Blackrock World Mining Trust Plc

BlackRock World Mining Trust plc

Annual Report and Financial Statements 31 December 2020 Annual Report and Financial Statements 31 December 2020 Annual Report

blackrock.com/uk/brwm

Job No: 44037 Proof Event: 4 Black Line Level: 1 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Job No: 44037 Proof Event: 13 Black Line Level: 1 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Financial highlights 536.34p 522.00p1 NAV per ordinary share Ordinary share price +23.8% +36.3%

£930.8m 20.40p Net assets Revenue return per +22.9% ordinary share -9.2% 20.30p 3.9%2,3 Total dividends Yield

7.7% +46.7%2, 4 Decrease in total Share price total return dividends per share MSCI ACWI Metals and Mining CPI5 +0.6% 30% Buffer 10/40 Index +20.6%4 FTSE All-Share Index -9.8%4 FTSE 100 -11.5%4 +31.8%2, 4 NAV total return MSCI ACWI Metals and Mining 30% Buffer 10/40 Index +20.6%4 FTSE All-Share Index -9.8%4 FTSE 100 -11.5%4

Percentage comparisons are year-on-year against 31 December 2019. ¹ Mid-market. 2 Alternative Performance Measures. See Glossary on pages 138 to 141. 3 Based on dividends paid and declared for the year ended 31 December 2020 and share price as at 31 December 2020. 4 Performance figures are calculated in sterling terms with dividends reinvested. 5 Consumer Price Index.

Within the gold equity market, the increased focus on shareholder returns continued during the period under review. Newmont Corporation offers the most attractive dividend yield of the senior gold producers, announcing a dividend increase of 79% at the beginning of the year. This was subsequently supplemented by a new gold-linked dividend policy. PHOTO COURTESY OF NEWMONT CORPORATION

Section 1: Overview and performance 1

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Why BlackRock World Mining Trust plc? Investment objective The Company’s investment policy is to provide a diversified investment in mining and metal assets worldwide, actively managed with the objective of maximising total returns. While the policy is to invest principally in quoted securities, the Company’s investment policy includes investing in royalties derived from the production of metals and minerals as well as physical metals. Up to 10% of gross assets may be held in physical metals and up to 20% may be invested in unquoted investments. Reasons to invest

Conviction Yield Flexibility A conviction-led approach to adding The Company offers an attractive 4.2% The Company provides a diversified value by truly understanding and net dividend yield for the year ended 31 exposure to the mining sector, with a comparing companies in the mining December 2020. Whilst mainly invested total return approach. The Portfolio sector, rather than by betting on the in equities, the Company makes use of Managers have the ability to use short-term direction of commodity fixed income and unquoted instruments investment tools such as option writing prices. Unconstrained by market cap, to enhance revenue. The Company’s and gearing. sub-sector or region, the Portfolio global remit means that the majority Managers can invest in a wide range of of its holdings generate earnings from opportunities. around the world.

Opportunity Expertise ESG There is an increased focus on The Company is managed by Environmental, Social and Governance sustainability and, globally, regulation BlackRock’s Sectors and Thematics (ESG) is a key consideration. Due to is stepping up as the world looks to team, one of the largest investors in the high impact that mining has on crack down on pollution and carbon natural resources. The team has the communities, countries and the world emissions. The Company seeks resources to undertake extensive, we live in, as a general approach the opportunities in mining companies that proprietary, on-the-ground research Company will not invest in companies produce materials that will help advance to get to know the management of the which have high ESG risks and no these changes, including the need companies in which they invest. plans to address existing deficiencies. for metals such as nickel, cobalt and lithium to supply the world’s growing demand for batteries in everything from iPads to electric vehicles.

A member of the Association of Investment Companies

Further details about the Company including the latest annual and half yearly financial reports, fact sheets and stock exchange announcements are available on the website at blackrock.com/uk/brwm

2 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Contents Section 1: Overview and performance Financial highlights 1 Why BlackRock World Mining Trust plc? 2 Performance record 4 Chairman’s statement 5 Investment manager’s report 9

Section 2: Portfolio Ten largest investments 27 Investments 29 Portfolio analysis 32

Section 3: Governance Governance structure 36 Directors’ biographies 37 Strategic report 39 Directors’ report 54 Directors’ remuneration report 63 Directors’ remuneration policy 66 Corporate governance statement 68 Report of the audit & management engagement committee 73 Statement of directors’ responsibilities in respect of the annual report and financial statements 78

Section 4: Financial statements Independent auditors’ report 82 Consolidated statement of comprehensive income 91 Consolidated and parent company statements of changes in equity 92 Consolidated and parent company statements of financial position 94 Consolidated and parent company cash flow statements 95 Notes to the financial statements 96

Section 5: Additional information Shareholder information 130 Analysis of ordinary shareholders 133 Historical record 134 Management and other service providers 135 AIFMD disclosures 136 Information to be disclosed in accordance with Listing Rule 9.8.4 137 Glossary 138

Section 6: Annual general meeting Notice of annual general meeting 144

Rio Tinto’s Pilbara network, the largest privately-owned and operated rail system in Australia. COVER PHOTO COURTESY OF RIO TINTO

Section 1: Overview and performance 3

31 December 31 December 2020 2019 Net assets (£’000)¹ 930,825 757,110 Net asset value per ordinary share (NAV) (pence) 536.34 433.17 Ordinary share price (mid-market) (pence) 522.00 383.00 Reference Index4 – net total return 4,566.93 3,786.17 Discount to net asset value 2, 3 2.7% 11.6% Performance Net asset value per share (with dividends reinvested)3 +31.8% +17.2% Ordinary share price (with dividends reinvested)3 +46.7% +19.4% Reference Index4 +20.6% +15.3%

1 The change in net assets reflects market movements, dividends paid and the buyback of ordinary shares into treasury during the year. 2 This is the difference between the share price and NAV per share with debt at par. Further details of the calculation of the discount are given in the Glossary on page 138. 3 Alternative Performance Measures, see Glossary on pages 138 to 141. Performance figures are calculated in sterling terms with dividends reinvested. 4 MSCI ACWI Metals and Mining 30% Buffer 10/40 Index (net total return).

Year ended Year ended 31 December 31 December Change 2020 2019 % Revenue Net revenue profit after taxation (£’000) 35,451 39,561 -10.4 Revenue return per ordinary share (pence) 20.40 22.46 -9.2 Dividend per ordinary share (pence) – 1st interim 4.00 4.00 – – 2nd interim 4.00 4.00 – – 3rd interim 4.00 4.00 – – Final 8.30 10.00 -17.0 Total dividends paid and payable 20.30 22.00 -7.7

Long-term capital and dividend returns 1300 1250 1200 1150 1100 1050 1000 950 900 850 800 750 700 650 600 550 500 450 Rebased to 100 400 350 300 250 200 150 100 50 0 2019 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2020

• Capital only share price • Dividend reinvested returns

4 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Highlights

• NAV per share +31.8%1 (with dividends reinvested) • Share price +46.7%1 (with dividends reinvested) • Dividend -7.7%

I am pleased to present the Annual Overview Financial Report for the year ended The year ended 31 December 2020 saw 31 December 2020. enormous disruption brought on by the global pandemic, which led to the Performance partial shutdown of many economies It is very pleasing to report that over the across the world for much of the period. twelve months to 31 December 2020, The nature and scale of the disruption David Cheyne the Company’s net asset value per was unparalleled but the significant Chairman share (NAV) returned +31.8%1 and the fiscal and monetary response was share price +46.7%1. In comparison, also unprecedented. This response over the same period the Company’s played an important part in markets Reference Index, the MSCI ACWI Metals rebounding from their March lows. It & Mining 30% Buffer 10/40 Index has also ensured that economies would (net total return), returned +20.6%, not suffer large scale or permanent our previous reference index, the EMIX demand destruction outside a few Global Mining Index, returned +21.8%, specific industries. the FTSE All-Share Index returned -9.8% and the UK Consumer Price Throughout the COVID-19 outbreak, Index (CPI) increased by 0.6%. the Board has had to adjust its mode of operation to minimise the risk the This is an excellent achievement virus has posed to the health and given that our Portfolio Managers wellbeing of those working on the have had to navigate the exceptional management and administration global economic and social upheaval of the Company. The Board has following the outbreak of COVID-19 continued to meet regularly and since and the ensuing pandemic. A detailed April all scheduled meetings have commentary on the portfolio’s been held by video conference. The performance, its positioning, ESG Board has also worked closely with its factors and their importance in Manager to ensure that the Company’s portfolio construction together with the operations have not been adversely investment outlook for the forthcoming impacted, that BlackRock and key year can be found in the Investment service providers have established Manager’s Report. Since the year end business continuity plans and a good and up until the close of business on level of service has continued to be 1 March 2021, the Company’s NAV has maintained. Unfortunately, however, increased by 8.5%. the arrangements for last year’s Annual General Meeting were disrupted as a

1 Alternative Performance Measures. All percentages calculated in sterling terms with dividends reinvested. Further details of the calculation of performance with dividends reinvested are given in the Glossary on page 139. Section 1: Overview and performance 5

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 result of COVID-19 related restrictions March 2021, the ex-dividend date focus on ESG and believes that it is and, with the current lockdowns in being 18 March 2021. It remains the important that our Company’s investee place, this may well be the case again Board’s intention to seek to distribute companies operate in a responsible for the forthcoming Annual General substantially all of the Company’s and sustainable way having regard to Meeting. The proposed Annual General available income along similar lines in the interests of all their stakeholders, Meeting arrangements are set out on the future. whether these are shareholders, the next page. employees, customers, regulators or Discount control suppliers. The Board is also aware Revenue return and The Board recognises the importance that ESG must be considered when dividends to investors that the market price of the investing in the Natural Resources sector and, as a general approach, the The Company’s revenue return per Company’s shares should not trade at Company will not invest in companies share for the year amounted to 20.40p a significant discount to the underlying which have high ESG risks and no compared with 22.46p for the previous NAV. Accordingly, the Board monitors plans to address existing deficiencies. year, representing a decrease of 9.2%. the Company’s discount to NAV and Our Manager, BlackRock, has an The main difference was a fall in will look to buy back shares in normal Investment Stewardship team which special dividends received from our market conditions if it is deemed to is responsible for protecting and investee companies, although the be in shareholders’ interests. During enhancing the value of your Company’s Company benefited from the positive the year, a total of 1,233,913 shares investments through engagement with outcome on a tax ruling which was were purchased at an average price companies to encourage business and explained in my Interim Statement of 373.53p per share for a total gross management practices that support to shareholders. In August 2020, consideration of £4,609,000. All shares sustainable financial performance over HM Revenue & Customs accepted have been placed in treasury. the long term. that the Company was entitled to claim double tax relief in relation to I am pleased to report that the Climate change is one of the most underlying tax suffered on dividends Company’s discount narrowed significant global risks and companies, received from non-UK companies in a considerably during December governments and investors reacted number of past accounting periods and and, at the year end, stood at 2.7%. positively during 2020, with firm subsequently the Company received Accordingly, no further shares have policy commitments to achieve net a corporation tax refund including been purchased since the year end, zero emissions across many of the interest of £2,980,000. up to and including the date of this report. Subsequent to the year end, major world economies. We expect momentum to build and accelerate in During the year, three quarterly interim the Company’s shares have traded at 2021, with profound implications for dividends each of 4.00p per share were a premium to the underlying NAV and the global economy. BlackRock believes paid on 26 June 2020, 25 September 3,720,000 shares have been reissued that its clients are best served by being 2020 and 18 December 2020. The from treasury at an average price of at the forefront of the transition to ‘net Board is proposing a final dividend 588.59p per share and an average zero’ and in January 2021 announced payment of 8.30p per share for the premium to the estimated NAV of key actions to help investors prepare year ended 31 December 2020. This, 1.2% for a total gross consideration for a net zero world, an approach fully together with the quarterly interim of £21,896,000. As at 1 March 2021 supported by your Board. Further dividends, makes a total of 20.30p the premium stood at 1.4%. information can be found in the per share (2019: 22.00p per share) Strategic Report on pages 51 to 53. representing a decrease of 7.7% Resolutions to renew the authorities on payments made in the previous to issue and buy back shares will be financial year and, as in past years, all put to shareholders at the forthcoming Articles of Association dividends are fully covered by income. Annual General Meeting. In light of the circumstances created In accordance with the Board’s stated by the outbreak of the COVID-19 policy, the total dividends represent ESG and Socially pandemic, the Board is proposing to substantially all of the year’s available Responsible Investment make amendments to the Articles of Association (the Articles) to enable the income. As a Board we are conscious that Company to hold general meetings Environmental, Social and Governance (wholly or partially) by electronic Subject to approval at the Annual (ESG) criteria are increasingly at means and to give additional General Meeting, the final dividend will the forefront of investors’ minds. powers in respect of postponing or be paid on 6 May 2021 to shareholders Given the nature of mining as an adjourning meetings in appropriate on the Company’s register on 19 industry, your Board has a strong

6 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Climate change is one of the most significant global risks and companies, governments and investors reacted positively during 2020, with firm policy commitments to achieve net zero emissions across many of the major world economies.

circumstances. The amendments are Accordingly, in view of this guidance, to normality. However, at the time of being sought in response to challenges the Board is changing the format of writing, the full extent of the economic posed by government restrictions on the Annual General Meeting again and social impact of the pandemic social interactions as a result of the this year to follow the minimum legal and the likely duration of the current COVID-19 pandemic, which have made requirements for an Annual General national lockdowns remain unclear. it impossible for shareholders to attend Meeting. Only the formal business set There are still challenges in the very physical general meetings. out in the Notice will be considered. In near term with a resurgence of cases line with this guidance, shareholders and the emergence of new mutations The Board’s objective in introducing are strongly discouraged from of the virus. Ongoing policy support these changes is to make it easier attending the meeting and indeed from central banks, alongside fiscal for shareholders to participate in entry will be refused if current UK stimulus, is therefore vital to limit any general meetings through introducing Government guidance is unchanged. permanent economic scarring. Widely electronic access for those unable to Shareholders are encouraged to check administered, effective vaccinations travel and also to ensure appropriate the Manager’s website at blackrock. should, however, provide more clarity security measures are in place for com/uk/brwm for updates to the for governments, businesses and the protection and wellbeing of Annual General Meeting arrangements, households about the timescale to shareholders. I should make it clear as changes may well be required to revive the post COVID-19 economy. that these powers would only be comply with new guidance and/or used if the specific circumstances or government measures. Mined commodity prices performed applicable law and regulation required well during 2020 aided by China’s it and the Board’s intention is to The Board is aware that many swift post pandemic recovery and always hold a physical Annual General shareholders look forward to hearing significant government investment in Meeting provided it is both safe the views of the Portfolio Managers infrastructure. In other regions, risks of and practical to do so. The safety of and may have questions for them and pandemic-related supply disruptions shareholders and the Company’s third- the Board. Accordingly, the Annual and slower than forecast economic party service providers must of course General Meeting will be followed by recovery may linger into next year but remain paramount. a webinar to include an introduction their impact on the sector should be from the Chairman and a presentation relatively moderate and the dominance The principal changes proposed to be by the Portfolio Managers, followed of China in determining overall demand introduced in the Articles, and their by a question and answer session. growth for industrial metals will remain. effect, are set out in more detail in the Shareholders are invited to join the The restrained approach to capital Directors’ Report on page 61. webinar and address any questions they spending in the sector in recent years have either by submitting questions should also cap the rapid emergence of Annual General Meeting during the webinar or in advance by new supply, underpinning the current The Company’s Annual General writing to the Company Secretary at attractive margins for some time. Meeting will be held at the offices of [email protected]. Details of the Your Portfolio Managers therefore BlackRock at 12 Throgmorton Avenue, exact timing and how to register for this believe that the commodity demand London EC2N 2DL on Thursday, 29 event will be uploaded to the Manager’s and pricing outlook is strong, and April 2021 at 11.30 a.m. Details of the website at blackrock.com/uk/brwm. they will remain focused on high business of the meeting are set out in quality companies with, alongside the Notice of Meeting on pages 144 to Notwithstanding these difficult engagement on ESG matters, strong 147 of this Annual Report. circumstances, the Board looks balance sheets and lower costs, an forward to offering opportunities for approach fully supported by the Board. At the time of writing, guidance has shareholders to meet the Portfolio been issued by the UK, Scottish Managers in the future once it and Welsh governments, regarding becomes safe for all. David Cheyne measures to reduce the transmission of Chairman COVID-19 in the UK. These measures Outlook 4 March 2021 are, and will continue to be, subject World equities appear to be on a to periodic amendment and currently firmer footing and there is increased impose rules on social distancing and optimism now that the uncertainty limitations on, among other things, of the US election has been resolved public gatherings. and the distribution of COVID-19 vaccines provides hope for some return

Section 1: Overview and performance 7

Evy Hambro Olivia Markham

Portfolio performance We are delighted to report that 2020 delivered another strong year for our Company despite the headwinds caused by the COVID-19 pandemic. Normally when global Gross Domestic Product (GDP) collapses, unemployment rates surge and equity market volatility explodes, the mining sector is one of the worst performing places to be invested but this time things were very different. The years of balance sheet repair, rigid capital discipline and sensible growth plans left the companies well placed to navigate the challenges brought about by the global pandemic.

The table on the following page highlights the Company’s results versus the broader mix of comparators that the Board uses to assess performance. Not only has the share price return been positive for four out of the last five years, but the total share price return moved to a new all-time high on 31 December 2020. In addition, the share price has benefited from a narrowing of the discount especially during the last quarter of 2020. Revenues for the Company have been robust as strong balance sheets have allowed mining companies to continue returning surplus cash to shareholders. However, the decrease in special dividends has meant that this year the Company’s total dividend payment to shareholders could not match last year’s record payment level.

The portfolio has a significant exposure to nickel, which saw its price rise by 18.7% in 2020. Indonesia has overtaken China as the largest producer of nickel pig iron (NPI), which the Company directly benefited from via its investment in Nickel Mines, an Australian-listed owner of three nickel projects in Indonesia. PHOTO COURTESY OF NICKEL MINES

Section 1: Overview and performance 9

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 2020 Price Change % 2020 Total Return % 3 Year Total Return % 5 Year Total Return % Share price 36.3 46.7 56.3 289.5 NAV per share 23.8 31.8 36.7 227.1 MSCI ACWI Metals & Mining 30% Buffer 10/40 Index 17.5 20.6 22.8 186.2 FTSE 100 Index -14.3 -11.5 -5.3 26.2 FTSE All-Share Index -12.5 -9.8 -2.7 28.5 UK CPI 0.6 0.6 4.0 8.8

All performance figures in sterling with dividends reinvested. Source: BlackRock.

Looking back on 2020 it is hard to major beneficiary. Anything that could know where to start given all the events be bought online and delivered to your that influenced returns. Obviously, home saw a massive recovery from the The policy on the key factor was the outbreak of lows in March and many companies COVID-19 leading to a global pandemic have enjoyed staggering share price spending and being declared. The huge impact of rallies leaving them at new all-time the environment the virus on people’s physical health highs by the year end. Governments during the year varied across the globe. have sought to protect as much of the seems likely Initially the virus outbreak affected economy and workforce as possible to result in China but by March it had spread to by putting in place financial support Europe leading to mass lockdowns packages to protect jobs and support a significant across the continent. After rapidly businesses during the lockdown increase in moving through Europe, the virus periods. These measures were meant impacted Africa and South America to be short lived, but as the virus has investment to and reached North America in early continued to thrive, the economic life summer, again leading to lockdowns support that governments provided support the to prevent it escalating to a level that has been extended for far longer than transition to a would put the health service at risk. originally expected. This has left central By late summer data suggested that bank balance sheets with record levels lower carbon the measures put into place to bring of debt following this sharp increase economy, which the virus under control had delivered in government spending and equally the hoped-for results and restrictions sharp drop in interest rates with many is likely to be were gradually lifted across the world, falling to zero or below. associated with especially as research evidence suggested an effective vaccine was Whilst the pandemic has been the an increase in imminent. However, this positive biggest factor during the year, other commodity momentum was short lived, as by early issues that had been expected to autumn the virus was spreading rapidly dominate events seem to have passed demand, once again and new mutated strains, with only limited impact. In the US, feared to be more contagious than the President Trump lost his battle for a especially for key original ones, were causing record high second term and now it seems that metals such as rates of infections in Europe and the the Biden administration is likely United States (US). Governments once to deliver sweeping changes on the copper. again acted by bringing lockdowns environment, large increases to back into play just as the year end government spending and probably a festive season got under way. At the less aggressive tone on Chinese trade, time of writing, it is clear that these new whilst still being tough on human measures are likely to be in place for rights and technology. Key for the several months until confidence that resources sector will be the policy on the vaccine roll-out has had the desired spending and the environment. The effect in controlling the virus. combination of these two areas seems likely to result in a significant increase Outside of the health risks, the virus in investment to support the transition obviously had a huge impact on to a lower carbon economy, which is economic activity. With large parts of likely to be associated with an increase the world in complete lockdown, many in commodity demand, especially industries have been severely impacted for key metals such as copper. The including travel, tourism, hotels, leisure focus on climate will likely see further and entertainment, whilst others have pressure on fossil fuels and, over time, thrived, the digital economy being the impact demand for them.

10 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Outside of the US, tensions related to After a year that has been disrupted in their favour. Digital retail revenues Brexit have been high in Europe and such a major way, it is very encouraging exploded, home media entertainment between China and Australia on trade. to see the long-term return and soared, online grocery deliveries grew As the year drew to a close, Brexit terms dividend trend for the Company market share and at home, fitness were finally agreed between the UK and remaining resolute. Many sectors services displaced gyms. These swings Europe removing a key policy overhang and companies have been unable to in economic fortune were reflected for both economies. The likely outcome pay dividends to shareholders during in the stock market with a massive is for both economic areas to increase 2020 and the outlook for recovery in divergence in performance by sector. spending to support a recovery from these areas remains uncertain to say We are pleased to say that despite all of the pandemic and limit the economic the least. It is our hope that investors the volatility, for the mining sector the fallout from the UK leaving the recognise the value of stable income outcome over the twelve month period European Union. In Australia it seems from resource companies in a world was not only better than feared but that China is doing everything it can to where yields are now so low. Perhaps actually extremely positive. impact trade between the two countries we will see a rotation of capital into with bans put in place on a whole range mining companies during 2021? Mining companies were well- of goods from wine to coal. Should the positioned to see out the immediate situation continue to worsen, one key Since the Initial Public Offering of the volatility due to the robustness of their risk for the portfolio is Chinese demand Company in 1993 at 100p per share, businesses. Strong revenues, rock for iron ore given its dominance in the shares have delivered a NAV total solid balance sheets and long duration the seaborne market. Whilst iron ore return of 959.9%. On an annualised debt maturities softened the blow from is seen as unlikely to be brought into basis, the Company’s NAV has returned lockdowns. In addition, immediate the fight, it is something we watch very 9.1% since launch compared to 6.2% closure of capacity in response to virus closely given the large exposure within and 6.7% for the FTSE 100 Index and outbreaks meant that inventories did the portfolio. FTSE All-Share Index respectively. not build into a supply overhang so that when demand restarted prices were Positives over the last twelve months Mining sector overview able to react positively to the recovering are that miners have generally benefited As discussed earlier, the influence of activity. Finally, with limited amounts from a lack of cost inflation driven by the pandemic has been significant of new supply coming onstream, this weaker currencies in the first half of the in driving company performance has left the market looking ‘short’ year and the huge fall in the price of oil. during the year given the scale of compared to the likely ongoing demand In addition, the lack of growth-related government enforced lockdowns and recovery during 2021. The chart below spending means that labour costs have the corresponding impact they had highlights the sensitivity of ‘basic seen little upwards pressure from rising on economic activity. Companies resources’ to world GDP and no sector demand, as have prices for equipment. operating in the most affected is better placed to benefit than the Looking into 2021, we expect these sectors such as travel, leisure, fitness miners. trends to reverse given weakness in the studios, tourism, high street retail and US dollar, the recovery in oil prices and entertainment saw revenues reduce Despite all of the positives, mining a catch up in mining company capital radically and share prices collapse. companies in the portfolio were expenditure, whilst labour cost inflation On the other side of the equation, rightly cautious during the initial should be manageable given the high beneficiaries saw trends in place virus outbreak and, given the timing, rates of unemployment across the prior to the pandemic accelerate in this resulted in lower than expected world. dividend payments to shareholders

The sensitivity of global equity sectors to economic activity beta of year on year % changes since 1993

8 Beta of earnings to World GDP

0 Banks Media Energy Drug & Utilities Telecom Tobacco Retailers Materials Insurance Chemicals & Services Real Estate Technology Health Care Autos & Parts Grocery Stores Construction & Industrials G&S Travel & Leisure Travel Basic Resources Basic Food, Beverages Food, Financial Services Consumer Products

Cyclicals Defensives

Sources: Datastream, Goldman Sachs Global Investment Research.

Section 1: Overview and performance 11

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 during the year. This was most acutely We are also challenging the executives Within the portfolio, a number of the reflected in the low level of special of the portfolio companies in which larger companies provided clarity dividends paid by the diversified we invest to set out how their current on their long-term carbon emission majors whose balance sheets now business plans are compatible targets. Companies such as Anglo hold significant levels of excess cash. with achieving a net zero carbon American and BHP have committed Shareholders are expecting 2021 to emissions economy by 2050. We to reduce their scope 1 & 2 emissions be a year of significant distributions of are also supporting the adoption of by 30% by 2030 and are looking to excess cash, as most companies now the Task Force on Climate-related achieve carbon neutrality for their have gearing well below the bottom end Financial Disclosures (TCFD) and the own operations by 2040 and 2050 of guidance levels. For the Company, Sustainability Accounting Standards respectively. These commitments will special dividends accounted for 0.30p Board (SASB) disclosures to help be a key driver of investment going per share in 2020 versus 3.80p in 2019, bring greater focus on climate risk and forward with the sector focused on but looking forward this area could broader sustainability issues. replacing diesel with renewable power potentially be a very supportive factor sources, investing in technology to for income in 2021. The commitment to sustainability was reduce their own and their customers put to test in 2020 with COVID-19 emissions and exiting businesses with During the year the Company providing an opportunity for targets a high carbon intensity. As at the end of maintained large holdings in key to be delayed. Encouragingly, we the year, the Company has no exposure producers of iron ore given the ongoing have seen numerous companies to pure-play thermal coal companies. supply issues and resultant better than reconfirm and increase commitments expected prices. Our holdings in key around carbon emissions, using ESG is a broad and rapidly evolving beneficiaries such as Vale, Rio Tinto, more sustainable packaging and area and is of critical importance to the BHP and Fortescue Metals Group, increasing recycling rates highlighting mining sector. As investment managers together with the iron royalty exposures the importance placed on this theme. we spend a considerable amount of in Vale Debentures and Labrador Governments have centred stimulus time understanding the ESG risks Iron Ore, all helped to increase the packages around sustainability with and opportunities facing companies Company’s NAV during the year. a focus on renewable energy, electric and industries in the portfolio. As Exposure to gold producers in the first vehicles and sustainable building an extractive industry, the mining half delivered excellent capital growth, materials, with investors rewarding sector naturally faces a number of as gold prices moved to new record companies that are embracing and ESG challenges given its dependence levels on the back of the expansion benefiting from sustainability themes on water, its carbon emissions and of central bank balance sheets and in the market. the geographical location of assets. collapse in interest rates. Gold shares However, we feel the sector under- enjoyed huge share price rallies, as the During the year a number of emphasises the many positive ESG absence of cost inflation allowed them governments committed to carbon benefits it provides to society through to capture the higher prices in margins. neutrality, most notably China, which the provision of critical infrastructure, Also, in precious metals, the platinum is targeting to become carbon neutral taxes and employment to local group metals (PGM) sector enjoyed by 2060. The scale of investment communities, providing materials equally spectacular returns, with the required to meet this goal is enormous essential to human progress, enabling PGM basket rising to new all-time and will be a key driver of China’s GDP the carbon transition through the highs, initially driven by palladium and growth and commodity demand for production of sustainable metals and then taken higher by rhodium during decades to come. We view copper continuing to improve health and the second half of the year. and other sustainable materials such safety standards across the industry. as nickel, lithium and cobalt as the Environmental, Social and clear winners from this transition. While the majority of the Company’s Governance (ESG) issues Substantial investment will be required holdings have advanced their into these commodities with the mining ESG credentials during the year, The focus on ESG continues to sector a clear beneficiary of the energy particularly around climate change intensify with society increasingly transition. On the flip side, thermal and COVID-19 support provided to aware of the climate risks facing coal faces increasing regulatory their host communities and employees, civilisation. Sustainability is at the and societal pressure with demand there have sadly also been some ESG forefront of decision making for expected to decline as cleaner and controversies. The most notable was the governments and regulators, climate cheaper sources of renewable power destruction of historical caves at Juukan risk is being embedded into corporate become available. The Company is Gorge on the land of the Puutu Kunti strategy, society is demanding change well-positioned to benefit from these Kurrama and Pinikura people (PKKP) in and there is a growing recognition from trends and we expect to build exposure the Pilbara region of Western Australia. the financial community that ESG is a to metals that will benefit from this This tragic incident has cast a dim light key driver of long-term growth. transition in years ahead. over Rio Tinto’s ESG practices which

12 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Copper was a key driver of performance in 2020. First Quantum Minerals was one of the standout contributors as its flagship Cobre Panama mine continues to ramp up. PHOTO COURTESY OF FIRST QUANTUM MINERALS

ultimately saw the removal of the CEO international practices. As confidence is taking appropriate action to resolve and a number of other key executives. increases in the improved ESG matters before deciding what to do. Following the Australian parliamentary credentials of the company, we would Depending on our assessment of the inquiry into Juukan Gorge and a expect the shares to re-rate higher to reaction of the Board and management review of the Native Title Act, we expect reflect the reduced ESG risk. to the event, we will take appropriate increased scrutiny over land access and measures which may include the full regulatory approval for future projects ESG is an integral element of the disposal of shares. which adds uncertainty to Australian investment process used to build and iron ore supply longer term. manage the portfolio. As a general In addition there will be companies approach the Company will not invest which have derated on the back Norilsk Nickel has been under in companies which have high ESG of an ESG event or generally poor significant scrutiny following an oil risks and which have no plans to ESG practices and there may be spill which saw circa 21,000t of diesel address existing deficiencies. opportunities to invest at a discounted spilled into the Arctic region. Norilsk price. However we will only invest has been ordered to pay US$1.9 billion We are also challenging the executives in these value-based opportunities in fines and damages. of the portfolio companies in which if we are satisfied that there is real we invest to set out how their current evidence that the company’s culture Vale has been under ESG scrutiny business plans are compatible has changed and that better operating following the tailings dam incidents at with achieving a net zero carbon practices have been put in place. In Samarco in 2015 and Brumadinho in emissions economy by 2050. We these cases, we will actively engage 2019. Both events have been extremely are also supporting the adoption of with management and closely monitor tragic and resulted in a heavy focus on the Task Force on Climate-related their remedial programmes. tailings dam management across the Financial Disclosures (TCFD) and the sector. Vale is committed to restoring Sustainability Accounting Standards Should a company achieve such a Brumadinho and continues to make Board (SASB) disclosures to help change, the shares can go from trading good progress rebuilding its pact bring greater focus on climate risk and at an ESG discount to more normal with society. Vale has implemented broader sustainability issues. multiples or even an ESG premium a number of changes to its tailings which will be to the benefit of the dam management process following There will be cases where a serious Company and all stakeholders. an independent review to ensure it event has occurred and in that case is aligned with the highest level of we will assess whether the company

Section 1: Overview and performance 13

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Shareholder returns price linked dividend payment policy Despite 2020 being a slightly lower which at current prices should lead year for income compared to the record to further increases in payments. In of 2019, compared with other sectors general, the year was far better than A number of it was an outstanding result. Only a feared and the outlook for 2021 looks handful of companies either cancelled particularly promising. gold producers dividend payments or deferred announced them until later in the year which is Growth and resource remarkable given the scale of economic replenishment 100% increases impact caused by global lockdowns. Just as in prior years this theme is the in dividends, The principal difference between the hardest to capture, especially when two years was the lower level of special it comes to production growth, as admittedly from dividends in 2020 which was mostly companies have remained disciplined in response to cautiousness rather in allocating capital to new projects. low levels, and a than an inability to pay. What was most Whilst this is challenging in terms handful did this pleasing was the adherence to policy of identifying exposure to growth, it on shareholder returns, as normally is extremely positive for commodity not once but twice companies would have been forced into prices due to the lack of new supply during the year. change during recessions. Dividends and even more so when the demand generally remained robust in absolute outlook is as positive as it now appears. terms as shown in the chart below. Within the data the growth seen from Within the portfolio, Anglo American gold companies has been spectacular. remains the major contributor with the highest rate of production growth A number of gold producers amongst the diversified miners, driven announced 100% increases in by new copper production coming dividends, admittedly from low levels, from the Quellaveco project in Peru and a handful did this not once but and longer term the Woodsmith twice during the year. Newmont polyhalite mine in Yorkshire. In copper, Corporation enhanced its returns First Quantum Minerals has ramped- policy by committing to a new gold up its new Cobre Panama mine and

Long-term dividend chart

25 250

20 200

15 150 pence pence 10 100

5 50

0 0 2019 1994 1995 1996 1997 1998 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2020 1999 • Revenue earnings per ordinary share • Dividends per ordinary share • Cumulative dividends (RHS)

Source: BlackRock.

14 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 is now able to use cash flow from Australian ‘Super Pit’ in Kalgoorlie from believed that by placing the royalty into higher production and better prices Newmont Corporation and Barrick a separately listed company it will allow to reduce debt to more manageable Gold back in 2019. Simplifying the the new group, called Deterra Royalties, levels. Ivanhoe Mines is on track to ownership structure should allow to diversify into other royalties. Lastly, bring its new Kamoa-Kakula mine cost saving synergies to be captured, Independence Group announced the into production by the end of the significant tax savings and the fast purchase of a stake in the Greenbushes year and ramp-up to capacity during tracking of value-added investment Lithium Mine via a holding in the joint 2022. Nevada Copper was the biggest decisions. Also, in gold, SSR Mining venture that owns half the operation. detractor from performance within and Alacer Gold combined in a merger The Company managed to buy into the the growth area, as the company of equals, once again driven by cost deal during the capital raise to fund was forced to delay their ramp-up in synergies and increasing the diversity the transaction and the shares have capacity due to COVID-19 and, as of the asset base. For the Company, risen significantly as the market rerates a result, needed to raise additional the most beneficial deal was the the combined business more akin to a debt at expensive rates and highly announced purchase of Teranga Gold higher multiple used for valuing ESG dilutive share issuance. Finally, the by Endeavour Mining. The Company sustainable companies from the lower Company continued to support Nickel bought its exposure in Teranga Gold multiples normally applying to mining Mines as it raised capital to further in December 2019 when the business companies. grow production through exposure sought finance for the purchase of the to additional production lines in Massawa gold project from Barrick Base metals Indonesia. Since the Company first Gold. Since then, the shares have risen The rerating of base metal prices supported Nickel Mines at its IPO in almost threefold and the ability to since the virus-hit lows of March August 2018, the shares have risen by retain ongoing exposure to the assets has been exceptional, with all base 2.5x and, in addition, the company paid through a holding in Endeavour Mining metal prices finishing the year higher. an inaugural dividend in July 2020. means additional value can accrue to However, with the exception of copper, the Company over time. it is worth noting that average prices The other source of growth for were actually lower on a year-on-year companies is mergers and acquisitions Outside of gold there were some basis reflecting the steep COVID-19 (M&A) activity, but this has also been smaller deals that impacted the drawdown in March. As we have seen constrained by the sector’s focus on portfolio. First, the sell down by in similar demand shock periods, capital discipline. Gold has been the Sheffield Resources in its Thunderbird financial investors used the base busiest area over the last few years Mineral Sands Project to Yansteel. This metals forward markets to express a and this continued in 2020 where the should see the project move forward negative view on the global economy. largest transaction was the merger by unblocking the financing hurdle Much of the price rally can be explained between Northern Star Resources and that faced Sheffield Resources. Also, in by the broad-based pick-up in end Saracen Mineral Holdings. Key to this Australia, Iluka Resources completed demand. However, there were a number deal was the fact that each company the demerger of its MAC iron ore of other factors which intensified the bought a fifty percent stake in the royalty into a new listed company. It is

• UK dividends • Overseas dividends • Special dividends • Fixed income securities • Royalty • Option premium • Income from • Other Vale debentures

Source: BlackRock.

Section 1: Overview and performance 15

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Table 2 – Selected commodity price changes during 2020 Price % Change % Change Avg 31/12/2020 12 month 2020 vs. 2019 Precious Metals US$/oz Silver 26.5 47.2 26.6 Gold 1,897.8 24.8 27.1 Platinum 1,075.0 10.7 2.4 Palladium 2,370.0 23.4 42.5

Base Metals US$/lb Tin 9.3 19.6 -8.0 Zinc 1.2 19.7 -11.0 Lead 0.9 10.8 -8.6 Aluminium 0.9 10.8 -5.0 Copper 3.5 26.0 2.9 Nickel 7.5 18.7 -0.7

Industrial Commodities Coking Coal US$/t 101.4 -25.4 -29.5 Thermal Coal US$/t Newcastle 80.5 18.9 -22.8 Iron Ore - fines 62% Fe China Import US$/t 161.0 73.1 16.3 Uranium US$/lb 30.0 20.0 13.6 Lithium Carbonate CIF to China spot 99% US$/t 7,430.4 31.0 -36.6

Sources: Datastream and Bloomberg.

rally such as COVID-19 related supply annum. We view copper as a clear production and OZ Minerals which has impacts, a collapse in scrap collection, beneficiary from decarbonisation exceeded expectations at its newest speculative inflow into commodities spending, which is a key multi-decade asset Carrapateena and continues and green related stimulus packages theme for the sector. Copper supply to extract value at Prominent Hill. As benefiting copper in particular. fundamentals also remain supportive we look into 2021, Ivanhoe Mines will with production impacted in key move from developer to producer at the Copper, the standout base metal regions such as Peru and Chile, growth world-class Kamoa-Kakula project and in 2020, led the recovery. Its price projects delayed by 12 to 24 months we are set to receive higher dividend bottomed at US$2.10/lb in March and scrap underperforming. We have payments from Cerro Verde. but subsequently rallied circa 70% previously talked about the long-term to finish the year at US$3.53/lb, a supply challenges the copper industry The other base metal that the Company price level not seen since 2013, with faces and, given the acceleration in has significant exposure to is nickel the market benefiting from strong green-related demand, we continue to which saw its price rise by 18.7% in Chinese imports for investment into remain positive on the commodity. 2020. The nickel market has been in the state grid, property and strategic surplus for much of 2020. However, it stockpiling, a feature we have not seen The Company has a very large exposure tightened in Q4 as Chinese stainless in the market for a number of years. to copper which represented 19.2% steel demand recovered along with the This surge in demand saw the copper of the portfolio at the year-end and rest of the world. A striking feature of the market move into a deficit by year end, was the key driver of performance in nickel market has been the rapid growth with investors beginning to reassess 2020. Standout performers included in nickel pig iron (NPI) production the longer-term demand picture as Freeport-McMoRan which has seen from Indonesia, which has overtaken governments prioritise ‘green-related’ a sharp inflection in free cash flow China as the largest producer of NPI stimulus into renewables, electric as the Grasberg underground mine globally. The Company has directly vehicles and the grid which has the ramps-up, First Quantum Minerals benefited from this via its investment potential to see medium-term copper which is rapidly deleveraging as its in Nickel Mines, an Australian listed demand increase by 3% to 5% per flagship Cobre Panama mine increases nickel producer, that owns three

16 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 nickel projects in Indonesia which are to see a moderation in steel demand to increase its use of scrap steel. operated under an agreement with during the second half of 2021 as policy Market commentators have talked Tsingshan. Nickel Mines has been a stimulus is phased out. However, we still about a ‘stronger for longer’ iron ore remarkable investment for the Company expect China’s steel output to remain market which seems plausible and with attributable production to grow strong with the iron ore market to be in underpins a strong dividend outlook from zero to circa 50ktpa Ni in under deficit again in 2021. for the major producers. However, five years since the IPO of the company the last two years of elevated iron in 2018. Supply disruption was a key feature ore prices have incentivised new of the iron ore market in 2020. This production into the market. The world Bulk commodities was largely centred on Brazil which class Simandou iron ore project has Iron ore was the standout commodity saw Vale miss the mid-point of its received approval from the Guinean during 2020, with the price rallying original 2020 guidance by over 40Mt, government to be developed by a more than 70% to finish the year at as operations were initially hampered China led consortium. Despite the high US$161/t. It was a perfect storm for the by excessive rainfall and then by capital intensity of the asset due to the iron ore market which saw record steel COVID-19. The Australian iron ore associated infrastructure development, demand in China, coupled with ongoing producers performed far better with Simandou offers strategic benefits to supply issues in Brazil. Following the BHP, Rio Tinto and Fortescue Metals China reducing their dependency on tragic Brumadinho tailings dam incident Group seeing minimal operational Australian iron ore and also providing at the beginning of 2019, the iron ore impact from COVID-19. However, them with another source of high- market has significantly tightened with supply risks have risen following the grade supply. The ultimate outcome the price more than doubling. This Australian parliamentary inquiry into of these additional projects coming to tightness was intensified during 2020 the destruction of Juukan Gorge and the market is likely to result in a larger with China surpassing expectations in the review of the Native Title Act in oversupply of iron ore once China’s ramping its steel production back above Australia. This has the potential to force steel production starts to moderate pre-COVID-19 levels by the middle of changes to current and future mine longer term. the year, as the government increased approvals, consequently impacting infrastructure investment and eased production and capital expenditure for The Company has benefited from the the property sector in an effort to the Australian iron ore producers. high level of iron ore prices during support the economy. China’s overall 2020 through its exposure to BHP, steel output grew by 5% in 2020 to We would expect supply tightness to Rio Tinto, Vale (both equity and the 1.05Bt and is poised to remain strong begin to ease from the end of 2021, Debentures), Fortescue Metals Group during 2021, underpinned by existing as Vale continues to bring tonnes and Labrador Iron. These producers infrastructure projects. We would expect into the market and China looks are enjoying record margins given the

China vs Australia coking coal price

225 HCC cfr China HCC fob Aus

200

175

150

125

100

75 Apr 19 Jan 19 Jul 19 Oct 19 Jan 20 Apr 20 Jul 20 Oct 20 Dec 20 Source: Morgan Stanley.

Section 1: Overview and performance 17

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 decline in their operating cost base Teck Resources has lagged the sector An encouraging feature of the gold since the last peak in the iron ore year-to-date given reduced coking equity market in recent years has been price and have returned a significant coal demand in Europe, as well as the the increased focus on shareholder proportion of free cash flow in dramatic fall in the oil price which has returns, with higher gold prices dividends. Given our expectation of impacted Fort Hills, its Canadian oil translating into higher margins another robust year for the iron ore sands asset. With Teck Resources able and dividends. The gold sector has market, we expect another strong year to take advantage of the strong coking generated decent returns in recent for shareholder returns in 2021. coal price in China and the better years with balance sheets deleveraged oil price outlook, we are looking for and growth projects rationalised, which Coking coal is another key steel raw improved performance in 2021. has seen several companies materially material but unlike iron ore the price raise dividends during 2020. Key was down 25% in 2020. Coking coal Precious metals dividend increases for the Company has been a casualty of the Australia- 2020 was a stellar year for the precious include Newmont Corporation with a China trade dispute, with China placing metals with a new all-time high gold 79% dividend increase announced at an informal ban on Australian coal price set at US$2,064/oz in August. the beginning of the year which was imports leaving circa 30% of Australia’s Gold and silver prices were up 25% and supplemented by a new gold-linked metallurgical coking coal looking for 47% respectively which follows strong dividend policy, Barrick Gold increasing a new home. A two-tier market has performance for both commodities in its quarterly dividend by 80% and developed between the landed China 2019. The huge expansion in central B2Gold by 100%. Given the continued seaborne price which is trading at a bank balance sheets, as governments strength in the gold price and the US$75/t premium to the equivalent adopted a ‘whatever it takes’ approach increased dividend commitment from quality of coking coal from Australia. in response to COVID-19, has seen a the sector, we look forward to further While there has been some rebalancing collapse in rates globally with the US dividend growth in 2021. of trade flows with Canada and Russia 10 year real rate moving into negative looking to fill the supply void, however, territory in 2020. This, combined with The last few years have been a busy given the scale of the deficit, we would the US Federal Reserve moving to an period for M&A in the gold sector. The expect that China will allow imports average inflation target and willing to end of 2018 saw the merger of Barrick from Australia again over the course tolerate periods of higher inflation, we Gold and Randgold Resources followed of 2021. believe has opened the door for real quickly by the takeover of Goldcorp by rates to reach never previously seen low Newmont Corporation. This was then The Company’s coking coal holdings levels and a new higher trading range followed by the merger of Barrick Gold include Teck Resources and BHP. to be established for gold. and Newmont Corporation’s Nevada

Gross margins on gold prices

900

800

700

600

500

US$/oz 400

300

200

100

0 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020

Average gold price minus average all-in sustaining cost.

