BlackRock World Mining Trust plc BRWM

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1 Page 1 of 7 Morningstar Research Report Text as of 17/10/2017, Data as of 02/02/2018 Morningstar Benchmark S&P Global Natural Resources Morningstar Category TM Sector Equity Natural Resourc Last Closing Price GBP Last Closing NAV GBP Discount/Premium % Latest Published NAV Latest Published NAV Date 01/02/2018 Traded Currency GBX Yield 2.99 Dividend Frequency Quarterly Total Assets Mil Net Assets Mil Market Cap Mil Net Gearing % 12 Avg Daily Shares Traded Mil (3 month) 0.37 Inception Date 15/12/ k 80k 60k 40k 20k 10k Returns Price NAV Category Index 4k 0 Discounts -5 Premium Discount -10 Average Line YTD Performance % Fund Price Fund NAV /- Category /- Benchmark Morningstar Analyst: Fatima Khizou, Analyst The conduct of Morningstar's analysts is governed by Morningstar's Code of Ethics, Securities Trading and Disclosure Policy, and Morningstar Manager Research Integrity Policy. For information regarding conflicts of interest, please click Executive Summary People: A seasoned mining investor backed by a well-resourced team with significant expertise in the space. Parent: BlackRock, though not perfect, has largely served fundholders well. Board: The fund has a board with a good balance of relevant industry and investment experience. Process: The investment process incorporates the assessment of commodity price trends over the long term and company analysis where management quality is key. Performance: The fund's NAV is slightly behind the benchmark thus far in 2017 (to Aug. 31). Fees: With a management fee of 0.8%, this fund is competitively priced. Role in Portfolio Single-sector funds typically only form a small part of an investor's broader portfolio, and investors should be aware that natural resources has been one of the most volatile sectors in recent years. Morningstar Opinion 17 Oct 2017 Management's ongoing focus on quality assets and measures taken by the board after the losses experienced in 2014 should help BlackRock World Mining Trust deliver going forward. Evy Hambro has led this fund since September 2000 but has been involved in the strategy since its inception in Hambro is a seasoned mining investor and provides considerable stability to the team and investors. He has helped build the natural-resources team at BlackRock into a unit that has significant expertise across the entire commodity spectrum. Hambro is supported by comanager Olivia Markham, who was appointed to the role in April She has worked on the natural-resources team since 2011, when she initially joined as a gold and mining analyst, and provides support in constructing the portfolio. The managers aim to add value through a combination of detailed commodity and company analysis, with an emphasis on the latter. The topdown approach aims to forecast the price trend for the underlying commodities, while the equity analysis focuses on lower-cost, higher-quality producers and incorporates manager meetings and mine visits. This approach has consistently been applied to good effect over the long term. Investors should note that the strategy is likely to lag during recovery periods where the strongest returns generally come from small-cap/lowerquality stocks, in which the managers typically invest a lower proportion of assets relative to the benchmark. Its underweighting in some of large index constituents (typically not held because of poor quality) will also impact the fund's returns during periods when investors flock to the most liquid names to gain exposure to the sector. Over Hambro's tenure through August 2017, the fund was marginally ahead of the Euromoney Global Mining benchmark. Recent years have been challenging and have impacted the nearterm performance. Additionally, a sizable stake in unquoted investments in 2014 also negatively impacted the fund. To minimise the risks from these types of investments and their impact on the trust, the board took a number of measures. While the 20% maximum exposure to royalties and unquoted investments has been maintained, the individual position in these investments should not exceed more than 3%. It is worth noting that the overall exposure to unquoted investments has been smaller in recent periods and only accounted for 4.3% as of June Another notable measure was a management fee cut. Since 2014, the management fee has gradually decreased and stood at 0.8% as of June This is relatively cheap given the specialised nature of the sector. All told, we continue to think this fund is a solid offering, underpinned by a rigorous, disciplined approach and an experienced manager backed by a team with significant expertise. The fund therefore retains its of Silver.

