, down by 2.2%.
During January, purchases for the portfolio totalled GBP5.8m and
realisations totalled GBP14.9m.
DEBT
UEM's bank debt declined from GBP26.1m to GBP25.2m and was drawn
as EUR 12.0m and USD 18.0m.
OTHER
UEM's share price ended January at 216.00p, up 3.3% over the
month. The discount to NAV widened slightly to 14.0% from 13.3%.
UEM bought back 75,000 shares at a price of 219.00p in the
month.
Name of contact and telephone number for enquiries:
ICM Investment Management Limited +44(0)1372 271486
Charles Jillings / Alastair Moreton
Montfort Communications
Gay Collins, Pippa Bailey +44(0)20 3770 7913
utilico@montfort.london
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END
MSCNKOBQBBKDFBD
(END) Dow Jones Newswires
February 17, 2023 07:50 ET (12:50 GMT)
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