Sources: Datastream and World Gold Council.

18 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Remote underground mining operators at Freeport-McMoRan’s Grasberg Block Cave mine in Papua, Indonesia. The company saw a sharp inflection in free cash flow during the year as production at Grasberg ramped up. PHOTO COURTESY OF FREEPORT-MCMORAN

gold assets to create a massive market- to remain positive on the PGM space Anglo American Platinum and Norilsk leading US gold business. The gold and believe the PGM basket will Nickel (1.1% of the portfolio). M&A market has been more subdued remain high relative to history given in 2020, the most notable transaction limited new supply projects, increasing Royalties and illiquid being the merger between Northern PGM loadings for auto catalysts to investments Star Resources and Saracen Mineral meet emissions standards and a The Company currently has one Holdings, its Joint Venture partner in sustained global auto recovery. In unquoted investment, the OZ Minerals the Kalgoorlie ‘Super Pit’. Northern Star terms of supply, a combination of Brazil Royalty, representing 1.9% of Resources has a proven track record Anglo American Platinum’s converter the portfolio as at the end of December of value creation from M&A where it failure and South Africa’s COVID-19 2020. The Company has an additional has grown from a single asset, 100koz lockdowns, saw 2020 refined platinum royalty investment, Vale Shareholder producer in 2010, to today being over a and palladium supply fall by 22% and Debentures, representing 4.1% of the 1Moz producer. 24% respectively. In the year ahead, portfolio. The latter is technically listed the PGMs we see as particularly in Brazil but due to the limited liquidity Other notable contributors to strong are palladium, with the market it is covered in this section. Together performance this year include forecast to remain in deficit in 2021 the two royalty investments make up Newmont Corporation which offers and rhodium the less talked about PGM 6.0% of the portfolio. These, and any the most attractive dividend yield which is seeing increasing demand to future investments, will be managed of the senior producers, Wheaton meet Nitrogen Oxide (NOx) emission in line with the guidelines set by the Precious Metals which benefited standards. The move in the rhodium Board as outlined to shareholders in from the strong increase in the silver price in 2020 has been nothing short the Strategic Report. price which is seeing rising industrial of spectacular at +280%. The Company demand via increased solar investment has continued to increase its pure and our exposure to the Russian gold play PGM exposure via its holdings in OZ Minerals Brazil Royalty producers, Polyus and Polymetal Impala Platinum, Northam Platinum Contract (1.9% of the International. and Sibanye Stillwater, which combined portfolio) equated to 4.7% of the portfolio at In July 2014 the Company signed a The PGMs continued their strong the end of December. In addition, the binding royalty agreement with Avanco performance in 2020 with the Company also has exposure to PGMs Minerals. The Company provided palladium and platinum price up 23% via its holding in Anglo American (7.2% US$12 million in return for a Net and 11% respectively. We continue of the portfolio) which owns 79% of Smelter Return (net revenue after

Section 1: Overview and performance 19

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 deductions for freight, smelter and asset in Brazil and is expected to to commodity prices, has resulted in refining charges) royalty payments produce more than twice the amount a valuation of £19.8 million for the comprising 2% on copper, 25% on gold of copper and gold production per year royalty which has been approved by and 2% on all other metals produced than the existing Antas Mine. Mining the Directors after considering the from mines built on Avanco’s Antas at Antas is scheduled to cease during independent valuation of the Royalty North and Pedra Branca licences. In 2021, after which ore from Pedra carried out by SRK Consulting (UK) addition, there is a flat 2% royalty over Branca will be processed through the Limited. all metals produced from any other existing facilities, making Pedra Branca discoveries within Avanco’s licence area a lower risk, capital light development Vale shareholder debentures as at the time of the agreement. project. Despite the challenges of In early 2019 the Company completed operating in Brazil during COVID-19, a transaction to increase its holding in In 2018 Avanco was acquired by OZ we are pleased to report that the first the Vale Shareholder Debentures. The Minerals an Australian based copper development ore from Pedra Branca Vale Debentures consist of a 1.8% net and gold producer for A$418 million, was trucked to the Carajas Antas hub revenue royalty over Vale’s Northern with the royalty now assumed by OZ during the September quarter, leaving System and Southeastern System Minerals. Since our initial US$12 million the asset well-positioned to ramp-up iron ore assets in Brazil, as well as a investment was made, we have received production during the first half of 2021. 1.25% royalty over the Sossego copper US$15.1 million in royalty payments, mine. The iron ore assets are world with the royalty achieving full payback From a valuation perspective, the class given their grade, cost position, on the initial investment. As at the end discount rate applied to Pedra Branca infrastructure and resource life which is of December 2020, the royalty was has been moved to a level that reflects well in excess of 50 years. Prior to this valued at £19.8m (1.9% of the portfolio) the project moving from development transaction, the Company had a 0.5% which equates to a 251.1% total return status to production. In addition, position in these securities versus the since our investment. with the increasing amount of royalty current level of 4.1%. revenue being generated from gold In November 2019 OZ Minerals in line with the increase in the gold The iron ore market has significantly approved the development of the price, we have in part reflected a tightened since Vale’s tragic tailings Pedra Branca underground mine and lower discount rate applied to gold dam accident at the beginning of released a feasibility study and mine royalties, in line with how the market 2019 which saw the iron ore price rally plan detailing an eight-year life of mine. prices precious metals royalties. over 30%. This was further intensified This is OZ Minerals’ second operating This, in addition to minor changes

Distribution on Vale shareholders’ debentures

1.4

1.2

1.0

0.8

0.6

0.4 Distribution rate per debenture (R$)

0.2

0.0 2H12 1H13 2H13 1H14 2H14 1H15 2H15 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20

Source: Vale.

20 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 in 2020, with Vale failing to meet its System, with the Vale Debentures been a low level of liquidity in the annual production guidance due to currently only making royalty payments Debentures and price volatility is to severe rains in the first half of the from the Northern System. be expected. Since the acquisition in year, as well as COVID-19 related February 2019 the Debentures have operating challenges. These supply The chart on the previous page shows paid out a total of R4.56/debenture issues combined with record steel the historic distributions paid by Vale resulting in a 20% distribution return demand in China, saw the iron ore price to the owners of the Debentures and in two years. The securities were priced increase by more than 70% in 2020. in 2020 this amounted to US$2.3 at R48.2/debenture at the end of 2020 The Debentures have directly benefited million for the Company. The payments versus a price of R23 when the holding from the move higher in the iron ore are expected to grow further once was last added to. price with the Company enjoying royalty payments commence on the increasing distributions as shown in Southeastern System in 2024 and We continue to actively look for the chart on the previous page. Vale volumes from the newly commissioned opportunities to grow royalty exposure is expected to spend US$13 billion iron ore project S11D continue to given it is a key differentiator of restoring the communities and ramp-up. Vale is looking to further the Company and an effective environment impacted by the increase production from the Northern mechanism to lock-in long-term Brumadinho incident between 2019 System from 206mtpa today to income, which further diversifies the and 2030. However, it is important 260mtpa longer term which provides Company’s revenues. to note that this cost is not borne by additional upside to our original the Debentures as they are a revenue expectations for the Debentures. Fixed income securities royalty with payments directly linked The Company continues to have a to the iron ore price which appreciated Whilst the Vale Debentures are a small but decreasing proportion of during the first half of 2020. It is royalty, they are also a listed security the portfolio allocated to fixed income also important to highlight that the on the Brazilian National Debentures securities, due to the ongoing decline operations impacted by the incident System. However, shareholders should in interest rates leaving the arbitrage are in the Southern and Southeastern be aware that historically there has return net of tax less attractive than

Iron ore producer Fortescue Metals Group opened its innovative ‘Fortescue Hive’ Integrated Operations Centre (IOC) in Perth, Western Australia, in June. The technologically-advanced facility enables the consolidated management of the entire mine to market supply chain, linking exploration, mining, transport and marketing teams. PHOTO COURTESY OF FORTESCUE METALS GROUP

Section 1: Overview and performance 21

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 alternative investments. At the end 2020, the Company had debt net of As always there are risks to the of the year 4.2% of the portfolio was group cash amounting £114.8 million outlook and we are well aware that invested in fixed income securities. representing gearing of 12.3%. margins are elevated, especially for Outside of the decline in interest Over the last few years, the amount producers of iron ore where these are rates, the ongoing improvement in of gearing allocated against higher well above historic levels. Given the corporate balance sheets meant both yielding mining company corporate mean reverting nature of commodity repayment of expiring bonds and bonds has declined due to increased markets, these will at some point limited new issuance further reduced returns available through the equities contract despite ongoing supply the opportunities available in the as well as reduced availability of bonds side issues and better than expected market. If current conditions continue that meet our valuation criteria. For demand from steel producers. In then revenue from this area will decline 2020 the majority of the Company’s addition, the pressure on management further, but it is hoped that this will be debt was once again hedged against to spend money on growth projects covered by increases from other areas the fixed income portfolio and is at its greatest when balance sheets such as ordinary dividends. During the royalty positions. are strong, metal prices are high and year one new holding was added to demand is rising. We hope that any this part of the portfolio, ArcelorMittal Outlook and strategy for investment decisions are thoroughly Mandatory Convertible Notes (MCNs) 2021 reviewed to limit the chances of value purchased as part of a capital raising destroying history repeating itself. This time last year we made the during the summer. Returns on this following bold statement: ‘After the investment have been spectacular so In summary, we believe that with the strong returns generated during the far given the recovery in steel markets demand outlook so strong there could year it might seem foolish to expect and it is hoped that, with the underlying be a few years of positive total returns another year of competitive total company now committed to stepping ahead given how long it takes for new returns for the mining sector in 2020 up shareholder returns, income from supply to come into production. The but with macro risks seemingly on the the MCNs will rise in 2021. As ever, we goal for the Company continues to turn for the better this might easily play continue to look for new deals but with a be to deliver a superior total return out’. With the benefit of hindsight, it is very strict focus on return versus quality. for shareholders through the cycle clear that whilst our forecast of strong from a combination of capital growth returns played out, we never expected and a premium yield to that generally Derivatives activity the scale of disruption caused by the available from the mining sector and The Company from time to time enters COVID-19 pandemic. This leads us to to keep generating competitive returns into derivatives contracts, mostly the often used quote from Mark Twain compared to world markets. involving the sale of ‘puts’ and ‘calls’. ‘it is difficult to make predictions, These are taken to revenue and are particularly about the future’ so this subject to strict Board guidelines year we will limit our forecast to that Evy Hambro and Olivia Markham BlackRock Investment Management which limit their magnitude to an of another strong year of expected (UK) Limited aggregate 10% of the portfolio. During returns without linking it to seemingly 4 March 2021 2020 income generated from options unforecastable macro events. was £8.8 million net of contracts repurchased. This is higher than in Our confidence on returns comes from the last couple of years, as the spike two areas: strong corporate outlook and in volatility during the peak of the commodity market imbalances. The pandemic presented a range of great former is based on the robust balance opportunities to monetise premiums. sheets, higher profit margins and The majority of options expired out of five-year track record of shareholder the money as options were written with return discipline. The combination of short lives and share prices rapidly all of these gives us conviction when recovered from the pandemic low point. expecting companies to do the right Given the spike in volatility during thing for shareholders when faced the year, it is unlikely that this will be with windfall gains from better than repeated in 2021 and therefore income expected market conditions. With from options is likely to be lower. At the regard to the latter, as mentioned end of 2020 the Company had 2.6% of earlier in the report, the expected the net assets exposed to derivatives. pick-up in fiscal spending around the world is set to drive commodity Gearing demand growth to levels above that of Debt, which can be drawn down or the last decade or longer. In addition, repaid at any time, is used in the the underinvestment into supply over portfolio to take tactical advantage of the last five years or more means that market volatility and opportunities, as industrial commodity prices should be well as enhance overall returns over the well supported in 2021. medium to long term. At 31 December

22 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Vale was the portfolio’s largest holding at the end of the period under review. The company is the world’s largest producer of iron ore, the standout commodity during 2020 as its price rallied more than 70%. PHOTO COURTESY OF RICARDO TELES/VALE

Section 2: Portfolio 25

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 1

2 3 4

5 6 7

8 9 10

26 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

1 Vale1, 2 (2019: 3rd) Diversified mining group Market value: £114,280,000 Share of investments: 10.9% (2019: 8.6%) One of the largest mining groups in the world, with operations in 30 countries. Vale is the world’s largest producer of iron ore and iron ore pellets, and the world’s largest producer of nickel. The group also produces manganese ore, ferroalloys, metallurgical coal, copper, platinum group metals, gold, silver and cobalt.

2 BHP3 (2019: 1st) Diversified mining group Market value: £79,817,000 Share of investments: 7.6% (2019: 9.7%) The world’s largest diversified mining group by market capitalisation. The group is an important global player in a number of commodities including iron ore, copper, metallurgical coal, manganese, nickel, silver and diamonds. The group also has significant interests in oil, gas and liquefied natural gas.

3 Rio Tinto3 (2019: 2nd) Diversified mining group Market value: £77,724,000 Share of investments: 7.5% (2019: 9.3%) One of the world’s leading mining groups. The group’s primary product is iron ore, but it also produces aluminium, copper, diamonds, gold, industrial minerals and energy products.

Section 2: Portfolio 27

4 Anglo American (2019: 4th) 8 Wheaton Precious Metals (2019: 9th) Diversified mining group Precious metals streaming group Market value: £75,031,000 Market value: £34,374,000 Share of investments: 7.2% (2019: 6.1%) Share of investments: 3.3% (2019: 3.7%) A global mining group. The group’s mining portfolio includes A precious metals streaming group. The group purchases bulk commodities including iron ore, manganese, and silver and gold production from mines that it does not own metallurgical coal, base metals including copper and nickel and operate. The group has streaming agreements with 22 and precious metals and minerals including platinum and operating mines worldwide including Newmont’s Penasquito, diamonds. The group has mining operations globally, with HudBay’s Constancia and Vale’s Salobo and Sudbury mines. significant assets in Africa and South America.

9 OZ Minerals2,4 (2019: 10th) 5 Freeport-McMoRan (2019: 16th) Copper producer Copper producer Market value: £33,544,000 Market value: £54,595,000 Share of investments: 3.2% (2019: 3.3%) Share of investments: 5.2% (2019: 2.2%) An Australian based mining company, with a primary focus A global mining group which operates large, long-lived, on copper. The company owns and operates the high quality geographically diverse assets with significant proven and Prominent Hill copper-gold mine and the Carrapateena probable reserves of copper, gold and molybdenum. copper-gold project, both situated in South Australia. In 2018 OZ Minerals successfully acquired Avanco Resources, with the Company’s royalty assumed by OZ Minerals.

6 Newmont Corporation (2019: 6th) Gold producer 10 First Quantum Minerals1 (2019: 7th) Market value: £46,903,000 Copper producer Share of investments: 4.5% (2019: 4.4%) Market value: £29,954,000 Following the acquisition of Goldcorp in the first half of 2019, Share of investments: 2.9% (2019: 4.2%) Newmont is the world’s largest gold producer by market capitalisation. The group has gold and copper operations on An established growing copper mining group operating five continents, with active gold mines in Nevada, Australia, seven mines including the ramp-up of their newest mine, Ghana, Peru and Suriname. Cobre Panama, which declared commercial production in September 2019. The group is a significant copper producer and also produces nickel, gold and zinc.

7 Barrick Gold (2019: 5th) Gold producer 1 Includes fixed income securities. 2 Includes investments held at Directors’ valuation. Market value: £43,339,000 3 Includes options. Share of investments: 4.1% (2019: 4.4%) 4 Includes mining royalty contract. Following the merger with Randgold Resources in 2018, Barrick Gold is the second largest gold producer by market All percentages reflect the value of the holding as a capitalisation and has operations and projects in 15 percentage of total investments. For this purpose, where countries across the world. In 2019, the group successfully more than one class of securities is held, these have been established a joint venture with Newmont across their aggregated. Nevada assets to maximize the synergies across both sets of assets. Together, the ten largest investments represented 56.4% of total investments of the Company’s portfolio as at 31 December 2020 (ten largest investments as at 31 December 2019: 57.4%).

28 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Main Market geographical value % of exposure £’000 investments Diversified Vale Global 70,917 6.8 Vale 0% Debentures*# Global 43,363 4.1 BHP Global 79,980 7.6 BHP Put Option 15/01/21 £19 Global (163) – Rio Tinto Global 78,148 7.5 Rio Tinto Call Option 15/01/21 £54 Global (424) – Anglo American Global 75,031 7.2 Teck Resources Global 23,077 2.2 Glencore Global 17,540 1.7 Independence Group Australasia 1,006 0.1 388,475 37.2 Gold Newmont Corporation Global 46,903 4.5 Barrick Gold Global 43,339 4.1 Wheaton Precious Metals Global 34,374 3.3 Northern Star Resources Australasia 22,504 2.2 Franco-Nevada Global 21,992 2.1 Kinross Gold Global 13,521 1.3 Polymetal International United Kingdom 13,289 1.3 Polyus Russia 11,462 1.1 Teranga Gold Canada 8,934 0.9 Agnico Eagle Mines Canada 8,175 0.8 B2Gold Canada 7,812 0.7 Kirkland Lake Gold Australasia 6,041 0.6 Gold Fields South Africa 5,654 0.5 Alamos Gold Latin America 4,805 0.5 Evolution Mining Global 3,524 0.3 Shanta Gold Convertible* Other Africa 1,313 0.1 253,642 24.3

Section 2: Portfolio 29

Main Market geographical value % of exposure £’000 investments Copper Freeport-McMoRan Global 54,595 5.2 OZ Minerals Brazil Royalty#~ Latin America 19,753 1.9 OZ Minerals Australasia 13,791 1.3 First Quantum Minerals* Global 29,954 2.9 Sociedad Minera Cerro Verde Latin America 23,358 2.2 Lundin Mining Global 16,496 1.6 Ivanhoe Mines Other Africa 15,204 1.5 Antofagasta Latin America 9,446 0.9 Ero Copper Latin America 9,372 0.9 SolGold Latin America 4,298 0.4 Nevada Copper United States 2,463 0.2 Solaris Resources# Latin America 2,405 0.2 201,135 19.2 Iron Ore Fortescue Metals Group Australasia 28,793 2.8 Labrador Iron Canada 28,738 2.7 Deterra Royalties Australasia 5,424 0.5 Equatorial Resources Other Africa 499 – 63,454 6.0 Platinum Group Metals Northam Platinum South Africa 17,032 1.6 Impala Platinum South Africa 16,966 1.6 Sibanye Stillwater South Africa 15,255 1.5 49,253 4.7 Steel ArcelorMittal* Global 25,770 2.5 Steel Dynamics United States 9,286 0.9 35,056 3.4 Nickel Nickel Mines Indonesia 16,223 1.6 Norilsk Nickel United Kingdom 11,163 1.1 Bindura Nickel Other Africa 106 – 27,492 2.7 Industrial Minerals Lynas Corporation Australasia 7,823 0.7 Iluka Resources Australasia 7,369 0.7 Sheffield Resources Australasia 4,203 0.4 19,395 1.8

30 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Main Market geographical value % of exposure £’000 investments Zinc Titan Mining+# United States 3,396 0.3 3,396 0.3 Silver & Diamonds Sierra Metals Latin America 3,325 0.3 3,325 0.3 Aluminium Metro Mining Australasia 608 0.1 608 0.1 1,045,231 100.0 Comprising – Investments 1,045,818 100.1 – Written options (587) (0.1) 1,045,231 100.0

* Includes fixed income securities. # Includes investments held at Directors’ valuation. ~ Mining royalty contract. + Includes warrant investments.

All investments are in equity shares unless otherwise stated. The total number of investments as at 31 December 2020 (including options classified as liabilities on the balance sheet) was 56 (31 December 2019: 65).

As at 31 December 2020 the Company held equity interests in two companies comprising more than 3% of a company’s share capital as follows: Sheffield Resources and Titan Mining.

Section 2: Portfolio 31

Commodity Exposure1

0.0% Other 2.0% 0.3%

0.0% Coal 0.5% 0.0%

0.1% Aluminium 0.2% 2.1% • 2020 Company portfolio 0.3% 2019# Company portfolio Silver & Diamonds 5.8% • 1.8% • 2020 Reference Index*

0.3% Zinc 0.1% 0.4%

1.8% Industrial Minerals 4.6% 0.3%

2.7% Nickel 2.6% 2.3%

4.7% Platinum Group Metals 0.0% 2.2%

3.4% Steel 0.0% 15.6%

6.0% Iron Ore 1.2% 4.2%

19.2% Copper 17.9% 10.0%

24.3% Gold 23.2% 28.6%

37.2% Diversified 41.9% 32.2% 0 10 20 30 40 50 1 Based on index classifications. # Represents exposure at 31 December 2019. * MSCI ACWI Metals & Mining 30% Buffer 10/40 Index.

32 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

2020 2019 • Global 64.9% • Global 63.8% • Australasia 9.4% • Latin America 13.0% • Latin America 7.3% • Canada 7.3% • Other3 6.5% • Australasia 6.5% • South Africa 5.2% • Other4 5.4% • Canada 5.1% • South Africa 2.2% • Other Africa • Other Africa (ex South Africa) 1.6% (ex South Africa) 1.8%

2 Based on the principal commodity exposure and place of operation of each investment. 3 Consists of Indonesia, Russia, United Kingdom and United States. 4 Consists of Indonesia, Kazakhstan, Russia, Sweden, United Kingdom and United States.

Section 2: Portfolio 33

BHP, the world’s largest diversified mining group by market capitalisation, committed to reduce its scope 1 & 2 emissions by 30% by 2030 and is looking to achieve carbon neutrality for its own operations by 2040. PHOTO COURTESY OF BHP

Section 3: Governance 35

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2019 T: 0207 055 6500 F: 020 7055 6600 Governance structure

Responsibility for good governance lies with the Board. The governance framework of the Company reflects the fact that as an investment company the Company has no employees, the Directors are all non- executive and investment management and administration functions are outsourced to the Manager and other external service providers.

Five non-executive Directors (NEDs), all independent of the Manager

Chairman: David Cheyne (since 2 May 2019)

Objectives: • T o determine the Company’s strategy including investment policy and investment guidelines; • T o provide leadership within a framework of prudent and effective controls which enable risk to be assessed and managed and the Company’s assets to be safeguarded; • T o challenge constructively and scrutinise performance of all outsourced The Board activities; and 5 scheduled meetings per annum • To determine the Company’s remuneration policy.

Membership: All NEDs excluding the Chairman of the Board

Chairman: Russell Edey

Key objectives: • T o oversee financial reporting; • T o consider the adequacy of the control environment and review the Company’s risk register; • T o review the reporting of the auditors and form an opinion on the effectiveness of the external audit process; • To review the provisions relating to whistleblowing and fraud; • T o ensure that the provisions of the investment management agreement follow industry practice, remain competitive and are in the best interests of Audit & Management shareholders; Engagement Committee • To review the performance of the Manager and Investment Manager; and 2 scheduled meetings per annum • To review other service providers.

Membership: All NEDs

Key objectives: • T o review regularly the Board’s structure and composition; Nomination Committee • To be responsible for Board succession planning; and 1 scheduled meeting per annum • To make recommendations for any new appointments.

36 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 41869 Proof Event: 16 Black Line Level: 5 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2019 T: 0207 055 6500 F: 020 7055 6600 Directors’ biographies

David Cheyne Russell Edey Jane Lewis Chairman Chairman of the Audit & Management Appointed 28 April 2016 Appointed 1 June 2012 Engagement Committee and Senior Independent Director Appointed 8 May 2014

David Cheyne is a senior adviser to Russell Edey is a non-executive Jane Lewis is an investment trust Akira Partners LLP and a trustee of director of Genesis Emerging Markets specialist who, until August 2013, was the RAF Benevolent Fund and Stowe Fund Limited and a co-opted member a director of corporate finance and School Foundation. He retired as a of the Essex Community Foundation. broking at Winterflood Investment consultant at Linklaters on 31 July He retired as chairman of Avocet Trusts. Prior to this she worked at 2015 where he was senior partner from Mining PLC in March 2018 having Henderson Global Investors and 2006 to 2011 and a partner from 1980. been on the board since 2010, served Gartmore Investment Management Throughout his career at Linklaters he as a non-executive director of Old Limited in investment trust business played a central role in a wide range Mutual PLC from June 2004 to May development and at West LB Panmure of corporate transactions, including 2013 and retired as chairman of as an investment trust broker. She M&A deals, joint ventures, flotations AngloGold Ashanti Limited in May is chairman of Invesco Perpetual UK and general corporate finance work. In 2010 having been a member of that Smaller Companies Investment Trust particular, he advised on a number of company’s board since 1998. In June plc and a non-executive director of large mining transactions. He was also 2014 he retired as a non-executive BMO Capital and Income Investment vice chairman of Europe, Middle East director of several companies in the Trust plc, The Scottish Investment Trust and Africa at Moelis & Company from Rothschild Group which he joined in plc and Majedie Investments PLC. 2011 to 2015. 1977. Prior to that, he worked for Anglo American Corporation of South Africa Limited in South Africa and Australia. Attendance record: Attendance record: Board: 5/5 Board: 5/5 Audit & Management Engagement Audit & Management Engagement Attendance record: Committee: 2/2 Committee: 2/2 Board: 5/5 Audit & Management Engagement Committee: 2/2

Section 3: Governance 37

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2019 T: 0207 055 6500 F: 020 7055 6600

Judith Mosely Ollie Oliveira Appointed 19 August 2014 Appointed 3 February 2020

Judith Mosely is a non-executive Ollie Oliveira is a chartered accountant, director of Galiano Gold Inc., Eldorado chartered management accountant Gold Corp. and Women in Mining and economist with over 35 years of (UK). She is also a trustee of the strategic and operating experience Camborne School of Mines Trust and in the mining industry and corporate a consultant with Northcott Capital, a finance. He is currently senior financial advisory firm specialising in independent director of Antofagasta debt finance in the mining and power plc and Polymetal International plc. sectors. She was previously Business He previously held senior executive Development Director for Rand positions within the Anglo American Merchant Bank and head of the mining group, including executive director finance team at Société Générale in corporate finance and head of strategy London. and business development of De Beers Consolidated Mines Ltd, De Beers Centenary AG and De Beers SA Attendance record: and a director of Dominion Diamond Board: 5/5 Corporation. Audit & Management Engagement Committee: 2/2 Attendance record: Board: 5/5 Audit & Management Engagement Committee: 2/2

None of the Directors has a service contract with the Company. The terms of their appointment are detailed in a letter sent to them when they joined the Board. These letters are available for inspection at the registered office of the Company and will be available at the Annual General Meeting.

38 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600

Strategic report

The Directors present the Strategic Report of the Company The management of the investment portfolio and the for the year ended 31 December 2020. The aim of the administration of the Company have been contractually Strategic Report is to provide shareholders with the delegated to the Manager who in turn (with the permission information to assess how the Directors have performed of the Company) has delegated certain investment their duty to promote the success of the Company for the management and other ancillary services to BlackRock collective benefit of shareholders. Investment Management (UK) Limited (the Investment Manager). The Manager, operating under guidelines The Chairman’s Statement together with the Investment determined by the Board, has direct responsibility for the Manager’s Report form part of this Strategic Report. The decisions relating to the day-to-day running of the Company Strategic Report was approved by the Board at its meeting on and is accountable to the Board for the investment, financial 4 March 2021. and operating performance of the Company.

Principal activities The Company delegates fund accounting services to the The Company carries on business as an investment trust Investment Manager, which in turn sub-delegates these and has a premium listing on the London Stock Exchange. services to The Bank of New York Mellon (International) Its principal activity is portfolio investment and that of its Limited (BNYM) (the Fund Accountant) and also subsidiary, BlackRock World Mining Investment Company sub-delegates registration services to the Registrar, Limited (together the Group), is investment dealing. Computershare Investor Services PLC. Other service providers include the Depositary (also BNYM). Details of the Investment trusts are pooled investment vehicles which allow contractual terms with these service providers and more exposure to a diversified range of assets through a single details of sub-delegation arrangements in place governing investment, thus spreading investment risk. custody services are set out in the Directors’ Report.

Objective Investment policy The Company’s objective is to maximise total returns to The Company’s investment policy is to provide a diversified shareholders through a worldwide portfolio of mining and investment in mining and metal securities worldwide. While metal securities. The Board recognises the importance of the policy is to invest principally in quoted securities, the dividends to shareholders in achieving that objective, in Company’s investment policy includes investing in royalties addition to capital returns. derived from the production of metals and minerals as well as physical metals. Up to 10% of gross assets may be held in Strategy, business model and investment physical metals.

policy In order to achieve its objective, it is intended that the Group Strategy will normally be fully invested, which means at least 90% The Company invests in accordance with the objective given of the gross assets of the Company and its subsidiary will above. The Board is collectively responsible to shareholders be invested in stocks, shares, royalties and physical metals. for the long-term success of the Company and is its However, if such investments are deemed to be overvalued, governing body. There is a clear division of responsibility or if the Manager finds it difficult to identify attractively between the Board and BlackRock Fund Managers Limited priced opportunities for investment, then up to 25% of the (the Manager). Matters reserved for the Board include setting Group’s assets may be held in cash or cash equivalents. the Company’s strategy, including its investment objective Risk is spread by investing in a number of holdings, many of and policy, setting limits on gearing (both bank borrowings which themselves are diversified businesses. and the effect of derivatives), capital structure, governance and appointing and monitoring of the performance of service The Group may occasionally utilise derivative instruments providers, including the Manager. such as options, futures and contracts for difference, if it is deemed that these will, at a particular time or for a particular Business model period, enhance the performance of the Group in the pursuit The Company’s business model follows that of an externally of its objectives. The Company is also permitted to enter into managed investment trust. Therefore, the Company does not stock lending arrangements. have any employees and outsources its activities to third- party service providers including the Manager who is the As approved by shareholders in August 2013, the Group principal service provider. In accordance with the Alternative may invest in any single holding of quoted or unquoted Investment Fund Managers’ Directive (AIFMD) the Company investments that would represent up to 20% of gross is an Alternative Investment Fund (AIF). BlackRock Fund assets at the time of acquisition. Although investments Managers Limited is the Company’s Alternative Investment are principally in companies listed on recognised stock Fund Manager. exchanges, the Company may invest up to 20% of the Group’s gross assets in investments other than quoted

Section 3: Governance 39

securities. Such investments include unquoted royalties, the year was 15.6% and, at the financial reporting date, equities or bonds. In order to afford the Company the net gearing (calculated as borrowings less cash and cash flexibility of obtaining exposure to metal and mining related equivalents as a percentage of net assets) stood at 12.3% royalties, it is possible that, in order to diversify risk, all or of shareholders’ funds (2019: 11.7%). For further details on part of such exposure may be obtained directly or indirectly borrowings refer to note 14 in the Financial Statements and through a holding company, a fund or another investment or the Alternative Performance Measure in the Glossary. special purpose vehicle, which may be quoted or unquoted. The Board will seek the prior approval of shareholders to any Portfolio analysis unquoted investment in a single company, fund or special Information regarding the Company’s investment exposures purpose vehicle or any single royalty which represents more is contained within the ten largest investments on pages than 10% of the Group’s assets at the time of acquisition. 27 and 28, the investments listed on pages 29 to 31 and portfolio analysis on pages 32 and 33. Further information In March 2015 the Board refined the guidelines associated regarding investment risk and activity throughout the year with the Company’s royalty strategy and proposed to can be found in the Investment Manager’s Report. maintain the 20% maximum exposure to royalties but the royalty/unquoted portfolio should itself deliver diversification As at 31 December 2020, the investment in the OZ Minerals across operator, country and commodity. To this end, new Brazil Royalty was held at Directors’ valuation, representing investments into individual royalties/unquoted investments a total of £19,753,000 (US$27,002,000) (2019: £15,790,000 should not exceed circa 3% of gross assets at the time of (US$20,918,000)). Unquoted investments can prove to be investment. Total exposure to any single operator, including more risky than listed investments. other issued securities such as debt and/or equity, where greater than 30% of that operator’s revenues come from the Continuation vote mine over which the royalty lies, must also not be greater As agreed by shareholders in 1998, an ordinary resolution for than 3% at the time of investment. In addition, the guidelines the continuation of the Company is proposed at each Annual require that the Investment Manager must, at the time of General Meeting. Despite the turmoil in markets due to the investment, manage total exposure to a single operator, via COVID-19 pandemic, 2020 was a solid year with mining reducing exposure to listed securities if they are also held in companies continuing down the path of capital discipline, the portfolio, in a timely manner where royalties/unquoted balance sheets in strong shape and earnings and dividends investments are revalued upwards. In the jurisdictions where rising. The Directors remain confident on the value available statutory royalties are possible (in countries where mineral in the sector and therefore recommend that shareholders rights are privately owned) these will be preferred and in vote in support of the Company’s continuation. respect of contractual royalties (a contractual obligation entered into by the operator and typically unsecured) the valuation must take into account the higher credit risk Performance involved. Board approval will continue to be required for all Details of the Company’s performance for the year are given royalty/unquoted investments. in the Chairman’s Statement. The Investment Manager’s Report includes a review of the main developments during While the Company may hold shares in other listed the year, together with information on investment activity investment companies (including investment trusts), the within the Company’s portfolio. Company will not invest more than 15% of the Group’s gross assets in other UK listed investment companies. Results and dividends The results for the Company are set out in the Consolidated The Group’s financial statements are maintained in sterling. Statement of Comprehensive Income. The total profit for the Although many investments are denominated and quoted in year, after taxation, was £216,515,000 (2019: £114,066,000) currencies other than sterling, the Board does not intend to of which £35,451,000 (2019: £39,561,000) is revenue profit. employ a hedging strategy against fluctuations in exchange rates. It is the Board’s intention to distribute substantially all of the Company’s available income. The Directors recommend No material change will be made to the investment policy the payment of a final dividend as set out in the Chairman’s without shareholder approval. Statement. Dividend payments/payable for the year ended 31 December 2020 amounted to £35,543,000 Gearing (2019: £38,496,000). The Investment Manager believes that tactical use of gearing can add value from time to time. This gearing is typically in Future prospects the form of an overdraft or short-term loan facility, which The Board’s main focus is to maximise total returns over can be repaid at any time or matched by cash. The level and the longer term through investment in mining and metal benefit of gearing is discussed and agreed with the Board assets. The outlook for the Company is discussed in both the regularly. The Company may borrow up to 25% of the Group’s Chairman’s Statement and the Investment Manager’s Report. net assets. The maximum level of gearing used during

40 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Social, community and human rights issues Key performance indicators As an investment trust with no employees, the Company has At each Board meeting, the Directors consider a number of no direct social or community responsibilities or impact on performance measures to assess the Company’s success the environment. However, the Company believes that it is in in achieving its objectives. The key performance indicators shareholders’ interests to consider human rights issues and (KPIs) used to measure the progress and performance environmental, social and governance factors when selecting of the Company over time and which are comparable to and retaining investments. Details of the Company’s policy on other investment trusts are set out below. As indicated in socially responsible investment are set out on page 71. the footnote to the table, some of these KPIs fall within the definition of ‘Alternative Performance Measures’ under Modern Slavery Act guidance issued by the European Securities and Markets As an investment vehicle the Company does not provide Authority (ESMA) and additional information explaining how goods or services in the normal course of business and does these are calculated is set out in the Glossary on pages 138 to not have customers. Accordingly, the Directors consider that 141. the Company is not required to make any slavery or human trafficking statement under the Modern Slavery Act 2015. In Additionally, the Board regularly reviews the performance of any event, the Board considers the Company’s supply chains, the portfolio, as well as the net asset value and share price of dealing predominantly with professional advisers and service the Company and compares this against various companies providers in the financial services industry, to be low risk in and indices. Information on the Company’s performance is relation to this matter. given in the Chairman’s Statement.

Directors, gender representation and employees The Directors of the Company are set out in the Directors’ Biographies on pages 37 and 38. The Board consists of three male Directors and two female Directors. The Company does not have any executive employees. Year ended Year ended 31 December 31 December 2020 2019 Net asset value total return1, 2 31.8% 17.2% Share price total return1, 2 46.7% 19.4% Discount to net asset value2 2.7% 11.6% Revenue earnings per share 20.40p 22.46p Total dividends per share 20.30p 22.00p Ongoing charges2, 3 0.99% 1.02% Ongoing charges on gross assets2, 4 0.87% 0.89%

1 This measures the Company’s NAV and share price total return, which assumes dividends paid by the Company have been reinvested. 2 Alternative Performance Measures, see Glossary on pages 138 to 141. 3 Ongoing charges represent the management fee and all other operating expenses, excluding finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain non-recurring items, as a % of average daily net assets. 4 Ongoing charges based on gross assets represent the management fee and all other operating expenses, excluding finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain non-recurring items, as a % of average daily gross assets. Gross assets are calculated based on net assets during the year before the deduction of the bank overdraft and loans. Ongoing charges based on gross assets are considered to be an appropriate performance measure as management fees are payable on gross assets only in the event of an increase in NAV on a quarter-on-quarter basis.

Principal risks The risk register, its method of preparation and the operation The Company is exposed to a variety of risks and of key controls in BlackRock’s and other third-party service uncertainties. As required by the 2018 UK Corporate providers’ systems of internal control, are reviewed on a Governance Code (the UK Code), the Board has put in regular basis by the Audit & Management Engagement place a robust ongoing process to identify, assess and Committee. In order to gain a more comprehensive monitor the principal risks and emerging risks. A core understanding of BlackRock’s and other third-party service element of this process is the Company’s risk register which providers’ risk management processes and how these apply identifies the risks facing the Company and assesses the to the Company’s business, BlackRock’s internal audit likelihood and potential impact of each risk and the quality department provides an annual presentation to the Audit of controls operating to mitigate it. A residual risk rating is Committee chairmen of the BlackRock investment trusts then calculated for each risk based on the outcome of the setting out the results of testing performed in relation assessment. to BlackRock’s internal control processes. The Audit &

Section 3: Governance 41

Management Engagement Committee also periodically of the annual evaluation process. Additionally, the Manager receives and reviews internal control reports from BlackRock considers emerging risks in numerous forums and the and the Company’s service providers. Risk and Quantitative Analysis team produces an annual risk survey. Any material risks of relevance to the Company The Board has undertaken a robust assessment of both through the annual risk survey will be communicated to the the principal and emerging risks facing the Company, Board. including those that would threaten its business model, future performance, solvency or liquidity. The COVID-19 The Board will continue to assess these risks on an ongoing pandemic has given rise to unprecedented challenges for basis. In relation to the UK Code, the Board is confident businesses across the globe and the Board has taken into that the procedures that the Company has put in place are consideration the risks posed to the Company by the crisis sufficient to ensure that the necessary monitoring of risks and incorporated these into the Company’s risk register. and controls has been carried out throughout the reporting The threat of climate change has also reinforced the period. importance of more sustainable practices and environmental responsibility. The principal risks and uncertainties faced by the Company during the financial year, together with the potential effects, Emerging risks are considered by the Board as they come controls and mitigating factors, are set out in the following into view and are incorporated into the existing review of the table. Company’s risk register. They were also considered as part

Principal Risk Mitigation/Control Counterparty The potential loss that the Company could incur if a counterparty Due diligence is undertaken before contracts are entered into and is unable (or unwilling) to perform on its commitments. exposures are diversified across a number of counterparties.