2 Page 2 of 7 Morningstar Research Report Text as of 17/10/2017, Data as of 02/02/2018 People Manager Evy Hambro Manager Start 01/09/2000 Manager Olivia Markham Manager Start 30/04/2015 Avg. Manager Tenure 10.1 Years Other Funds Managed Evy Hambro joined Mercury Asset Management (now BlackRock) in 1993 and has been in charge of BlackRock World Mining since September He brings an outstanding pedigree in his field, and his entire career has been focused on the analysis of mining stocks and precious metals. In addition to this fund, he also manages the group's gold strategies. He has helped build BlackRock's natural-resources team, which included over 10 investment professionals as at July The team was led by Graham Birch until April 2009, when he embarked upon a nine-month sabbatical and subsequently retired. Hambro has consequently taken on the role of CIO of the team, which has retained significant experience and expertise overall. That said, the team suffered a meaningful blow in the first half of 2015 when comanager Catherine Raw left the firm. She was replaced by Olivia Markham, who joined BlackRock in 2011 as a gold and mining analyst. Previously, she worked at UBS, where she led the European mining research team. The group also hired experienced analyst Cailey Baker, who joined the team in September He has a strong technical background, which the team felt it lost with the previous comanager's departure. While the overall resources team has seen some departures/retirements in recent years, BlackRock has always acted quickly and hired experienced and specialised individuals. We continue to believe this is a high-quality team. Parent Fund Advisor Domicile Website BlackRock Investment Management (UK) Ltd. UK l/products/investmenttrust/blackrock-world-miningtrust At $5 trillion in assets under management, Black- Rock is the largest asset manager in the world. The firm isn't perfect--after struggling with its active-equity capabilities for years, it's reorganising that outfit for the second time, and its ishares franchise launches some trendy exchangetraded funds. But the firm has made great strides to encourage its portfolio managers to invest alongside fundholders, and strengthen its investment offerings. The firm's Parent rating was raised to Positive from Neutral. The firm has grown quickly, in large part thanks to the strength of ishares and its active fixed-income and multi-asset businesses, as well as a growing institutional business, which includes mostly index-based strategies. BlackRock's solid stewardship of capital stems in large part from its decision that to succeed as a publicly traded asset manager, it must act as a responsible, highperforming fiduciary. The firm uses its scale and technological capabilities to achieve this goal. BlackRock is constantly evolving and has focused on technology in recent years to further growth, including selling its proprietary risk-management system, Aladdin, to competitors and developing a pared-down version for advisors. A recent announcement to move $30 billion in active equity to quant-driven strategies demonstrates a willingness to rely more heavily on technology to run portfolios. Board of Directors Tender Offer Buyback Authorization No No The board comprises six nonexecutive directors, all of whom are considered to be independent. There have been several changes in the past three years. May 2014 saw the appointment of Russell Edey, which coincided with Oliver Baring's retirement. He brings industry experience, having previously worked for one of the largest gold producers, AngloGold Ashanti. Judith Mosely, a banker who has spent most of her career focused on the metals and mining sector, also joined in April 2016 saw the retirement of Ian Barby and chairman Anthony Lea from the board. Ian Cockerill and Jane Lewis were consequently appointed to the roles of chairman and director, respectively. Cockerill has served as a director since November 2013 and has over 40 years of experience in the mining industry, notably as chief executive of Gold Fields and Anglo Coal between 1999 and Lewis is an investment trust specialist who, until August 2013, was a director of corporate finance and broking at Winterflood Investment Trusts. We believe there is a good balance between investment and industry experience, the latter being crucial, in our view, given the nature of the fund. Furthermore, all six nonexecutive directors hold shares in the company, which we think aligns their interests with those of their shareholders'. We think this is a solid board that understands well the specialist nature of the fund's investment universe. It meets at least five times each year, more frequently when required.

