Interim Management Statement (8377P)

TIDMBSRT

RNS Number : 8377P

Baker Steel Resources Trust Ltd

10 October 2011

BAKER STEEL RESOURCES TRUST LTD

www.bakersteelresourcestrust.com

September 2011 Quarterly Factsheet

 
                                                                    % Change 
   At 30 September   Price/Index    % Change om    % Change in        from 
   2011                 Level         Quarter          Year        Inception 
------------------  -------------  -------------  -------------  ------------- 
   Net Asset Value 
    (pence/share)       118.7          +1.5%          +14.8%        +18.7%* 
------------------  -------------  -------------  -------------  ------------- 
   Diluted Net 
    Asset Value 
    (pence/share)       115.6          +1.3%          +12.4%          n/a 
------------------  -------------  -------------  -------------  ------------- 
   Ordinary Share 
    Price 
    (pence/share)        98.5          -5.0%          +25.5%        -1.5%** 
------------------  -------------  -------------  -------------  ------------- 
   Subscription 
    Share Price 
    (pence/share)        17.5          -22.2%         +12.9%          n/a 
------------------  -------------  -------------  -------------  ------------- 
   MSCI World 
    Index               280.64         -17.9%         -15.1%         -9.0% 
------------------  -------------  -------------  -------------  ------------- 
   HSBC Global 
    Mining Index       1143.83         -25.6%         -29.4%         -12.0% 
------------------  -------------  -------------  -------------  ------------- 
   CRB Index            298.15         -11.8%         -10.4%         +9.1% 
------------------  -------------  -------------  -------------  ------------- 
   Chinese 
    Domestic Iron 
    Ore - 
    Hebei/Tangshan 
    (US$/t)              230           +10.0%         +7.0%          +19.8% 
------------------  -------------  -------------  -------------  ------------- 
   Copper (US$/t)        6998          -25.7%         -27.5%         -6.1% 
------------------  -------------  -------------  -------------  ------------- 
   Gold (US$/oz)       1623.97         +8.2%          +14.3%         +39.1% 
------------------  -------------  -------------  -------------  -------------

Source: Bloomberg closing 27/4/10, **Issue price 28/4/10, * NAV 30/4/10

This document constitutes an interim management statement for the period from 1 June 2011 to 10 October 2011 (the "Period"). Financial information has been drawn up as at 30/09/2011. There have been no material changes since that date.

 
 Review At the end of June 2011, Baker Steel    Investment Objective 
 Resources Trust Limited ("BSRT" or "the         To seek capital growth 
 Company") was 99.5% invested. During the        over the long term through 
 quarter the realisation of the Company's        a focused global portfolio 
 interest in First Coal Corporation ("First      consisting principally 
 Coal") resulted in the percentage invested      of the equities, or related 
 falling to 92.8% of net asset value ("NAV").    instruments, of natural 
 Since the period end the Company has            resources companies. 
 returned to being close to fully invested       Investment Strategy 
 following a further investment in October       Investing predominantly 
 2011. During the quarter NAV per share rose     in attractively valued 
 1.5% with the profit on the sale of First       private companies with 
 Coal being partially offset by the fall in      strong development projects 
 the share prices in the listed investments      and focused management 
 in the portfolio. Following a mixed first       and also in listed securities 
 half of 2011, markets for mining equities       to exploit value inherent 
 fell sharply in the third quarter with the      in market inefficiencies. 
 HSBC Global Mining Index falling 25.6%. The     Asset Allocation 
 performance of commodities themselves was       Unlisted Equities GBP65.3 
 mixed with iron ore and gold holding up well    M 83.3 % 
 and base metals such as copper falling          Listed Equities GBP 7.5 
 heavily. The emphasis of markets generally      M 9.5 % 
 has been one of de-risking as investors         Net Cash & GBP 5.6 M 7.2 
 continue to be concerned by debt levels in      % 
 the western economies and the crisis of         Equivalents 
 confidence in the Eurozone. For example, as     Net Assets GBP78.4 M 
 the gold price has risen, the margins of        Gearing: NIL 
 gold producers have generally widened but       Shares in Issue 
 the market's lack of appetite for risk and      Trading: The London Stock 
 equities in general has resulted in gold        Exchange Ordinary: 66,033,061 
 share prices falling rather than rising, as     Code: BSRT 
 might be expected with enhanced                 ISIN GG00B6686L20 
 profitability. During the quarter the           Subscription: 13,194,622 
 Company made one significant addition to its    Code: BSRW 
 portfolio, investing GBP3.75 million in         ISIN GG00B64WLC23 
 Metals Exploration plc, an AIM listed           Financial Calendar 
 company, as part of a larger strategic stake    Listing Date: 28 April 
 alongside other funds managed by Baker          2010 
 Steel. Metals Exploration plc holds the         Year End: 31 December 
 Runruno gold project in the Philippines         Interims: August 
 where a feasibility study has been completed    Finals April 
 into a mine producing approximately 100,000 
 ounces of gold per annum. During the 
 quarter, the Company made its first major 
 realisation following the takeover of First 
 Coal Corporation by Xstrata Coal in an all 
 cash offer. After taking into account 
 Canadian tax payable, the Company made a 
 gain of C$6.75 million on its investment 
 representing a return of 129%. Outlook One 
 of the main avenues for realisations of the 
 Company's investments is through IPOs on 
 relevant stock exchanges. Several of the 
 companies in the portfolio had been planning 
 IPO's during the second half of 2011. These 
 plans have been disrupted by the recent 
 turbulent markets but they are well 
 positioned for when market conditions 
 normalise. The Company's strategy has been 
 to invest in projects with sufficient 
 quality and scale that they would be 
 attractive to major mining companies. The 
 balance sheets of the majors are currently 
 very strong and this, in the meantime, 
 remains a route for realisations as was 
 demonstrated by the First Coal sale. 
---------------------------------------------  ------------------------------- 
 