The Depositary is liable for restitution for the loss of financial instruments held in custody unless able to demonstrate the loss was a result of an event beyond its reasonable control. Investment performance The returns achieved are reliant primarily upon the performance To manage this risk the Board: of the portfolio. • regularly reviews the Company’s investment mandate and long- The Board is responsible for: term strategy;

• deciding the investment strategy to fulfil the Company’s • has set investment restrictions and guidelines which the objective; and Investment Manager monitors and regularly reports on;

• monitoring the performance of the Investment Manager and • receives from the Investment Manager a regular explanation of the implementation of the investment strategy. stock selection decisions, portfolio exposure, gearing and any changes in gearing, and the rationale for the composition of the An inappropriate investment policy may lead to: investment portfolio;

• underperformance compared to the reference index; • monitors and maintains an adequate spread of investments in order to minimise the risks associated with particular • a reduction or permanent loss of capital; and countries or factors specific to particular sectors, based on the diversification requirements inherent in the investment policy; • dissatisfied shareholders and reputational damage. • receives and reviews regular reports showing an analysis of the Company’s performance against other indices, including the performance of major companies in the sector; and

• has been assured that the Investment Manager has training and development programmes in place for its employees and its recruitment and remuneration packages are developed in order to retain key staff.

42 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Principal Risk Mitigation/Control Legal and regulatory compliance The Company has been approved by HM Revenue & Customs as The Investment Manager monitors investment movements, the an investment trust, subject to continuing to meet the relevant level and type of forecast income and expenditure and the amount eligibility conditions, and operates as an investment trust in of proposed dividends to ensure that the provisions of Chapter 4 accordance with Chapter 4 of Part 24 of the Corporation Tax Act of Part 24 of the Corporation Tax Act 2010 are not breached. The 2010. As such, the Company is exempt from capital gains tax on results are reported to the Board at each meeting. the profits realised from the sale of its investments. Compliance with the accounting rules affecting investment trusts Any breach of the relevant eligibility conditions could lead to the are also carefully and regularly monitored. Company losing investment trust status and being subject to corporation tax on capital gains realised within the Company’s The Company Secretary, Manager and the Company’s portfolio. In such event, the investment returns of the Company professional advisers provide regular reports to the Board in may be adversely affected. respect of compliance with all applicable rules and regulations. The Board and the Manager also monitor changes in government Any serious breach could result in the Company and/or the policy and legislation which may have an impact on the Company. Directors being fined or the subject of criminal proceedings or the suspension of the Company’s shares which would in turn lead to a breach of the Corporation Tax Act 2010.

Amongst other relevant laws, the Company is required to comply with the provisions of the Companies Act 2006, the Alternative Investment Fund Managers’ Directive, the UK Listing Rules, Disclosure Guidance and Transparency Rules and the Market Abuse Regulation. Market Market risk arises from volatility in the prices of the Company’s The Board considers the diversification of the portfolio, asset investments. It represents the potential loss the Company might allocation, stock selection and levels of gearing on a regular basis suffer through realising investments in the face of negative and has set investment restrictions and guidelines which are market movements. monitored and reported on by the Investment Manager.

Changes in general economic and market conditions, such The Board monitors the implementation and results of the as currency exchange rates, interest rates, rates of inflation, investment process with the Investment Manager. industry conditions, tax laws, political events and trends, can also substantially and adversely affect the securities and, as a The Board also recognises the benefits of a closed-end fund consequence, the Company’s prospects and share price. structure in extremely volatile markets such as those experienced with the COVID-19 pandemic. Unlike open-ended counterparts, Market risk includes the potential impact of events which are closed-end funds are not obliged to sell-down portfolio holdings outside the Company’s control, such as the COVID-19 pandemic. at low valuations to meet liquidity requirements for redemptions. During times of elevated volatility and market stress, the ability Companies operating in the sectors in which the Company of a closed-end fund structure to remain invested for the long invests may be impacted by new legislation governing climate term enables the Portfolio Managers to adhere to disciplined change and environmental issues, which may have a negative fundamental analysis from a bottom-up perspective and be ready impact on their valuation and share price. to respond to dislocations in the market as opportunities present themselves.

The Portfolio Managers spend a considerable amount of time understanding the environmental, social and governance (ESG) risks and opportunities facing companies and industries in the portfolio. They use ESG information when conducting research and due diligence on new investments and again when monitoring investments in the portfolio.

Section 3: Governance 43

Principal Risk Mitigation/Control Operational In common with most other investment trust companies, the Due diligence is undertaken before contracts are entered into with Company has no employees. The Company therefore relies on third-party service providers. Thereafter, the performance of the the services provided by third parties and is dependent on the provider is subject to regular review and reported to the Board. control systems of the Manager and BNYM (the Depositary, Custodian and Fund Accountant) which maintain the Company’s The Board reviews on a regular basis an assessment of the fraud assets, dealing procedures and accounting records. risks that the Company could potentially be exposed to and also a summary of the controls put in place by the Manager, Depositary, The security of the Company’s assets, dealing procedures, Custodian, Fund Accountant and Registrar specifically to mitigate accounting records and adherence to regulatory and legal these risks. requirements depend on the effective operation of the systems of these third-party service providers. There is a risk that a major Most third-party service providers produce internal control disaster, such as floods, fire, a global pandemic, or terrorist reports to provide assurance regarding the effective operation of activity, renders the Company’s service providers unable to internal controls as reported on by their reporting accountants. conduct business at normal operating effectiveness. These reports are provided to the Audit & Management Engagement Committee for review. The Committee would seek Failure by any service provider to carry out its obligations to the further representations from service providers if not satisfied with Company could have a material adverse effect on the Company’s the effectiveness of their control environment. performance. Disruption to the accounting, payment systems or custody records (including cyber security risk) could prevent the The Company’s assets are subject to a strict liability regime accurate reporting and monitoring of the Company’s financial and, in the event of a loss of assets, the Depositary must return position. assets of an identical type or the corresponding amount, unless able to demonstrate the loss was a result of an event beyond its reasonable control.

The Board reviews the overall performance of the Manager, Investment Manager and all other third-party service providers on a regular basis and compliance with the Investment Management Agreement annually.

The Board also considers the business continuity arrangements of the Company’s key service providers on an ongoing basis and reviews these as part of its review of the Company’s risk register. In respect of the unprecedented and emerging risks posed by the COVID-19 pandemic in terms of the ability of service providers to function effectively, the Board has received reports from key service providers setting out the measures that they have put in place to address the crisis, in addition to their existing business continuity framework. Having considered these arrangements and reviewed service levels since the crisis has evolved, the Board is confident that a good level of service has and will be maintained. Financial The Company’s investment activities expose it to a variety of Details of these risks are disclosed in note 18 to the Financial financial risks which include market risk, counterparty credit risk, Statements, together with a summary of the policies for managing liquidity risk and the valuation of financial instruments. these risks.

44 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 In the view of the Board, there have not been any changes • the ongoing relevance of the Company’s investment to the fundamental nature of these risks and these principal objective, business model and investment policy in the risks and uncertainties are equally applicable for the current current environment; and financial year. • the level of demand for the Company’s shares.

Viability statement The Board has also considered a number of other factors, In accordance with Provision 31 of the 2018 UK Corporate including: Governance Code, the Directors have assessed the prospects of the Company over a longer period than the twelve months • por tfolio liquidity in light of the COVID-19 pandemic on referred to by the ‘Going Concern’ guidelines. global market liquidity. As at 1 March 2021, 97.5% of the portfolio was estimated as being capable of being The Board is cognisant of the uncertainty surrounding the liquidated within three to five days; potential duration of the COVID-19 pandemic, its impact on the global economy and the prospects for many of the • the Company’s revenue and expense forecasts in light Company’s portfolio holdings. Notwithstanding this crisis, of the COVID-19 pandemic and its anticipated impact and given the factors stated below, the Board expects the on dividend income and market valuations. The Board is Company to continue for the foreseeable future and has confident that the Company’s business model remains therefore conducted this review for a period of three years. viable and that there are sufficient resources to meet all This is generally the investment holding period investors liabilities as they fall due for the period under review; consider while investing in the mining sector. • the principal risks and uncertainties as set out above and In its assessment of the viability of the Company, the is confident that the Company has appropriate controls Directors have noted that: and processes in place to manage these and to maintain its operating model, even given the challenges posed by • the Company invests predominantly in highly liquid, large COVID-19; listed companies so its assets are readily realisable and • the operational resilience of the Company and its key provide a level of cash receipts in the form of interest and service providers and their ability to continue to provide a dividends; good level of service for the foreseeable future; • the Company invests in mining companies with long life • the effectiveness of business continuity plans in place for assets; the Company and key service providers; and • the Company continues to meet its financial covenants in • the level of income generated by the Company and future respect of its borrowing facilities; income forecasts. • the Company’s forecasts for revenues, expenses and Based on the results of their analysis, the Directors have liabilities are relatively stable and it has largely fixed concluded that there is a reasonable expectation that the overheads which comprise a small percentage of net Company will continue in operation and meet its liabilities as assets (0.99%); and they fall due over the period of their assessment. • the business model should remain attractive for much longer than three years, unless there is significant economic or regulatory change.

The Company will undertake its annual continuation vote at the forthcoming Annual General Meeting and the Board has reviewed the potential impact that this may have on the Company’s viability. The Board is confident that the continuation vote will be passed and have prepared the viability statement under this assumption.

The Directors have also reviewed:

• the impact of a significant fall in commodity markets on the value of the Company’s investment portfolio, factoring in the impact of the recent volatility related to the COVID-19 pandemic;

Section 3: Governance 45

Section 172 statement: Promoting the success of the Company New regulations (The Companies (Miscellaneous Reporting) Regulations) require directors of large companies to explain more fully how they have discharged their duties under section 172(1) of the Companies Act 2006 in promoting the success of their companies for the benefit of members as a whole. This includes the likely consequences of their decisions in the longer term and how they have taken wider stakeholders’ needs into account.

The enhanced disclosure that follows covers how the Board has engaged with and understands the views of stakeholders and how stakeholders’ needs have been taken into account, the outcome of this engagement and the impact that it has had on the Board’s decisions. The Board considers the main stakeholders in the Company to be the Manager, Investment Manager and the shareholders. In addition to this, the Board considers investee companies and key service providers of the Company to be stakeholders; the latter comprise the Company’s Custodian, Depositary, Registrar and Broker.

Stakeholders Manager and Investment Shareholders Manager Other key service providers Investee companies Continued shareholder support The Board’s main working In order for the Company to Portfolio holdings are and engagement are critical to relationship is with the function as an investment trust ultimately shareholders’ the continued existence of the Manager, who is responsible with a listing on the premium assets and the Board Company and the successful for the Company’s portfolio segment of the official list recognise the importance delivery of its long-term management (including of the Financial Conduct of good stewardship and strategy. The Board is focused asset allocation, stock and Authority (FCA) and trade on communication with investee on fostering good working sector selection) and risk the London Stock Exchange’s companies in meeting the relationships with shareholders management, as well as (LSE) main market for listed Company’s investment and on understanding the ancillary functions such as securities, the Board relies on objective and strategy. The views of shareholders in order administration, secretarial, a diverse range of advisors for Board monitors the Manager’s to incorporate them into the accounting and marketing support in meeting relevant stewardship arrangements Board’s strategy and objective services. The Manager has obligations and safeguarding and receives regular feedback in maximising total returns sub-delegated portfolio the Company’s assets. For this from the Manager in respect of to shareholders through a management to the Investment reason, the Board consider meetings with the management worldwide portfolio of mining Manager. Successful the Company’s Custodian, of investee companies. and metal securities. management of shareholders’ Depositary, Registrar and assets by the Investment Broker to be stakeholders. Manager is critical for the The Board maintains regular Company to successfully contact with its key external deliver its investment strategy service providers and receives and meet its objective. The regular reporting from them Company is also reliant on the through the Board and Manager as AIFM to provide Committee meetings, as well as support in meeting relevant outside of the regular meeting regulatory obligations under cycle. the AIFMD and other relevant legislation.

46 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Investment mandate The Board has responsibility to The Board worked closely with the The portfolio activities undertaken and objective shareholders to ensure that the Investment Manager throughout by the Investment Manager can Company’s portfolio of assets is the year in further developing be found in their Report. The invested in line with the stated investment strategy and Company has been building investment objective and in a way underlying policies, not simply exposure to longer dated growth that ensures an appropriate balance for the purpose of achieving opportunities that have significant between spread of risk and portfolio the Company’s investment potential, as well as quality growth returns. objective but in the interests of companies where that growth shareholders and future investors. translates into growth on a value per share basis.

Responsible More than ever, the importance of The Board believes that The Board and the Investment ownership good governance and sustainability responsible investment and Manager believes there is likely practices are key factors in making sustainability are integral to to be a positive correlation investment decisions. Climate the longer-term delivery of the between strong ESG practices change is becoming a defining Company’s success. The Board and investment performance factor in companies’ long-term works closely with the Investment over time. It is especially vital in prospects across the investment Manager to regularly review mining given the long investment spectrum with significant and the Company’s performance, cycle and its ability to impact a lasting implications for economic investment strategy and company maintaining its social growth and prosperity. The mining underlying policies to ensure licence to operate. ESG is one industries in which the Company’s that the Company’s investment of the many factors that we look investment universe operate are objective continues to be met at and site visits to companies’ facing ethical and sustainability in an effective, responsible and mines provide valuable insights issues that cannot be ignored by sustainable way in the interests of into their ESG practices. asset managers and investment shareholders and future investors. companies alike. BlackRock has stated that, The Investment Manager’s as part of its commitment to approach to the consideration sustainability, it will divest any of ESG factors in respect of the investment in companies that Company’s portfolio, as well derive more than 25% of revenues as the Investment Manager’s from thermal coal production from engagement with investee all discretionary active investment companies to encourage the portfolios. During the year under adoption of sustainable business review, the Company has had practices which support long-term minimal exposure to companies value creation, are kept under whose principal activity is the review by the Board. The Board extraction of thermal coal. also expects to be informed by the Investment Manager of any Within the parameters of the sensitive voting issues involving Company’s existing investment the Company’s investments. policy, the Investment Manager Environmental issues were is continuing to look for prominent in the engagement, opportunities to deploy capital in as was executive pay and the re- growth investments that should election of directors in portfolio benefit from the demand for companies. ‘green’ materials. It is likely that this area will become a more The Investment Manager reports significant part of the portfolio. to the Board in respect of its ESG policies and how these are integrated into the investment process; a summary of BlackRock’s approach to ESG and sustainability is set out on pages 51 to 53. The Investment Manager’s engagement and voting policy is detailed on pages 55 and 56 and on the BlackRock website.

Section 3: Governance 47

Area of Engagement Issue Engagement Impact

Shareholders Continued shareholder support The Board is committed to The Board values any feedback and engagement are critical to maintaining open channels of and questions from shareholders the continued existence of the communication and to engage ahead of and during Annual Company and the successful with shareholders. The Company General Meetings in order to delivery of its long-term strategy. welcomes and encourages gain an understanding of their attendance and participation views and will take action when from shareholders at its Annual and as appropriate. Feedback General Meetings. Shareholders and questions will also help the will have the opportunity to meet Company evolve its reporting, the Directors and Investment aiming to make reports more Manager and to address transparent and understandable. questions to them directly. The Investment Manager will also Feedback from all substantive provide a presentation on the meetings between the Investment Company’s performance and the Manager and shareholders will outlook for the mining sector. be shared with the Board. The Directors will also receive updates The Annual Report and Half Yearly from the Company’s broker and Financial Report are available on Kepler, marketing consultants, on the BlackRock website and are any feedback from shareholders, also circulated to shareholders as well as share trading activity, either in printed copy or via share price performance and electronic communications. In an update from the Investment addition, regular updates on Manager. performance, monthly factsheets, the daily NAV and other Portfolio holdings are ultimately information are also published on shareholders’ assets and the the website at blackrock.com/uk/ Board recognise the importance brwm. of good stewardship and communication with investee Unlike trading companies, one- companies in meeting the to-one shareholder meetings Company’s investment objective normally take the form of a and strategy. The Board monitors meeting with the Investment the Manager’s stewardship Manager as opposed to members arrangements and receives of the Board. The Company’s regular feedback from the willingness to enter into Investment Manager in respect of discussions with institutional meetings with the management of shareholders is also demonstrated portfolio companies. by the programmes of institutional presentations by the Investment Manager. If shareholders wish to raise issues or concerns with the Board, they are welcome to do so at any time. The Chairman is available to meet directly with shareholders periodically to understand their views on governance and the Company’s performance where they wish to do so. He may be contacted via the Company Secretary whose details are given on page 135.

48 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Discount The Board recognises the The Board monitors the Company’s The Board continues to monitor management importance to shareholders that discount on an ongoing basis and the Company’s discount to NAV the market price of the Company’s receives regular updates from the and will look to buy back shares if shares should not trade at either a Manager and the Company’s Broker it is deemed to be in the interests significant discount or premium to regarding the level of discount. The of shareholders as a whole. the NAV. Board believes that the best way of The Company participates in a maintaining the share rating at an focused investment trust sales optimal level over the long term is and marketing initiative operated to create demand for the shares in by the Manager on behalf of the secondary market. To this end, the investment trusts under its the Investment Manager is devoting management. Further details are considerable effort to broadening set out on page 55. the awareness of the Company, particularly to wealth managers and During the year, the Company’s to the wider retail market. discount narrowed significantly. The Company’s average discount In addition, the Board has worked for the year to 31 December 2020 closely with the Manager to develop was 11.3% and, since February the Company’s marketing strategy, 2021, the shares have been with the aim of ensuring effective trading at a premium to NAV. communication with existing shareholders and to attract new shareholders to the Company in order to improve liquidity in the Company’s shares and to sustain the share rating of the Company.

Service levels The Board acknowledges the The Manager reports to the Board All performance evaluations were of third-party importance of ensuring that the on the Company’s performance on performed on a timely basis and providers Company’s principal suppliers a regular basis. The Board carries the Board concluded that all third- are providing a suitable level of out a robust annual evaluation party service providers, including service, including the Investment of the Manager’s performance, the Manager and Investment Manager in respect of investment their commitment and available Manager, were operating performance and delivering on the resources. effectively and providing a good Company’s investment mandate; level of service. the Custodian and Depositary in The Board performs an annual respect of their duties towards review of the service levels of all The Board has received updates safeguarding the Company’s assets; third-party service providers and in respect of business continuity the Registrar in its maintenance of concludes on their suitability to planning from the Company’s the Company’s share register and continue in their role. The Board Manager, Custodian, Depositary, dealing with investor queries; and receives regular updates from the Fund Accountant, Registrar and the Company’s Brokers in respect AIFM, Depositary, Registrar and Printer and is confident that of the provision of advice and Brokers on an ongoing basis. arrangements are in place to acting as a market maker for the ensure a good level of service will Company’s shares. In light of the challenges continue to be provided despite presented by the COVID-19 the impact of the COVID-19 pandemic to the operation of pandemic. businesses across the globe, the Board has worked closely with the Manager to gain comfort that relevant business continuity plans are operating effectively for all of the Company’s key service providers.

Section 3: Governance 49

Area of Engagement Issue Engagement Impact Board composition The Board is committed to ensuring All Directors are subject to a As at the date of this report, the that its own composition brings an formal evaluation process on Board was comprised of three appropriate balance of knowledge, an annual basis (more details men and two women. No Director experience and skills, and that it and the conclusions of the has a tenure in excess of nine is compliant with best corporate 2020 evaluation process are years. Details of each Directors’ governance practice under the UK given on pages 69 and 70). All contribution to the success and Code, including guidance on tenure Directors stand for re-election by promotion of the Company are and the composition of the Board’s shareholders annually. set out in the Directors’ Report committees. on page 60 and details of the Shareholders may attend the Directors’ biographies can be Annual General Meeting and found on pages 37 and 38. raise any queries in respect of Board composition or individual The Directors are not aware of Directors in person or may any issues that have been raised contact the Company Secretary directly by shareholders in respect or the Chairman using the details of Board composition in the year provided on page 135 with any under review. issues. The Board appointed Ollie Oliveira The Board undertook a review as a Director of the Company with of succession planning effect from 3 February 2020. Colin arrangements and identified Buchan retired as a Director on the need for a new Director. The 30 April 2020. Nomination Committee agreed the selection criteria and the method of selection, recruitment and appointment, Board diversity, including gender, were carefully considered when establishing the criteria. The services of an external search consultant, Norman Broadbent Group PLC, as well as the Directors’ range of contacts, were used to identify potential candidates.

50 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Environmental Social Corporate governance Mines will inevitably have an impact on the BlackRock believes it is vital that natural As with all companies, good corporate local environment. Key is how companies resources companies maintain their social governance is critical for natural resources manage this process ensuring the benefits licence to operate. By this, BlackRock companies. In conjunction with the are appropriately shared amongst all means that companies maintain broad BlackRock Investment Stewardship team, stakeholders. The negative impact on acceptance from their employees, the portfolio management team actively the market capitalisation of companies stakeholders, local communities and engages with companies on a wide range such as BHP and Vale, after the Samarco the national government. The portfolio of governance issues including board and Brumadinho tailings dam failures, management team’s site visits to independence, executive compensation, highlights the key role that ESG has on companies’ assets provide them with shareholder protection and timely share price performance. valuable insight into these issues which disclosure. often cannot be properly understood from As set out in more detail below, BlackRock company reports. will be aligning its engagement and stewardship priorities to UN Sustainable Development Goals and is committed to voting against management to the extent that they have not demonstrated sufficient progress in how they manage these environmental impacts and operating events.

The Board’s approach Environmental, social and governance (ESG) issues can present both opportunities and threats to long-term investment performance. The Company’s investment universe comprises sectors that are likely to be highly impacted by increasing regulation as a result of climate change and other social and governance factors. These ethical and sustainability issues cannot be ignored and your Board has appointed a Manager that applies the highest standards of ESG practice. Effective engagement with management is, in most cases, the most constructive way of driving meaningful change in the behaviour of investee company management. However, as a general approach the Company will not invest in companies which have high ESG risks and no plans to address existing deficiencies. Where the Board is not satisfied that an investee company is taking steps to address matters of an ESG nature, it may discuss with the Manager how this situation might be resolved, including potentially by a full disposal of shares.

BlackRock’s approach to sustainable By December 2020, BlackRock announced that the following investing key achievements had been made in progress towards its goals, including: Sustainability is BlackRock’s standard for investing, based on the investment conviction that integrating sustainability • Ensuring that 100% of active portfolios are ESG- can help investors build more resilient portfolios and achieve integrated; better long term, risk-adjusted returns. BlackRock believes that climate change is now a defining factor in companies’ • Launching a new database (Aladdin Climate) to set a new long-term prospects and that it will have a significant standard for climate data and analytics; and lasting impact on economic growth and prosperity. BlackRock believes that climate risk now equates to • Intensif ying the investment stewardship focus on investment risk and this will drive a profound reassessment sustainability; of risk and asset values as investors seek to react to the impact of climate policy changes. This in turn is likely to drive • Joining Climate Action 100+, a natural progression a significant reallocation of capital away from traditional in BlackRock’s work to advance sustainable business carbon intensive industries over the next decade. practices aligned with the Task Force on Climate-related Financial Disclosures (TCFD); and In January 2020, with this transition in mind, BlackRock outlined how it was making sustainability integral to the way • Establishing nearly a hundred new sustainable BlackRock BlackRock manage risk, generate alpha, build portfolios and funds in 2020, helping to increase access and provide pursue investment stewardship, in order to help improve investors with greater choice. investment outcomes for clients.

Section 3: Governance 51

A detailed summary of the actions taken by BlackRock in are considered within the portfolio management team’s 2020 on making sustainability the new standard for investing fundamental analysis of companies and industries. The team can be found at https://www.blackrock.com/corporate/ aims to assess financial materiality in relation to ESG via literature/publication/our-2020-sustainability-actions.pdf data insights integrated into the team’s standard research templates shown in the BlackRock ESG Risk Window. The BlackRock also announced in January 2021 that it was Risk Window, using MSCI data, flags any stock-specific committed to supporting the goal of ‘net zero’ (building an concerns allowing investors to investigate them further. It economy that emits no more carbon dioxide than it removes screens for ESG metrics through over 400 single data points from the atmosphere) by 2050 (the scientifically-established and ranks potential risks from High to Managed. BlackRock’s threshold necessary to keep global warming well below 2ºC). portfolio management teams also have access to other data BlackRock is taking a number of steps to help investors sources such as RepRisk or SustainAnalytics to complement prepare their portfolios for a net zero world, including the Risk Window. BlackRock’s unparalleled access to capturing opportunities created by the net zero transition. company management allows it to engage on these issues Key actions targeted by BlackRock for 2021 include: through questioning management teams and conducting site visits. BlackRock looks to understand how management Measurement and Transparency approaches ESG risks and opportunities and the potential • P ublishing the proportion of BlackRock assets under impact this may have on company financials. management that are currently aligned to net zero, and announcing an interim target on the proportion of The BlackRock Investment Stewardship team (BIS) promotes BlackRock assets under management that will be aligned sound corporate governance and sustainable business to net zero in 2030, for markets with sufficiently reliable practices to help maximize long-term shareholder value for data; and BlackRock’s clients. BIS does this in three ways: engaging with companies, using BlackRock’s vote, and promoting • Through Aladdin Climate, helping more investors manage thought leadership. Through this combination of quantitative and meet their climate objectives by tracking investment and qualitative assessment, BlackRock ensures that its portfolios’ trajectories toward net zero, and helping to understanding of the portfolio’s investments is thorough, catalyse increasingly robust and standardised climate data reliable and up to date. The portfolio management team’s and metrics to better serve the industry. understanding of ESG issues is further supported by BlackRock’s Sustainable Investment team (BSI). BSI looks to Investment Management advance ESG research and integration, active engagement • Incorporating the impacts of climate change into and the development of sustainable investment solutions BlackRock’s capital market assumptions, the cornerstone across the firm. BlackRock believes ESG issues have for portfolio construction at BlackRock; important financial impacts over the long term.

• Implementing a ‘heightened-scrutiny model’ in The sustainable investing effort is embedded into BlackRock’s active portfolios as a framework for managing BlackRock’s culture from the top down through the securities that pose significant climate risk; and belief that a company’s ability to manage ESG matters • Helping BlackRock's clients benefit from opportunities demonstrate the leadership and good governance that is created by the energy transition, from investments in essential to sustainable, long-term growth. electric cars to clean energy to energy-efficient housing. Investment Stewardship Stewardship BIS plays a fundamental role in the activation of BlackRock’s • Using investment stewardship to ensure the companies purpose of helping more and more people experience that BlackRock invests in on behalf of clients are mitigating financial well-being. As a fiduciary, BlackRock has a climate risk and considering the opportunities presented responsibility to its clients to make sure companies are by the net zero transition; adequately managing and disclosing ESG risks and opportunities that can impact their ability to generate long- • Asking companies to disclose a business plan aligned term financial performance and to hold them accountable with the goal of limiting global warming to well below 2ºC, through BlackRock’s vote if they are not. consistent with achieving net zero global greenhouse gas emissions by 2050; and BlackRock’s BIS team has been focusing on sustainability issues for years. Each year, the BIS team prioritises its • Increasing the role of votes on shareholder proposals in work around several engagement themes that it believes BlackRock’s stewardship efforts around sustainability. will encourage sound governance practices and deliver Integration of ESG into BlackRock’s investment sustainable long-term financial performance for BlackRock management process clients. For each engagement priority, BIS provides a high level, globally relevant ‘Key Performance Indicator’ (KPI) so As well as the initiatives set out above, as part of BlackRock’s companies are aware of BlackRock’s expectations. structured investment process, ESG risks and opportunities

52 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 In 2020, BIS put an increased focus on ESG-related issues As the past year has only intensified BlackRock’s conviction and relevant disclosures, given the growing impact of these that sustainability risk, and climate risk in particular, is issues on long-term value creation. To that end, BIS made investment risk, BIS is continuing to increase its focus on an explicit ask that companies align their disclosures to how sustainability-related factors are impacting a company’s the TCFD framework and the Sustainability Accounting ability to generate shareholder returns. As detailed in the Standards Board (SASB) standards. This includes each 2021 BIS Stewardship Expectations report and the BIS investee company’s plan for operating under a scenario commentary on Climate Risk and Transition to a Low-Carbon where the Paris Agreement’s goal of limiting global warming Economy, BIS expects companies to disclose a business to less than two degrees is fully realised, as expressed by the plan aligned with the goal of limiting global warming to TCFD guidelines. BlackRock is greatly encouraged by the well below 2ºC, consistent with achieving net zero global progress it has seen over the past year – a 363% increase greenhouse gas (GHG) emissions by 2050. These disclosures in SASB disclosures and more than 1,700 organisations are essential to helping investors assess a company’s expressing support for the TCFD. ability to transition its business to a low-carbon world and to capture value-creation opportunities created by the As reported in the BIS 2020 annual report, in the year climate transition. This report can be found at https://www. from 1 July 2019 to 30 June 2020, BIS held over 3,000 blackrock.com/corporate/literature/publication/our-2021- engagements globally with over 2,000 companies covering stewardship-expectations.pdf. 61% by value of BlackRock’s clients’ equity investments. In terms of voting, BIS voted at approximately 16,200 BlackRock is also committed to transparency in terms of shareholder meetings and on 153,000 proposals. Voting disclosure on its engagement with companies and voting is how BIS holds companies accountable when they fall rationales. More details about BlackRock Investment short of expectations. BIS might vote against directors or Stewardship can be found on BlackRock’s website at www. other management proposals or might vote to support blackrock.com/corporate/about-us/investment-stewardship. a shareholder proposal. BIS views holding directors In terms of its own reporting, BlackRock believes that accountable as one of the most effective ways to encourage the SASB provides a clear set of standards for reporting change at a company. Given the groundwork already laid sustainability information across a wide range of issues, through past engagements and the growing investment from labour practices to data privacy to business ethics. For risks surrounding sustainability, BIS will be increasingly evaluating and reporting climate-related risks, as well as the disposed to vote against the re-election of directors when related governance issues that are essential to managing companies have not made sufficient progress. In the year them, the TCFD provides a valuable framework. to 30 June 2020, BIS opposed the re-election of over 5,100 directors, more than ever before, sending a strong signal of BlackRock recognises that reporting to these standards concern when companies did not make sufficient progress requires significant time, analysis, and effort. BlackRock’s on issues that are central to long-term value creation. BIS own SASB-aligned disclosure is available on its raised questions on board quality, taking voting action website at www.blackrock.com/corporate/literature/ against directors for lack of independence on the board, continuousdisclosure-and-important-information/ insufficient board diversity and overcommitment. BIS also blackrock-2019-sasb-disclosure.pdf and BlackRock held directors to account for not meeting expectations published a detailed TCFD-aligned report on its 2020 on climate risk management or disclosures and for activities. More information on BlackRock’s policies on management and compensation policies inconsistent with Corporate Sustainability can be found on BlackRock’s sustainable long-term financial performance. BIS also sees website at www.blackrock.com/corporate/sustainability. voting on shareholder proposals playing an increasingly important role in BlackRock’s stewardship efforts around By order of the Board sustainability. Accordingly, where BIS agrees with the intent CAROLINE DRISCOLL of a shareholder proposal addressing a material business For and on behalf of risk, and if BIS determines that management could do better BlackRock Investment Management (UK) Limited in managing and disclosing that risk, BIS will support the Company Secretary proposal. BIS may also support a proposal if management 4 March 2021 is on track but BIS believes that voting in favour might accelerate their progress. As a long-term investor, BIS has historically engaged to explain its views on an issue and given management ample time to address it. However, given the need for urgent action on many business relevant sustainability issues, BIS will be more likely to support a shareholder proposal without waiting to assess the effectiveness of engagement.

Section 3: Governance 53

The Directors present the Annual Report and Financial Information (the Common Reporting Standard) was Statements of the Company and its subsidiary (together the introduced on 1 January 2016. The legislation requires Group) for the year ended 31 December 2020. investment trust companies to provide personal information to HMRC about investors who purchase shares in investment Status of the Company trusts. As an affected company, BlackRock World Mining The Company is domiciled in the United Kingdom. The Trust plc has to provide information annually to the local Company is a public company limited by shares and is also tax authority on the tax residencies of a number of non-UK an investment company under section 833 of the Companies based certification shareholders and corporate entities. The Act 2006 and operates as such. It is not a close company and local tax authority to which the information is initially passed has no employees. may in turn exchange the information with the tax authorities of another country or countries in which the shareholder may The Company has been approved by HM Revenue & Customs be tax resident, where those countries (or tax authorities in (HMRC) as an investment trust in accordance with sections those countries) have entered into agreements to exchange 1158 and 1159 of the Corporation Tax Act 2010, subject to financial account information. the Company continuing to meet eligibility conditions. The All new shareholders, excluding those whose shares are Directors are of the opinion that the Company has conducted held in CREST, entered on to the share register, will be its affairs in a manner which will satisfy the conditions for sent a certification form for the purposes of collecting this continued approval. information.

As an investment company that is managed and marketed GDPR in the United Kingdom, the Company is an Alternative Data protection rights were harmonised across the European Investment Fund (AIF) falling within the scope of, and subject Union following the implementation of the General Data to the requirements of, the Alternative Investment Fund Protection Regulation (GDPR) on 25 May 2018. The Board Managers’ Directive (AIFMD). The Company is governed by has sought and received assurances from its third-party the provisions of the European Union (Alternative Investment service providers that they have taken appropriate steps to Fund Managers) Regulations 2013 (the Regulations) and is ensure compliance with the new regulation. The Company’s required to be authorised by the Financial Conduct Authority ‘Data Privacy Policy’ can be found on the BlackRock website (FCA). It must comply with a number of obligations, including at blackrock.com/uk/brwm. the appointment of an Alternative Investment Fund Manager (AIFM) and a depositary to carry out certain functions. The AIFM must also comply with the Regulations in respect of Shareholder Rights Directive II leverage, outsourcing, conflicts of interest, risk management, The Shareholder Rights Directive II took effect from 10 valuation, remuneration and capital requirements and June 2019 with some transitional provisions. It encourages must also make additional disclosures to both shareholders long-term shareholder engagement and transparency and the FCA. Further details are set out on the Company’s between companies and shareholders. In substantive website at blackrock.com/uk/brwm, the Regulatory terms the changes are small for investment companies Disclosures section on pages 136 and 137, and in the notes and the majority of requirements apply to the Company’s to the Financial Statements. remuneration policy and disclosure of processes, as well as related party transactions. There are also additional rules for The Company’s shares are eligible for inclusion in the stocks AIFMs and proxy advisers. and shares component of an Individual Savings Account (ISA). Dividends Details of the dividends paid and payable in respect of the Facilitating retail investments year are set out in the Chairman’s Statement and in note 8 on The Company currently conducts its affairs so that the page 104. shares issued by the Company can be recommended by independent financial advisers to ordinary retail investors Investment management and in accordance with the FCA’s rules in relation to non- administration mainstream pooled investments and intends to continue BlackRock Fund Managers Limited (BFM) was appointed as to do so for the foreseeable future. The shares are excluded the Company’s AIFM with effect from 2 July 2014, having from the FCA’s restrictions which apply to non-mainstream been authorised as an AIFM by the FCA on 1 May 2014. The pooled investments because they are shares in an management contract is terminable by either party on six investment trust. months’ notice. Under the agreement, the Board continues to be independent from the AIFM. The agreement provides The Common Reporting Standard the appropriate balance between the Board’s control over Tax legislation under the Organisation for Economic the Company, its investment policies and compliance with Cooperation and Development (OECD) Common Reporting regulatory obligations. Standard for Automatic Exchange of Financial Account

54 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 BlackRock Investment Management (UK) Limited (BIM (UK)) cash flows and ensuring the Company’s assets are valued continues to act as the Company’s Investment Manager appropriately in accordance with the relevant regulations and under a delegation agreement with BFM. BIM (UK) also acted guidance. The Depositary is also responsible for enquiring as the Secretary of the Company throughout the year. The into the conduct of the AIFM in each annual accounting Manager receives an annual management fee equivalent period. The Depositary receives a fee payable at 0.0095% to 0.80% of the Company’s net assets, which includes all per annum of net assets. The Company has appointed the services provided by BlackRock. However, in the event that Depositary in a tripartite agreement, to which BFM as AIFM the NAV per share increases on a quarter-on-quarter basis, is also a signatory. The Depositary is liable for the loss of the the fee will then be paid on gross assets for the quarter. financial instruments held in custody.

Included within this management fee is a contribution Under the depositary agreement, custody services in respect of £74,000 (excluding VAT) to a consortium element of a of the Company’s assets have been delegated to The Bank focused investment trust sales and marketing initiative, of New York Mellon (International) Limited (BNYM). BNYM which enables the BlackRock investment trusts to achieve receives a custody fee payable by the Company at rates efficiencies by combining certain sales and marketing depending on the number of trades effected and the location activities and is matched by BlackRock. This contribution will of securities held. The depositary agreement is subject to 90 be deducted from the fee payable to BlackRock such that the days’ notice of termination by any party. total fee will not exceed 0.80% of gross assets. The purpose of the programme is to ensure effective communication with Registrar existing shareholders and to attract new shareholders to the The Company has appointed Computershare Investor Company. This has the benefit of improving liquidity in the Services PLC as its Registrar (the Registrar). The principal Company’s shares and helps sustain the stock market rating duty of the Registrar is the maintenance of the register of the Company. of shareholders (including registering transfers). It also provides services in relation to any corporate actions, BFM and BIM (UK) are subsidiaries of BlackRock, Inc. which dividend administration, shareholder documentation, the is a publicly traded corporation on the New York Stock Common Reporting Standard and the Foreign Account Tax Exchange operating as an independent firm. Compliance Act.

Appointment of the Manager The Registrar receives a fixed fee each year, plus The Board considers the arrangements for the provision of disbursements and VAT for the maintenance of the register. investment management services to the Company on an Fees in respect of corporate actions are negotiated on an ongoing basis and a formal review is conducted annually. arising basis. As part of this review, the Board considered the quality and continuity of the personnel assigned to handle the Change of control Company’s affairs, the investment process and the results There are no agreements to which the Company is a achieved to date. party that might be affected by a change in control of the Company. The Board believes that the continuing appointment of BFM (the Manager) as AIFM, and the delegation of investment Exercise of voting rights in investee management services to BIM (UK) (the Investment Manager) on the terms disclosed above is in shareholders’ interests as companies a whole. The specialist nature of the Company’s investment The exercise of voting rights attached to the Company’s remit is, in the Board’s view, best served by the Natural portfolio has been delegated to the Investment Manager Resources team at BlackRock, who have a proven track by BFM. BlackRock’s approach to voting at shareholder record in successfully investing in the mining sector. meetings, engagement with companies and corporate governance is framed within an investment context. BlackRock believes that sound corporate governance Depositary and Custodian practices by companies contribute to their long-term The Company is required under the AIFMD to appoint an financial performance and thus better risk-adjusted returns. AIFMD compliant depositary. The Company has appointed BlackRock’s proxy voting process is led by its Investment The Bank of New York Mellon (International) Limited (BNYM Stewardship team, located in eight offices around the world. or the Depositary) to perform this role. In addition to its own professional staff, the Investment Stewardship team draws upon the expertise of BlackRock’s The Depositary’s duties and responsibilities are outlined in portfolio managers, researchers and other internal and the investment fund legislation (as defined in the FCA AIF external resources globally. Rulebook). The main role of the Depositary under AIFMD is to act as a central custodian with additional duties to monitor the operations of the Company, including monitoring

Section 3: Governance 55

BlackRock’s global corporate governance and engagement its key third-party service providers have in place appropriate principles are published on the website https://www. business continuity plans and these services have continued blackrock.com/corporate/literature/fact-sheet/blk- to be supplied without interruption throughout the COVID-19 responsible-investment-guidelines-emea.pdf. The principles pandemic. set out BlackRock’s views on the overarching features of corporate governance that apply in all markets. For each The Company has a portfolio of investments which are region, BlackRock also publishes market-specific policies predominantly readily realisable and is able to meet all of which are updated every year to ensure that they remain its liabilities from its assets and income generated from relevant. The voting guidelines are principles-based and not these assets. Accounting revenue and expense forecasts prescriptive because BlackRock believes that each voting are maintained and reported to the Board regularly and situation needs to be assessed on its merits. Voting decisions it is expected that the Company will be able to meet all its are taken to support the outcome that BlackRock believes (in obligations. Borrowings under the overdraft facility shall its professional judgement) will best protect the economic at no time exceed 25% of the Group’s net assets and this interests of their clients. covenant was complied with during the period. Based on the above, the Board is satisfied that it is appropriate to During the year under review, the Investment Manager continue to adopt the going concern basis in preparing the voted on 578 proposals at 49 general meetings on behalf of financial statements. Ongoing charges for the year ended the Company. At these meetings the Investment Manager 31 December 2020 were approximately 0.99% of net assets. voted in favour of most resolutions, as should be expected when investing in well run companies, but voted against 15 The Company has an annual continuation vote with the next (2.6%) resolutions and abstained from voting on 16 (2.7%) vote due to be held at the Annual General Meeting in April resolutions. Most of the votes against were in respect of 2021. The Board has no reason to believe that this resolution resolutions relating to the election or re-election of directors, will not be passed. The Company’s longer-term viability is changes to board structure and governance and directors’ considered in the viability statement on page 45. remuneration, which were deemed by the Investment Manager as not being in the best interests of shareholders. Directors The Directors of the Company as at 31 December 2020 and Continuation vote their biographies are set out on pages 37 and 38. Details of As agreed by shareholders, an ordinary resolution for the their interests in the shares of the Company are set out in continuation of the Company as an investment trust is the Directors’ Remuneration Report on page 65. All of the proposed annually at the Annual General Meeting. If any Directors held office throughout the year under review and such resolution is not passed, the Board shall put proposals up to the date of signing the financial statements, with the to shareholders within 42 days of the Annual General exception of Mr Oliveira who was appointed to the Board in Meeting with a view to enabling shareholders to realise their February 2020. The Board may appoint additional Directors holding of shares for cash or, if appropriate, a non-cash to the Board, but any Director so appointed must stand for consideration with a cash alternative. election by shareholders at the next Annual General Meeting.