3 Page 3 of 7 Morningstar Research Report Text as of 17/10/2017, Data as of 02/02/2018 Process: Investment Approach Investment Objective: To maximise total returns to shareholders through a worldwide portfolio of mining and metal securities. Up to 10% of the assets may be invested in physical metals and up to 20% of the assets may be invested in unquoted securities. Hedging Policy Tactical Use of Cash Process: Portfolio Positioning Morningstar Holdings Based Style Map Deep Val Core Val Core Core Grw High Grw Giant Large Mid Small Micro NULL No World Regions Assets % Greater Europe United Kingdom Europe-Developed 3.52 Europe-Emerging 0.46 Africa/Middle East 0.45 Americas North America Latin America Greater Asia Japan 0.00 Australasia Asia-Developed 0.00 Asia-Emerging 0.00 Not Classified 0.00 The process incorporates the assessment of commodity prices and companies. The team seeks to identify the drivers of each commodity price to help forecast a directional trend that supports its company-level analysis. This covers supply and demand analysis, with the latter increasingly influenced by investor demand. Such analysis frames bottom-up company research, which is critical to the process; the team members see more than 1,000 companies annually and believe good management is key to a company's success. They focus on lower-cost, higher-quality producers where they believe equity valuations underestimate the longer-term earnings prospects for a business. A top-down overlay incorporates The fund has exhibited an underweighting to large caps while being overweight mid-caps relative to the Euromoney Global Mining Index. Turnover has also tended to be low, helped by the long-term emphasis on low-cost miners with the ability to grow production. The managers will at times hold more-tactical positions designed to take advantage of a company's commodity-price sensitivity. The team gradually increased the fund's allocation to gold amid its exceptional year in 2016 and Asset Allocation Top 10 Holdings 30/09/2017 % Assets Long Short Net Cash Equity Bond Other % Assets BHP Billiton PLC Rio Tinto PLC Glencore PLC 9.58 Vale SA ADR 7.29 Teck Resources Ltd Class B 4.47 First Quantum Minerals Ltd 4.28 Sociedad Minera Cerro Verde SAA 3.85 Newmont Mining Corp 3.68 South32 Ltd 3.41 Newcrest Mining Ltd 2.73 factors such as political risk into the analysis. The fund is constructed in a benchmark-aware manner with the aim of generating steady outperformance. It comprises three segments: large holdings of 5% to 10%, where liquidity is good and conviction is high; medium positions of 2% to 5%, typically a single metal producer or activity in one country only; and positions below 2%, which are usually stocks with poorer liquidity. The 10 largest holdings will typically make up more than 50% of assets, and portfolio turnover will usually be low. The fund will typically have between 50 and 80 stocks. continued to maintain a sizable exposure to gold in 2017; it accounted for 17.2% of assets as of July. Diversified producers continue to form a big part of the portfolio; Vale was added in 2016 and this position was increased in first-quarter 2017 based on relative valuations, attractive cash flows, and the company's ongoing strategy for deleveraging its balance sheet. Deleveraging was a key theme within the portfolio, helped by soaring commodity prices and mining companies' willingness to keep costs low. Sector Weightings % Equity h Cyclical r Basic Materials t Consumer Cyclical 0.0 y Financial Services 0.0 u Real Estate 0.0 j Sensitive 0.0 i Communication Services 0.0 o Energy 0.0 p Industrials 0.0 a Technology 0.0 k Defensive 0.0 s Consumer Defensive 0.0 d Healthcare 0.0 f Utilities 0.0

4 Page 4 of 7 Morningstar Research Report Text as of 17/10/2017, Data as of 02/02/2018 NAV Performance Analysis Data as of Trailing Returns Price Total Rtn % +/- Bmark 3 month Month Year Year Ann Year Ann Performance is analysed relative to the Euromoney Global Mining Index, as the fund has a narrower mandate than most in the Sector Equity Natural Resources Morningstar Category. Over Evy Hambro's tenure from September 2000 through August 2017, the fund was marginally ahead of the benchmark. Recent years have been challenging, and the fund's weak near-term results have dented the overall track record. However, the team's focus on quality assets and recent changes made following the losses in 2014 should help the fund to outperform was an excellent year for commodities, but while the fund's net asset value rose strongly, finishing the period at 92.6%, it failed to outperform the benchmark's 94%. In 2017 through August, the fund's NAV was behind the index, partly because of the fund's overweight positions in copper and nickel producers. Trailing Returns NAV Total Rtn % +/- Bmark +/- Cat %Rnk In Cat 3 month Month Year Year Ann Year Ann Calendar Total Returns Fund(price) Fund(NAV) YTD -60 Discount / Premium Data as of Discount / Premium % 6 Mo 1Yr 3Yr High Average Low Z-Statistic On Aug. 31, 2017, the trust traded at a 12.2% discount, a lower level than at the start of 2016 when it stood at 15%. During 2016, the board took the decision to repurchase 832,000 ordinary shares to address the discount. No shares were purchased during 2017 (to the end of July). While the board has shareholder approval to buy back shares and has done so selectively over the years, it does not operate a hard discount-control mechanism. The fund can hold up to 10% of its issued shares in treasury, which can then be canceled or sold for cash in the market; the board has stated its intention to sell shares from treasury only at or above NAV. Risk & Return Data as of Morningstar Rating Return Risk Rating 3 Year High Above Avg Q 5 Year Below Avg Above Avg 10 Year Avg High Overall Avg High This fund carries significant risks, as its holdings incorporate high exposure to movements in bulk commodities, base-metals, and precious-metals prices. It is certainly only for investors seeking dedicated exposure to miners. The top 10 stocks usually account for more than half of total assets, which puts pressure on the managers' stock-picking skills. The team will write options to manage position sizes and reduce overall risk in the fund. The purchase of revenue-related royalties adds diversification to the fund's income but also brings added risk with those specific companies. A 20% maximum exposure to unquoted names was maintained by the board, but each position should not exceed 3% of gross assets at the time of investment. The overall exposure to unquoted investments has been smaller in recent periods; it was 4.3% as of June Volatility Ratios 3 Yr NAV 5 Yr NAV Standard Deviation Mean Sharpe Ratio Sortino Ratio Risk vs Index 3 Year 5 Year Alpha NAV Beta NAV R-Squared NAV Treynor Ratio NAV

5 Page 5 of 7 Morningstar Research Report Text as of 17/10/2017, Data as of 02/02/2018 Fees Management Fee % 0.80 Ongoing Charge ex Perf Fee % 1.10 Gearing Total Assets Mil Net Assets Mil Dividends Dividend History Dividend Special Dividend Total This fund is competitively priced, particularly since the measures taken by the board following the disappointing results in Fees were gradually reduced: Between July 1, 2015, and Sept. 30, 2015, the annual fee was reduced from a flat 130 basis points to 120 basis points on the first GBP 500 million of gross assets; 100 basis The managers can use gearing in this fund up to 25% of net assets through the use of a bank loan and an overdraft. In the past, the team was tactical in its deployment. It eliminated gearing in the portfolio at the end of 2007 as the subprime crisis started to unfold, but Evy Hambro put a little on in early He soon reversed this, but in August he was tempted back in, some three months too early. Having avoided gearing in 2009, he used it once again at the start of 2010, at a modest level of around 4%. Since then, the The aim of this fund is to maximise total returns, and there is no predetermined level of income that is targeted. That said, the fund does have a history of paying an annual dividend. The managers also write call options on a selective basis to help boost the fund's income. The use of these instruments was popular from as the sector saw dividend cuts; revenues from options doubled over that period. The board had to make use of reserves to cover the dividend in points on the next GBP 500 million; and 85 basis points on gross assets above GBP 1 billion. From the start of October 2015, the annual management fee was reduced to 0.8%. The board intends to keep fee rates under review, and we believe there is still room for some improvement. managers have used gearing to fund the purchase of royalties from the production of metals and minerals. From 2012, gearing has significantly increased. As the end of 2016, gearing was 12.4%. This gearing has been drawn down against the higher yielding mining company corporate bonds and is predominantly denominated in the same currency as that of the bonds. More recently, at the end of June 2017, the trust's net gearing was 14.5%. As of 2017, investors should note that the board has increased the frequency of the dividend payment from twice to four times a year. A dividend of 3 pence per share was paid in June 2017, and 3p/share is expected to be paid in September. The majority of the income is derived from ordinary shares and is expected to grow as many mining companies have increased or reinstated dividend payments on the back of improved profitability and reduced balance sheet concerns.

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