 
 Largest Investments (at 30 September       Investment Manager Baker Steel 
 2011) Ivanhoe Nickel and Platinum          Capital Managers LLP Investment 
 Limited 27.9% NAV A private company      Advisers AWR Lloyd Capital Ltd Rock 
 with a major copper project in the      Capital Partners Ltd Management Fees 
 Democratic Republic of Congo and a        Monthly: 1/12 of 1.75% of Market 
 platinum/nickel project in South         Capitalisation Performance: 15% of 
 Africa. Ferrous Resources Limited       NAV growth (if over 8% p.a. compound 
 14.0% NAV A private company with five     hurdle rate, with high watermark) 
 iron ore projects in Brazil,              Board Howard Myles (Chairman) Ed 
 containing Joint Ore Resource            Flood Charles Hansard Clive Newall 
 Committee ("JORC") resources of 5.1       Chris Sherwell Joint Brokers RBC 
 billion tonnes of iron ore. Gobi Coal    Capital Markets +44(0)20 7653 4253 
 & Energy Limited 13.9% NAV A private        Winterflood Investment Trusts 
 company with three coking coal            +44(0)20 3100 0000 Contact: Baker 
 projects in Mongolia with a JORC        Steel Capital Managers LLP 86 Jermyn 
 compliant resource of 322 million        Street, London SW1Y 6JD +44 (0) 20 
 tonnes. Ironstone Resources Limited                   7389 8237 
 6.5% NAV A private company with an      enquiries@bakersteelresourcestrust.co 
 iron ore/vanadium project in Canada.    m Baker Steel Resources Trust Ltd is 
 It has a NI-43-101 compliant resource   incorporated in Guernsey Registration 
 of 203 million tonnes of iron ore.         Number: 51576 Arnold House, St 
 Silver China 5.6% NAV A private            Julian's Avenue, St Peter Port, 
 company with a producing                              Guernsey 
 silver/lead/zinc mine and other 
 development opportunities in China. 
 Metals Exploration plc 4.9% NAV A 
 company listed on the AIM market of 
 the London Stock Exchange whose main 
 asset is the Runruno gold project in 
 the Philippines. Bilboes Holdings 
 (Pvt) Limited 4.9% NAV A private 
 company which owns four previously 
 producing gold mines in Zimbabwe. 
 Copperbelt Minerals Limited 4.4% NAV 
 A private company with a 68% interest 
 in the Deziwa Copper-Cobalt Project 
 in the Democratic Republic of Congo. 
 Polar Silver 4.4% NAV A private 
 company which holds a 50% interest in 
 the Prognoz silver project in Russia 
 which has JORC resources containing 
 293 million ounces of silver. The 
 remainder of the Portfolio (excluding 
 cash) comprises six holdings totaling 
 6.3% NAV. Further information is 
 available on BSRT's website: 
 www.bakersteelresourcestrust.com 
--------------------------------------  -------------------------------------- 
 Important Information This document is issued and approved by Baker Steel 
 Capital Managers LLP (authorised and regulated by the Financial Services 
 Authority). The information contained in this document is not intended to and 
 does not constitute an offer, solicitation, inducement, invitation or 
 commitment to purchase, subscribe to, provide or sell any securities, service 
 or product or to provide any recommendations which should be relied upon for 
 financial, securities, investment or other advice or to take any decision 
 based on such information. Individual advice should be sought from legal, 
 financial, personal and other advisors before making any investment or 
 financial decision or purchasing any financial, securities or 
 investment-related service or product. As a registered collective investment 
 scheme, shares in Baker Steel Resources Trust Ltd are not permitted to be 
 directly offered to the public in Guernsey but may be offered to regulated 
 entities in Guernsey or offered to the public by entities appropriately 
 licensed under the Protection of Investors (Bailiwick of Guernsey) Law 1987 
 as amended. 
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