Principal risks Although the Company’s Articles of Association require that The key risks faced by the Company are set out in the one-third of Directors retire and seek re-election at intervals Strategic Report. of no more than three years, the Board has resolved that all Directors should be subject to re-election on an annual Going concern basis. Accordingly, all of the Directors will offer themselves for re-election at the Annual General Meeting. The Board As described in the viability statement in the Strategic has considered the positions of the retiring Directors as part Report, the Board is mindful of the uncertainty surrounding of the evaluation process and believes that it would be in the potential duration of the COVID-19 pandemic and its the Company’s best interests for each of the Directors to be impact on the global economy, the Company’s assets and the proposed for re-election at the forthcoming Annual General potential for the level of revenue derived from the portfolio Meeting, given their material level of contribution and to reduce. The Portfolio Managers will continue to review the commitment to the role. composition of the Company’s portfolio and to be pro-active in taking investment decisions if necessary. Having considered the Directors’ performance within the annual Board performance evaluation process, further The Directors, having considered the nature and liquidity of details of which are provided on pages 69 and 70, the Board the portfolio, the Company’s investment objective and the believes that it continues to be effective and the Directors Company’s projected income and expenditure, are satisfied bring extensive knowledge and commercial experience and that the Company has adequate resources to continue demonstrate a range of valuable business, financial and in operational existence for the foreseeable future and is asset management skills. The Board therefore recommends financially sound. The Board believes that the Company and

56 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 that shareholders vote in favour of each Director’s proposed Notifiable interests in the Company’s voting re-election. More details in respect of the skills and rights experience each Director brings to the Board are set out on As at 31 December 2020 Witan Investment Trust plc notified page 60. the Company that it held an interest in 4.36% of the voting rights attached to the Company’s issued share capital There were no contracts subsisting during or at the end (excluding shares held in treasury). Subsequently, Witan of the year in which a Director of the Company is or was Investment Trust plc advised that its interest in the voting materially interested and which is or was significant in rights attached to the Company’s issued share capital relation to the Company’s business. None of the Directors was 3.84% as at 15 February 2021. The Company has not has a service contract with the Company. No Director is received any other notifications in accordance with the FCA’s entitled to compensation for loss of office on the takeover of Disclosure Guidance and Transparency Rule 5.1.2R. the Company. Foreign exchange Directors’ indemnity At the financial year end, approximately 73.3% of the The Company has maintained appropriate Directors’ and Company’s portfolio was invested in non-sterling assets, Officers’ liability insurance throughout the year. In addition with 31.7% invested in US dollar denominated assets. The to Directors’ and Officers’ liability insurance cover, the Investment Manager does not actively hedge currency Company’s Articles of Association provide, subject to the exposure. provisions of applicable UK legislation, a qualifying third- party indemnity for Directors in respect of costs incurred in the defence of any proceedings brought against them Derivative transactions by third parties arising out of their positions as Directors, During the year, the Group entered into a number of in which they are acquitted or judgement is given in their derivative put and call option contracts generating option favour. The Company has entered into Deeds of Indemnity premium income of £8,765,000 (2019: £6,008,000). Two with Directors individually which are available for inspection option contracts remained open at 31 December 2020 at the Company’s registered office and will also be available (2019: five option contracts), details of which are given in the at the Annual General Meeting. The indemnity has been in investment listing on pages 29 to 31. All open options were force during the financial year and up to the date of approval fully covered. of the financial statements. Share capital Conflicts of interest Details of the Company’s issued share capital are given in The Board has put in place a framework for Directors to note 16 to the Financial Statements. Details of the voting report conflicts of interest or potential conflicts of interest rights in the Company’s ordinary shares as at the date of this which it believes has worked effectively during the year. All report are given in note 17 to the Notice of Annual General Directors are required to notify the Company Secretary of Meeting. The ordinary shares carry the right to receive any situations or potential situations where they consider dividends and have one voting right per ordinary share. There that they have or may have a direct or indirect interest or duty are no restrictions on the voting rights of the ordinary shares that conflicted or possibly conflicted with the interests of or on the transfer of ordinary shares, and there are no shares the Company. The Board has considered that the framework that carry specific rights with regard to the control of the worked effectively throughout the year under review. All such Company. situations are reviewed by the Board and duly authorised. Directors are also made aware at each meeting that there Share repurchases remains a continuing obligation to notify the Company Shares may be repurchased when, in the opinion of the Secretary of any new situation that may arise, or any change Directors, the discount appears high or wider than the peer to a situation previously notified. It is the Board’s intention to group average and shares are available in the market. The continue to review all notified situations on a regular basis. main objective of any buy back is to enhance the net asset value per share of the remaining shares and to reduce the Directors’ remuneration report absolute level and volatility of any discount to net asset value The Directors’ Remuneration Report is set out on pages 63 to at which shares may trade. Although the Manager initiates 67. An advisory ordinary resolution to approve this report will the buy backs, the policy and parameters are set by the Board be put to shareholders at the Company’s forthcoming Annual and reviewed at regular intervals. The Company would raise General Meeting. The Company is also required to put the the cash needed to finance the purchase of ordinary shares Directors’ Remuneration Policy to a binding shareholder either by selling securities in the Company’s portfolio or by vote every three years. The Company’s Remuneration Policy short-term borrowing. was last put to shareholders at the Annual General Meeting in 2020, therefore an ordinary resolution to approve the policy will next be put to shareholders at the Annual General Meeting in 2023.

Section 3: Governance 57

During the year and up to the date of this report, the Streamlined Energy and Carbon Company bought back 1,233,913 ordinary shares at an average price of 373.53p per share, at an average discount Reporting (SECR) statement: of 12.1%, for a total cost of £4,609,000. All shares have been greenhouse gas (GHG) emissions placed in treasury. and energy consumption The latest authority to purchase ordinary shares for disclosure cancellation or to be held in treasury was granted to the This is a SECR statement1 on the Group’s annual energy Directors on 30 April 2020 and expires on 29 April 2021. consumption and GHG emissions for the financial year The Directors are proposing that their authority to buy 1 January 2020 to the 31 December 2020 and the prior back shares be renewed at the forthcoming Annual General year, 2019. The Group does not own, lease or operate any Meeting. Purchases of ordinary shares pursuant to this assets, and has no direct employees. Therefore, there are authority will only be made in the market for cash at prices zero emissions associated or attributed to the entity (Table below the prevailing NAV per share. 1) and no underlying global energy consumption (Table 2). In addition, there are no energy efficiency action measures Share issues taken over the reporting year. This is the Group’s first SECR The Company has the authority to issue new shares or statement. sell shares from treasury for cash. Since the year end, the Company has reissued 3,720,000 ordinary shares from The Group used the main requirements of the GHG treasury for a total gross consideration of £21,896,000 at Protocol Corporate Standard (revised edition) as a basis an average price of 588.59p per share and an average 1.2% to report on any GHG emissions in tonnes of carbon premium to NAV. The current authority to issue new ordinary dioxide equivalent (tCO2e), which expresses multiple shares or sell shares from treasury for cash was granted to greenhouse gases in terms of carbon dioxide based on the Directors on 30 April 2020 and expires on 29 April 2021. their global warming potential (including methane, nitrous The Directors are proposing that their authority to issue oxide, hydrofluorocarbons, perfluorocarbons and sulphur new ordinary shares or sell shares from treasury for cash be hexafluoride). Emissions considered relate to activities for renewed at the forthcoming Annual General Meeting. which the Group is responsible and included as applicable: combustion of any fuel and operation of its facilities; and Treasury shares annual emissions from the purchase of electricity, heat, steam or cooling by the Group for its own use. The Company is currently authorised to purchase its own

ordinary shares into treasury for reissue or cancellation 1 GHG emissions and energy consumption statement pursuant at a future date. The use of treasury shares should assist to the Companies (Directors’ Report) and Limited Liability the Manager in the objective of providing a discount Partnerships (Energy and Carbon Report) Regulations 2018 (the management mechanism. The Board intends only to SECR Regulations). authorise the sale of shares from treasury at prices at or above the prevailing net asset value per share (plus costs of the relevant sale). This should result in a positive overall effect for shareholders if shares are bought back at a discount and then sold at a price at or above the net asset value per share (plus costs of the relevant sale).

The Company holds 15,741,028 ordinary shares in treasury (8.9% of the Company’s issued share capital excluding treasury shares).

58 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

2020 2019 2 GHG Emissions (tCO2e) (Market-based) (Location-based) (Market-based) (Location-based) Scope 13 – Combustion of fuels and fugitive emissions of refrigerant gases 0 0 0 0

Scope 24 – Electricity, heat, steam, and cooling purchased for landlord shared services and own use 0 0 0 0

Scopes 1 + 2 – Mandatory carbon footprint disclosure 0 0 0 0

Scopes 1 + 2 – Mandatory intensity ratio: emissions per total revenue (tCO2e/$100m) 0 0 0 0

Table 2: 2020 BlackRock World Mining Trust plc Energy Use

2020 2019 Consumption Source Scope Consumption Value Unit Consumption Value Unit

Natural Gas Scope 1 0 kWh 0 kWh

Diesel Fuel Scope 1 0 kWh 0 kWh

Private Aviation (Jet Fuel) Scope 1 0 kWh 0 kWh

Refrigerants Scope 1 0 lbs 0 lbs

Electricity Scope 2 0 kWh 0 kWh

2 Tonnes of carbon dioxide equivalent. 3 Scope 1 emissions are direct GHG emissions from activities owned or controlled by an organisation. 4 Scope 2 emissions are indirect emissions associated with an organisation’s consumption of purchased electricity, heat, steam and cooling. These emissions occur as a consequence of an organisation’s activities at sources which the organisation does not own or control.

BlackRock acts as Investment Manager to BlackRock World The business of this year’s Annual General Meeting consists Mining Trust plc. Therefore, for full transparency, BlackRock’s of 15 resolutions. Resolutions 1 to 12 are proposed as global Scope 1 and 2 emissions can be found in its 2020 ordinary resolutions and 13 to 15 are being proposed as Carbon Disclosure Project (CDP) submission: https://www. special resolutions. cdp.net/en/responses/1875 Resolution 1 – Approval of the annual report and Articles of Association financial statements Any amendments to the Company’s Articles of Association This resolution seeks shareholder approval of the Annual must be made by special resolution. Report and Financial Statements for the year ended 31 December 2020 and the auditors’ report thereon. Annual General Meeting The following information to be discussed at the Resolution 2 – Approval of the Directors’ forthcoming Annual General Meeting is important and remuneration report requires your immediate attention. If you are in any doubt This resolution is an advisory vote on the Directors’ about the action you should take, you should seek advice Remuneration Report, excluding any content relating to the from your stockbroker, bank manager, solicitor, accountant remuneration policy, as set out on pages 63 to 65. or other financial adviser authorised under the Financial Services and Markets Act 2000 (as amended). Resolution 3 – Approval of the dividend Resolution 3 seeks shareholder approval of a final dividend If you have sold or transferred all of your ordinary shares of 8.30p per share for the year ended 31 December 2020. in the Company, you should pass this document, together with any other accompanying documents (but not the Resolutions 4 to 8 – Re-election of Directors personalised Form of Proxy) as soon as possible to the Resolutions 4 to 8 relate to the re-election of the Directors. purchaser or transferee, or to the stockbroker, bank The Board has undertaken a formal performance evaluation or other agent through whom the sale or transfer was during the year and confirms that the performance of the effected, for onward transmission to the purchaser or Directors standing for re-election continues to be effective transferee.

Section 3: Governance 59

and that each Director demonstrates commitment to their 2019 by Rand Merchant Bank as Business Development role. The biographies of the Directors are set out on pages Director for mining where she was responsible for identifying 37 and 38. The Directors have been appointed in order to opportunities in the sector in raising bank finance, mergers bring a range of experience appropriate to managing a and acquisitions, commodity hedging and debt capital business which invests in mining companies and mining markets. Prior to this she headed the mining finance team related businesses. Their experiences range from holding of Société Générale in London. She therefore has a strong senior positions in mining companies, to advising mining appreciation of risk, as well as a current appreciation of the companies on investments in other mining companies and opportunities and challenges in the sector including ESG. mines, to arranging finance for mines and mining companies She regularly attends key industry conferences and her and to working in the investment business. Individually involvement in industry groups such as Women in Mining their competences and experiences mean that the Board is ensures that she is kept abreast of key industry matters. able to develop appropriate strategies to manage the risk of investing in this sector and also to deal with ESG issues, Resolution 8 relates to the re-election of Ollie Oliveira who such as businesses that invest in pure-play thermal coal. The was appointed as a Director in February 2020. He is an skills and experience each Director brings to the Board for accountant and has over 40 years of corporate finance the long-term sustainable success of the Company are set experience. He has been a member of two listed companies’ out below. audit and risk committees and has experience of board committees covering the whole spectrum of governance Resolution 4 relates to the re-election of David Cheyne bodies common to resource groups. In the last 18 years of who was appointed as a Director in 2012 and as Chairman his executive career he held various senior positions within in 2019. Mr Cheyne was a legal adviser to a large number the Anglo American and De Beers groups in operational, of mining companies both on corporate matters and on strategic and corporate finance roles. He has extensive acquisitions and financing for over 30 years. As a result, he knowledge of the mining and natural resources sector has a great deal of experience on the issues that affect the and has led and managed corporate finance assignments sector, including those relating to ESG. His experience as a covering every major commodity. He is currently the senior corporate lawyer, advising boards and as chairman of a large independent director at Chilean copper miner Antofagasta international law firm, gives him considerable governance plc and has the same role at Russian gold miner Polymetal experience, as well as a knowledge of the sector. International plc.

Resolution 5 relates to the re-election of Russell Edey who Resolutions 9 and 10 – Re-appointment of the was appointed as a Director in 2014. Mr Edey is a chartered external auditors and auditors’ remuneration accountant and brings this skill set to his role as Chairman These resolutions relate to the re-appointment and of the Company’s Audit & Management Engagement remuneration of the Company’s auditors. The Company, Committee. He started his career with Anglo American through its Audit & Management Engagement Committee, Corporation of South Africa Ltd., a large diversified miner, has considered the independence and objectivity of in South Africa and subsequently in Australia. He joined the external auditors and is satisfied that the auditors N.M. Rothschild’s corporate finance division in London remain independent. Further information in relation to the and advised mining companies (and others) on mergers assessment of the auditors’ independence can be found on and acquisitions and capital raising. He was chairman of page 76. AngloGold Ashanti, a large international gold producer. He is a director of Genesis Emerging Markets Fund and Resolutions relating to the following items of special so has experience of investment trusts and investment business will be proposed at the forthcoming Annual General management. Mr Edey brings considerable experience of Meeting. the mining industry, corporate finance and governance and investment to his position as a Director of the Company. Resolution 11 – Continuation of the Company as an investment trust Resolution 6 relates to the re-election of Jane Lewis who has The ordinary resolution to be proposed will seek served on the Board for nearly five years. She has extensive shareholders’ authority that the Company shall continue in sector experience through her career in investment company being as an investment trust. corporate broking at Winterflood and business development at leading investment trust management houses. She holds Resolution 12 – Authority to allot shares a number of investment trust directorships, including as The Directors may only allot shares for cash if authorised to chairman. do so by shareholders in general meeting. This resolution seeks authority for the Directors to allot shares for cash Resolution 7 relates to the re-election of Judith Mosely up to an aggregate nominal amount of £886,354 which who was appointed as a Director in 2014. Ms Mosely has is equivalent to 17,727,081 ordinary shares of 5p each over twenty years’ experience in the City focusing on the and represents 10% of the current issued share capital, mining sector. She was employed until the end of December

60 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 excluding treasury shares, as at the date of the Notice of number of times in relation to the same meeting) does not Annual General Meeting. This authority will expire at the require a new notice to be sent, although the Directors are conclusion of next year’s Annual General Meeting in 2022, required to take appropriate actions to inform shareholders unless renewed prior to that date at an earlier general of the new time and place; meeting. • Ar ticle 52 (Form of general meetings) introduces the option Resolution 13 – Authority to disapply pre- of meetings being held as either ‘physical meetings’ or emption rights as ‘hybrid meetings’, with the latter involving both the physical attendance of members and participation by By law, Directors require specific authority from shareholders members via electronic means. Directors will be granted before allotting new shares or selling shares out of treasury the discretion to determine that any particular general for cash without first offering them to existing shareholders meeting (including an adjourned or postponed meeting) in proportion to their holdings. Resolution 13 empowers shall be held either as a physical meeting or hybrid the Directors to allot new shares for cash or to sell shares meeting but shall be under no obligation to convene which are held by the Company in treasury, otherwise any particular meeting as a hybrid meeting. It is the than to existing shareholders on a pro rata basis, up to an current expectation of the Directors that hybrid meetings aggregate nominal amount of £886,354 which is equivalent would only be used where a solely physical meeting is to 17,727,081 ordinary shares of 5p each and 10% of the impracticable or unworkable. Article 52 further empowers Company’s issued ordinary share capital, excluding treasury the Directors to make such arrangements as they see fit in shares, as at the date of the Notice of Annual General connection with electronic participation in hybrid meetings Meeting. Unless renewed at a general meeting prior to such and grants them the flexibility to change such meetings time, this authority will expire at the conclusion of the Annual to a physical meeting or change the electronic facilities to General Meeting of the Company to be held in 2022. be used, should they consider that their use has become impracticable or unreasonable; Resolution 14 – Authority to buy back shares The resolution to be proposed will seek to renew the authority • Ar ticle 53 (Attendance and participation at different granted to Directors enabling the Company to purchase its places) permits the Directors to make arrangements for own shares. The Directors will only consider repurchasing simultaneous attendance at and participation in general shares in the market if they believe it to be in shareholders’ meetings (via electronic means or otherwise) by members interests and as a means of correcting any imbalance at ‘satellite’ meetings, which are held at different venues between supply and demand for the Company’s shares. to that of the ‘Principal Place’ of the meeting at which the chairman presides, while still counting towards the quorum The Directors are seeking authority to purchase up to and being able to vote; and 26,572,895 ordinary shares (being 14.99% of the issued share capital, excluding treasury shares, as at the date of • Ar ticles 54 and 55 (Security arrangements and orderly this report) or, if less, 14.99% of the ordinary shares in issue conduct) permit the Directors or the chairman of at 29 April 2021. This authority, unless renewed at an earlier the meeting to put in place security measures where general meeting, will expire at the conclusion of next year’s considered appropriate in the circumstances, and to take Annual General Meeting. such action, give such directions or put in place such arrangements as are considered appropriate to secure the Resolution 15 – Amendments to the Articles of safety of those attending the meeting and to promote the Association orderly conduct of the meeting. The amendments to the Articles of Association involve the addition of five new articles described below, all of which Recommendation introduce increased flexibility for the Directors to determine The Board considers that the resolutions to be proposed at the time and place of general meetings and the manner in the Annual General Meeting are likely to promote the success which they are conducted (including the ability to hold hybrid of the Company and are in the best interests of the Company meetings) which the Directors believe will be desirable from and its shareholders as a whole. The Directors unanimously a corporate governance perspective following restrictions recommend that shareholders vote in favour of these around shareholder attendance at general meetings during resolutions as they intend to do so in respect of their own the COVID-19 pandemic: beneficial holdings.

• Ar ticle 51 (Postponement of a general meeting) allows the Corporate governance Directors to postpone the time at which a general meeting Full details are given in the Corporate Governance Statement. is to be held, or change the place of the general meeting, in The Corporate Governance Statement forms part of this the event that they decide it has become impracticable or Directors’ Report. undesirable to hold the meeting at the declared time and place. The exercise of this power (which may be used any

Section 3: Governance 61

Audit information As required by section 418 of the Companies Act 2006, each of the Directors in office at the date of approval of this report confirm that, so far as they are aware, there is no relevant audit information of which the Group’s auditors are unaware and each Director has taken all the steps that they ought to have taken as a Director to make themselves aware of any relevant audit information and to establish that the Group’s auditors are aware of that information.

Independent auditors The auditors, PricewaterhouseCoopers LLP, have indicated their willingness to continue in office and resolutions proposing their reappointment and authorising the Audit & Management Engagement Committee to determine their remuneration for the ensuing year will be submitted at the Annual General Meeting.

The Directors’ Report was approved by the Board at its meeting on 4 March 2021.

By order of the Board

CAROLINE DRISCOLL For and on behalf of BlackRock Investment Management (UK) Limited Company Secretary 4 March 2021

62 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

The Board presents the Directors’ Remuneration Report for the The Board’s remuneration is considered annually and was year ended 31 December 2020 which has been prepared in last reviewed in November 2020. Following this review, it accordance with sections 420-422 of the Companies Act 2006. was agreed that no changes would be made to Directors’ remuneration for the current financial year. Prior to this, The Remuneration Report comprises a remuneration policy Directors’ fees were last reviewed and increased on 1 October report and a remuneration policy implementation report. The 2013. remuneration policy report is subject to a triennial binding shareholder vote and was last approved by the Company’s No discretionary fees have been paid to the Directors shareholders at the Annual General Meeting held on 30 April during the year or previous year and the payment of such 2020. The remuneration implementation report is subject to fees is expected to be a rare occurrence, only necessary an annual advisory vote. in exceptional circumstances. Any discretionary fees paid to the Directors will be clearly disclosed in the Directors’ The law requires the Company’s auditors to audit certain Remuneration Report accompanied by an explanation of the of the disclosures provided. Where disclosures have been work undertaken and why it was deemed necessary to pay audited, they are indicated as such. The auditors’ opinion is such additional remuneration. included in their report on pages 82 to 90.

Statement by the Chairman Remuneration Committee A key element of the remuneration policy is that fees The Board as a whole fulfils the function of the Remuneration payable to Directors should be sufficient to attract and Committee and considers any change in the Directors’ retain individuals with suitable knowledge and experience remuneration policy. It is not considered necessary to have to promote the long-term success of the Company, whilst a separate Remuneration Committee as the Company’s also reflecting the time commitment and responsibilities of Directors are all non-executive and independent of the the role. The basis for determining the level of any increase Manager. No advice or services were provided by any external in the Directors’ remuneration and the Board’s policy on agencies or third parties in respect of remuneration levels. remuneration is set out in the Directors’ Remuneration Policy on pages 66 and 67.

Remuneration implementation report A single figure for the total remuneration of each Director is set out in the table below for the year ended 31 December 2020.

Year ended 31 December 2020 Year ended 31 December 2019

Base Taxable Base Taxable Directors salary benefits1 Total salary benefits1 Total

£ £ £ £ £ £

David Cheyne² 45,000 – 45,000 39,986 – 39,986

Ian Cockerill3 – – - 15,041 5,953 20,994

Colin Buchan4 12,500 – 12,500 37,500 – 37,500

Russell Edey5 35,000 – 35,000 30,000 1,001 31,001

Judith Mosely 30,000 – 30,000 30,000 – 30,000

Jane Lewis 30,000 – 30,000 30,000 646 30,646

Ollie Oliveira6 27,213 2,862 30,075 – – –

Total 179,713 2,862 182,575 182,527 7,600 190,127

1 Taxable benefits relate to travel and subsistence costs. 2 Appointed as Chairman on 2 May 2019. 3 Retired as Chairman on 2 May 2019. 4 Retired as Chairman of the Audit & Management Engagement Committee and Senior Independent Director on 30 April 2020. ⁵ Appointed as Chairman of the Audit & Management Engagement Committee and Senior Independent Director with effect from 1 May 2020. ⁶ Appointed as a Director with effect from 3 February 2020.

The information in the above table has been audited. The amounts paid by the Company to the Directors were for services as non-executive Directors. As at 31 December 2020 fees of £14,375 (2019: £14,375) were outstanding to Directors. No discretionary payments were made in the year to 31 December 2020 (2019: nil).

Section 3: Governance 63

Relative importance of spend on remuneration To enable shareholders to assess the relative importance of spend on pay, this has been shown in the table below compared with the Group’s dividend distributions, total revenue, net profit/(loss) on ordinary activities and buy back of ordinary shares.

As the Company has no employees, no consideration is required to be given to employment conditions elsewhere in setting Directors’ pay.

2020 2019 Change £’000 £’000 £’000

Directors' total remuneration 183 190 -7

Total dividends paid and payable 35,543 38,496 -2,953

Total revenue 39,471 46,514 -7,043

Net profit on ordinary activities after taxation 216,515 114,066 +102,449

Buy back of ordinary shares 4,609 5,546 -937

No payments were made in the year to any past Directors (2019: nil).

Annual percentage change in Directors’ remuneration The following table set outs the annual percentage change in Directors’ fees for the year to 31 December 2020.

David Cheyne (Chairman) 0%

Russell Edey (Audit & Management Engagement Committee Chairman and Senior Independent Director) 0%

Jane Lewis 0%

Judith Mosely 0%

Ollie Oliveira 0%

As previously noted, the Company does not have any employees and hence no comparisons are given in respect of the comparison between Directors’ and employees’ pay increases.

64 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Performance 31 December 31 December The line graph that follows compares the Company’s net 2020 2019 asset value and mid-market share price (with dividends Ordinary Ordinary shares Shares reinvested) with the MSCI ACWI Metals & Mining 30% Buffer 10/40 Index - net total return. This index was chosen David Cheyne 24,000 24,000 for comparison purposes as it was deemed to be the most Colin Buchan n/a 29,000 relevant to the Company’s investment objective when reporting to shareholders. Russell Edey 20,000 20,000

Jane Lewis 5,362 5,362 Performance 1 January 2010 to 31 December 2020 Judith Mosely 7,400 7,400 150 Ollie Oliveira 18,000 n/a

The information in the above table has been audited. 100 All of the holdings of the Directors are beneficial. No changes to these holdings have been notified up to the date of this

50 report.

Implementation of the remuneration policy

0 in 2021 financial year There are no significant changes in the current financial

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 year. The remuneration policy was implemented at the 2020 Annual General Meeting and there have been no changes to • MSCI ACWI Index • Net asset value per share Directors’ fees. • Share price (mid-market) Total return performance record, rebased to 100 at 31 December 2010. Retirement of Directors Sources: BlackRock and Datastream. Further details are given in the Directors’ Report on page 56.

Shareholdings By order of the Board The Board has not adopted a policy that Directors are required to own shares in the Company. The interests of DAVID CHEYNE the Directors in the ordinary shares of the Company are set Chairman out in the following table. The Company does not have a 4 March 2021 share option scheme, therefore none of the Directors has an interest in share options.

Section 3: Governance 65

Directors’ remuneration policy shareholders have the opportunity to express their views In determining the appropriate level of Directors’ fees, a and raise any queries in respect of the remuneration policy number of factors are considered, including the workload at this meeting. To date, no shareholders have commented of the Directors, their responsibilities, any change in these in respect of the remuneration policy. In the event that there responsibilities and additional legal duties (for example was a substantial vote against any resolution proposed at as a result of new legislation being implemented), the the Company’s Annual General Meeting, the reasons for any relationship with their suppliers and the size and complexity such vote would be sought and appropriate action taken. of the Company. The time commitment required, the Should the vote be against resolutions in relation to the level of skills and appropriate experience required and Directors’ remuneration, further details will be provided in the need for Directors to maintain on an ongoing basis future Directors’ Remuneration Reports. an appropriate level of knowledge of regulatory and compliance requirements in an industry environment of In accordance with the Companies Act 2006, the Company increasing complexity are also taken into account. The is required to seek shareholder approval of its remuneration Board also considers the average rate of inflation during policy on a triennial basis. An ordinary resolution for the the period since the last fee increase and reviews the level approval of the remuneration policy and the future policy of remuneration in comparison with other investment trusts table was put to members at the 2020 Annual General of a similar size and/or mandate, as well as taking account Meeting. It is the intention of the Board that the policy on of any data published by the Association of Investment remuneration will continue to apply for all financial years of Companies to ensure that fees are in line with industry the Company up to 31 December 2022. practice. This comparison, together with consideration of any alteration in non-executive Directors’ responsibilities, is used Any discretionary fees paid to the Directors will be to review whether any change in remuneration is necessary. clearly disclosed in the Directors’ Remuneration Report accompanied by an explanation of the work undertaken. The review is performed on an annual basis. No director will be present when his or her own pay is being determined. Shareholder voting The Company has no employees and consequently no At the Company’s previous Annual General Meeting held on consideration is required to be given to employment 30 April 2020, 99.79% of votes cast (including votes cast at conditions elsewhere in setting this policy and there has the Chairman’s discretion) were in favour of the resolution been no employee consultation. to approve the Directors’ Remuneration Report in respect of the year ended 31 December 2019 and 0.21% were against. No element of the Directors’ remuneration is performance 107,868 votes were withheld. related or subject to recovery or withholding (except for tax). Directors cannot be awarded any share options or long- At the Company’s Annual General Meeting held on 30 April term performance incentives. None of the Directors has a 2020, 99.77% (including votes cast at the Chairman’s service contract with the Company or receives any non-cash discretion) were in favour of the resolution to approve the benefits (except as described in the policy table), pension remuneration policy and 0.23% of votes cast were against. entitlements or compensation for loss of office. 120,960 votes were withheld.

The remuneration policy will be applied when agreeing the remuneration package of any new Director. The terms of a Director’s appointment are detailed in a letter sent to them when they join the Board. These letters are available for inspection at the registered office of the Company.

Directors’ appointments do not have a fixed duration, but they can be terminated by the Company in writing at any time without obligation to pay compensation. On termination of the appointment, Directors shall only be entitled to accrued fees as at the date of termination, together with reimbursement of any expenses properly incurred prior to that date. Directors are also subject to re-election on an annual basis and, if not elected, their appointment ceases immediately. No payments for loss of office are made.

Consideration of shareholders’ views An ordinary resolution to approve the Remuneration Report is put to members at each Annual General Meeting and

66 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Purpose and link Fees and benefits payable to Directors should be sufficient to attract and retain individuals of high calibre with to strategy suitable knowledge and experience. Those chairing the Board and key Committees should be paid higher fees than other Directors in recognition of their more demanding roles. Fees should reflect the time spent by Directors on the Company’s affairs and the level of complexity of responsibilities borne by the Directors.

Fees Discretionary fees Benefits

Description Current levels of fixed annual fee The Company’s Articles of The Directors are entitled to be repaid (effective from 1 October 2013) Association authorise the all reasonable travelling, hotel and payment of discretionary fees other expenses incurred by them in or Chairman - £45,000 to Directors for any additional about the performance of their duties work undertaken on behalf of the as Directors, including any expenses Audit & Management Company which is outside of their incurred in attending meetings of the Engagement Committee normal duties. Board or Committees of the Board, Chairman/Senior Independent Annual General Meetings or General Director - £37,500 Any such work and the fees Meetings. payable are subject to the prior Directors - £30,000 approval of the Chairman or, in the Some expenses incurred by Directors case of the Chairman undertaking are required to be treated as taxable The Board reviews the quantum of the extra work, subject to the benefits. Taxable benefits include Directors’ pay each year to ensure prior approval of the Chairman (but are not limited to) travel that this is in line with the level of of the Audit & Management expenses incurred by the Directors Directors’ remuneration for other Engagement Committee. in the course of travel to attend investment trusts of a similar size. Board and Committee meetings When making recommendations Any discretionary fees paid will which are held at the Company’s for any changes in fees, the be disclosed in the Directors’ registered office in London and Board will consider wider factors remuneration implementation which are reimbursed by the such as the average rate of report within the Annual Report. Company and therefore treated as inflation over the period since a benefit in kind and are subject the previous review and the level to tax and national insurance. The and any change in complexity Company’s policy in respect of this of the Directors’ responsibilities element of remuneration is that all (including additional time reasonable costs of this nature will commitments as a result of be reimbursed as they are incurred, increased regulatory or corporate including the tax and national governance requirements). insurance costs incurred by the Director on such expenses.

Maximum levels Fixed fees are set each year The level of discretionary fees No more than £50,000 per annum in accordance with the stated shall be determined by the may be paid in respect of taxable policies and as such there is no Directors and will be subject to a benefits. set maximum threshold; however, maximum of £10,000 per annum any increase granted must be in per Director. line with the stated policies. The Company’s Articles of Association set an aggregate limit of £250,000 in respect of the remuneration that may be paid to Directors in any financial year.

These ceilings have been set at a level to provide flexibility in respect of the recruitment of additional Board members and inflation.

Section 3: Governance 67

Chairman’s introduction Company throughout this accounting period, except the Corporate Governance is the process by which the Board provisions relating to: seeks to look after shareholders’ interests and protect and enhance shareholder value. Shareholders hold the Directors • the role of the chief executive; responsible for the stewardship of the Company, delegating • executive directors’ remuneration; and authority and responsibility to the Directors to manage the Company on their behalf and holding them accountable for • the need for an internal audit function. its performance. The Board considers that these provisions are not relevant The Board is ultimately responsible for framing and to the position of the Company, being an eternally managed executing the Company’s strategy and for closely investment company with no executive employees and, in monitoring risks. We aim to run our Company in a manner relation to the internal audit function, in view of BlackRock which is responsible and consistent with our belief in having an internal audit function. Further explanation is honesty, transparency and accountability. In our view, provided below. good governance means managing our business well and engaging effectively with investors. We consider the practice Information on how the Company has applied the principles of good governance to be an integral part of the way we of the AIC Code and UK Code is set out below. The UK Code manage the Company and we are committed to maintaining is available from the Financial Reporting Council’s website at high standards of financial reporting, transparency and frc.org.uk. The AIC Code is available from the Association of business integrity. Investment Companies at theaic.co.uk.

As a UK-listed investment trust company our principal The Board reporting obligation is driven by the UK Corporate The Board consists of five non-executive Directors, all of Governance Code (the UK Code) issued by the Financial whom are independent of the Company’s Manager. Provision Reporting Council in July 2018. However, as listed 9 of the UK Code which relates to the combination of the investment trust companies differ in many ways from other roles of the chairman and chief executive does not apply as listed companies, the Association of Investment Companies the Company has no executive directors. has drawn up its own set of guidelines, the AIC Code of Corporate Governance (the AIC Code) issued in February The Board’s primary purpose is to direct the Company to 2019, which addresses the governance issues relevant maximise shareholder value within a framework of proper to investment companies and meets the approval of the controls and in accordance with the Company’s investment Financial Reporting Council. objective.

Both the UK Code and the AIC Code apply to accounting Board structure and management periods beginning on or after 1 January 2019. The Board has Details of the Board’s structure, roles and responsibilities determined that it has complied with the recommendations and management are set out in the summary of Governance of the AIC Code. This in most material respects is the same Structure on page 36. The Directors’ biographies on pages as the UK Code, save that there is greater flexibility regarding 37 and 38 demonstrate a breadth of investment, commercial, the tenure of office of the Chairman and membership of the accounting, financial and professional experience which Audit Committee. enables them to provide effective strategic leadership and proper governance of the Company. Details of the Chairman’s This report, which forms part of the Directors’ Report, other significant time commitments can be found on page explains how the Board deals with its responsibility, authority 37. and accountability.

The Company does not have a chief executive as day-to-day Compliance management of the Company’s affairs is delegated to the The Board has made the appropriate disclosures in this Manager as AIFM, with investment management and other report to ensure the Company meets its continuing ancillary services delegated to the Investment Manager. obligations. It should be noted that, as an investment trust, Representatives of the Manager, Investment Manager most of the Company’s day-to-day responsibilities are and Company Secretary attend each Board meeting. The delegated to third parties, the Company has no employees Board, the AIFM, the Investment Manager and the Company and the Directors are all non-executive, therefore not all of Secretary operate in a supportive and co-operative manner. the provisions of the UK Code are directly applicable to the Company. Board independence and tenure The Board’s individual independence, including that of The Board considers that the Company has complied with the Chairman, has been considered and confirmed, and the recommendations of the AIC Code and the provisions this independence allows all of the Directors to sit on the contained within the UK Code that are relevant to the Company’s various Committees. In view of the changes to the

68 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 UK Code effective from 1 January 2019, the Chairman of the Company and his or her duties and responsibilities as a Board does not act as a member of the Audit & Management Director. In addition, a new Director will also spend some Engagement Committee. time with the Portfolio Managers, the Company Secretary and other key employees of the Manager whereby he or she None of the Directors has a service contract with the will become familiar with the workings and processes of the Company. The terms of their appointment are detailed in Company. a letter sent to them when they join the Board. Copies of these letters are available on request from the Company’s The Company’s policy is to encourage Directors to keep up registered office and will be available at the Annual General to date and attend training courses on matters which are Meeting. directly relevant to their involvement with the Company. The Directors also receive regular briefings from, amongst others, Diversity the auditors and the Company Secretary regarding any Our Company is highly specialised and our priority to proposed developments or changes in laws or regulations shareholders is to have a Board with the specialist abilities that could affect them or the Company. Directors’ training and technical mining experience to look after the Group’s and development needs are reviewed by the Chairman on an investments. In addition, the Board should be able to annual basis. demonstrate with conviction that any new appointee would make a meaningful contribution. We also focus on diversity Directors’ liability insurance in its broadest sense, in terms of expertise, geographic The Company has maintained appropriate Directors’ liability background, gender and race. insurance cover throughout the year.

The Board should have a blend of skills and attributes that The Board’s responsibilities is appropriate to its needs; we believe that gender is an The Board is responsible to shareholders for the overall important element and one we should aspire to on the basis management of the Company. It decides upon matters that the expertise is available. As the Board is committed to relating to the Company’s investment objective, policy appointing the most appropriate candidate, regardless of and strategy and monitors the Company’s performance gender or other forms of diversity, no targets have been set towards achieving that objective through its agreed policy against which to report. and strategy. The Board has also adopted a schedule of matters reserved for its decision. The Board is supplied in Directors’ appointment, retirement and a timely manner with information in a form and of a quality rotation appropriate to enable it to discharge its duties. The rules concerning the appointment, retirement and rotation of Directors are discussed in the Directors’ Report Strategic issues and all operational matters of a material on page 56. The Board has considered the position of nature are determined by the Board. The Board has each of the Directors as part of the evaluation process and responsibility for ensuring that the Company keeps adequate believes it would be in the best interests of the Company for accounting records which disclose with reasonable accuracy the Directors retiring to be proposed for re-election at the at any time the financial position of the Company and which forthcoming Annual General Meeting given their material enable it to ensure that the financial statements comply with level of contribution and commitment to the Company. the Companies Act 2006. It is the Board’s responsibility to present a balanced and understandable assessment, which The Board recognises the value of progressive renewing extends to interim and other price-sensitive reports. The of, and succession planning for, company boards. The Board is also responsible for safeguarding the assets of the refreshment of the Board will remain as an ongoing Company and for taking reasonable steps for the prevention process to ensure that the Board is well-balanced through and detection of fraud and other irregularities. the appointment of new Directors with the skills and experience necessary. Directors must be able to demonstrate The Board has established a procedure whereby Directors commitment to the Company, including in terms of time. The wishing to do so in the furtherance of their duties, may take Board is cognisant of the concept of ‘overboarding’ and has independent advice at the Company’s expense. considered the time commitment required by the Directors’ other roles, taking into account their nature and complexity. Performance evaluation The Board reviews this information annually to ensure all In order to review the effectiveness of the Board, its Directors have sufficient capacity to effectively carry out their Committees and the individual Directors, the Board carries role. out an annual appraisal process. The annual evaluation for the year ended 31 December 2020 has been carried out with Directors’ induction, training and the assistance of an independent third-party and took the development form of electronic performance evaluation questionnaires. When a new Director is appointed to the Board, he or she The responses were then collated, analysed and discussions is provided with all the relevant information regarding the held between the Chairman and the Directors. The

Section 3: Governance 69

performance of the Chairman was reviewed by the other Directors wishing to do so in the furtherance of their duties, Directors led by the Audit & Management Engagement may take independent professional advice at the Company’s Committee Chairman. expense.

The appraisal process is considered to be constructive in Committees of the Board terms of identifying areas for improving the functioning Nomination Committee of the Board and its Committees and the contribution of As the Board is small and comprises only non-executive individual Directors, as well as building on and developing Directors it fulfils the function of the Nomination Committee individual and collective strengths. There were no significant and is chaired by the Chairman of the Board. Should a actions arising from the evaluation process and it was vacancy occur, or the Board decide to recruit new members, agreed that the current composition of the Board and its the Board will take into account the size, balance and profile Committees reflected a suitable mix of skills and experience of the Board as a whole to identify any areas that need and that the Board as a whole, the individual Directors and its strengthening. Due to the specialist nature of the investment Committees, were functioning effectively. mandate and the difficulty in finding new Directors with knowledge of the mining sector, the existing Directors Delegation of responsibilities may identify suitable individuals from their range of Management and administration contacts, although other sources, including external search The management of the investment portfolio and the consultants, may also be used as required. administration of the Company have been contractually delegated to BlackRock Fund Managers Limited (BFM), as Audit & Management Engagement Committee the Company’s AIFM, and BFM (with the permission of the A separately chaired Audit & Management Engagement Company) has delegated certain investment management Committee has been established and consists of four of and other ancillary services to BlackRock Investment the Directors of the Company and is chaired by Russell Management (UK) Limited (BIM (UK) or the Investment Edey. Further details are given in the Report of the Audit & Manager). The contractual arrangements with BFM (the Management Engagement Committee on pages 73 to 77. Manager) are summarised on pages 54 and 55. Remuneration Committee The Manager, operating under guidelines determined The Company’s policy on Directors’ remuneration, together by the Board, has direct responsibility for the decisions with details of the remuneration of each Director, is detailed relating to the day-to-day running of the Company and is in the Directors’ Remuneration Report and Directors’ accountable to the Board for the investment, financial and Remuneration Policy on pages 63 to 67. As stated in the operating performance of the Company. The Board has Directors’ Remuneration Report, the full Board determines final investment authority on unquoted investments. The the level of Directors’ fees and accordingly there is no review of the Manager’s performance is an ongoing duty and separate Remuneration Committee. responsibility of the Board which is carried out at each Board meeting. In addition, a formal review is undertaken annually, Internal Controls details of which are set out in the Directors’ Report. The Board is responsible for establishing and maintaining the internal controls of the Company and for reviewing The Investment Manager has delegated the portfolio their effectiveness, for ensuring that financial information valuation and fund accounting services to The Bank of New published or used within the business is reliable and for York Mellon (International) Limited (BNYM). The assets of regularly monitoring compliance with regulations governing the Company have been entrusted to the Depositary for the operation of investment trusts. The Board, through safekeeping. The Depositary is The Bank of New York Mellon the Audit & Management Engagement Committee (the (International) Limited. The address at which this business is Committee), regularly reviews the effectiveness of the conducted is given on page 135. internal control systems to identify, evaluate and manage the Company’s significant risks. If any significant failings or The Board has delegated the exercise of voting rights weaknesses are identified, the Manager and Board ensure attaching to the securities held in the portfolio to the that necessary action is taken to remedy the failings. The Investment Manager. Details of the Investment Manager’s Board is not aware of any significant failings or weaknesses voting policy are set out on pages 55 and 56. arising in the year under review. The Company Secretary Control of the risks identified, covering financial, operational, The Board has direct access to company secretarial compliance and risk management, is embedded in the advice and the services of the Manager which, through its operations of the Company. There is a monitoring and nominated representative, is responsible for ensuring that reporting process to review these controls, which has been Board and Committee procedures are followed and that in place throughout the year under review and up to the applicable regulations are complied with. The appointment date of this report, carried out by the Manager’s Risk and and removal of the Company Secretary is a matter for the Quantitative Analysis Group. This accords with the Financial whole Board. The Board has established a procedure whereby

70 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Reporting Council’s ‘Guidance on Risk Management, Internal to meet its stated objectives. However, the Board believes Control and Related Financial and Business Reporting’. that it is important to invest in companies whose boards act responsibly in respect of environmental, ethical and social The Company’s risk register sets out the risks relevant to the issues. The Investment Manager’s evaluation procedures Company and describes, where relevant, the internal controls and financial analysis of the companies within the portfolio that are in place at the AIFM, the Investment Manager and includes research and appraisal and also takes into account other third-party service providers to mitigate these risks. environmental policies, social, ethical and other business The Committee formally reviews this register on a semi- issues. In this regard the Natural Resources team works annual basis and the Manager as the Company’s AIFM closely with BlackRock’s Investment Stewardship team. reports on any significant issues that have been identified in the period. In addition, BlackRock’s internal audit department BlackRock defines ESG integration as the practice provides an annual presentation to the Audit Committee of incorporating material environmental, social, and chairmen of the BlackRock investment trusts on the results governance (ESG) information into investment decisions in of testing performed in relation to BlackRock’s internal order to enhance risk-adjusted returns. Some of BlackRock’s control processes. The Depositary also reviews the control clients call this responsible investing - to BlackRock, processes in place at the Custodian, the Fund Accountant integrating ESG information, or sustainability considerations, and the AIFM and reports formally to the Committee twice should be part of any robust investment process and means yearly. Both the AIFM and the Depositary will escalate issues adapting research and core investment processes to account and report to the Committee outside of these meetings on for additional sources of risk and return that are explained an ad hoc basis to the extent this is required. The Committee by ESG information. In alpha-seeking strategies, BlackRock also receives annual and quarterly internal control reports can use ESG information when conducting research and due respectively from BlackRock and BNYM on the internal diligence on new investments, and again when monitoring controls of their respective operations, together with the investments in a portfolio. Of course, ESG information is not opinion of their reporting accountant. the sole consideration for investment decisions; instead, the firm’s investment professionals assess a variety of The Board recognises that these control systems can only economic and financial indicators, which can include ESG be designed to manage rather than eliminate the risk issues, to make investment decisions appropriate for clients’ of failure to achieve business objectives and to provide objectives. BlackRock’s approach to ESG integration is to reasonable, but not absolute, assurance against material broaden the total amount of information its investment misstatement or loss, and relies on the operating controls professionals consider in order to improve investment established by the Manager and Custodian. The Manager analysis, seeking to meet or exceed economic return and prepares revenue forecasts and management accounts financial risk targets. which allow the Board to assess the Company’s activities and review its performance. The Board and the Manager have Further details on ESG and Socially Responsible Investing agreed clearly defined investment criteria, specified levels can be found in the Strategic Report on pages 51 to 53. of authority and exposure limits. Reports on these issues, including performance statistics and investment valuations, The Manager is a Tier 1 signatory to the UK Stewardship are submitted to the Board at each meeting. Code, which among other things, sets out the responsibilities of institutional shareholders in respect of investee The Company does not have its own internal audit function, companies. The Manager’s compliance with the UK as all the administration is delegated to the Manager and Stewardship Code is publicly available on the BlackRock other third-party service providers. The Board monitors the website: https://www.blackrock.com/corporate/about- controls in place through the internal control reports and the us/investment-stewardship. The Manager’s approach to Manager’s internal audit department and feels that there is sustainable investing is detailed on the website at https:// currently no need for the Company to have its own internal www.blackrock.com/us/individual/investment-ideas/ audit function, although this matter is kept under review. sustainable-investing.

Financial reporting Bribery prevention policy The Statement of Directors’ Responsibilities in respect of the The provision of bribes of any nature to third parties in Annual Report and Financial Statements is set out on page order to gain a commercial advantage is prohibited and is 78, the Independent Auditors’ Report on pages 82 to 90 and a criminal offence. The Board has a zero tolerance policy the Statement of Going Concern on page 56. towards bribery and a commitment to carry out business fairly, honestly and openly. The Board takes its responsibility Socially responsible investment to prevent bribery very seriously and the Manager has anti- Generally, investment trusts do not employ staff and bribery policies and procedures in place which are high accordingly have no direct impact on social matters but level, proportionate and risk based. The Company’s service can be significant investors in the economies of the regions providers have been contacted in respect of their anti-bribery in which they invest. The Company invests in mining policies and, where necessary, contractual changes are made companies around the world primarily on financial grounds to existing agreements in respect of anti-bribery provisions.

Section 3: Governance 71

Criminal Finances Act 2017 financial statements, regular factsheets and other The Company has a commitment to zero tolerance towards information are also published on the BlackRock website the criminal facilitation of tax evasion. at blackrock.com/uk/brwm. The work undertaken by the auditors does not involve consideration of the maintenance Communications with shareholders and integrity of the website and, accordingly, the auditors accept no responsibility for any changes that have occurred Under normal operating circumstances, all shareholders to the financial statements since they were initially presented have the opportunity to attend and vote at the Annual on the website. Visitors to the website need to be aware that General Meeting. Although physical attendance at the legislation in the United Kingdom governing the preparation Company’s 2021 Annual General Meeting in April may not and dissemination of the accounts may differ from be possible due to social distancing restrictions in place, the legislation in their jurisdiction. Board encourages shareholders to send any questions that they would like to address by post or email to the Secretary at the address shown on page 135. Shareholders are also Packaged Retail and Insurance-Based encouraged to submit their votes by proxy. A written response Investment Products (PRIIPS) Regulation will be provided to all queries. The Notice of Annual General (the Regulation) Meeting which is sent out 20 working days in advance of Effective from 1 January 2018, the European Union’s the meeting sets out the business of the Meeting which is PRIIPs Regulation came into force and requires that anyone explained in the Directors’ Report. Separate resolutions are manufacturing, advising on, or selling a PRIIP to retail proposed for substantive issues. investors in the EEA must comply with the Regulation. Shares issued by investment trusts fall into scope of the In addition, regular updates on performance are available Regulation. to shareholders on the BlackRock website and the Portfolio Managers will review the Company’s portfolio performance Investors should be aware that the PRIIPs Regulation at the Annual General Meeting. This year, to the extent that requires the AIFM, as PRIIPs manufacturer, to prepare a key social distancing regulations make physical attendance at information document (KID) in respect of the Company. This the Annual General Meeting impossible, a recorded video of KID must be made available, free of charge, to EEA retail the Portfolio Managers’ presentation will be made available investors prior to them making any investment decision and on the website at www.blackrock.com/uk/brwm. Proxy voting have been published on BlackRock’s website. The Company figures will be announced to shareholders at the Annual is not responsible for the information contained in the KID General Meeting and will be made available on the website and investors should note that the procedures for calculating shortly after the meeting. In accordance with Provision 4 of the risks, costs and potential returns are prescribed by law. the UK Code, when 20% of votes have been cast against a The figures in the KID may not reflect the expected returns resolution at any general meeting, the Board will explain, for the Company and anticipated performance returns when announcing the results of voting, what actions it cannot be guaranteed. intends to take to understand the reasons behind the vote result. An interim action statement will also be published The PRIIPs KID in respect of the Company can be found at: within six months of the vote, setting out the views received blackrock.com/uk/brwm. from shareholders and the actions that the Company has taken, and the Board will include a summary of the feedback Disclosure Guidance and Transparency and actions in the next Annual Report. Rules Other information required to be disclosed pursuant to the The Company’s willingness to enter into discussions with Disclosure Guidance and Transparency Rules has been institutional shareholders is also demonstrated by the placed in the Directors’ Report on pages 54 to 62 because it programmes of institutional presentations by the Investment is information which refers to events that have taken place Manager. The Board discusses with the Investment Manager during the course of the year. at each Board meeting any feedback from meetings with shareholders and it also receives reports from its corporate For and on behalf of the Board brokers. The Chairman is available to meet directly with shareholders periodically without the Investment Manager DAVID CHEYNE being present. The Chairman may be contacted via the Chairman Company Secretary whose details are given on page 135. 4 March 2021 The dialogue with shareholders provides a two way forum for canvassing the views of shareholders and enabling the Board to become aware of any issues of concern, including those relating to performance, strategy and corporate governance.

There is a section within this report entitled ‘Shareholder Information’ which provides an overview of useful information available to shareholders. The Company’s

72 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

As Chairman of the Company’s Audit & Management Narrative reporting Engagement Committee (the Committee) I am pleased to • reviewing the content of the Annual Report and Financial present the Committee’s report to shareholders for the year Statements and advising the Board on whether, taken as ended 31 December 2020. a whole, they are fair, balanced and understandable and provide the information necessary for shareholders to Composition assess the Group’s position, performance, business model All of the Directors, except the Chairman of the Board, were and strategy. members of the Committee during the year under review. The Chairman may attend Committee meetings by invitation. External audit • making recommendations to the Board, to be put to The Directors’ biographies are given on pages 37 and 38 shareholders for approval at the Annual General Meeting in and the Board considers that at least one member of the relation to the appointment, re-appointment and removal Committee has competence in accounting and/or auditing of the Company’s external auditors; and the Committee as a whole has competence relevant to • reviewing the scope, execution, results, cost effectiveness, the sector in which the Company operates. independence and objectivity of the external auditors;

Performance evaluation • reviewing and approving the audit and non-audit fees Details of the evaluation of the Committee are set out in the payable to the external auditors and the terms of their Corporate Governance Statement on pages 69 and 70. engagement;

• reviewing and approving the external auditors’ plan Role and responsibilities for the following financial year, with a focus on the The Committee meets at least twice a year. The two planned identification of areas of audit risk and consideration of the meetings are held prior to the Board meetings to approve appropriateness of the level of audit materiality adopted; the half yearly and annual results. The Committee does not consider that as an investment trust company it needs • reviewing the efficiency of the external audit process and to hold an additional meeting, although this is kept under the quality of the audit engagement partner and the audit review. team, and making a recommendation with respect to the reappointment of the auditors; The Committee operates within written terms of reference • reviewing the role of the Manager and third-party service detailing its scope and duties and these are available on providers in an effective audit process; the website at blackrock.com/uk/brwm. The Committee’s principal duties, as set out in the terms of reference, are set • considering the quality of the formal audit report to out below. In accordance with these duties, the principal shareholders; and activities of the Committee during the year included: • overseeing the relationship with the external auditors. Internal controls, financial reporting and risk Management engagement management systems • reviewing the management contract to ensure that the • reviewing the adequacy and effectiveness of the Group’s terms remain competitive; internal financial controls and the internal control and risk management systems; • satisf ying itself that the continuing appointment of the Manager is in the interests of shareholders as a whole; and • reasonably satisfying itself that such systems meet relevant legal and regulatory requirements; • considering the remuneration of the Manager and other service providers. • monitoring the integrity of the financial statements; Third-party service providers • reviewing the consistency of, and any changes to, • considering the appointment of other third-party service accounting policies; providers; and • reviewing the Half Yearly and Annual Report and Financial • ensuring that third-party service providers comply with the Statements to ensure that the Group’s results and terms of their agreements and that the provisions of such financial position are presented accurately and fairly to agreements remain competitive. shareholders;

• reviewing semi-annual reports from the Manager on its Reporting responsibilities activities as AIFM; and • repor ting to the Board on its proceedings and how it has discharged its responsibilities, making whatever • reviewing half yearly reports from the Depositary on its recommendations it deems appropriate on any area within activities. its remit; and

Section 3: Governance 73

• compiling a report on its activities to be included in the As the provision of portfolio valuation, fund accounting Annual Report and Financial Statements. and administration services is delegated to the Investment Manager, which sub-delegates certain administrative Internal audit functions to The Bank of New York Mellon (International) • considering the need for an internal audit function, as set Limited (BNYM), the Committee has also reviewed the out in the Corporate Governance Statement on page 71 internal control reports prepared by BlackRock and BNYM. and below. This enables the Committee to ensure that the relevant control procedures are in place to cover the areas of risk as The fees paid to the external auditors are set out in note 5 identified in the table that follows and are adequate and of the Financial Statements. An explanation of how auditor appropriate and have been confirmed as operating effectively objectivity and independence is safeguarded is reported by their reporting auditor. under ‘Assessment of the effectiveness of the external audit process’ on page 76.

Whistleblowing policy The Committee has reviewed and accepted the ‘whistleblowing’ policy that has been put in place by BlackRock under which its staff, in confidence, can raise concerns about possible improprieties in matters of financial reporting or other matters, insofar as they affect the Company.

Internal audit The Company does not have its own internal audit function, as all the administration is delegated to the Manager. The Board considers that it is sufficient to rely on the internal audit department of BlackRock and the requirement for an internal audit function is kept under review. The external auditors obtain an understanding of the internal controls in place at both the Manager and the Fund Accountant by analysing the relevant control reports issued by their independent auditors.

Non-audit services The Company’s policy on permitted audit related and non‑audit services is set out in full in the Committee’s terms of reference which are available on the Manager’s website at blackrock.com/uk/brwm. The only audit related services provided in the year related to the review of the half yearly financial statements.

Significant issues considered regarding the Annual Report and Financial Statements During the year, the Committee considered a number of significant issues and areas of key audit risk in respect of the Annual Report and Financial Statements. The Committee reviewed the external audit plan at an early stage and concluded that the appropriate areas of audit risk relevant to the Company had been identified and that suitable audit procedures had been put in place to obtain reasonable assurance that the financial statements as a whole would be free of material misstatements. The table on page 75 sets out the key areas of risk identified and also explains how these were addressed.

74 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

The accuracy of the valuation of the investment portfolio Listed investments are valued using stock exchange prices from third party valuers. The Board reviews detailed portfolio valuations including the fair valuation of unquoted investments on a regular basis throughout the year and receives confirmation from the Manager that the pricing basis is appropriate and in line with relevant accounting standards as adopted by the Company and that the carrying values are materially correct. In relation to the OZ Minerals Brazil Royalty Contract, the Board engages an independent external mining consultant to conduct a periodic valuation of the Royalty Contract.

The risk of misappropriation of assets and unsecured The Depositary is responsible for financial restitution for loss of ownership of investments financial investments held in custody. The Depositary reports to the Committee twice a year.

The Committee reviews reports from its service providers on key controls over the assets of the Company and will take action to address any significant issues that are identified in these reports, which may include direct discussions with representatives of the relevant service providers to obtain more detailed information surrounding any matters of concern and gaining assurance that appropriate remediation has been taken. Any significant issues are reported by the Manager to the Committee. The Manager has put in place procedures to ensure that investments can only be made to the extent that the appropriate contractual and legal arrangements are in place to protect the Company’s assets.

The accuracy of the calculation of management fees The management fee is calculated in accordance with the contractual terms in the investment management agreement by the Fund Accountant and is reviewed in detail by the Manager.

The risk that income is overstated, incomplete or inaccurate The Committee reviews income forecasts, including special through failure to recognise proper income entitlements dividends and written options, and receives explanations from or to apply the appropriate accounting treatment for the Manager for any variations or significant movements from recognition of income previous forecasts and prior year numbers. The Committee also reviews and approves the rationale for the revenue/capital accounting treatment of option income and special dividends.

The Committee also reviews SOC1 Reports from its service providers, including the Company’s Fund Accountant and Custodian, BNYM. These reports include information on control processes in place to ensure the accurate recording of income and any exceptions are highlighted to the Committee and will be investigated further to ensure that appropriate remedial action has been taken where relevant.

The risk that the global economic disruption caused by The Committee has reviewed the impact of the recent market COVID-19 will affect the Company’s ability to continue volatility related to the COVID-19 pandemic on the Company’s in operation due to the impact on market valuations of portfolio and received regular reports from the Portfolio Managers. portfolio companies or the ability of key service providers The Committee has also reviewed portfolio liquidity and updated (including the Manager, the Depositary, the Custodian, revenue and expense forecasts in light of COVID-19 and its impact the Fund Accountant and Broker) to maintain business on portfolio liquidity, income and market valuations and considers continuity and continue to provide appropriate service that the Company’s business model remains viable and that the levels. Company has sufficient resources to continue in operation and to meet all liabilities as they fall due.

The Committee has reviewed the Company’s borrowing facilities and considers that the Company continues to meet its financial covenants in respect of these facilities and has a wide margin before any relevant threshold is reached.

The Committee keeps the Company’s principal risks and uncertainties under review and is confident that the Company has appropriate controls and processes in place to manage these risks and to maintain its operating model despite the challenges posed by COVID-19. The Committee has also received updates from key service providers in respect of their business continuity plans and is confident that they will be able to continue to provide a good level of service for the foreseeable future.

Section 3: Governance 75

Auditors and audit tenure • policies and procedures to pre-approve and monitor The Committee reviews the performance of the auditors non‑audit services including gifts and hospitality; on an annual basis, taking into consideration the • the independence and objectivity of the audit firm; and services and advice provided to the Company and the fees charged for these services. The Company’s auditors, • the quality of the formal audit report to shareholders. PricewaterhouseCoopers LLP, were appointed on 28 April 2016 following the result of a tender process held in late Feedback in relation to the audit process and also the 2015. Ms Sally Cosgrove has been the Company’s audit effectiveness of the Manager in performing its role is also partner since 28 April 2016. sought from relevant involved parties, notably the audit partner and team. The external auditors are invited to attend The Committee, in conjunction with the Board, is committed the Committee meetings at which the half yearly and annual to reviewing the auditors’ appointment each year to ensure financial statements are considered and at which they that the Company is receiving an optimal level of service. have the opportunity to meet with the Committee without In addition, even if no change is made to the audit firm representatives of the Manager or Investment Manager appointed, the audit partner changes at least every five being present. years. Ms Gillian Alexander will replace Ms Cosgrove as audit partner for the current financial year. The effectiveness of the Committee and the Manager in the external audit process is assessed principally in relation to There are no contractual obligations that restrict the the timely identification and resolution of any process errors Company’s choice of auditors. The Committee is mindful or control breaches that might impact the Company’s net of EU audit legislation which requires the rotation of long asset values and accounting records. It is also assessed by serving auditors. The Company will be required to put its reference to how successfully any issues in respect of areas audit contract out to tender again by no later than 2026. of accounting judgement are identified and resolved, the quality and timeliness of papers analysing these judgements, Audit related service fees of £7,540 (excluding VAT) paid to the Board and the Manager’s approach to the value of the PricewaterhouseCoopers LLP relate to their review of the half independent audit and the booking of any audit adjustments yearly financial statements (2019: £6,580). arising, and the timely provision of draft public documents for review by the auditors and the Committee. Assessment of the effectiveness of the external audit process To form a conclusion regarding the independence of the external auditors, the Committee considers whether the skills To assess the effectiveness of the external audit, members and experience of the auditors make them a suitable supplier of the Committee work closely with the Manager to obtain of non-audit services and whether there are safeguards in a good understanding of the progress and efficiency of the place to ensure that there is no threat to their objectivity audit. The Committee has adopted a formal framework to and independence in the conduct of the audit resulting review the effectiveness of the external audit process and from the provision of such services. On an ongoing basis, audit quality. This includes a review of the following areas: PricewaterhouseCoopers LLP review the independence of their relationship with the Company and report to the • the quality of the audit engagement partner and the audit Committee, providing details of any other relationship team; with the Manager. As part of this review, the Committee • the expertise of the audit firm and the resources available also receives information about policies and processes for to it; maintaining independence and monitoring compliance with relevant requirements from the Company’s auditors, • identification of areas of audit risk; including information on the rotation of audit partners and staff, the level of fees that the Company pays in proportion • planning, scope and execution of the audit; to the overall fee income of the firm, and the level of related fees, details of any relationships between the audit firm and • consideration of the appropriateness of the level of audit its staff and the Company, as well as an overall confirmation materiality adopted; from the auditors of their independence and objectivity. • the role of the Committee, the Manager and third-party service providers in an effective audit process; As a result of its review, the Committee has concluded that the external audit has been conducted effectively and also • communications by the auditors with the Committee; that PricewaterhouseCoopers LLP is independent of the Company and the Manager. • how the auditors support the work of the Committee and how the audit contributes added value;

76 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Conclusions in respect of the Annual Report and Financial Statements The production and the audit of the Company’s Annual Report and Financial Statements is a comprehensive process requiring input from a number of different contributors. In order to reach a conclusion that the Annual Report and Financial Statements are fair, balanced and understandable, the Board has requested that the Committee advise on whether these criteria are satisfied. In so doing, the Committee has given consideration to the following:

• the comprehensive control framework over the production of the Annual Report and Financial Statements, including the verification processes in place to deal with the factual content;

• the extensive levels of review that are undertaken in the production process by the Manager, the Depositary and other third-party service providers responsible for accounting services and the Committee;

• the controls that are in place at the Manager and third- party service providers to ensure the completeness and accuracy of the Group’s financial records and the security of the Group’s assets; and

• the existence of satisfactory internal control reports that have been reviewed and reported on by external auditors to verify the effectiveness of the internal controls of the Manager, Depositary, Custodian and Fund Accountants.

In addition to the work outlined above, the Committee has reviewed the Annual Report and Financial Statements and is satisfied that, taken as a whole, they are fair, balanced and understandable. In reaching this conclusion, the Committee has assumed that the reader of the Annual Report and Financial Statements would have a reasonable level of knowledge of the investment trust industry in general and of investment trusts in particular. The Committee has reported on these findings to the Board who affirm the Committee’s conclusions in the Statement of Directors’ Responsibilities in respect of the Annual Report and Financial Statements.

RUSSELL EDEY Chairman Audit & Management Engagement Committee 4 March 2021

Section 3: Governance 77

The Directors are responsible for preparing the Annual They are also responsible for safeguarding the assets of Report and Financial Statements in accordance with the Company and hence for taking reasonable steps for the applicable law and regulations. Company law requires the prevention and detection of fraud and other irregularities. Directors to prepare financial statements for each financial year. Under that law, the Directors are required to prepare The Directors are also responsible for preparing the Strategic the financial statements in accordance with International Report, Directors’ Report, the Directors’ Remuneration Financial Reporting Standards (IFRS) adopted pursuant to Report, the Corporate Governance Statement and the Report Regulation (EC) No 1606/2002 as it applies in the European of the Audit & Management Engagement Committee in Union and in conformity with the requirements of the accordance with the Companies Act 2006 and applicable Companies Act 2006. regulations, including the requirements of the Listing Rules and the Disclosure Guidance and Transparency Rules. The Under Company law, the Directors must not approve the Directors have delegated responsibility to the Manager for financial statements unless they are satisfied that they the maintenance and integrity of the Company’s corporate give a true and fair view of the state of affairs of the Group and financial information included on the BlackRock website. and Company and of the profit or loss of the Group for that Legislation in the United Kingdom governing the preparation period. In preparing those financial statements, the Directors and dissemination of financial statements may differ from are required to: legislation in other jurisdictions.

• present fairly the financial position, financial performance Each of the Directors, whose names are listed on pages 37 and cash flows of the Group and Company; and 38, confirm to the best of their knowledge that:

• select suitable accounting policies in accordance with • the financial statements, which have been prepared in IAS 8: Accounting Policies, Changes in Accounting accordance with IFRS adopted pursuant to Regulation Estimates and Errors and then apply them consistently; (EC) No 1606/2002 as it applies in the European Union and in conformity with the requirements of the Companies • present information, including accounting policies, in a Act 2006, give a true and fair view of the assets, liabilities, manner that provides relevant, reliable, comparable and financial position and net return of the Group and understandable information; Company; and

• make judgements and estimates that are reasonable and • the Strategic Report contained in the Annual Report prudent; and Financial Statements includes a fair review of the development and performance of the business and the • state whether the financial statements have been prepared position of the Group and Company, together with a in accordance with IFRS adopted pursuant to Regulation description of the principal risks and uncertainties that it (EC) No 1606/2002 as it applies in the European Union faces. and in conformity with the requirements of the Companies Act 2006, subject to any material departures disclosed and The 2018 UK Corporate Governance Code also requires explained in the financial statements; Directors to ensure that the Annual Report and Financial Statements are fair, balanced and understandable. In order • provide additional disclosures when compliance with to reach a conclusion on this matter, the Board has requested the specific requirements in accordance with IFRS that the Audit & Management Engagement Committee adopted pursuant to Regulation (EC) No 1606/2002 advise on whether it considers that the Annual Report and as it applies in the European Union and in conformity Financial Statements fulfil these requirements. The process with the requirements of the Companies Act 2006 is by which the Committee has reached these conclusions is set insufficient to enable users to understand the impact of out in the Audit & Management Engagement Committee’s particular transactions, other events and conditions on the Report on pages 73 to 77. As a result, the Board has Group’s and Company’s financial position and financial concluded that the Annual Report and Financial Statements performance; and for the year ended 31 December 2020, taken as a whole, • prepare the financial statements on the going concern are fair, balanced and understandable and provide the basis unless it is inappropriate to presume that the Group information necessary for shareholders to assess the Group’s and Company will continue in business. and Company’s position, performance, business model and strategy. The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain For and on behalf of the Board the Group’s and Company’s transactions and disclose with DAVID CHEYNE reasonable accuracy at any time the financial position of Chairman the Group and Company and enable them to ensure that the 4 March 2021 financial statements comply with the Companies Act 2006.

78 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Canadian mining company Ivanhoe is on track to bring its new, world-class Kamoa-Kakula mine in the Democratic Republic of Congo into production by the end of the year and ramp up to capacity during 2022. Kakula is projected to be the world’s highest-grade major copper mine and will be powered by clean, renewable hydroelectricity. PHOTO COURTESY OF IVANHOE MINES

Section 4: Financial statements 81

Job No: 41869 Proof Event: 5 Black Line Level: 0 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2019 T: 0207 055 6500 F: 020 7055 6600 Independent auditors’ report to the members of BlackRock World Mining Trust plc

Report on the audit of the financial Independence statements We remained independent of the Group in accordance with the ethical requirements that are relevant to our Opinion audit of the financial statements in the UK, which includes In our opinion, BlackRock World Mining Trust plc’s Group the FRC’s Ethical Standard, as applicable to listed public financial statements and Parent Company financial interest entities, and we have fulfilled our other ethical statements (the “financial statements”): responsibilities in accordance with these requirements. • give a true and fair view of the state of the Group’s and To the best of our knowledge and belief, we declare that non- of the Parent Company’s affairs as at 31 December 2020 audit services prohibited by the FRC’s Ethical Standard were and of the Group’s profit and the Group’s and Parent not provided to the Group. Company’s cash flows for the year then ended; Other than those disclosed in note 5 to the financial • have been properly prepared in accordance with statements, we have provided no non-audit services to the international accounting standards in conformity with the Group in the period under audit. requirements of the Companies Act 2006; and Our audit approach • have been prepared in accordance with the requirements Overview of the Companies Act 2006. Audit scope We have audited the financial statements, included within • The Group comprises BlackRock World Mining Trust plc the Annual Report and Financial Statements (the “Annual (the “Parent Company”) and BlackRock World Mining Report”), which comprise: Consolidated and parent company Investment Company Limited. The Group engages statements of financial position as at 31 December 2020; BlackRock Fund Managers Limited (the “Manager”) to Consolidated statement of comprehensive income; the manage its assets. Consolidated and parent company statement of changes in equity; the Consolidated and parent company cash flow • We conducted our audit of the financial statements statements for the year then ended; and the notes to the using information from The Bank of New York Mellon financial statements, which include a description of the (International) Limited (the “Fund Accountant”) to whom significant accounting policies. the Manager has, with the consent of the Directors, delegated the provision of certain administrative functions. Our opinion is consistent with our reporting to the Audit & Management Engagement Committee. • We tailored the scope of our audit taking into account the types of investments within the Group, the involvement Separate opinion in relation to international financial of the third parties referred to above, the accounting reporting standards adopted pursuant to Regulation (EC) processes and controls, and the industry in which the No 1606/2002 as it applies in the European Union Group operates. As explained in note 2 to the Group financial statements, the Group, in addition to applying international accounting • We obtained an understanding of the control environment standards in conformity with the requirements of the in place at both the Manager and the Fund Accountant and Companies Act 2006, has also applied international financial adopted a fully substantive testing approach using reports reporting standards adopted pursuant to Regulation (EC) No obtained from the Fund Accountant. 1606/2002 as it applies in the European Union. Key audit matters In our opinion, the Group financial statements have been properly prepared in accordance with international financial • Valuation and existence of investments (Group and Parent reporting standards adopted pursuant to Regulation (EC) No Company). 1606/2002 as it applies in the European Union. • Accuracy , completeness and occurrence of income (Group Basis for opinion and Parent Company). We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. • Consideration of Impacts of COVID-19 (Group and Parent Our responsibilities under ISAs (UK) are further described Company). in the Auditors’ responsibilities for the audit of the financial • Abilit y to continue as a going concern (Continuation Vote) statements section of our report. We believe that the audit (Parent Company). evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

82 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Materiality • understanding the controls implemented by the Manager and the Fund Accountant designed to prevent and detect • Overall Group materiality: £9.31m (2019: £7.57m) based irregularities; on 1% of net assets. • as sessment of the Parent Company’s compliance with the • Overall Parent Company materiality: £8.84m (2019: requirements of Chapter 4 of Part 24 of the Corporation £7.20m) based on 1% of net assets, capped at 95% of the Tax Act 2010, including recalculation of numerical aspects Group materiality. of the eligibility conditions;

• P erformance materiality: £6.98m (Group) and £6.63m • identif ying and testing journal entries, in particular year (Parent Company). end journal entries posted by the Fund Accountant during the preparation of the financial statements; and The scope of our audit As part of designing our audit, we determined materiality and • designing audit procedures to incorporate unpredictability assessed the risks of material misstatement in the financial around the nature, timing or extent of our testing. statements. There are inherent limitations in the audit procedures Capability of the audit in detecting irregularities, including described above. We are less likely to become aware of fraud instances of non-compliance with laws and regulations that Irregularities, including fraud, are instances of non- are not closely related to events and transactions reflected compliance with laws and regulations. We design procedures in the financial statements. Also, the risk of not detecting a in line with our responsibilities, outlined in the Auditors’ material misstatement due to fraud is higher than the risk of responsibilities for the audit of the financial statements not detecting one resulting from error, as fraud may involve section, to detect material misstatements in respect of deliberate concealment by, for example, forgery or intentional irregularities, including fraud. The extent to which our misrepresentations, or through collusion. procedures are capable of detecting irregularities, including fraud, is detailed below. Key audit matters Key audit matters are those matters that, in the auditors’ Based on our understanding of the Group and industry, we professional judgement, were of most significance in the identified that the principal risks of non-compliance with audit of the financial statements of the current period and laws and regulations related to breaches of Chapter 4 of Part include the most significant assessed risks of material 24 of the Corporation Tax Act 2010, and we considered the misstatement (whether or not due to fraud) identified by the extent to which non-compliance might have a material effect auditors, including those which had the greatest effect on: on the financial statements. We also considered those laws the overall audit strategy; the allocation of resources in the and regulations that have a direct impact on the preparation audit; and directing the efforts of the engagement team. of the financial statements such as the Companies Act 2006. These matters, and any comments we make on the results of We evaluated management’s incentives and opportunities our procedures thereon, were addressed in the context of our for fraudulent manipulation of the financial statements audit of the financial statements as a whole, and in forming (including the risk of override of controls), and determined our opinion thereon, and we do not provide a separate that the principal risks were related to posting inappropriate opinion on these matters. journal entries to increase revenue (investment income and capital gains) or to increase net asset value, and This is not a complete list of all risks identified by our audit. management bias in accounting estimates, such as the valuation of investments. Audit procedures performed by the Consideration of Impacts of COVID-19 and Ability to engagement team included: continue as a going concern (Continuation Vote) are new key audit matters this year. Otherwise, the key audit matters • discus sions with the Manager and the Audit & overleaf are consistent with last year. Management Engagement Committee, including consideration of known or suspected instances of non- compliance with laws and regulation and fraud;

• challenging assumptions and judgements made by management in their significant accounting estimates, in particular in relation to the valuation of unquoted investments (see key audit matter below);

• reviewing relevant meeting minutes, including those of the Audit & Management Engagement Committee;

Section 4: Financial statements 83

Key audit matter How our audit addressed the key audit matter Valuation and existence of investments (Group and Parent Existence of listed, quoted and unquoted investments Company) We tested the existence of the investment portfolio by Refer to the Report of the Audit & Management Engagement agreeing the holdings for investments to supporting Committee (page 75), the Accounting Policies (page 98) and documentation such as a royalty contract or an independent the Notes to the financial statements (page 106). confirmation from the custodian or broker.

The investment portfolio of the Group as at the year-end Valuation of listed and quoted investments comprised listed and quoted investment assets valued at We tested the valuation of the listed and quoted investments £1,026 million, contractual rights valued at £19.75 million by agreeing the prices used in the valuation to independent and derivative investment liabilities valued at (£0.59) million. third party sources. We considered the reliability of market The investment portfolio of the Parent Company as at the pricing data and the methodology management used to year-end comprised listed and quoted investment assets determine the fair value. valued at £1,026 million, contractual rights and investment in subsidiary at £26.93 million and derivative investment Valuation of contractual rights and investment in subsidiary liabilities valued at (£0.59) million. We have understood the controls around the pricing of contractual rights and investment in subsidiary, including We focused on the existence of listed, quoted and unquoted final approval of the valuation by the Manager’s Pricing investments. Listed and quoted investments, which Committee and the Board. We reviewed the appropriateness comprise the majority of the Group’s and Parent Company’s of the valuation methodology used by the Manager, including investments balance, and contractual rights, are individually, whether the valuation methodology is in line with IFRS and and in aggregate, material to the financial statements. IPEV Guidelines, as well as assessing the key assumptions applied by the Manager in determining the value of the We focused on the valuation of listed and quoted investments contractual rights and investment in subsidiary and the because listed and quoted investments represent the reliability of the data involved. For the Parent Company’s principal element of the net asset value as disclosed on the investment in the subsidiary, we agreed the investment to Consolidated and Parent Company Statements of Financial the net asset value of the subsidiary which we audited. For Position. the OZ Minerals Brazil Royalty Contract, we obtained the Manager’s expert’s valuation. Our valuation experts examined We also focused on the valuation of the contractual rights the valuation methodology applied and the key assumptions (the OZ Minerals Brazil Royalty) as the valuation of this within the valuation. We re-performed the calculations, investment requires estimates and significant judgements assessed the reasonableness of production volumes used to be applied by the Manager, such that changes to the in the valuation and performed price benchmarking over estimates and or judgements can result, either on an gold and copper price forecasts. We performed an analysis individual or aggregate basis, in a material change to of discount rates used including determining the valuation’s the valuation of the OZ Mineral Brazil Royalty. When sensitivity to discount rates. We also agreed the royalty rate assessing the valuation of these unquoted investments, to the royalty agreement and agreed certain other inputs in we also examine the compliance with the requirements of the discounted cash flow calculation to publicly-available International Private Equity and Venture (‘IPEV’) Capital information. Valuation Guidelines, as incorrect application could indicate a misstatement in the valuation. No material issues were identified.

84 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Key audit matter How our audit addressed the key audit matter Accuracy, completeness and occurrence of income (Group and We assessed the accounting policies for income recognition Parent Company) for compliance with IFRS and the AIC SORP and performed Refer to the Report of the Audit & Management Engagement testing to check that income from these investments Committee (page 75), the Accounting Policies (page 97) and had been accounted for in accordance with these stated the Notes to the financial statements (page 100). accounting policies. We found that the accounting policies implemented were in accordance with accounting standards Income from investments comprised dividend income, and the AIC SORP, and that income has been accounted for in fixed income, income from debentures and income from accordance with the stated accounting policy. contractual rights. Other income includes option premium Dividend income income. We focused on the accuracy, completeness and We tested the accuracy of dividend receipts by agreeing the occurrence of income recognition, as incomplete or dividend rates from investments to independent market inaccurate income could have a material impact on the data. To test for completeness, we tested, for all investment Group and Parent Company’s net asset value and the Parent holdings in the portfolio, that dividends declared in the Company’s dividend cover. market had been recorded. To test for occurrence, we confirmed that all dividends recorded had occurred in the We also focused on the accounting policies for income market, and audited cash reconciliations to identify any recognition and the presentation of income in the unreconciled dividend cash payments. We also tested the Consolidated statement of comprehensive income for allocation and presentation of dividend income between compliance with the requirements of the Association of the revenue and capital return columns of the Consolidated Investment Companies Statement of Recommended Practice statement of comprehensive income in line with the (the ‘AIC SORP’), as incorrect application could result in a requirements set out in the AIC SORP by determining reasons misstatement of income recognition. behind dividend distributions.

Option premium income We tested the accuracy and completeness of option premium income by agreeing a sample of premium income recorded to broker statements. To test for completeness of option premium income, we selected a sample of the options held throughout the period and tested that the appropriate premiums had been recorded during the year or accrued for at year end.

Fixed interest income We tested the accuracy and completeness of fixed interest income by recalculating the expected coupon interest and amortisation, using coupon rates and maturity dates obtained from the market. We tested completeness of fixed interest income by testing that income was received or accrued for all bonds held during the year.

Section 4: Financial statements 85

Key audit matter How our audit addressed the key audit matter Vale Debenture income We tested the income received through the Vale Debentures by agreeing amounts received in the year to bank statements. We recalculated amounts received in the year using rates published on the website of Vale S.A., the issuer of these securities, and we assessed the appropriateness of the income accrued at the year end.

Income from contractual rights We tested the accuracy and completeness of income from contractual rights by agreeing income recorded to invoices and payments received in the year to bank statements. We tested the completeness by testing that income was recorded for all quarters. We also tested the allocation and presentation of income from contractual rights between the revenue and capital return columns of the Consolidated statement of comprehensive income in line with the requirements set out in the AIC SORP.

No material issues were identified.

Consideration of Impacts of COVID-19 (Group and Parent We evaluated the Directors’ assessment of the impact of the Company) COVID-19 pandemic on the Group and Parent Company by: Refer to the Chairman’s Statement (page 5), Principal Risks • Evaluating the Group and Parent Company’s updated risk (page 42), the Viability statement (page 45) and the Going assessment and considering whether it addresses the concern statement (page 56), which disclose the impact of the relevant threats presented by COVID-19. COVID-19 pandemic. • Evaluating management’s assessment of operational The COVID-19 outbreak has been declared a pandemic by the impacts, considering their consistency with other available World Health Organisation. Since the first quarter of 2020, information and our understanding of the business and it has caused significant economic uncertainty globally and assessing the potential impact on the financial statements. disruption to supply chains and travel, slowed global growth • T esting the impact of COVID-19 on the valuation of and caused volatility in global markets and in exchange rates. sampled investments.

The Directors have prepared the financial statements of the We obtained and evaluated the Directors’ going concern Group and Parent Company on a going concern basis, and assessment which reflects conditions up to the point of believe this assumption remains appropriate. This conclusion approval of the Annual Report by: is based on the assessment that, notwithstanding the • Obtaining evidence to support the key assumptions and significant market uncertainties, they are satisfied that the forecasts driving the Directors’ assessment. This included Group and the Parent Company have adequate resources to reviewing the Directors’ assessment of the Group and continue in operational existence for the foreseeable future Parent Company’s financial position and forecasts, their and that the Group and the Parent Company and its key third assessment of liquidity and loan covenant compliance party service providers have in place appropriate business as well as their review of the operational resilience of the continuity plans and will be able to maintain service levels Parent Company and oversight of key third party service throughout the COVID-19 pandemic. providers.

We assessed the disclosures presented in the Annual Report in relation to COVID-19 by:

• Reading the other information, including the Principal Risks and Viability statement set out in the Strategic Report, and assessing its consistency with the financial statements and the evidence we obtained in our audit.

Our conclusions relating to other information are set out in the ‘Reporting on other information’ section of our report. Our conclusions relating to going concern are set out in the “Going Concern” section on page 88.

86 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Key audit matter How our audit addressed the key audit matter Ability to continue as a going concern (Continuation Vote) We have reviewed the Directors’ assessment of going (Parent Company) concern in relation to the passing of the continuation vote. Refer to the Going concern statement (page 56) and Viability We have also assessed the appropriateness of preparing the statement (page 45) and the Basis of Preparation in the Notes financial statements on a going concern basis taking into to the Accounts (page 96). consideration the continuation vote. We have challenged the Directors on their assessment which includes, but is not A continuation vote is due to take place at the 2021 AGM, limited to, the following in support of the vote: which, if passed, will allow the Parent Company to continue as an investment trust for a further year. As such, the Directors • The shareholder register is stable, comprising a wide range have considered and assessed the potential impact on the of private wealth managers and retail investors; ability of the Parent Company to continue as a going concern. • The Parent Company has a positive long term performance track record; and

• The previous continuation vote in 2020 passed with no significant votes against.

Our findings in respect of going concern are set out in the “Going Concern” section below.

How we tailored the audit scope We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements as a whole, taking into account the structure of the Group and the Parent Company, the accounting processes and controls, and the industry in which they operate.

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements. In particular, we looked at where the Directors made subjective judgements, for example in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain.

Materiality The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Financial statements - Group Financial statements - Parent Company Overall materiality £9.31m (2019: £7.57m). £8.84m (2019: £7.20m). How we determined it 1% of net assets 1% of net assets Rationale for benchmark applied NAV is deemed the appropriate NAV is deemed the appropriate benchmark because Investment Trusts benchmark because Investment Trusts measure their performance on their net measure their performance on their net asset value. NAV is the main measure asset value. NAV is the main measure used throughout the annual report used throughout the annual report and financial statements and is often and financial statements and is often an important part of management and an important part of management and performance fee calculations. performance fee calculations. The Parent Company is capped at 95% of the overall Group materiality.

For each component in the scope of our Group audit, we allocated a materiality that is less than our overall Group materiality. The range of materiality allocated across components was between £72k and £8,842K. Certain components were audited to a local statutory audit materiality that was also less than our overall Group materiality.

Section 4: Financial statements 87

We use performance materiality to reduce to an appropriately In auditing the financial statements, we have concluded that low level the probability that the aggregate of uncorrected the Directors’ use of the going concern basis of accounting in and undetected misstatements exceeds overall materiality. the preparation of the financial statements is appropriate. Specifically, we use performance materiality in determining the scope of our audit and the nature and extent of our testing However, because not all future events or conditions can of account balances, classes of transactions and disclosures, be predicted, this conclusion is not a guarantee as to the for example in determining sample sizes. Our performance Group’s and the Parent Company’s ability to continue as a materiality was 75% of overall materiality, amounting to going concern. £6.98m for the Group financial statements and £6.63m for the Parent Company financial statements. In relation to the Parent Company’s reporting on how they have applied the UK Corporate Governance Code, we have In determining the performance materiality, we considered nothing material to add or draw attention to in relation to a number of factors - the history of misstatements, risk the Directors’ statement in the financial statements about assessment and aggregation risk and the effectiveness of whether the Directors considered it appropriate to adopt the controls - and concluded that an amount at the lower end of going concern basis of accounting. our normal range was appropriate. Our responsibilities and the responsibilities of the Directors We agreed with the Audit & Management Engagement with respect to going concern are described in the relevant Committee that we would report to them misstatements sections of this report. identified during our audit above £463K (Group audit) (2019: £378K) and £440K (Parent Company audit) (2019: £360K) as well as misstatements below those amounts that, in our view, Reporting on other information warranted reporting for qualitative reasons. The other information comprises all of the information in the Annual Report other than the financial statements and Conclusions relating to going concern our auditors’ report thereon. The Directors are responsible Our evaluation of the Directors’ assessment of the Group’s for the other information. Our opinion on the financial and the Parent Company’s ability to continue to adopt the statements does not cover the other information and, going concern basis of accounting included: accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form • evaluating the Directors’ updated risk assessment and of assurance thereon. considering whether it addressed the relevant threats presented by COVID-19; In connection with our audit of the financial statements, our responsibility is to read the other information and, • evaluating the Directors’ assessment of potential in doing so, consider whether the other information is operational impacts, considering their consistency with materially inconsistent with the financial statements or our other available information and our understanding of knowledge obtained in the audit, or otherwise appears to the business and assessed the potential impact on the be materially misstated. If we identify an apparent material financial statements; inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material • reviewing the Directors’ assessment of the Parent misstatement of the financial statements or a material Company’s financial position in the context of its misstatement of the other information. If, based on the work ability to meet future expected operating expenses, we have performed, we conclude that there is a material their assessment of liquidity as well as their review of misstatement of this other information, we are required to the operational resilience of the Parent Company and report that fact. We have nothing to report based on these oversight of key third-party service providers; and responsibilities.

• as sessing the implication of significant reductions in NAV With respect to the Strategic report and Director’s report, we as a result of market performance on the ongoing ability of also considered whether the disclosures required by the UK the Parent Company to operate. Companies Act 2006 have been included. • reviewing the Directors’ assessment of going concern in relation to the passing of the continuation vote. Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain Based on the work we have performed, we have not identified opinions and matters as described below. any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on Strategic report and Directors’ report the Group’s and the Parent Company’s ability to continue as In our opinion, based on the work undertaken in the course a going concern for a period of at least twelve months from of the audit, the information given in the Strategic report when the financial statements are authorised for issue. and Directors’ report for the year ended 31 December 2020

88 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 is consistent with the financial statements and has been statement; checking that the statement is in alignment with prepared in accordance with applicable legal requirements. the relevant provisions of the UK Corporate Governance Code; and considering whether the statement is consistent In light of the knowledge and understanding of the Group with the financial statements and our knowledge and and Parent Company and their environment obtained in understanding of the Group and Parent Company and their the course of the audit, we did not identify any material environment obtained in the course of the audit. misstatements in the Strategic report and Directors’ report. In addition, based on the work undertaken as part of our Directors’ Remuneration audit, we have concluded that each of the following elements In our opinion, the part of the Directors’ remuneration report of the corporate governance statement is materially to be audited has been properly prepared in accordance with consistent with the financial statements and our knowledge the Companies Act 2006. obtained during the audit:

Corporate governance statement • The Directors’ statement that they consider the The Listing Rules require us to review the Directors’ Annual Report, taken as a whole, is fair, balanced and statements in relation to going concern, longer-term viability understandable, and provides the information necessary and that part of the corporate governance statement relating for the members to assess the Group’s and Parent to the Parent Company’s compliance with the provisions of Company’s position, performance, business model and the UK Corporate Governance Code specified for our review. strategy; Our additional responsibilities with respect to the corporate • The section of the Annual Report that describes the review governance statement as other information are described in of effectiveness of risk management and internal control the Reporting on other information section of this report. systems; and

Based on the work undertaken as part of our audit, we • The section of the Annual Report describing the work of the have concluded that each of the following elements of the Audit & Management Engagement Committee. corporate governance statement is materially consistent with the financial statements and our knowledge obtained during We have nothing to report in respect of our responsibility to the audit, and we have nothing material to add or draw report when the Directors’ statement relating to the Parent attention to in relation to: Company’s compliance with the Code does not properly disclose a departure from a relevant provision of the Code • The Directors’ confirmation that they have carried out a specified under the Listing Rules for review by the auditors. robust assessment of the emerging and principal risks; Responsibilities for the financial statements • The disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify and the audit emerging risks and an explanation of how these are being Responsibilities of the Directors for the financial managed or mitigated; statements As explained more fully in the Statement of directors’ • The Directors’ statement in the financial statements about responsibilities in respect of the annual report and financial whether they considered it appropriate to adopt the going statements, the Directors are responsible for the preparation concern basis of accounting in preparing them, and their of the financial statements in accordance with the applicable identification of any material uncertainties to the Group’s framework and for being satisfied that they give a true and Parent Company’s ability to continue to do so over a and fair view. The Directors are also responsible for such period of at least twelve months from the date of approval internal control as they determine is necessary to enable of the financial statements; the preparation of financial statements that are free from material misstatement, whether due to fraud or error. • The Directors’ explanation as to their assessment of the Group’s and Parent Company’s prospects, the period this In preparing the financial statements, the Directors are assessment covers and why the period is appropriate; and responsible for assessing the Group’s and the Parent Company’s ability to continue as a going concern, disclosing, • The Directors’ statement as to whether they have a as applicable, matters related to going concern and using reasonable expectation that the Parent Company will be the going concern basis of accounting unless the Directors able to continue in operation and meet its liabilities as either intend to liquidate the Group or the Parent Company they fall due over the period of its assessment, including or to cease operations, or have no realistic alternative but to any related disclosures drawing attention to any necessary do so. qualifications or assumptions.

Our review of the Directors’ statement regarding the longer- Auditors’ responsibilities for the audit of the financial term viability of the Group was substantially less in scope statements Our objectives are to obtain reasonable assurance about than an audit and only consisted of making inquiries whether the financial statements as a whole are free from and considering the Directors’ process supporting their

Section 4: Financial statements 89

material misstatement, whether due to fraud or error, and Other required reporting to issue an auditors’ report that includes our opinion. Companies Act 2006 exception reporting Reasonable assurance is a high level of assurance, but is Under the Companies Act 2006 we are required to report to not a guarantee that an audit conducted in accordance with you if, in our opinion: ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are • we have not obtained all the information and explanations considered material if, individually or in the aggregate, they we require for our audit; or could reasonably be expected to influence the economic decisions of users taken on the basis of these financial • adequate accounting records have not been kept by the statements. Parent Company, or returns adequate for our audit have not been received from branches not visited by us; or Our audit testing might include testing complete populations of certain transactions and balances, possibly using data • cer tain disclosures of Directors’ remuneration specified by auditing techniques. However, it typically involves selecting law are not made; or a limited number of items for testing, rather than testing • the Parent Company financial statements and the part of complete populations. We will often seek to target particular the Directors’ remuneration report to be audited are not in items for testing based on their size or risk characteristics. In agreement with the accounting records and returns. other cases, we will use audit sampling to enable us to draw a conclusion about the population from which the sample is We have no exceptions to report arising from this selected. responsibility.

A further description of our responsibilities for the audit of Appointment the financial statements is located on the FRC’s website at: Following the recommendation of the Audit & Management www.frc.org.uk/auditorsresponsibilities. This description Engagement Committee, we were appointed by the members forms part of our auditors’ report. on 28 April 2016 to audit the financial statements for the year ended 31 December 2016 and subsequent financial Use of this report periods. The period of total uninterrupted engagement is 5 This report, including the opinions, has been prepared for years, covering the years ended 31 December 2016 to 31 and only for the Parent Company’s members as a body in December 2020. accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing. SALLY COSGROVE (Senior Statutory Auditor) for and on behalf of PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors London 4 March 2021

90 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Revenue Revenue Capital Capital Total Total Notes 2020 2019 2020 2019 2020 2019 £’000 £’000 £’000 £’000 £’000 £’000 Income from investments held at fair value through profit or loss 3 31,507 40,880 –– 31,507 40,880 Other income 3 7,964 5,634 –– 7,964 5,634 Total revenue 39,471 46,514 – – 39,471 46,514 Net profit on investments held at fair value through profit or loss 10 –– 183,667 77,517 183,667 77,517 Net profit on foreign exchange –– 2,431 3,230 2,431 3,230 Total 39,471 46,514 186,098 80,747 225,569 127,261 Expenses Investment management fee 4 (1,546) (1,564) (4,859) (4,916) (6,405) (6,480) Other operating expenses 5 (997) (1,030) (18) (20) (1,015) (1,050) Total operating expenses (2,543) (2,594) (4,877) (4,936) (7,420) (7,530) Net profit on ordinary activities before finance costs and taxation 36,928 43,920 181,221 75,811 218,149 119,731 Finance costs 6 (424) (896) (1,272) (2,683) (1,696) (3,579) Net profit on ordinary activities before taxation 36,504 43,024 179,949 73,128 216,453 116,152 Taxation 7 (1,053) (3,463) 1,115 1,377 62 (2,086) Profit for the year 35,451 39,561 181,064 74,505 216,515 114,066 Earnings per ordinary share (pence) 9 20.40 22.46 104.22 42.30 124.62 64.76

The total column of this statement represents the Group’s Statement of Comprehensive Income, prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006. The supplementary revenue and capital columns are both prepared under guidance published by the Association of Investment Companies (AIC). All items in the above statement derive from continuing operations. No operations were acquired or discontinued during the year. All income is attributable to the equity holders of the Group.

The Group does not have any other comprehensive income. The profit for the year disclosed above represents the Group’s total comprehensive income.

The notes on pages 96 to 126 form part of these financial statements.

Section 4: Financial statements 91

Called Share Capital up share premium redemption Special Capital Revenue Group Notes capital account reserve reserve reserves reserve Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 For the year ended 31 December 2020 At 31 December 2019 9,651 127,155 22,779 108,601 447,806 41,118 757,110 Total comprehensive income: Net profit for the year –– –– 181,064 35,451 216,515 Transactions with owners, recorded directly to equity: Ordinary shares purchased into treasury 16,17 –– – (4,573) –– (4,573) Share purchase costs 16,17 –– – (36) –– (36) Dividends paid1 8 – – ––– (38,191) (38,191) At 31 December 2020 9,651 127,155 22,779 103,992 628,870 38,378 930,825

For the year ended 31 December 2019 At 31 December 2018 9,651 127,155 22,779 114,147 373,301 38,562 685,595 Total comprehensive income: Net profit for the year –– –– 74,505 39,561 114,066 Transactions with owners, recorded directly to equity: Ordinary shares purchased into treasury –– – (5,512) –– (5,512) Share purchase costs –– – (34) –– (34) Dividends paid2 8 – – ––– (37,005) (37,005) At 31 December 2019 9,651 127,155 22,779 108,601 447,806 41,118 757,110

1 The final dividend of 10.00p per share for the year ended 31 December 2019, declared on 27 February 2020 and paid on 7 May 2020; 1st interim dividend of 4.00p per share for the year ended 31 December 2020, declared on 30 April 2020 and paid on 26 June 2020; 2nd interim dividend of 4.00p per share for the year ended 31 December 2020, declared on 19 August 2020 and paid on 25 September 2020 and 3rd interim dividend of 4.00p per share for the year ended 31 December 2020, declared on 12 November 2020 and paid on 18 December 2020. 2 The final dividend of 9.00p per share for the year ended 31 December 2018, declared on 28 February 2019 and paid on 10 May 2019; 1st interim dividend of 4.00p per share for the year ended 31 December 2019, declared on 2 May 2019 and paid on 28 June 2019; 2nd interim dividend of 4.00p per share for the year ended 31 December 2019, declared on 20 August 2019 and paid on 1 October 2019 and 3rd interim dividend of 4.00p per share for the year ended 31 December 2019, declared on 14 November 2019 and paid on 20 December 2019.

For information on the Company’s distributable reserves, please refer to note 17 on page 109.

The notes on pages 96 to 126 form part of these financial statements.

92 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Called Share Capital up share premium redemption Special Capital Revenue Company Notes capital account reserve reserve reserves reserve Total £’000 £’000 £’000 £’000 £’000 £’000 £’000 For the year ended 31 December 2020 At 31 December 2019 9,651 127,155 22,779 108,601 454,613 34,311 757,110 Total comprehensive income: Net profit for the year –– –– 179,934 36,581 216,515 Transactions with owners, recorded directly to equity: Ordinary shares purchased into treasury 16,17 –– – (4,573) –– (4,573) Share purchase costs 16,17 –– – (36) –– (36) Dividends paid1 8 – – ––– (38,191) (38,191) At 31 December 2020 9,651 127,155 22,779 103,992 634,547 32,701 930,825

For the year ended 31 December 2019 At 31 December 2018 9,651 127,155 22,779 114,147 380,486 31,377 685,595 Total comprehensive income: Net profit for the year –– –– 74,127 39,939 114,066 Transactions with owners, recorded directly to equity: Ordinary shares purchased into treasury –– – (5,512) –– (5,512) Share purchase costs –– – (34) –– (34) Dividends paid2 8 – – ––– (37,005) (37,005) At 31 December 2019 9,651 127,155 22,779 108,601 454,613 34,311 757,110

For information on the Company’s distributable reserves, please refer to note 17 on page 109.

The notes on pages 96 to 126 form part of these financial statements.

Section 4: Financial statements 93

31 December 2020 31 December 2019 Notes Group Company Group Company £’000 £’000 £’000 £’000 Non current assets Investments held at fair value through profit or loss 10 1,045,818 1,052,996 845,777 851,732 Current assets Other receivables 12 6,837 6,837 4,626 4,626 Cash collateral held with brokers 18 2,943 2,943 431 431 Cash and cash equivalents 18 309 309 1,399 39 Total current assets 10,089 10,089 6,456 5,096 Total assets 1,055,907 1,063,085 852,233 856,828 Current liabilities Other payables 13 (5,545) (6,613) (4,003) (5,071) Derivative financial liabilities held at fair value through profit or loss 10 (587) (587) (314) (314) Bank overdraft 14,15,18 (16,317) (22,427) (99) (3,626) Bank loans 14,15 (102,418) (102,418) (90,583) (90,583) Total current liabilities (124,867) (132,045) (94,999) (99,594) Total assets less current liabilities 931,040 931,040 757,234 757,234 Non current liabilities Deferred taxation liability 7 (c) (215) (215) (124) (124) Net assets 930,825 930,825 757,110 757,110 Equity attributable to equity holders Called up share capital 16 9,651 9,651 9,651 9,651 Share premium account 17 127,155 127,155 127,155 127,155 Capital redemption reserve 17 22,779 22,779 22,779 22,779 Special reserve 17 103,992 103,992 108,601 108,601 Capital reserves: At 1 January 447,806 454,613 373,301 380,486 Net profit for the year 181,064 179,934 74,505 74,127 17 628,870 634,547 447,806 454,613 Revenue reserve: At 1 January 41,118 34,311 38,562 31,377 Net profit for the year 35,451 36,581 39,561 39,939 Dividends paid (38,191) (38,191) (37,005) (37,005) 17 38,378 32,701 41,118 34,311 Total equity 930,825 930,825 757,110 757,110 Net asset value per ordinary share (pence) 9 536.34 536.34 433.17 433.17

The financial statements on pages 91 to 126 were approved and authorised for issue by the Board of Directors on 4 March 2021 and signed on its behalf by Mr David Cheyne, Chairman.

BlackRock World Mining Trust plc Registered in England and Wales, No.2868209

The notes on pages 96 to 126 form part of these financial statements.

94 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

31 December 2020 31 December 2019 Group Company Group Company £’000 £’000 £’000 £’000 Operating activities Net profit before taxation 216,453 216,453 116,152 116,152 Add back finance costs 1,696 1,696 3,579 3,579 Net profit on investments held at fair value through profit or loss (including transaction costs) (182,539) (182,536) (76,960) (77,141) Net profit on foreign exchange (2,431) (2,431) (3,230) (3,230) Sales of investments held at fair value through profit or loss 360,288 359,062 377,210 377,210 Purchases of investments held at fair value through profit or loss (377,517) (377,517) (367,499) (367,499) Decrease/(increase) in other receivables 618 618 (2,058) (2,058) Increase in other payables 268 268 268 270 Increase in amounts due from brokers (2,902) (2,902) (118) (118) Increase/(decrease) in amounts due to brokers 2,473 2,473 (13,713) (13,713) Net movement in cash collateral held with brokers (2,512) (2,512) 219 219 Net cash inflow from operating activities before taxation 13,895 12,672 33,850 33,671 Taxation paid (1,038) (1,038) (2,035) (2,035) Taxation on investment income included within gross income (1,664) (1,664) (124) (124) Prior year corporation tax refund 2,687 2,687 – – Net cash inflow from operating activities 13,880 12,657 31,691 31,512 Financing activities Drawdown/(repayment) of loans 15,016 15,016 (20,000) (20,000) Interest paid (1,772) (1,772) (3,815) (3,815) Payments for ordinary shares purchased into treasury (5,455) (5,455) (4,632) (4,632) Share purchase costs paid (36) (36) (32) (32) Dividends paid (38,191) (38,191) (37,005) (37,005) Net cash outflow from financing activities (30,438) (30,438) (65,484) (65,484) Decrease in cash and cash equivalents (16,558) (17,781) (33,793) (33,972) Cash and cash equivalents at start of the year 1,300 (3,587) 35,501 30,793 Effect of foreign exchange rate changes (750) (750) (408) (408) Cash and cash equivalents at end of year (16,008) (22,118) 1,300 (3,587) Comprised of: Cash and cash equivalents 309 309 1,399 39 Bank overdraft (16,317) (22,427) (99) (3,626) (16,008) (22,118) 1,300 (3,587)

The notes on pages 96 to 126 form part of these financial statements.

Section 4: Financial statements 95

1. Principal activity the Group operates. All values are rounded to the nearest The principal activity of the Company is that of an investment thousand pounds (£’000) except where otherwise indicated. trust company within the meaning of section 1158 of the Corporation Tax Act 2010. The Company was incorporated on IFRS standards that have recently been adopted: 28 October 1993 and this is the 27th Annual Report. Amendments to IFRS 3 - definition of a business (effective 1 January 2020). This amendment revises the definition of a The principal activity of the subsidiary, BlackRock World business. According to feedback received by the International Mining Investment Company Limited, is investment dealing. Accounting Standards Board, application of the current guidance is commonly thought to be too complex and it 2. Accounting policies results in too many transactions qualifying as business combinations. The standard has been endorsed by the EU. The principal accounting policies adopted by the Group and The adoption of this standard has had no impact on the Company have been applied consistently, other than where financial statements of the Group. new policies have been adopted and are set out below.

Amendments to IAS 1 and IAS 8 - definition of material (a) Basis of preparation (effective 1 January 2020). The amendments to IAS 1, The Group and Parent Company financial statements have ‘Presentation of Financial Statements’, and IAS 8, ‘Accounting been prepared under the historic cost convention modified Policies, Changes in Accounting Estimates and Errors’, by the revaluation of certain financial assets and financial and consequential amendments to other IFRSs require liabilities held at fair value through profit or loss and in companies to: accordance with International Financial Reporting Standards (IFRS) adopted pursuant to Regulation (EC) No 1606/2002 (i) use a consistent definition of materiality throughout as it applies in the European Union and in conformity with IFRSs and the Conceptual Framework for Financial the requirements of the Companies Act 2006. The Company Reporting; has taken advantage of the exemption provided under section 408 of the Companies Act 2006 not to publish its (ii) clarif y the explanation of the definition of material; and individual Statement of Comprehensive Income and related notes. All of the Group’s operations are of a continuing (iii) incorporate some of the guidance of IAS 1 about nature. immaterial information.

Insofar as the Statement of Recommended Practice (SORP) This standard has been endorsed by the EU. The adoption of for investment trust companies and venture capital trusts this standard has had no impact on the financial statements issued by the Association of Investment Companies (AIC) in of the Group. October 2019, is compatible with IFRS adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Amendments to IFRS 9, IAS 39 and IFRS 7 - interest Union and in conformity with the requirements of the rate benchmark reform (effective 1 January 2020). These Companies Act 2006, the financial statements have been amendments provide certain reliefs in connection with the prepared in accordance with guidance set out in the SORP. interest rate benchmark reform. The reliefs relate to hedge accounting and have the effect that the Inter Bank Offer Rate Substantially all of the assets of the Group consist of (IBOR) reform should not generally cause hedge accounting securities that are readily realisable and, accordingly, the to terminate. However, any hedge ineffectiveness should Directors believe that the Group has adequate resources continue to be recorded in the income statement. Given the to continue in operational existence for the foreseeable pervasive nature of hedges involving IBOR based contracts, future. Consequently, the Directors have determined that it the reliefs will affect companies in all industries. is appropriate for the financial statements to be prepared on a going concern basis. The Directors have considered This standard has been endorsed by the EU. The adoption of any potential impact of the COVID-19 pandemic and the this standard has had no impact on the financial statements mitigation measures which key service providers, including of the Group as it does not hedge. the Manager, have in place to maintain operational resilience on the going concern of the Company. The Directors have IFRS standards that have yet to be adopted: reviewed compliance with the covenants associated with A number of new standards, amendments to standards and the bank overdraft facility, loan facility, income and expense interpretations are effective for the annual periods beginning projections and the liquidity of the investment portfolio in on or after 1 January 2021 and have not been adopted early making their assessment. in preparing these financial statements (major changes and new standards issued are detailed below), as these are The Group’s financial statements are presented in sterling, not expected to have any effect on the measurement of the which is the functional currency of the Group and the amounts recognised in the financial statements of the Group. currency of the primary economic environment in which

96 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 IFRS 17 - insurance contracts (effective 1 January 2021). premium is treated as a revenue item. Where the purpose This standard replaces IFRS 4, which currently permits a wide of the option is the maintenance of capital, the premium is variety of practices in accounting for insurance contracts. treated as a capital item. IFRS 17 will fundamentally change the accounting by all entities that issue insurance contracts and investment Option premium income is recognised as revenue evenly over contracts with discretionary participation features. The the life of the option contract and included in the revenue standard has not been endorsed by the EU. This standard column of the Consolidated Statement of Comprehensive is unlikely to have any impact on the Group as it has no Income unless the option has been written for the insurance contracts. maintenance and enhancement of the Group’s investment portfolio and represents an incidental part of a larger capital (b) Basis of consolidation transaction, in which case any premia arising are allocated The Group’s financial statements are made up to to the capital column of the Consolidated Statement of 31 December each year and consolidate the financial Comprehensive Income. statements of the Company and its wholly owned subsidiary, which is registered and operates in England and Wales, Royalty income from contractual rights is measured at the BlackRock World Mining Investment Company Limited fair value of the consideration received or receivable where (together ‘the Group’). The subsidiary company is not the Investment Manager can reliably estimate the amount, considered an investment entity. pursuant to the terms of the agreement. Royalty income from contractual rights received comprise of a return of income Subsidiaries are consolidated from the date of their and a return of capital based on the underlying cost of the acquisition, being the date on which the Company obtains contract and, accordingly, the return of income element control, and continue to be consolidated until the date that is taken to the revenue account and the return of capital such control ceases. The financial statements of subsidiaries element is taken to the capital account. These amounts are used in the preparation of the consolidated financial disclosed in the Consolidated Statement of Comprehensive statements are based on consistent accounting policies. All Income within income from investments and gains/losses intra-group balances and transactions, including unrealised on investments held at fair value through profit or loss, profits arising therefrom, are eliminated. respectively.

(c) Presentation of the Statement of The useful life of the contractual rights will be determined Comprehensive Income by reference to the contractual arrangements, the planned mine life on commencement of mining and the In order to better reflect the activities of an investment trust underlying cost of the contractual rights will be revalued on company and in accordance with guidance issued by the AIC, a systematic basis using the units of production method supplementary information which analyses the Consolidated over the life of the contractual rights which is estimated Statement of Comprehensive Income between items of a using available estimated proved and probable reserves revenue and a capital nature has been presented alongside specifically associated with the mine. The Investment the Consolidated Statement of Comprehensive Income. Manager relies on public disclosures for information on (d) Segmental reporting proven and probable reserves from the operators of the mine. Amortisation rates are adjusted on a prospective basis for The Directors are of the opinion that the Group is engaged in all changes to estimates of the life of contractual rights and a single segment of business being investment business. iron ore reserves. These are disclosed in the Consolidated Statement of Comprehensive Income within gains/losses on (e) Income investments held at fair value through profit or loss. Dividends receivable on equity shares are recognised as revenue for the year on an ex-dividend basis. Where no ex- Where the Group has elected to receive its dividends in dividend date is available, dividends receivable on or before the form of additional shares rather than in cash, the cash the year end are treated as revenue for the year. Provision is equivalent of the dividend is recognised as income. Any made for any dividends and interest income not expected to excess in the value of the shares received over the amount of be received. Special dividends, if any, are treated as a capital the cash dividend is recognised in capital. or a revenue receipt depending on the facts or circumstances of each particular case. The return on a debt security is Underwriting commission receivable is taken into account on recognised on a time apportionment basis so as to reflect an accruals basis. the effective yield on the debt security. Interest income and deposit interest is accounted for on an accruals basis.

Options may be purchased or written over securities held in the portfolio for generating or protecting capital returns, or for generating or maintaining revenue returns. Where the purpose of the option is the generation of income, the

Section 4: Financial statements 97

2. Accounting policies continued through profit or loss and are managed and evaluated on a (f) Expenses fair value basis in accordance with its investment strategy and business model. All expenses, including finance costs, are accounted for on an accruals basis. Expenses have been charged wholly All investments, including contractual rights, are initially and to the revenue column of the Consolidated Statement of subsequently measured at fair value through profit or loss. Comprehensive Income, except as follows: Purchases of investments are recognised on a trade date basis. Contractual rights are recognised on the completion • expenses which are incidental to the acquisition or sale date, where a purchase of the rights is under a contract, and of an investment are charged to the capital column of are initially measured at fair value excluding transaction the Consolidated Statement of Comprehensive Income. costs. Sales of investments are recognised at the trade date Details of transaction costs on the purchases and sales of of the disposal. investments are disclosed within note 10 to the financial statements on page 106; The fair value of the financial investments is based on their • expenses are treated as capital where a connection with quoted bid price at the financial reporting date, without the maintenance or enhancement of the value of the deduction for the estimated future selling costs. This policy investments can be demonstrated; and applies to all current and non current asset investments held by the Group. • the investment management fee and finance costs have been allocated 75% to the capital column and 25% The gains and losses from changes in fair value of to the revenue column of the Consolidated Statement contractual rights are taken to the Consolidated Statement of Comprehensive Income in line with the Board’s of Comprehensive Income and arise as a result of the expectations of the long term split of returns, in the form of revaluation of the underlying cost of the contractual rights, capital gains and income, respectively, from the investment changes in commodity prices and changes in estimates of portfolio. proven and probable reserves specifically associated with the mine. (g) Taxation The tax expense represents the sum of the tax currently Under IFRS, the investment in the subsidiary in the payable and deferred tax. The tax currently payable is based Company’s Statement of Financial Position is fair valued on the taxable profit for the year. Taxable profit differs from which is deemed to be the net asset value of the subsidiary. net profit as reported in the Consolidated Statement of Changes in the value of investments held at fair value Comprehensive Income because it excludes items of income through profit or loss and gains and losses on disposal are or expenses that are taxable or deductible in other years and recognised in the Consolidated Statement of Comprehensive it further excludes items that are never taxable or deductible. Income as ‘Net profits or losses on investments held at fair The Group’s liability for current tax is calculated using tax value through profit or loss’. Also included within the heading rates that were applicable at the balance sheet date. are transaction costs in relation to the purchase or sale of investments. Where expenses are allocated between capital and revenue, any tax relief in respect of the expenses is allocated between For all financial instruments not traded in an active market, capital and revenue returns on the marginal basis using the fair value is determined by using various valuation the Company’s effective rate of corporation tax for the techniques. Valuation techniques include market approach accounting period. (i.e., using recent arm’s length market transactions adjusted as necessary and reference to the current market value of Deferred taxation is recognised in respect of all temporary another instrument that is substantially the same) and the differences that have originated but not reversed at the income approach (i.e., discounted cash flow analysis and financial reporting date, where transactions or events that option pricing models making as much use of available and result in an obligation to pay more tax in the future or right supportable market data as possible). Where no reliable fair to pay less tax in the future have occurred at the financial value can be estimated for such instruments, they are carried reporting date. This is subject to deferred taxation assets only at cost subject to any provision for impairment. See note 2(q) being recognised if it is considered more likely than not that below. there will be suitable profits from which the future reversal of the temporary differences can be deducted. Deferred (i) Options taxation assets and liabilities are measured at the rates Options are held at fair value based on the bid/offer prices of applicable to the legal jurisdictions in which they arise. the options written to which the Group is exposed. The value of the option is subsequently marked-to‑market to reflect (h) Investments held at fair value through profit the fair value of the option based on traded prices. Where or loss the premium is taken to revenue, an appropriate amount is In accordance with IFRS 9, the Group classifies its shown as capital return such that the total return reflects the investments at initial recognition as held at fair value overall change in the fair value of the option. When an option

98 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 is exercised the gain or loss is accounted for as a capital gain Statements of Financial Position if there is a currently or loss. Any cost on closing out an option is transferred to enforceable legal right to offset the recognised amounts and revenue along with any remaining unamortised premium. there is an intention to settle on a net basis, or to realise the asset and settle the liability simultaneously. (j) Other receivables and other payables Other receivables and other payables do not carry any (p) Share repurchases and share reissues interest and are short-term in nature and are accordingly Shares repurchased and subsequently cancelled – share stated on an amortised cost basis. capital is reduced by the nominal value of the shares repurchased and the capital redemption reserve is (k) Dividends payable correspondingly increased in accordance with section 733 Under IFRS, final dividends should not be accrued in the of the Companies Act 2006. The full cost of the repurchase is financial statements unless they have been approved by charged to the special reserve. shareholders before the financial reporting date. Interim dividends should not be accrued in the financial statements Shares repurchased and held in treasury – the full cost of the unless they have been paid. repurchase is charged to the special reserve.

Dividends payable to equity shareholders are recognised Where treasury shares are subsequently reissued: in the Consolidated and Parent Company Statements of Changes in Equity. • amounts received to the extent of the repurchase price are credited to the special reserve; and (l) Foreign currency translation • any surplus received in excess of the repurchase price is Transactions involving foreign currencies are converted taken to the share premium account. at the rate ruling at the date of the transaction. Foreign currency monetary assets and liabilities and non monetary (q) Critical accounting estimates and judgements assets held at fair value are translated into sterling at the The Group makes estimates and assumptions concerning the rate ruling on the financial reporting date. Foreign exchange future. The resulting accounting estimates and assumptions differences arising on translation are recognised in the will, by definition, seldom equal the related actual results. Consolidated Statement of Comprehensive Income as a Estimates and judgements are regularly evaluated and are revenue or capital item depending on the income or expense based on historical experience and other factors, including to which they relate. For investment transactions and expectations of future events that are believed to be investments held at the year end, denominated in a foreign reasonable under the circumstances. The estimates and currency, the resulting gains or losses are included in the assumptions that have a significant risk of causing a material profit/(loss) on investments held at fair value through profit adjustment to the carrying amounts of assets and liabilities or loss in the Consolidated Statement of Comprehensive within the next financial year are addressed below. Income. Fair value of unquoted financial instruments (m) Cash and cash equivalents When the fair values of financial assets and financial Cash comprises cash in hand, bank overdrafts and on liabilities recorded in the Consolidated and Parent Company demand deposits. Cash equivalents are short-term, highly Statements of Financial Position cannot be derived from liquid investments that are readily convertible to known active markets, their fair value is determined using a variety amounts of cash and that are subject to an insignificant risk of valuation techniques that include the use of valuation of changes in value. Bank overdrafts are shown separately models. on the Consolidated and Parent Company Statements of Financial Position. (a) The fair value of the OZ Minerals contractual rights was assessed by an independent valuer with a recognised (n) Bank borrowings and relevant professional qualification. The inputs to Bank overdrafts and loans are recorded as the proceeds these models are taken from observable markets where received. Finance charges, including any premium payable possible, but where this is not feasible, estimation is on settlement or redemption and direct issue costs, are required in establishing fair values. The estimates include accounted for on an accruals basis in the Consolidated considerations of production profiles, commodity prices, Statement of Comprehensive Income using the effective cash flows and discount rates. Changes in assumptions interest rate method and are added to the carrying amount about these factors could affect the reported fair value of the instrument to the extent that they are not settled in the of financial instruments in the Consolidated and Parent period in which they arise. Company Statements of Financial Position and the level where the instruments are disclosed in the fair value (o) Offsetting hierarchy. To assess the significance of a particular input Financial assets and financial liabilities are offset and the net to the entire measurement, the external valuer performs amount reported in the Consolidated and Parent Company sensitivity analysis.

Section 4: Financial statements 99

2. Accounting policies continued (b) The investment in the subsidiary company was valued The key assumptions used to determine the fair value of the based on the net assets of the subsidiary company, unquoted financial instruments and sensitivity analyses are which is considered appropriate based on the nature and provided in note 18(d). volume of transactions in the subsidiary company.

3. Income 2020 2019 £’000 £’000 Investment income: UK dividends 12,328 11,817

UK special dividends – 4,402

Overseas dividends 12,133 11,394

Overseas special dividends 538 2,249

Income from contractual rights (OZ Minerals Royalty) 1,800 1,541 Income from Vale debentures 2,304 3,708 Income from fixed income investments 2,510 5,769 Less provision for doubtful debts (106) – 31,507 40,880 Other income: Option premium income 8,765 6,008 Deposit interest 7 106 Interest on corporation tax refund 293 – Stock lending income 27 77 Loss on investment dealing in the subsidiary (1,128) (557) 7,964 5,634 Total income 39,471 46,514

During the year, the Group received option premium income in cash totalling £8,821,000 (2019: £5,986,000) for writing put and covered call options for the purposes of revenue generation. Option premium income is amortised evenly over the life of the option contract and accordingly, during the year, option premiums of £8,765,000 (2019: £6,008,000) were amortised to revenue. At 31 December 2020, there were two (2019: five) open positions with an associated liability of £587,000 (2019: £314,000).

Dividends and interest received in cash during the year amounted to £25,363,000 and £3,421,000 (2019: £27,581,000 and £8,252,000) respectively.

Special dividends amounting to £34,000 (2019: £5,229,000) have been recognised in capital during the year and included within investment gains.

100 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 4. Investment management fee 2020 2019 Revenue Capital Total Revenue Capital Total £’000 £’000 £’000 £’000 £’000 £’000 Investment management fee 1,546 4,859 6,405 1,564 4,916 6,480 Total 1,546 4,859 6,405 1,564 4,916 6,480

The investment management fee (which includes all services provided by BlackRock) is 0.8% of the Company’s net assets. However, in the event that the NAV per share increases on a quarter–on–quarter basis, the fee will then be paid on gross assets for the quarter. During the year £5,907,000 (2019: £5,888,000) of the investment management fee was generated from net assets and £498,000 (2019: £592,000) from the gearing effect on gross assets due to the quarter–on–quarter increase in the NAV per share during the year as below:

Cum income Quarterly Gearing effect NAV per share increase/ on management Quarter end (pence) (decrease) % fees (£’000) 31 December 2019 433.17 – –

31 March 2020 307.48 (29.0) – 30 June 2020 428.24 +39.3 113 30 September 2020 456.18 +6.5 183 31 December 2020 536.34 +17.6 202

The daily average of the net assets under management during the year ended 31 December 2020 was £748,853,000 (2019: £733,356,000). The fee is allocated 25% to the revenue column and 75% to the capital column of the Consolidated Statement of Comprehensive Income.

There is no additional fee for company secretarial and administration services.

Section 4: Financial statements 101

5. Other operating expenses 2020 2019 £’000 £’000 Allocated to revenue Custody fee 105 114 Auditors’ remuneration: – audit services 39 36 – non-audit services1 8 7 Registrar’s fee 86 88 Directors’ emoluments2 183 190 Broker fees 24 24 Depositary fees 74 63 Marketing fees 152 159 Stock exchange fees 21 19 Legal and professional fees 40 43 Bank facility fees3 72 75 AIC Fees 17 22 FCA Fee 20 18 Directors’ insurance 14 14 Directors’ search fees 13 26 Printing and postage fees 41 45 Other administrative costs 106 87 Write back of prior year expenses4 (18) – 997 1,030 Allocated to capital Custody transaction charges5 18 20

1,015 1,050

2020 2019 The Company’s ongoing charges6, calculated as a percentage of average daily net assets and using management fee and all other operating expenses, excluding finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain non- recurring items were: 0.99% 1.02% The Company’s ongoing charges6, calculated as a percentage of average daily gross assets and using management fee and all other operating expenses, excluding finance costs, direct transaction costs, custody transaction charges, VAT recovered, taxation and certain non- recurring items were: 0.87% 0.89%

1 Fees paid to the auditor for non-audit services of £7,540 excluding VAT (2019: £6,580) relate to the review of the half yearly financial statements. 2 Details of the Directors’ emoluments are given in the Directors’ Remuneration Report on page 63. Emoluments include taxable benefits for reimbursement of expenses. The Company has no employees. 3 There is a 4 basis point facility fee chargeable on the full loan facility amount whether drawn or undrawn. 4 Relates to prior year accrual for broker fees written back during the year. 5 These relate to costs charged by the custodian on sale and purchase trades. 6 Alternative Performance Measures, see Glossary on pages 138 to 141.

6. Finance costs 2020 2019 Revenue Capital Total Revenue Capital Total £’000 £’000 £’000 £’000 £’000 £’000 Interest on bank loans 409 1,229 1,638 889 2,662 3,551 Interest on bank overdraft 15 43 58 7 21 28 Total 424 1,272 1,696 896 2,683 3,579

102 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 7. Taxation (a) Analysis of charge/(credit) in the year 2020 2019 Revenue Capital Total Revenue Capital Total £’000 £’000 £’000 £’000 £’000 £’000 Current tax: Corporation taxation 2,563 (1,115) 1,448 2,626 (1,377) 1,249 Prior year corporation tax adjustment (30) – (30) – – – Double taxation relief (621) – (621) (393) – (393) Overseas tax 1,695 – 1,695 1,256 – 1,256 Prior years overseas tax adjustment 42 – 42 – – – UK corporation tax refund (note 7(d)) (2,687) – (2,687) – – – Total current taxation charge/(credit) 962 (1,115) (153) 3,489 (1,377) 2,112 Deferred taxation movement (note 7(c)) 7 – 7 (26) – (26) Prior years deferred tax adjustment 84 – 84 – – – Total taxation (note 7(b)) 1,053 (1,115) (62) 3,463 (1,377) 2,086

(b) Factors affecting total tax charge/(credit) for the year The taxation assessed for the year is lower (2019: lower) than the standard rate of corporation tax in the UK of 19.00% (2019: 19.00%). The differences are explained below:

2020 2019 Revenue Capital Total Revenue Capital Total £’000 £’000 £’000 £’000 £’000 £’000 Total profit on ordinary activities before taxation 36,504 179,949 216,453 43,024 73,128 116,152 Profit on ordinary activities multiplied by standard rate of corporation tax 19.00% (2019: 19.00%) 6,936 34,190 41,126 8,175 13,894 22,069 Effects of: Overseas tax suffered 1,695 – 1,695 1,256 – 1,256 Foreign exchange profit not taxable – (462) (462) – (607) (607) Gain on investments held at fair value through profit or loss not subject to tax – (34,846) (34,846) – (14,667) (14,667) Non taxable UK dividends (2,342) – (2,342) (3,101) – (3,101) Non taxable overseas dividends (2,024) – (2,024) (2,474) – (2,474) Disallowed expenses – 3 3 – 3 3 Double taxation relief (621) – (621) (393) – (393) Prior year corporation tax adjustment (30) – (30) – – – Prior years overseas tax adjustment 42 – 42 – – – Prior years deferred tax adjustment 84 – 84 – – – UK corporation tax refund (2,687) – (2,687) – – – (5,883) (35,305) (41,188) (4,712) (15,271) (19,983) Total taxation charge/(credit) for the year (note 7(a)) 1,053 (1,115) (62) 3,463 (1,377) 2,086

The Company is exempt from corporation tax on capital gains provided it maintains its status as an investment trust under Chapter 4 of Part 24 of the Corporation Tax Act 2010. Due to the Company’s intention to meet the conditions required to maintain its investment trust status, it has not provided for deferred tax on any capital gains or losses.

Section 4: Financial statements 103

7. Taxation continued (c) Deferred tax liability Following the changes in Peruvian tax legislation effective from 1 January 2011, a capital gains tax is imposed on gains realised by non-residents at rates of 5% or 30% depending on whether the transaction took place inside or outside of Peru. The Group has accrued a capital gains tax liability of £nil (2019: £nil) for unrealised capital gains arising on investments in stocks listed on the Peruvian stock exchange. The tax has been calculated at the rate of 5% of the unrealised capital gains, being the difference between the market value of the investments at the year end and their average purchase cost.

Group and Group and Company Company 2020 2019 £’000 £’000 Deferred tax liabilities in respect of timing differences: Deferred tax liability brought forward (124) (150) Deferred tax charge in respect of taxable dividend income (7) 26 Prior years deferred tax in respect of taxable dividend income (84) – Deferred tax liability carried forward (215) (124)

(d) UK corporation tax refund The Company received a corporation tax repayment of £2,687,000 from Her Majesty’s Revenue & Customs (HMRC) in the period. The refund related to corporation tax paid with respect to the years ended 2007, 2008, and 2009 and was issued as HMRC agreed that the Company was entitled to claim credit relief for the underlying tax associated with overseas dividends received in those periods. The Company also received interest of £293,000 on the corporation tax refund.

8. Dividends 2020 2019 Record date Payment date £’000 £’000 Final dividend of 10.00p per share for the year ended 31 December 2019 (2018: 9.00p) 20 March 2020 7 May 2020 17,361 15,870 1st interim dividend of 4.00p per share for the year ended 31 December 2020 (2019: 4.00p) 29 May 2020 26 June 2020 6,944 7,053 2nd interim dividend of 4.00p per share for the year ended 31 December 2020 (2019: 4.00p) 28 August 2020 25 September 2020 6,944 7,052 3rd interim dividend of 4.00p per share for the year ended 31 December 2020 (2019: 4.00p) 20 November 2020 18 December 2020 6,942 7,030

38,191 37,005

The total dividends payable in respect of the year ended 31 December 2020 which form the basis of section 1158 of the Corporation Tax Act 2010 and section 833 of the Companies Act 2006, and the amounts proposed, meet the relevant requirements as set out in this legislation.

Dividends paid, proposed or declared on equity shares: 2020 2019 £’000 £’000 1st interim dividend of 4.00p per share for the year ended 31 December 2020 (2019: 4.00p) 6,944 7,053 2nd interim dividend of 4.00p per share for the year ended 31 December 2020 (2019: 4.00p) 6,944 7,052 3rd interim dividend of 4.00p per share for the year ended 31 December 2020 (2019: 4.00p) 6,942 7,030 Final interim dividend of 8.30p per share for the year ended 31 December 2020 (2019: final dividend 10.00p)1 14,713 17,361 35,543 38,496

1 Based on 177,270,814 ordinary shares in issue on 4 March 2021.

104 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 9. Consolidated earnings and net asset value per ordinary share 2020 2019 Net revenue profit attributable to ordinary shareholders (£’000) 35,451 39,561 Net capital profit attributable to ordinary shareholders (£’000) 181,064 74,505 Total profit attributable to ordinary shareholders (£’000) 216,515 114,066 Equity shareholders’ funds (£’000) 930,825 757,110 The weighted average number of ordinary shares in issue during the year, on which the earnings per ordinary share was calculated was: 173,740,499 176,135,318 The actual number of ordinary shares in issue at the year end, on which the net asset value per ordinary share was calculated was: 173,550,814 174,784,727 Earnings per share Revenue earnings per share (pence) 20.40 22.46 Capital profit per share (pence) 104.22 42.30 Total profit per share (pence) 124.62 64.76

As at As at 31 December 31 December 2020 2019 Net asset value per ordinary share (pence) 536.34 433.17 Ordinary share price (pence) 522.00 383.00

There were no dilutive securities at the year end.

Section 4: Financial statements 105

10. Investments held at fair value through profit or loss Group Company Group Company 2020 2020 2019 2019 £’000 £’000 £’000 £’000 UK listed equity investments 246,902 246,902 232,413 230,060 Overseas listed equity investments 691,714 691,714 528,829 528,829 Fixed income investments 87,449 87,449 68,745 68,745 Contractual rights 19,753 19,753 15,790 15,790 Investment in subsidiary1 – 7,178 – 8,308 Total value of financial asset investments 1,045,818 1,052,996 845,777 851,732 Derivative financial instruments - written option contracts (587) (587) (314) (314) Total value of financial asset investments and derivatives at 31 December 1,045,231 1,052,409 845,463 851,418 Opening book cost of investment and derivative holdings 679,207 677,415 657,420 655,628 Investment and derivative holding gains 166,256 174,003 120,794 128,360 Opening fair value 845,463 851,418 778,214 783,988 Analysis of transactions made during the year Purchases at cost 377,517 377,517 367,499 367,499 Sales proceeds received (360,104) (358,878) (376,939) (376,939) Contractual rights - return of capital (184) (184) (271) (271) Gains on investments and derivatives2 182,539 182,536 76,960 77,141 Closing fair value 1,045,231 1,052,409 845,463 851,418 Closing book cost of investment and derivative holdings 693,750 693,750 679,207 677,415 Closing investment and derivative holding gains 351,481 358,659 166,256 174,003 Closing fair value 1,045,231 1,052,409 845,463 851,418

1 Relates to wholly owned subsidiary, BlackRock World Mining Investment Company Limited. 2 Includes losses on investment dealing in the subsidiary company of £1,128,000 (2019: losses of £557,000) included within income. See note 3.

The Group received £360,104,000 (2019: £376,939,000) from investments sold in the year. The bookcost of these investments when they were purchased was £362,790,000 (2019: £345,441,000). These investments have been revalued over time and until they were sold any unrealised gains/losses were included in the fair value of investments. Special dividends amounting to £34,000 (2019: £5,229,000) have been recognised in capital during the year.

During the year, transaction costs of £815,000 (2019: £868,000) were incurred on the addition of investments. Costs relating to the disposal of investments during the year amounted to £168,000 (2019: £323,000). All transaction costs have been charged to the capital column of the Consolidated Statement of Comprehensive Income.

2020 2019 Securities lending £’000 £’000 Aggregate value of securities on loan at year end 26,845 18,701 Maximum aggregate value of securities on loan during the year 67,340 66,798 Fee income from stock lending during the year 27 77

In respect of securities on loan at the year end, securities of £29,381,000 (2019: £21,931,000) were held as collateral, the value of which exceeded the value of securities on loan by £2,536,000 (2019: £3,230,000).

In respect of the maximum aggregate value of securities on loan during the year, securities of £74,984,000 (2019: £74,849,000) were held as collateral, the value of which exceeded the value of securities on loan by £7,644,000 (2019: £8,051,000).

The value of securities on loan did not exceed the value of collateral held at any time during the year ended 31 December 2020.

106 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 11. Investment in subsidiary At 31 December 2020, the Company had one wholly owned subsidiary which is registered and operating in England and Wales and has been included in the consolidated financial statements. BlackRock World Mining Investment Company Limited was incorporated on 11 November 1993. There are no non-controlling interests in the subsidiary.

The principal activity of the subsidiary company is investment dealing. The registered address of the subsidiary company is 12 Throgmorton Avenue, London EC2N 2DL.

Issued share capital Description of shares 2020 2019 BlackRock World Mining Investment Company Limited Ordinary shares of £1 £100 £100

Under IFRS, the investment in the subsidiary is fair valued in the separate financial statements of the Company which is deemed to be the total equity of the Company and equates to £7,178,000 (2019: £8,308,000). The subsidiary has not paid dividends to the parent company during the year ended 31 December 2020 (2019: £nil).

12. Other receivables Group Company Group Company 2020 2020 2019 2019 £’000 £’000 £’000 £’000

Amount due from brokers 3,020 3,020 118 118

Withholding tax recoverable 114 114 187 187

Prepayments and accrued income 3,703 3,703 4,321 4,321 6,837 6,837 4,626 4,626

13. Other payables Group Company Group Company 2020 2020 2019 2019 £’000 £’000 £’000 £’000

Amounts due to brokers 2,473 2,473 – –

Accruals for expenses and interest payable 2,561 2,561 2,369 2,369

Share buyback payable – – 882 882

Taxation payable 511 511 752 752

Amounts due to subsidiary – 1,068 – 1,068 5,545 6,613 4,003 5,071

14. Interest bearing loans and borrowings Group Company Group Company 2020 2020 2019 2019 £’000 £’000 £’000 £’000 Bank loan 102,418 102,418 90,583 90,583 Bank overdraft 16,317 22,427 99 3,626 118,735 124,845 90,682 94,209

The Group has an overdraft facility of £30 million (2019: £30 million) and a multi-currency loan facility of £150 million (2019: £150 million). At 31 December 2020, the Company had a US dollar loan outstanding for US$140,000,000 which matures on 12 May 2021 (2019: US dollar loan for US$120,000,000 which matured on 15 May 2020). The loan is provided by The Bank of New York Mellon (International) Limited. The interest rate on bank loans approximate to 1.06% per annum for US dollar balances and nil% per annum for UK sterling balances (2019: 3.34% per annum US dollar balances and 1.23% per annum UK sterling balances). The Company incurred foreign currency loss on the translation of US$ denominated loans of £3,181,000 (2019: loss of £3,638,000).

Section 4: Financial statements 107

15. Reconciliation of liabilities arising from financing activities Group Company Group Company 2020 2020 2019 2019 £’000 £’000 £’000 £’000

Bank loan and overdraft at beginning of the year 90,682 94,209 114,221 114,221

Cash flows:

Movement in overdraft 16,218 18,801 99 3,626

Net proceeds/(repayment) in loan 15,016 15,016 (20,000) (20,000)

Non cash flows:

Effects of foreign exchange movement (3,181) (3,181) (3,638) (3,638) Bank loan and overdraft at end of the year 118,735 124,845 90,682 94,209

16. Called up share capital Nominal Number of Treasury Total value ordinary shares shares shares £’000 Allotted, called up and fully paid share capital comprised:

Ordinary shares of 5p each At 31 December 2019 174,784,727 18,227,115 193,011,842 9,651

Shares purchased into treasury (1,233,913) 1,233,913 – – At 31 December 2020 173,550,814 19,461,028 193,011,842 9,651

During the year 1,233,913 shares were bought back and transferred to treasury for a total consideration of £4,609,000 (2019: 1,545,515 shares were bought back and transferred to treasury for a total consideration of £5,546,000).

Since the year end, the Company has reissued 3,720,000 ordinary shares from treasury for a total gross consideration of £21,896,000.

108 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 17. Reserves Capital reserve Capital arising on reserve revaluation Share Capital arising on of premium redemption Special investments investments Revenue account reserve reserve sold held reserve Group £’000 £’000 £’000 £’000 £’000 £’000 At 31 December 2019 127,155 22,779 108,601 281,550 166,256 41,118 Movement during the year: Total comprehensive income: Net capital (loss)/profit for the year – – – (4,161) 185,225 – Net revenue profit for the year – – – – – 35,451 Transactions with owners recorded directly to equity: Ordinary shares purchased into treasury – – (4,573) – – – Share purchase costs – – (36) – – – Dividends paid – – – – – (38,191) At 31 December 2020 127,155 22,779 103,992 277,389 351,481 38,378

Distributable reserves Capital reserve Capital arising on reserve revaluation Share Capital arising on of premium redemption Special investments investments Revenue account reserve reserve sold held reserve Company £’000 £’000 £’000 £’000 £’000 £’000 At 31 December 2019 127,155 22,779 108,601 280,610 174,003 34,311 Movement during the year: Total comprehensive income: Net capital (loss)/profit for the year – – – (4,722) 184,656 – Net revenue profit for the year – – – – – 36,581 Transactions with owners recorded directly to equity: Ordinary shares purchased into treasury – – (4,573) – – – Share purchase costs – – (36) – – – Dividends paid – – – – – (38,191) At 31 December 2020 127,155 22,779 103,992 275,888 358,659 32,701

Pursuant to a resolution of the Company passed at an Extraordinary General Meeting on 13 January 1998 and following the Company’s application to the Court for cancellation of its share premium account, the Court approval was received on 27 January 1999 and £157,633,000 was transferred from the share premium account to a special reserve which is a distributable reserve.

The share premium account and capital redemption reserve are not distributable profits under the Companies Act 2006. In accordance with ICAEW Technical Release 02/17BL on Guidance on Realised and Distributable Profits under the Companies Act 2006, the special reserve and capital reserve (excluding capital reserves of £9,601,000 on revaluation of unquoted investments and subsidiary) may be used as distributable profits for all purposes and, in particular, the repurchase by the Company of its ordinary shares and for payments as dividends. In accordance with the Company’s Articles of Association, net capital returns may be distributed by way of dividend. The £358,659,000 of capital reserve arising on the revaluation of investments is subject to fair value movements and may not be readily realisable at short notice, as such it may not be entirely distributable.

The reserves of the subsidiary company are not distributable until distributed as a dividend to the Company.

Section 4: Financial statements 109

18. Risk management policies and procedures The Group’s investment activities expose it to various types of risks which are associated with the financial instruments and markets in which it invests. The following information is not intended to be a comprehensive summary of all risks and shareholders should refer to the Alternative Investment Fund Managers’ Directive FUND 3.2.2R Disclosures which can be found at www.blackrock.com/uk/brwm for a more detailed discussion of the risks inherent in investing in the Group.

Risk management framework The following information refers to the risk management framework of the Alternative Investment Fund Manager (AIFM). However, as disclosed in the Corporate Governance Statement on pages 70 and 71 and in the Statement of Directors’ Responsibilities on page 78, it is the ultimate responsibility of the Board to ensure that the Group’s risks are appropriately monitored, and to the extent that elements of this are delegated to third party service providers, the Board is responsible for ensuring that the relevant parties are discharging their duties in accordance with the terms of the relevant agreements and taking appropriate action to the extent issues are identified.

The Directors of the AIFM review quarterly investment performance reports and receive semi-annual presentations in person from the Investment Manager covering the Group’s performance and risk profile during the year. The AIFM has delegated the day-to-day administration of the investment programme to the Investment Manager. The Investment Manager is also responsible for ensuring that the Group is managed within the terms of its investment guidelines and limits set out in the Alternative Investment Fund Managers’ Directive FUND 3.2.2R Disclosures which can be found at www.blackrock.com/uk/ brwm.

The AIFM is responsible for monitoring investment performance, product risk monitoring and oversight and has the responsibility for the monitoring and oversight of regulatory and operational risk for the Group. The Directors of the AIFM have appointed a Risk Manager who has responsibility for the daily risk management process with assistance from key risk management personnel of the Investment Manager, including members of the Risk and Quantitative Analysis Group (RQA) which is a centralised group which performs an independent risk management function. RQA independently identifies, measures and monitors investment risk and tracks the actual risk management practices being deployed across the Group. By breaking down the components of the process, RQA have the ability to determine if the appropriate risk management processes are in place. This captures the risk management tools employed, how the levels of risk are controlled, ensuring risk/ return is considered in portfolio construction and reviewing outcomes.

The AIFM reports to the Audit and Management Engagement Committee twice yearly on key risk metrics and risk management processes; in addition, the Depositary monitors the performance of the AIFM and reports to the Audit and Management Engagement Committee semi-annually. Any significant issues are reported to the Board as they arise.

Risk Exposures The risk exposures of the Group and Company are set out as follows:

(a) Market risk Market risk arises mainly from uncertainty about future values of financial instruments influenced by price, currency and interest rate movements. It represents the potential loss the Group may suffer through holding market positions in financial instruments in the face of market movements.

A key metric the RQA Group uses to measure market risk is Value-at-Risk (VaR) which encompasses price, currency and interest rate risk. VaR is a statistical risk measure that estimates the potential portfolio loss from adverse market moves in an ordinary market environment. VaR analysis reflects the interdependencies between risk variables, unlike a traditional sensitivity analysis.

The VaR calculations are based on a confidence level of 99%, with a holding period of not greater than one day and a historical observation period of not less than one year (250 days). A VaR number is defined at a specified probability and a specified time horizon. A 99% one day VaR means that the expectation is that 99% of the time over a one-day period the Company will lose less than this number in percentage terms. Therefore, higher VaR numbers indicate higher risk. It is noted that the use of VaR methodology has limitations, namely assumptions that risk factor returns are normally distributed and that the use of historical market data as a basis for estimating future events does not encompass all possible scenarios, particularly those that are of an extreme nature and that the use of a specified confidence level (e.g. 99%) does not take into account losses that occur beyond this level. There is some probability that the loss could be greater than the VaR amounts. These limitations, and the nature of the VaR measure, mean that the Company can neither guarantee that losses will not exceed the VaR amounts indicated, nor that losses in excess of the VaR amounts will not occur more frequently.

110 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 The one-day VaR for the Group and Company as of 31 December 2020 and 31 December 2019 (based on a 99% confidence level) was 4.57% and 2.19% respectively.

(i) Market risk arising from price risk Exposure to price risk Price risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices (other than those arising from interest rate risk or currency risk), whether those changes are caused by factors specific to the individual financial instrument or its issuer, or factors affecting similar financial instruments traded in the market. Local, regional or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Group and the market price of its investments and could result in increased premiums or discounts to the Group’s net asset value.

An outbreak of an infectious respiratory illness caused by a novel coronavirus known as COVID-19 was first detected in China in December 2019 and has now developed into a global pandemic. This coronavirus has resulted in travel restrictions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in healthcare service preparation and delivery, prolonged quarantines, cancellations, supply chain disruptions and lower consumer demand, as well as general concern and uncertainty. The impact of COVID-19 has adversely affected the economies of many nations across the entire global economy, individual issuers and capital markets, and could continue to an extent that cannot necessarily be foreseen. In addition, the impact of infectious illnesses in emerging market countries may be greater due to generally less established healthcare systems. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its effects cannot be determined with certainty.

The Group is exposed to market price risk arising from its equity investments, fixed income investments and written options. The movements in the prices of these investments result in movements in the performance of the Group. Price risk sensitivity has been covered by the VaR analysis under the market risk section above.

Management of price risk By diversifying the portfolio, where this is appropriate and consistent with the Group’s objectives, the risk that a price change of a particular investment will have a material impact on the NAV of the Group is minimised which is in line with the investment objectives of the Group.

Exchange traded and over-the-counter (OTC) financial derivative instruments When appropriate, the Group may write both exchange traded and over-the-counter option contracts as part of its investment policy. Options written by the Group provide the purchaser with the opportunity to purchase from or sell the Group the underlying asset at an agreed-upon value either on or before the expiration of the option. Options are generally settled on a net basis.

During the year ended 31 December 2020 and 2019, the Group wrote covered call and put option contracts to generate revenue income for the Group. As the call and put options are covered by dedicated cash resources and no call and put option contracts were written to manage price risk, there is no impact on the Group’s exposure to gearing or leverage as a result of writing covered call and put options. The notional amount of the one put and one call options written that were open (2019: two put options and three call options) at 31 December 2020 was £23,770,000 (2019: £16,061,000).

Management of OTC financial derivative instruments Economic exposure through option writing is restricted such that no more than 20% of the Group’s portfolio shall be under option at any given time. Exposures are monitored daily by the Investment Manager, BlackRock, and its independent risk management team. The Group’s Board also reviews the exposures regularly.

The option positions are diversified across sectors and geographies comprising two positions as at 31 December 2020 (2019: five).

The economic exposures to options can be closed out at any time by the Group with immediate effect. Details of securities and exposures to market risk and credit risk implicit within the options portfolio are given above and on page 114.

Section 4: Financial statements 111

18. Risk management policies and procedures continued Concentration of exposure to market price risks An analysis of the Group’s investment portfolio is shown on pages 29 to 31. At 31 December 2020 this shows that the portfolio had significant levels of investments in Latin America, Australasia, Canada and USA. Accordingly, there is a concentration of exposure to those regions, though it is recognised that an investment’s country of domicile or listing does not necessarily equate its exposure to the economic conditions in that country.

(ii) Market risk arising from foreign currency risk Exposure to foreign currency risk Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. Foreign currency sensitivity has been covered by the VaR analysis under the market risk section.

The fair values of the Group’s and Company’s monetary items which have foreign currency exposure at 31 December 2020 and 31 December 2019 are shown below. Where the equity investments which are not monetary items are denominated in a foreign currency, they have been included separately in the analysis so as to show the overall level of exposure.

US Canadian Australian Brazilian dollar dollar dollar real Others Total 2020 £’000 £’000 £’000 £’000 £’000 £’000 Receivables (due from brokers, dividends and other income receivable) 1,043 2,528 1,877 1,144 91 6,683 Cash and cash equivalents 266 43 – – – 309 Bank loans (102,418) – – – – (102,418) Bank overdraft – – (3) – – (3) Payables (130) – – – – (130) Total foreign currency exposure on net monetary items (101,239) 2,571 1,874 1,144 91 (95,559) Investments at fair value through profit or loss 334,645 223,080 111,767 43,363 55,013 767,868 Total net foreign currency exposure 233,406 225,651 113,641 44,507 55,104 672,309

US Canadian Australian Brazilian dollar dollar dollar real Others Total 2019 £’000 £’000 £’000 £’000 £’000 £’000 Receivables (due from brokers, dividends and other income receivable) 2,733 496 – 1,219 98 4,546 Cash and cash equivalents – 39 – – – 39 Bank loans (90,583) – – – – (90,583) Bank overdrafts (99) – – – – (99) Payables (202) (38) – – – (240) Derivative financial liabilities at fair value through profit or loss (131) (66) – – (58) (255) Total foreign currency exposure on net monetary items (88,282) 431 – 1,219 40 (86,592) Investments at fair value through profit or loss 242,092 201,549 81,465 28,702 36,021 589,829 Total net foreign currency exposure 153,810 201,980 81,465 29,921 36,061 503,237

Management of foreign currency risk The Investment Manager monitors the Group’s exposure to foreign currencies on a daily basis and reports to the Board of the Group on a regular basis.

The Investment Manager measures the risk to the Group of the foreign currency exposure by considering the effect on the Group’s net asset value and income of a movement in the exchange rate to which the Group’s assets, liabilities, income and expenses are exposed.

The Group does not use financial instruments to mitigate the currency exposure in the period between the time that income is included in the financial statements and its receipt. Derivative contracts are not used to hedge against exposure to foreign currency risk.

112 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Consequently, the Group is exposed to risks that the exchange rate of its reporting currencies, relative to other currencies, may change in a manner which has an adverse effect on the value of the portion of the Group’s assets which are denominated in currencies other than their own currencies.

(iii) Market risk arising from interest rate risk Exposure to interest rate risk Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

The Group is exposed to interest rate risk specifically through its fixed income investments, cash holdings and its borrowing facility for investment purposes. Interest rate movements may affect the level of income receivable from any cash at bank and on deposits. The effect of interest rate changes on the earnings of the companies held within the portfolio may have a significant impact on the valuation of the Group’s investments. Interest rate sensitivity risk has been covered by the VaR analysis under the market risk section.

Interest rate exposure The exposure for Group and Company at 31 December 2020 and 31 December 2019 of financial assets and liabilities to interest rate risk is shown by reference to:

– floating interest rates – when the interest rate is due to be re-set; and

– fixed interest rates – when the financial instrument is due for repayment.

2020 2019 Within More Within More one than one one than one year year Total year year Total Group £’000 £’000 £’000 £’000 £’000 £’000 Exposure to floating interest rates: Cash collateral held with brokers 2,943 – 2,943 431 – 431 Cash and cash equivalents 309 – 309 1,399 – 1,399 Bank loans (102,418) – (102,418) (90,583) – (90,583) Bank overdraft (16,317) – (16,317) (99) – (99) Exposure to fixed interest rates: Fixed income investments – 87,449 87,449 – 68,745 68,745 Total exposure to interest rates (115,483) 87,449 (28,034) (88,852) 68,745 (20,107)

2020 2019 Within More Within More one than one one than one year year Total year year Total Company £’000 £’000 £’000 £’000 £’000 £’000 Exposure to floating interest rates: Cash collateral held with brokers 2,943 – 2,943 431 – 431 Cash and cash equivalents 309 – 309 39 – 39 Bank loans (102,418) – (102,418) (90,583) – (90,583) Bank overdraft (22,427) – (22,427) (3,626) – (3,626) Exposure to fixed interest rates: Fixed income investments – 87,449 87,449 – 68,745 68,745 Total exposure to interest rates (121,593) 87,449 (34,144) (93,739) 68,745 (24,994)

Section 4: Financial statements 113

18. Risk management policies and procedures continued Interest rates received on cash balances are approximately 0.25% for USD balances and 0.07% per annum for GBP balances (2019: 1.88% for USD balances and 0.34% per annum for GBP balances). Interest rates paid on bank loans are approximately 1.65% per annum for USD balances and nil% per annum for GBP balances (2019: 3.34% per annum for USD balances and 1.23% per annum for GBP balances). Effective interest rates on fixed income investments ranged from 4.00% to 13.50% (2019: 3.88% to 13.50%).

Management of interest rate risk The possible effects on fair value and cash flows that could arise as a result of changes in interest rates are taken into account when making investment decisions and borrowings under the loan and overdraft facilities.

The Group finances part of its activities through borrowings at levels approved and monitored by the Board of the Company. Derivative contracts are not used to hedge against the exposure to interest rate risk.

(b) Counterparty credit risk Credit risk is the risk that the issuer of a financial instrument will fail to fulfil an obligation or commitment that it has entered into with the Group.

The Group is exposed to counterparty credit risk from the parties with which it trades and will bear the risk of settlement default. Counterparty credit risk to the Group arises from transactions to purchase or sell investments, fixed income investments, and through option writing transactions on equity investments held within the portfolio.

Other receivables as at 31 December 2020 include fixed interest income of £106,000 that has been fully provided for (see Note 3). There were no past due assets as of 31 December 2020 (2019: nil).

The major counterparties engaged with the Group and Company are all widely recognised and regulated entities.

Depositary The Group’s Depositary is The Bank of New York Mellon (International) Limited (the Depositary) (S&P’s long-term credit rating as at 31 December 2020: AA- (2019: AA-)). All of the equity and fixed income assets and cash of the Group are held within the custodial network of the global custodian appointed by the Depositary. Bankruptcy or insolvency of the Depositary may cause the Group’s rights with respect to its investments held by the Depositary to be delayed or limited. The maximum exposure to this risk at 31 December 2020 is the total value of equity and fixed income investments held with the Depositary and cash and cash equivalents in the Consolidated and Parent Company Statements of Financial Position.

In accordance with the requirements of the depositary agreement, the Depositary will ensure that any agents it appoints to assist in safekeeping the equity and fixed income investments of the Group will segregate the equity and fixed income investments of the Group. Thus, in the event of insolvency or bankruptcy of the Depositary, the Group’s non-cash assets are segregated and this reduces counterparty credit risk. The Group will, however, be exposed to the counterparty credit risk of the Depositary in relation to the Group’s cash held by the Depositary. In the event of the insolvency or bankruptcy of the Depositary, the Group will be treated as a general creditor of the Depositary in relation to cash holdings of the Group.

The Group’s listed investments are held on its behalf by The Bank of New York Mellon (International) Limited as the Group’s custodian (as sub-delegated by the Depositary). Bankruptcy or insolvency of the custodian may also cause the Group’s rights with respect to its securities held by the custodian to be delayed or limited. The Board monitors the Group’s risk by reviewing the custodian’s internal control reports.

Securities lending All securities lending transactions entered into by the Company are subject to a written legal agreement between the Company and the Securities Lending Agent, BlackRock Advisors (UK) Limited, a related party to the Company, and separately between the Securities Lending Agent and the approved borrowing counterparty. Collateral received in exchange for securities lent is transferred under a title transfer arrangement and is delivered to and held in an account with a tri-party collateral manager in the name of the Depositary, The Bank of New York Mellon (International) Limited, on behalf of the Company. Collateral received is segregated from the assets belonging to the Company’s Depositary or the Lending Agent.

The value of securities on loan as a proportion of the Group and Company’s total lendable assets as at 31 December 2020 was 3.13% (2019: 2.63%) and as a proportion of the Group’s net assets as at 31 December 2020 was 2.90% (2019: 2.47%). Income earned from securities lending during the year ended 31 December 2020 is set out in note 3 of the financial statements.

114 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Total lendable assets represent the aggregate value of assets forming part of the Group and Company’s securities lending programme. This excludes any assets held by the Company that are not considered lendable due to any market, regulatory, investment or other restriction.

The following table details the value of securities on loan and associated collateral received, analysed by counterparty as at 31 December 2020 and 31 December 2019.

Stock Collateral lending received Country of 2020 establishment £’000 £’000

Citigroup Global Markets Limited United Kingdom 5,877 6,290

HSBC Bank plc United Kingdom 20,968 23,091 26,845 29,381

Stock Collateral lending received Country of 2019 establishment £’000 £’000

Barclays Capital Securities Limited United Kingdom 2,990 3,302

Citigroup Global Markets Limited United Kingdom 361 388

Credit Suisse Securities (Europe) Limited United Kingdom 1,212 1,310

HSBC Bank plc United Kingdom 2,184 3,610

UBS AG Switzerland 11,954 13,321 18,701 21,931

Collateral The Company engages in securities lending transactions for which it may hold collateral received from a counterparty. The following table provides an analysis by currency of the underlying non-cash collateral received by way of a title transfer collateral arrangement by the Company, in respect of securities lending transactions as at 31 December 2020 and 31 December 2019:

Non-cash collateral received 2020 Currency £’000 Chinese yuan 4,233 Euro 3,746 Japanese yen 293 UK sterling 5,154 US dollar 14,746 Other 1,209 Total 29,381

Section 4: Financial statements 115

18. Risk management policies and procedures continued Non-cash collateral received 2019 Currency £’000 Australian dollar 1,198 Canadian dollar 192 Chinese yuan 2,209 Euro 5,691 Hong Kong dollar 3,476 Japanese yen 366 Singapore dollar 24 Swiss franc 1,776 UK sterling 3,935 US dollar 3,031 Other 33 Total 21,931

Non-cash collateral received by way of a title transfer collateral arrangement in relation to securities lending transactions cannot be sold, reinvested or pledged.

The following table provides an analysis of the type, quality and maturity tenor of non-cash collateral received and posted by the Group and Company by way of a title transfer collateral arrangement in respect of securities lending transactions as at 31 December 2020 and 31 December 2019.

Maturity Tenor 91 to 365 More than Open 8 to 30 days days 365 days Transactions Total 2020 £’000 £’000 £’000 £’000 £’000 Collateral received – securities lending Fixed Income Investment grade – – 9,586 – 9,586 Equities Recognised equities – – – 19,795 19,795 Total – – 9,586 19,795 29,381

Maturity Tenor 91 to 365 More than Open 8 to 30 days days 365 days Transactions Total 2019 £’000 £’000 £’000 £’000 £’000 Collateral received – securities lending Fixed Income Investment grade – – 274 – 274 Equities Recognised equities – – – 21,657 21,657 Total – – 274 21,657 21,931

Investment grade securities are those issued by an entity with a minimum investment grade credit rating from at least one globally recognised credit rating agency; Standard & Poor’s, Moody’s or Fitch.

116 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 The maturity tenor analysis for fixed income securities received as collateral is based on the respective contractual maturity date, while equity securities received as collateral are presented as open transactions as they are not subject to a contractual maturity date.

As at 31 December 2020 and 2019, all non-cash collateral received by the Group and Company in respect of securities lending transactions is held by the Group’s Depositary (or through its delegates).

The following table lists the ten largest issuers by value of non-cash collateral received by the Group by way of a title transfer collateral arrangement across securities lending transactions as at 31 December 2020 and 2019.

Value % of the 2020 Company’s Non cash collateral issuer £’000 NAV UK Gilt 4,021 0.43 Industrial and Commercial Bank 2,117 0.23

China Construction Bank 2,117 0.23

Tencent 2,117 0.23

China Mengniu Dairy 2,117 0.23

Xiamoi 2,117 0.23 Alibaba Group 2,116 0.23 Meituan 2,116 0.23 Country Garden 1,591 0.17 Avantor 1,237 0.13 Other issuers 7,715 0.83 Total 29,381 3.17

Value % of the 2019 Company’s Non cash collateral issuer £’000 NAV CSL 1,198 0.16 Sun Hung Kai Properties 1,130 0.15

Legal & General 1,006 0.13

AIA Group 993 0.13

JPMorgan Chase 920 0.12

Alibaba Group 881 0.12 Deutsche Börse 580 0.08 Sonova 545 0.07 Tencent 455 0.06 China Life Insurance 420 0.06 Other issuers 13,803 1.82 Total 21,931 2.90

Counterparties/brokers The Group only invests directly in markets that operate on a delivery versus payment basis and consequently most investment transactions in listed securities involve simultaneous delivery of securities against cash payment using an approved broker. The risk of default is considered minimal and the trade will fail if either party fails to meet its obligation.

For a few markets that the Group invests in from time to time, although they operate on a ‘delivery versus payment’ basis, there may be a very short time gap between stock delivery and payment, giving a potential rise to counterparty credit risk with the broker in relation to transactions awaiting settlement. Risk relating to unsettled transactions is considered small due to the short settlement period involved and the high credit quality of the brokers used for those markets.

Section 4: Financial statements 117

18. Risk management policies and procedures continued Cash held as security by the counterparty to financial derivative contracts is subject to the credit risk of the counterparty. The following table details the total number of counterparties to which the Group is exposed, the maximum exposure to any one counterparty, the collateral held by the Group against this exposure, the total exposure to all other counterparties and the lowest long-term credit rating of any one counterparty (or its ultimate parent if unrated).

Maximum exposure Total exposure to any one to all other Lowest credit counterparty1 Collateral held1 counterparties1 Total number of rating of any one counterparties £’000 £’000 £’000 counterparty2

2020 4 2,943 – 3,325 A+

2019 4 1,399 – 549 A+

1 Calculated on a net basis. 2 S&P ratings.

The Group may also be exposed to counterparty risk should there be any rehypothecation of pledged collateral. Collateral is received/paid where the client service agreement states that there should be collateral movements agreed with the counterparty, where there is a requirement for a mark-to-market process or collateralisation to ensure that the Group is protected against any counterparty default.

Collateral The Group engages in activities which may require collateral to be provided to a counterparty (pledged collateral) or may hold collateral received (inbound collateral) from a counterparty. The Group uses inbound collateral received from a counterparty to reduce the counterparty credit risk associated with any trading activity in which the Group has engaged.

Cash collateral pledged by the Group is separately identified as an asset in the Consolidated and Parent Company Statements of Financial Position and is not included as a component of cash and cash equivalents. The cash is subject to certain counterparty credit risk as the Group’s access to its cash could be delayed should the counterparties become insolvent or bankrupt. Collateral received in the form of securities is not reflected in the Consolidated and Parent Company Statements of Financial Position. The Group has the right to sell or re-pledge collateral received in the form of securities in circumstances such as default.

The fair value of inbound cash collateral and cash collateral pledged is reflected in the table below:

Pledged collateral Inbound collateral As at As at As at As at 31 December 31 December 31 December 31 December 2020 2019 2020 2019 £’000 £’000 £’000 £’000 Cash collateral - Bank of America Merrill Lynch 2,943 431 – –

Receivables Amounts due from debtors are disclosed in the Consolidated and Parent Company Statements of Financial Position as receivables. The counterparties included in receivables are the same counterparties discussed previously under counterparty credit risk and subject to the same scrutiny by the BlackRock RQA Counterparty & Concentration Risk team (RQA CCR). The Group monitors the ageing of receivables to mitigate the risk of debtor balances becoming overdue.

118 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

2020 2019 Group £’000 £’000 Investment in contractual rights 19,753 15,790 Fixed income investments 87,449 68,745 Cash collateral held with brokers 2,943 431 Cash and cash equivalents 309 1,399 Other receivables (amounts due from brokers, dividends, interest and tax receivable) 6,837 4,626 117,291 90,991

2020 2019 Company £’000 £’000 Investment in contractual rights 19,753 15,790 Fixed income investments 87,449 68,745 Cash collateral held with brokers 2,943 431 Cash and cash equivalents 309 39 Other receivables (amounts due from brokers, dividends, interest and tax receivable) 6,837 4,626 117,291 89,631

Management of counterparty credit risk RQA CCR is responsible for the risk management of the Group, with duties comprising of identifying, monitoring and managing risk, including counterparty credit risk. RQA CCR is supported in this role by the Investment Manager.

The counterparty/credit risk is managed as follows:

– transactions are only entered into with those counterparties approved by RQA CCR, with a formal review carried out for each new counterparty and with counterparties selected by RQA CCR on the basis of a number of risk mitigation criteria designed to reduce the risk to the Group of default;

– the creditworthiness of financial institutions with whom cash and fixed income instruments are held is reviewed regularly by the Investment Manager; and

– the RQA CCR team review the credit standard of the Company’s brokers on a periodic basis, and set limits on the amount that may be due from any one broker.

The Board monitors the Group’s counterparty risk by reviewing:

– the semi-annual report from the Depositary, which includes the results of periodic site visits to the Group’s custodian where controls are reviewed and tested;

– the custodian’s Service Organisation Control (SOC 1) reports which include a report by the custodian’s auditor. This report sets out any exceptions or issues noted as a result of the auditor’s review of the custodian’s control processes;

– the Manager’s internal control reports which include a report by the Manager’s auditor. This report sets out any exceptions or issues noted as a result of the auditor’s review of the Manager’s control processes; and

– in addition, the Depositary and the Manager report any significant breaches or issues arising to the Board as soon as these are identified.

Section 4: Financial statements 119

18. Risk management policies and procedures continued Offsetting disclosures In order to better define its contractual rights and to secure rights that will help the Group mitigate its counterparty risk, the Group may enter into an ISDA Master Agreement or similar agreement with its OTC derivative contract counterparties. An ISDA Master Agreement is an agreement between the Group and the counterparty that governs OTC derivative contracts and typically contains, among other things, collateral posting terms and netting provisions in the event of a default and/or termination event. Under an ISDA Master Agreement, the Group has a contractual right to offset with the counterparty certain derivative financial instruments payables and/or receivables with collateral held and/or posted and create one single net payment in the event of default including the bankruptcy or insolvency of the counterparty. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on, or prohibitions against the right of offset in bankruptcy, insolvency or other events.

For financial reporting purposes, the Group does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the Statements of Financial Position. The disclosures set out in the following tables include financial assets and financial liabilities that are subject to an enforceable master netting arrangement or similar agreement.

At 31 December 2020 and 2019, the Group’s and Company’s derivative assets and liabilities (by type) are as follows:

At 31 December 2020 At 31 December 2019 Assets Liabilities Assets Liabilities Derivatives £’000 £’000 £’000 £’000 Written option contracts – (587) – (314) Total derivative assets and liabilities in the Consolidated and Parent Company Statements of Financial Position – (587) – (314) Derivatives not subject to a master netting agreement – – – – Total assets and liabilities subject to a master netting agreement – (587) – (314)

The following table presents the Group’s and Company’s derivative liabilities by counterparty, net of amounts available for offset, under a master netting agreement and net of any related collateral paid by the Group at 31 December 2020 and 2019:

Derivative liabilities subject to a master netting Derivatives Net amount agreement by a available for Non-cash Cash collateral of derivative counterparty offset collateral given given liabilities Counterparty £’000 £’000 £’000 £’000 £’000

At 31 December 2020

Bank of America Merrill Lynch (587) – – 587 –

At 31 December 2019

Bank of America Merrill Lynch (314) – – 314 –

(c) Liquidity risk Liquidity risk is the risk that the Group will encounter difficulties in meeting obligations associated with financial liabilities. The Group is also exposed to the liquidity risk for margin calls on derivative instruments. The Group has an overdraft facility of £30 million (2019: £30 million) and a multi-currency loan facility of £150 million (2019: £150 million). As per the borrowing agreements, borrowings under the overdraft and loan facilities shall at no time exceed £180 million or 25% of the Group’s net asset value (whichever is the lower) (2019: £180 million or 25% of the Group’s net asset value (whichever is lower)) and this covenant was complied with during the year. For details of the loan facility, refer to note 14.

120 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Liquidity risk exposure The remaining undiscounted gross cash outflows of the financial liabilities as at 31 December 2020 and 2019, based on the earliest date on which payment can be required, were as follows:

2020 2019 3 months or 3 months or less less Group £’000 £’000 Current liabilities: Amounts due to brokers, accruals and provisions 5,545 4,003 Derivative financial liabilities at fair value through profit or loss 587 314 Bank overdraft 16,317 99 Bank loans 102,418 90,583 124,867 94,999

2020 2019 3 months or 3 months or less less Company £’000 £’000 Current liabilities: Amounts due to brokers, accruals and provisions 6,613 5,071 Derivative financial liabilities at fair value through profit or loss 587 314 Bank overdraft 22,427 3,626 Bank loans 102,418 90,583 132,045 99,594

Management of liquidity risk Liquidity risk is minimised by holding sufficient liquid investments which can be readily realised to meet liquidity demands. Asset disposals may also be required to meet liquidity needs. However, the timely sale of trading positions can be impaired by many factors including decreased trading volume and increased price volatility. As a result, the Group may experience difficulties in disposing of assets to satisfy liquidity demands. Liquidity risk is not significant as the majority of the Group’s assets are investments in listed securities that are readily realisable.

The Board gives guidance to the Investment Manager as to the maximum amounts of the Group’s resources that should be invested in any one company. The policy is that the Group should remain 90% invested in normal market conditions and that 25% of the Group’s assets may be invested in cash or cash equivalents. Short-term borrowings may be used to manage short- term cash requirements.

The Group’s liquidity risk is managed on a daily basis by the Investment Manager in accordance with established policies and procedures in place. The Investment Manager reviews daily forward-looking cash reports which project cash obligations. These reports allow them to manage their obligations.

For the avoidance of doubt, none of the assets of the Group are subject to special liquidity arrangements.

(d) Valuation of financial instruments Financial assets and financial liabilities are either carried in the Consolidated and Parent Company Statements of Financial Position at their fair value (investment and derivatives) or at an amount which is a reasonable approximation of fair value (due from brokers, dividends and interest receivable, due to brokers, accruals, cash at bank and bank overdrafts). IFRS 13 requires the Group to classify fair value measurements using a fair value hierarchy that reflects the significance of inputs used in making the measurements. The valuation techniques used by the Group are explained in the accounting policies note 2(h) to the Financial Statements on page 98.

Categorisation within the hierarchy has been determined on the basis of the lowest level input that is significant to the fair value measurement of the relevant asset.

Section 4: Financial statements 121

18. Risk management policies and procedures continued The fair value hierarchy has the following levels:

Level 1 – Quoted market price for identical instruments in active markets A financial instrument is regarded as quoted in an active market if quoted prices are readily available from an exchange, dealer, broker, industry group, pricing service or regulatory agency and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The Group does not adjust the quoted price for these instruments.

Level 2 – Valuation techniques using observable inputs This category includes instruments valued using quoted prices for similar instruments in markets that are considered less than active, or other valuation techniques where all significant inputs are directly or indirectly observable from market data.

Valuation techniques used for non-standardised financial instruments such as options, currency swaps and other over-the- counter derivatives include the use of comparable recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, option pricing models and other valuation techniques commonly used by market participants making the maximum use of market inputs and relying as little as possible on entity specific inputs.

Over-the-counter derivative option contracts have been classified as Level 2 investments as their valuation has been based on market observable inputs represented by the underlying quoted securities to which these contracts expose the Group.

Level 3 – Valuation techniques using significant unobservable inputs This category includes all instruments where the valuation technique includes inputs not based on observable market data and these inputs could have a significant impact on the instrument’s valuation.

This category also includes instruments that are valued based on quoted prices for similar instruments where significant entity determined adjustments or assumptions are required to reflect differences between the instruments and instruments for which there is no active market. The Investment Manager considers observable data to be that market data that is readily available, regularly distributed or updated, reliable and verifiable, not proprietary, and provided by independent sources that are actively involved in the relevant market.

The level in the fair value hierarchy within which the fair value measurement is categorised in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement.

Assessing the significance of a particular input to the fair value measurement in its entirety requires judgement, considering factors specific to the asset or liability. The determination of what constitutes ‘observable’ inputs requires significant judgement by the Investment Manager.

Valuation process and techniques for Level 3 valuations The Directors engage a mining consultant, an independent valuer with a recognised and relevant professional qualification, to conduct a periodic valuation of the contractual rights and the fair value of the contractual rights is assessed with reference to relevant factors. At the reporting date the income streams from contractual rights have been valued on the net present value of the pre-tax cash flows discounted at a rate the external valuer considers reflects the risk associated with the project. The valuation model uses discounted cash flow analysis which incorporates both observable and non-observable data. Observable inputs include assumptions regarding current rates of interest and commodity prices. Unobservable inputs include assumptions regarding production profiles, price realisations, cost of capital and discount rates. In determining the discount rate to be applied, the external valuer considers the country and sovereign risk associated with the project, together with the time horizon to the commencement of production and the success or failure of projects of a similar nature. To assess the significance of a particular input to the entire measurement, the external valuer performs a sensitivity analysis. The external valuer has undertaken an analysis of the impact of using alternative discount rates on the fair value of contractual rights.

This investment in contractual rights is reviewed regularly to ensure that the initial classification remains correct given the asset’s characteristics and the Group’s investment policies. The contractual rights are initially recognised using the transaction price as the best evidence of fair value at acquisition and are subsequently measured at fair value, taking into consideration the relevant IFRS 13 requirements. In arriving at their estimates of market values, the valuers have used their market knowledge and professional judgement. The Group classifies the fair value of this investment as Level 3.

122 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Valuations are the responsibility of the Directors of the Company. In arriving at a final valuation, the Directors consider the independent valuer’s report, the significant assumptions used in the fair valuation and the review process undertaken by BlackRock’s Pricing Committee. The valuation of unquoted investments is performed on a quarterly basis by the Portfolio Managers and reviewed by the Pricing Committee of the Investment Manager. On a quarterly basis the Portfolio Managers will review the valuation of the contractual rights and inputs for significant changes. A valuation of contractual rights is performed annually by an external valuer, SRK Consulting (UK) Limited, and reviewed by the Pricing Committee of the Investment Manager. The valuations are also subject to quality assurance procedures performed within the Pricing Committee. On a semi-annual basis, after the checks above have been performed, the Investment Manager presents the valuation results to the Directors. This includes a discussion of the major assumptions used in the valuations. There were no changes in valuation techniques during the year.

Fair values of financial assets and financial liabilities The table below sets out fair value measurements using the IFRS 13 fair value hierarchy.

Financial assets/(liabilities) at fair value through profit or loss at 31 December 2020 - Group Level 1 Level 2 Level 3 Total £’000 £’000 £’000 £’000 Assets: Equity investments 935,805 2,811 – 938,616 Fixed income securities 42,773 44,676 – 87,449 Investment in contractual rights – – 19,753 19,753 Total assets 978,578 47,487 19,753 1,045,818 Liabilities: Derivative financial instruments – written options – (587) – (587) Total 978,578 46,900 19,753 1,045,231

Financial assets/(liabilities) at fair value through profit or loss at 31 December 2019 - Group Level 1 Level 2 Level 3 Total £’000 £’000 £’000 £’000 Assets: Equity investments 761,242 – – 761,242 Fixed income securities 38,646 30,099 – 68,745 Investment in contractual rights – – 15,790 15,790 Total assets 799,888 30,099 15,790 845,777 Liabilities: Derivative financial instruments – written options – (314) – (314) Total 799,888 29,785 15,790 845,463

Financial assets/(liabilities) at fair value through profit or loss at 31 December 2020 - Company Level 1 Level 2 Level 3 Total £’000 £’000 £’000 £’000 Assets: Equity investments 935,805 2,811 7,178 945,794 Fixed income securities 42,773 44,676 – 87,449 Investment in contractual rights – – 19,753 19,753 Total assets 978,578 47,487 26,931 1,052,996 Liabilities: Derivative financial instruments – written options – (587) – (587) Total 978,578 46,900 26,931 1,052,409

Section 4: Financial statements 123

18. Risk management policies and procedures continued Financial assets/(liabilities) at fair value through profit or loss 31 December 2019 - Company Level 1 Level 2 Level 3 Total £’000 £’000 £’000 £’000 Assets: Equity investments 758,889 – 8,308 767,197 Fixed income securities 38,646 30,099 – 68,745 Investment in contractual rights – – 15,790 15,790 Total assets 797,535 30,099 24,098 851,732 Liabilities: Derivative financial instruments – written options – (314) – (314) Total 797,535 29,785 24,098 851,418

A reconciliation of fair value measurement in Level 3 is set out below.

Level 3 Financial assets at fair value through profit or loss At 31 December – Group 2020 2019 £’000 £’000 Opening fair value 15,790 18,513 Total profit or loss included in net profit on investments in the Consolidated Statement of Comprehensive Income: – assets held at the end of the year 3,963 (2,723) Closing balance 19,753 15,790

Level 3 Financial assets at fair value through profit or loss At 31 December – Company 2020 2019 £’000 £’000 Opening fair value 24,098 27,199 Total profit or loss included in net profit on investments in the Consolidated Statement of Comprehensive Income: – assets held at the end of the year 2,833 (3,101) Closing balance 26,931 24,098

The Level 3 valuation process and techniques used are explained in the accounting policies in note 2(h). A more detailed description of the techniques is found on pages 122 and 123 under ‘Valuation process and techniques’.

Quantitative information of significant unobservable inputs – Level 3 – Group and Company 2020 2019 Valuation Unobservable Description £’000 £’000 technique input

Discounted rate – weighted average cost of capital Discounted cash Average gold and OZ Minerals Brazil Royalty 19,753 15,790 flows copper prices Investment in subsidiary company 7,178 8,308 Net assets Net assets

124 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 21 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Sensitivity analysis to significant changes in unobservable inputs within Level 3 hierarchy The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy, together with an estimated quantitative sensitivity analysis, as at 31 December 2020 are as shown below.

Description Input Estimated sensitivity used1 Impact on fair value OZ Minerals Brazil Royalty Discount rate – weighted 2020 – 1% 2020 – £1.1m average cost of capital 2019 – 1% 2019 – £0.8m Average gold and copper 2020 – 10% 2020 – £1.4m prices 2019 – 10% 2019 – £2.2m

1 The sensitivity analysis refers to a percentage amount added or deducted from the input and the effect this has on the fair value.

The sensitivity impact on fair value is calculated based on the sensitivity estimates set out by the independent valuer in its report on the valuation of contractual rights. Significant increases/(decreases) in estimated commodity prices and discount rates in isolation would result in a significantly higher/(lower) fair value measurement. Generally, a change in the assumption made for the estimated value is accompanied by a directionally similar change in the commodity prices and discount rates.

(e) Capital management policies and procedures The Group’s capital management objectives are:

– to ensure it will be able to continue as a going concern; and

– to achieve a balanced return of dividends and capital growth over the longer term, by investing primarily in securities of companies in the mining and metals sectors.

This is to be achieved through an appropriate balance of equity capital and gearing. The Company operates a flexible gearing policy which depends on prevailing conditions. The policy is that debt should not be more than 25% of the Group’s net assets.

The Group’s total invested capital at 31 December 2020 was £1,049,560,000 (2019: £847,792,000) comprising of bank loans and an overdraft of £118,735,000 (2019: £90,682,000) and equity shares, capital and reserves of £930,825,000 (2019: £757,110,000).

Under the terms of the overdraft and loan facility agreement, the Group’s total indebtedness shall at no time exceed £180 million or 25% of the Group’s net asset value (whichever is the lowest).

The cash and bank overdraft accounts of the Company and subsidiary in the same currency are managed under a compensated group arrangement and are therefore presented on a net basis in the Group financial statements.

The Board with the assistance of the Investment Manager monitors and reviews the broad structure of the Group’s capital on an ongoing basis. This review includes:

– the planned level of gearing, which takes into account the Investment Manager’s view on the market; and

– the need to buy back equity shares, either for cancellation or to be held in treasury, which takes account of the difference between the NAV per share and the share price (i.e. the level of share price discount or premium).

The Group is subject to externally imposed capital requirements:

– as a public company, the Group has a minimum share capital of £50,000; and

– in order to be able to pay dividends out of profits available for distribution, the Group has to be able to meet one of the two capital restrictions tests imposed on investment companies by law.

During the year, the Group complied with the externally imposed capital requirements to which it was subject.

Section 4: Financial statements 125

19. Transactions with the investment manager and AIFM BlackRock Fund Managers Limited (BFM) provides management and administration services to the Company under a contract which is terminable on six months’ notice. BFM has (with the Company’s consent) delegated certain portfolio and risk management services, and other ancillary services to BlackRock Investment Management (UK) Limited (BIM (UK)). Further details of the investment management contract are disclosed in the Directors’ Report on pages 54 and 55.

The investment management fee due for the year ended 31 December 2020 amounted to £6,405,000 (2019: £6,480,000). At the year end, £2,064,000 (2019: £1,714,000) was outstanding in respect of management fees.

In addition to the above services, BlackRock has provided the Group with marketing services. The total fees paid or payable for these services for the year ended 31 December 2020 amounted to £152,000 excluding VAT (2019: £159,000 excluding VAT). Marketing fees of £55,000 were outstanding as at 31 December 2020 (2019: £50,000).

The ultimate holding company of the Manager and the Investment Manager is BlackRock, Inc. a company incorporated in Delaware USA. During the period, PNC Financial Services Group, Inc. (PNC) was a substantial shareholder in BlackRock, Inc. PNC did not provide any services to the Company during the financial year ended 31 December 2019 and the period up to 11 May 2020, when PNC announced its intent to sell its investment in BlackRock, Inc. through a registered offering and related buyback by BlackRock, Inc.

20. Related party disclosure Directors’ emoluments At the date of this report, the Board consists of five non-executive Directors, all of whom are considered to be independent of the Manager by the Board.

Disclosures of the Directors’ interests in the ordinary shares of the Company and fees and expenses payable to the Directors are set out in the Directors’ Remuneration Report on pages 63 and 65. As at 31 December 2020 £14,375 (2019: £14,375) was outstanding in respect of Directors’ fees.

Significant Holdings The following investors are:

a. funds managed by the BlackRock Group or are affiliates of BlackRock Inc. (“Related BlackRock Funds”) or

b. investors (other than those listed in (a) above) who held more than 20% of the voting shares in issue in the Company and are as a result, considered to be related parties to the Company (“Significant Investors”).

As at 31 December 2020 Total % of shares held by Related Total % of shares held by Significant Number of Significant Investors who BlackRock Funds Investors who are not affiliates of are not affiliates of BlackRock Group or BlackRock Group or BlackRock, Inc. BlackRock, Inc. 2.45 n/a n/a As at 30 December 2019 Total % of shares held by Related Total % of shares held by Significant Number of Significant Investors who BlackRock Funds Investors who are not affiliates of are not affiliates of BlackRock Group or BlackRock Group or BlackRock, Inc. BlackRock, Inc. 1.99 n/a n/a

21. Contingent liabilities There were no contingent liabilities at 31 December 2020 (2019: nil).

126 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

The most beneficial M&A deal for the Company was the purchase of Teranga by Endeavour. The combined entity will be largest gold producer in each of Senegal, Côte d’Ivoire and Burkina Faso and and possess the largest exploration portfolio across the underexplored West African Birimian Greenstone Belt. PHOTO COURTESY OF ENDEAVOUR

Section 5: Additional information 129

Job No: 41869 Proof Event: 25 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2019 T: 0207 055 6500 F: 020 7055 6600 Shareholder information

Financial calendar Dividend reinvestment scheme (DRIP) The timing of the announcement and publication of the Shareholders may request that their dividends be used Company’s results may normally be expected in the months to purchase further shares in the Company. Dividend shown below: reinvestment forms may be obtained from Computershare Investor Services PLC through their secure website February/March Annual results announced. investorcentre.co.uk or on 0370 707 1187. Shareholders who March Annual Report and Financial Statements have already opted to have their dividends reinvested do not published. need to reapply. The last date for registering for this service April/May Annual General Meeting. for the forthcoming dividend is 14 April 2021. August Half yearly figures announced and half yearly financial report published. Dividend tax allowance The annual tax-free allowance on dividend income across Dividend – 2020 an individual’s entire share portfolio is £2,000. Above this amount, individuals pay tax on their dividend income at a The proposed final dividend in respect of the year ended 31 rate dependent on their income tax bracket and personal December 2020 is 8.30p per share. The Board also declared circumstances. three quarterly interim dividends of 4.00p per share. The Company continues to provide registered shareholders Ex-dividend date (shares transferred without the dividend) 18 March 2021 with confirmation of the dividends paid and this should be Record date (last date for registering included with any other dividend income received when transfers to receive the dividend) 19 March 2021 calculating and reporting total dividend income received. It is Last date for registering DRIP instructions 14 April 2021 a shareholder’s responsibility to include all dividend income when calculating any tax liability. Dividend payment date 6 May 2021 If you have any tax queries, please contact a financial advisor. Quarterly dividends Dividends will be paid quarterly as follows Share price The Company’s mid-market ordinary share price is quoted daily in The Financial Times and The Times under Period ending Announce Payment date ‘Investment Companies’ and in The Daily Telegraph under 31 March April/May June ‘Investment Trusts’. The share price is also available on the 30 June August September BlackRock website at blackrock.com/uk/brwm. 30 September November December 31 December February May ISIN/SEDOL numbers The ISIN/SEDOL numbers and mnemonic codes for the Company’s shares are: Payment of dividends Cash dividends will be sent by cheque to the first-named Ordinary shares shareholder at their registered address. Dividends may also be paid direct into a shareholder’s bank account via ISIN GB0005774855 BACSTEL-IP (Bankers’ Automated Clearing Service – Telecom SEDOL 0577485 Internet Protocol). This may be arranged by contacting Reuters Code BRWM.L the Company’s registrar, Computershare Investor Services Bloomberg Code BRWM LN PLC, through their secure website investorcentre.co.uk, or by telephone on 0370 707 1187, or by completing the Ticker BRWM Mandate Instructions section on the reverse of your dividend confirmation statement and sending this to the Company’s registrar, Computershare. Dividend confirmations will be sent to shareholders at their registered address, unless other instructions have been given, to arrive on the payment date.

130 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Share dealing Shareholders who opt for this service will receive an email Investors wishing to purchase more shares in the Company from Computershare with a link to the relevant section of or sell all or part of their existing holding may do so the BlackRock website where the documents can be viewed through a stockbroker. Most banks also offer this service. and downloaded. Please submit your email address by Alternatively, they can do so by creating a Trading Account visiting investorcentre.co.uk/ecomms. You will require your at www.computershare.com/dealing/uk. To purchase shareholder reference number which you will find on your this investment, you must have read the Key Information share certificate or dividend confirmation statement. Document before the trade can be executed. Computershare can email or post this to you. You will continue to receive a printed copy of these reports if you have elected to do so. Alternatively, if you have not For existing shareholders not looking to purchase shares, submitted your email address nor have elected to receive the Company’s registrar, Computershare, has an internet printed reports, we will write and let you know where you can and telephone share dealing service. The telephone share view these reports online. dealing service is available on 0370 703 0084. To access the internet share dealing service, you will need to access Electronic proxy voting www.computershare.com/dealing/uk using your shareholder Shareholders are able to submit their proxy votes reference number, which can be found on paper or electronic electronically via Computershare’s internet site at communications that you have previously received from eproxyappointment.com using their shareholder reference Computershare. number, control number and a unique identification PIN which will be provided with voting instructions and the Notice Internet dealing – The fee for this service is 1% of the value of Annual General Meeting. of the transaction (subject to a minimum of £30). CREST members who wish to appoint one or more proxies Telephone dealing – The fee for this service will be 1% of the or give an instruction through the CREST electronic proxy value of the transaction (plus £50). appointment service may do so by using the procedures described in the CREST manual. More details are set out CREST in the notes on the Form of Proxy and the Notice of Annual The Company’s shares may be held in CREST, an electronic General Meeting. system for uncertificated securities trading. Duration of the company Private investors can continue to retain their share Shareholders are given an opportunity at each Annual certificates and remain outside the CREST system. Private General Meeting to vote on an ordinary resolution to investors are able to buy and sell their holdings in the same continue the life of the Company for a further twelve months. way as they did prior to the introduction of CREST, although there may be differences in dealing charges. Nominee code Where shares are held in a nominee company name, the Risk factors Company undertakes: • P ast performance is not necessarily a guide to future performance. • to provide the nominee company with multiple copies of shareholder communications, so long as an indication of • The value of your investment in the Company and the quantities has been provided in advance; and income from it can fluctuate as the value of the underlying investments fluctuate. • to allow investors holding shares through a nominee company to attend general meetings, provided the correct • The price at which the Company’s shares trade on the authority from the nominee company is available. London Stock Exchange is not the same as their net asset value (NAV) (although they are related) and therefore you Nominee companies are encouraged to provide the may realise returns which are lower or higher than NAV necessary authority to underlying shareholders to attend the performance. Company’s general meetings.

Electronic communications We encourage you to play your part in reducing our impact on the environment and elect to be notified by email when your shareholder communications become available online. This means you will receive timely, cost-effective and greener online annual reports, half yearly financial reports and other relevant documentation.

Section 5: Additional information 131

Publication of net asset value/portfolio • Downloadable forms – including dividend mandates, stock analysis transfer, dividend reinvestment and change of address forms. The net asset value per share (NAV) of the Company is calculated daily, with details of the Company’s investments and performance being published monthly. Shareholder enquiries The Company’s registrar is Computershare Investor The daily NAV per share and monthly information are Services PLC. Certain details relating to your holding can released through the London Stock Exchange’s Regulatory be checked through the Computershare Investor Centre News Service and are available on the website at blackrock. website. As a security check, specific information needs com/uk/brwm and through the Reuters News Service to be input accurately to gain access to an individual’s under the code ‘BLRKINDEX’, on page 8800 on Topic 3 account. This includes your shareholder reference number, (ICV terminals) and under ‘BLRK’ on Bloomberg (monthly available from your share certificate, dividend confirmation information only). statement or other electronic communications you have previously received from Computershare. The address of the Individual Savings Accounts (ISAs) Computershare website is investorcentre.co.uk. Alternatively, please contact the registrar on 0370 707 1187. ISAs are a tax-efficient method of investment and the Company’s shares are eligible investments for inclusion Changes of name or address must be notified in writing within stocks and shares Individual Savings Accounts. In the either through Computershare’s website, or to the registrar 2020/2021 tax year investors have an annual ISA allowance at: of £20,000 (2019/2020: £20,000) which can be invested in either cash or shares. Computershare Investor Services PLC The Pavilions Online access Bridgwater Road Other details about the Company are also available on the Bristol BS99 6ZZ website at blackrock.com/uk/brwm. The financial statements and other literature are published on the website. Visitors to General enquiries the website need to be aware that legislation in the United Enquiries about the Company should be directed to: Kingdom governing the preparation and dissemination of the financial statements may differ from legislation in their The Secretary jurisdiction. BlackRock World Mining Trust plc 12 Throgmorton Avenue Shareholders can also manage their shareholding online by London EC2N 2DL using Investor Centre, Computershare’s secure website at Telephone: 020 7743 3000 investorcentre.co.uk. To register on Computershare’s website Email: [email protected] you will need your shareholder reference number which can be found on paper or electronic communications you have previously received from Computershare. Listed below are the most frequently used features of the website.

• Holding enquiry – view balances, values, history, payments and reinvestments.

• P ayments enquiry – view your dividends and other payment types.

• Address change – change your registered address.

• B ank details update – choose to receive your dividend payment directly into your bank account instead of by cheque.

• e-Comms sign-up – choose to receive email notifications when your shareholder communications become available instead of paper communications.

• O utstanding payments – reissue payments using the online replacement service.

132 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

By type of holder Number of % of total % of total Number of % of total % of total shares 2020 2019 holders 2020 2019 Direct private investors 3,499,230 2.0 2.0 1,690 50.5 47.6 Nominee companies 168,287,698 97.2 97.2 1,616 48.3 51.1 Others 1,763,886 0.8 0.8 41 1.2 1.3 173,550,814 100.0 100.0 3,347 100.0 100.0

By size of holding Number of % of total % of total Number of % of total % of total shares 2020 2019 holders 2020 2019 1-10,000 5,578,552 3.2 3.5 2,962 88.5 89.3 10,001-100,000 7,181,080 4.1 4.0 232 6.9 6.3 100,001-1,000,000 38,016,172 21.9 21.5 106 3.2 3.1 1,000,001-5,000,000 86,034,258 49.6 52.8 42 1.3 1.2 Over 5,000,000 36,740,752 21.2 18.2 5 0.1 0.1 173,550,814 100.0 100.0 3,347 100.0 100.0

Excludes treasury shares of 19,461,028.

Section 5: Additional information 133

Undiluted Diluted Revenue Net Asset Net Asset Revenue Earnings Dividends Value per Value per available per per Year ended Ordinary Ordinary Ordinary for Ordinary Ordinary Ordinary 31 December Net Assets Share Share1 Gearing Share Price Shareholders Share Share £’000 p p % p £’000 p p 1994 446,816 104.94 104.12 – 93.50 3,642 0.86 0.77 1995 452,762 106.27 105.23 0.1 93.00 5,637 1.32 1.00 1996 424,774 99.70 – – 86.50 5,082 1.19 1.15 1997 318,494 74.75 – – 59.50 3,894 0.91 0.85 1998 230,284 60.92 – – 55.75 5,619 1.43 2.35 1999 223,397 116.99 – 11.2 100.75 2,238 1.00 1.20 2000 186,022 109.36 – 8.3 91.50 2,939 1.63 1.30 2001 196,726 118.48 – – 96.50 6,434 3.82 3.15 2002 243,350 149.48 – – 131.75 4,110 2.52 2.10 2003 389,244 239.09 – 8.8 217.00 2,816 1.73 1.70 20042 398,129 244.55 240.29 6.0 218.00 4,899 3.01 2.50 2005 668,202 397.03 – 0.7 351.50 5,642 3.39 2.80 2006 868,545 516.07 503.23 0.9 444.00 14,782 8.78 4.50 2007 1,268,120 804.13 752.28 – 655.00 13,391 8.25 5.50 2008 590,927 331.39 – 0.5 252.50 9,831 5.64 5.50 2009 1,176,813 662.02 – 3.6 550.00 8,714 4.90 4.75 2010 1,708,023 962.06 – 1.8 811.00 11,667 6.57 6.00 2011 1,317,004 742.86 – 2.5 631.50 26,099 14.71 14.00 2012 1,215,743 685.75 – 7.1 586.50 38,614 21.78 21.00 2013 885,346 499.39 – 9.6 465.00 39,633 22.36 21.00 2014 624,674 352.35 – 11.7 310.35 37,452 21.13 21.00 2015 377,313 212.83 – 12.2 181.00 32,744 18.47 21.00 2016 677,546 383.98 – 12.4 336.50 23,303 13.19 13.00 2017 804,647 456.01 – 12.2 397.75 28,093 15.92 15.60 2018 685,595 388.81 – 13.5 340.50 32,013 18.15 18.00 2019 757,110 433.17 – 11.7 383.00 39,561 22.46 22.00 2020 930,825 536.34 – 12.3 522.00 35,451 20.40 20.30

1 Diluted net asset value per ordinary share calculated for potentially dilutive securities in issue such as warrants and treasury shares. 2 Prior to 2004, financial information had been prepared under UK GAAP. From 2004 all information is prepared under IFRS as set out in note 2 to the Financial Statements on pages 96 to 100.

134 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Registered Office Stockbrokers (Registered in England, No. 2868209) JPMorgan Cazenove Limited* 12 Throgmorton Avenue 25 Bank Street London EC2N 2DL Canary Wharf London E14 5JP Alternative Investment Fund Manager BlackRock Fund Managers Limited* Winterflood Securities Limited* 12 Throgmorton Avenue The Atrium Building London EC2N 2DL Cannon Bridge 25 Dowgate Hill Investment Manager and Company London EC4R 2GA Secretary Solicitors BlackRock Investment Management (UK) Limited* Herbert Smith Freehills LLP 12 Throgmorton Avenue Exchange House London EC2N 2DL Primrose Street Telephone: 020 7743 3000 London EC2A 2EG Email: [email protected]

Depositary, Custodian, Banker and Fund Accountant The Bank of New York Mellon (International) Limited* One Canada Square Canary Wharf London E14 5AL

Registrar Computershare Investor Services PLC* The Pavilions Bridgwater Road Bristol BS99 6ZZ Telephone: 0370 707 1187

Auditors PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors 7 More London Riverside London SE1 2RT

* Authorised and regulated by the Financial Conduct Authority.

Section 5: Additional information 135

Report on remuneration Using the methodologies prescribed under the AIFMD, the The Alternative Investment Fund Managers’ Directive (the leverage of the Group and Company is disclosed in the table AIFMD) requires certain disclosures to be made with regard below: to the remuneration policy of the Company’s Alternative Investment Fund Manager (AIFM). Details of the BlackRock Gross AIFM Remuneration Policy (the Policy) are disclosed on the Commitment leverage leverage as at as at website at blackrock.com/uk/brwm. 31 December 31 December 2020 2020 Quantitative remuneration disclosures Leverage ratio 1.11 1.14 Disclosures in accordance with FUND 3.3.5, Article 22(2)e and 22(2)f of the AIFMD and Article 107 of the Delegated Other risk disclosures Regulation are disclosed on the website at blackrock.com/ The financial risk disclosures relating to risk framework uk/brwm. and liquidity risk are set out in note 18 to the notes to the Financial Statements. Leverage The Company may employ leverage and borrow cash in Pre investment disclosures accordance with its stated investment policy or investment The AIFMD requires certain information to be made strategy. The Company may also employ leverage in its available to investors in AIFs before they invest and requires investment programme through foreign exchange forward that material changes to this information be disclosed contracts. The use of borrowings and leverage has attendant in the Annual Report of each AIF. An Investor Disclosure risks and can, in certain circumstances, substantially Document, which sets out information on the Company’s increase the adverse impact to which the Company’s investment strategy and policies, leverage, risk, liquidity, investment portfolio may be subject. administration, management, fees, conflicts of interest and other shareholder information is available on the website at Consistent with its investment objective and policy, the blackrock.com/uk/brwm. Company may utilise a variety of exchange traded and over- the-counter (OTC) derivative instruments such as covered There have been no material changes (other than those put/call options as part of its investment policy. The use of reflected in these financial statements or previously derivatives may expose the Company to a higher degree of disclosed to the London Stock Exchange through a risk. No derivatives were used for leverage purposes during primary information provider) to this information requiring the year. disclosure. Any information requiring immediate disclosure pursuant to the AIFMD will be disclosed to the London Stock For the purposes of this disclosure, leverage is any method Exchange through a primary information provider. by which the Company’s exposure is increased, whether through borrowing of cash or securities, or leverage CAROLINE DRISCOLL embedded in foreign exchange forward contracts or by any For and on behalf of other means. The AIFMD requires that each leverage ratio be BlackRock Investment Management (UK) Limited expressed as the ratio between a Company’s exposure and its Company Secretary NAV, and prescribes two required methodologies, the gross 4 March 2021 methodology and the commitment methodology (as set out in AIFMD Level 2 Implementation Guidance), for calculating such exposure.

136 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

The disclosures below are made in compliance with the requirements of Listing Rule 9.8.4.

9.8.4 (1) The Company has not capitalised any interest in the period under review.

9.8.4 (2) The Company has not published any unaudited financial information in a class 1 circular or prospectus or any profit forecast or profit estimate.

9.8.4 (3) This provision has been deleted.

9.8.4 (4) The Company does not have any long-term incentive schemes in operation.

9.8.4 (5) and 9.8.4 (6) No Director of the Company has waived or agreed to waive any current or future emoluments from the Company or any subsidiary undertaking.

9.8.4 (7) Since the Company’s financial year end and up to the date of this report, the Company has issued 3,720,000 ordinary shares from treasury at a premium to NAV at an average price of 588.59p per share, for a total consideration of £21,896,000 excluding costs.

9.8.4 (8) The Company’s subsidiary has not allotted any equity securities for cash in the period under review.

9.8.4 (9) This provision is not applicable to the Company.

9.8.4 (10) There were no other contracts of significance subsisting during the period under review to which the Company is a party and in which a Director of the Company is or was materially interested; or between the Company and a controlling shareholder.

9.8.4 (11) This provision is not applicable to the Company.

9.8.4 (12) and 9.8.4 (13) There were no arrangements under which a shareholder has waived or agreed to waive any dividends or future dividends.

9.8.4 (14) This provision is not applicable to the Company.

CAROLINE DRISCOLL For and on behalf of BlackRock Investment Management (UK) Limited Company Secretary 4 March 2021

Section 5: Additional information 137

Alternative performance measures (APM) Gearing works by magnifying a company’s performance. If An APM is a measure of performance or financial position a company ‘gears up’ and then markets rise and returns on that is not defined in applicable accounting standards and the investments outstrip the costs of borrowing, the overall cannot be directly derived from the financial statements. The returns to investors will be even greater. But if markets fall and Group’s APMs are set out below and are cross-referenced the performance of the assets in the portfolio is poor, then where relevant to the financial inputs used to derive them as losses suffered by the investor will also be magnified. contained in other sections of the Annual Financial report. 31 December 31 December Net gearing 2020 2019 Closed-end company calculation Page £’000 £’000 An investment trust works along the same lines as a unit Net assets 94 930,825 757,110 (a) trust, in that it pools money from investors which is then managed on a collective basis. The main difference is that an Borrowings 94 118,735 90,682 (b) investment trust is a company listed on the Stock Exchange Total assets (a + b) 1,049,560 847,792 (c) and, in most cases, trading takes place in shares which have Current assets1 94 10,089 6,456 (d) already been issued, rather than through the creation or redemption of units. As the number of shares which can be Current liabilities (excluding issued or cancelled at any one time is limited, and requires borrowings) 94 (6,132) (4,317) (e) the approval of existing shareholders, investment trusts are known as closed-end funds or companies. This means Cash and cash equivalents (d + e) 3,957 2,139 (f) that investment trusts are not subject to the same liquidity constraints as open ended funds and can therefore invest in Net gearing (g = (c – f – a)/ a) 12.3% 11.7% (g) less liquid investments.

1 Includes cash at bank. Discount and premium* Investment trust shares can frequently trade at a discount to Gross assets NAV. This occurs when the share price (based on the mid- Gross assets is defined as the total of the Group’s net assets market share price) is less than the NAV and investors may and borrowings. therefore buy shares at less than the value attributable to them by reference to the underlying assets. The discount is the difference between the share price and the NAV, Leverage expressed as a percentage of the NAV. As at 31 December Leverage is defined in the AIFM Directive as ‘any method by 2020, the share price was 522.00p (2019: 383.00p) and the which the AIFM increases the exposure of an AIF it manages NAV was 536.34p (2019: 433.17p) giving a discount of 2.7% whether through borrowing of cash or securities, or leverage (2019: 11.6%) (please see note 9 of the financial statements embedded in derivative positions or by any other means’. on page 105 for the audited inputs to the calculation). Leverage is measured in terms of ‘exposure’ and is expressed A premium occurs when the share price (based on the mid- as a ratio of net asset value: market share price) is more than the NAV and investors Exposure would therefore be paying more than the value attributable Leverage ratio = to the shares by reference to the underlying assets. For Net assets example, if the share price was 370p and the NAV 365p, the premium would be 1.4%. The Directive sets out two methodologies for calculating exposure. These are the Gross Method and the Commitment Discounts and premiums are mainly the consequence of Method. The treatment of cash and cash equivalent balances supply and demand for the shares on the stock market. in terms of calculating what constitutes an ‘exposure’ under AIFMD differs for these two methods. The definitions for Gearing and borrowings calculating the Gross Method exposures require that ‘the Investment companies can borrow to purchase additional value of any cash and cash equivalents which are highly investments. This is called ‘gearing’. It allows investment liquid investments held in the base currency of the AIF, companies to take advantage of a long-term view on a sector that are readily convertible to a known amount of cash, are or to take advantage of a favourable situation or a particularly subject to an insignificant risk of change in value and provide attractive stock without having to sell existing investments. a return no greater than the rate of a three-month high quality government bond’ should be excluded from exposure calculations.

* Alternative Performance Measures.

138 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 NAV and share price return (with dividends in issue (excluding treasury shares); the undiluted NAV reinvested)* was therefore 536.34p per ordinary share (please see note 9 of the financial statements for the audited inputs to the Performance statistics enable the investor to make calculations). performance comparisons between investment trusts with different dividend policies. The performance measures the Equity shareholders’ funds are calculated by deducting from combined effect of any dividends paid, together with the the Group’s total assets, its current and long-term liabilities rise or fall in the share price or NAV. This is calculated by and any provision for liabilities and charges. the movement in the share price or NAV plus the dividends paid by the Group assuming these are reinvested in the Group at the prevailing NAV/Share price (please see note Net asset value per share (Capital only 9 of the financial statements for the audited inputs to the NAV)* calculations). The capital only NAV is a popular point of reference when comparing a range of investment trusts. This NAV focuses on the value of the Group’s assets disregarding the current NAV total return – 31 December 31 December sterling Page 2020 2019 period revenue income, on the basis that most trusts will Closing NAV per distribute substantially all of their income in any financial share (pence) 105 536.34 433.17 period. It is also the measure adopted by the Association of Add back interim Investment Companies for preparation of statistical data. It is and final dividends calculated by dividing ‘equity shareholders’ funds’ (excluding (pence) 104 22.00 21.00 current period revenue) by the total number of ordinary Effect of dividend shares in issue. reinvestment (pence) 12.38 1.62 As at 31 December 2020, equity shareholders’ funds less Adjusted closing the current year net revenue return (after interim dividends) NAV (pence) 570.72 455.79 (a) amounted to £916,204,000 and there were 173,550,814 Opening NAV per ordinary shares in issue (excluding treasury shares); share (pence) 105 433.17 388.81 (b) therefore the capital only NAV was 527.92p. NAV total return (c = ((a - b)/b)) (%) 31.8 17.2 (c) Equity shareholders’ funds (excluding current period revenue) of £916,204,000 are calculated by deducting Share price total 31 December 31 December from the Group’s net assets (£930,825,000) its current return – sterling Page 2020 2019 period revenue (£35,451,000) and adding back the interim Closing share dividends paid from revenue (£20,830,000). price (pence) 105 522.00 383.00 Add back interim Ongoing charges ratio* and final dividends Annualised ongoing charges (pence) 104 22.00 21.00 Ongoing charges (%) = Effect of dividend Average undiluted net asset value reinvestment in the period (pence) 17.73 2.39 Adjusted closing Ongoing charges are those expenses of a type which are share price likely to recur in the foreseeable future, whether charged to (pence) 561.73 406.39 (a) capital or revenue, and which relate to the operation of the Opening share investment company as a collective fund. Ongoing charges price (pence) 105 383.00 340.50 (b) are based on costs incurred in the year as being the best Share price total estimate of future costs and include the annual management return (c = ((a - b)/b)) (%) 46.7 19.4 (c) charge.

Net asset value per share (Cum income NAV) This is the value of the Group’s assets attributable to one ordinary share. It is calculated by dividing ‘equity shareholders’ funds’ by the total number of ordinary shares in issue (excluding treasury shares). For example, as at 31 December 2020, equity shareholders’ funds were worth £930,825,000 and there were 173,550,814 ordinary shares

* Alternative Performance Measures.

Section 5: Additional information 139

As recommended by the AIC in its guidance, ongoing charges no down side for the seller. However, if the stock rises above are calculated using the Group’s annualised recurring the exercise price the holder of the option is likely to exercise revenue and capital expenses (excluding finance costs, the option and this strategy can reduce returns in a rising direct transaction costs, custody transaction charges, market. VAT recovered, taxation and certain non-recurring items) expressed as a percentage of the average daily net assets of The Company employs an options overwriting strategy but the Group during the year. seeks to mitigate risk by utilising predominantly covered call options (meaning that call options are only written in respect The inputs that have been used to calculate the ongoing of stocks already owned within the Company’s portfolio such charges percentage are set out in the following table. that, if the options are exercised, the Company does not need to purchase stock externally at fluctuating market prices to Ongoing charges 31 December 31 December meet its obligations under the options contract). Any use of calculation on 2020 2019 derivatives for efficient portfolio management and options net assets Page £’000 £’000 for investment purposes will be made on the basis of the Management fee 101 6,405 6,480 same principles of risk spreading and diversification that apply to the Company’s direct investments. Other operating expenses 102 997 1,030 Total management Physical metals fee and other Metals such as copper, zinc and nickel. operating expenses 7,402 7,510 (a) Quoted securities and unquoted Average daily net assets in the year 748,853 733,356 (b) investments Securities that trade on an exchange for which there is a Ongoing charges on net assets publicly quoted price. Unquoted securities are financial (c = a/b) 0.99% 1.02% (c) securities that do not trade on an exchange for which there is not a publicly quoted price.

Ongoing charges calculation on 31 December 31 December Reference index - MSCI ACWI Metals & gross assets Page 2020 2019 Mining 30% Buffer 10/40 Index (MSCI ACWI) Management fee 101 6,405 6,480 The MSCI ACWI index is designed to be less concentrated and more diversified than other indices by constraining the Other operating expenses 102 997 1,030 exposure to any single issuer to 10% of the index value, with a 30% buffer applied, and the sum of the weights of all Total management fee and other exposures to single issuers at more than 5% of the index at operating 40%, also with a 30% buffer applied. expenses 7,402 7,510 (a) Average daily The 30% buffer operates to ensure that the index does not gross assets in the have to be rebalanced constantly to retain its diversification year 847,155 845,352 (b) characteristics due to the market movement of the Ongoing charges index constituents. The buffer is applied at the quarterly on gross assets rebalancing of the index taking the maximum weight of any (c = a/b) 0.87% 0.89% (c) index security to 7% (10% reduced by 30%) and the sum of the weights of securities representing more than 3.5% (5% Options and options overwriting strategy reduced by 30%) to 28% (40% reduced by 30%). An option is a contract that offers the buyer the right, but not the obligation, to buy (call) or sell (put) a security or other If, due to market moves, any security breaches a 9% position, financial asset at an agreed-upon price (the strike price) or the sum of all securities over 4.5% breach 36%, (which during a certain period of time or on a specific date (exercise is equivalent to a 10% buffer applied to the 5 and 40 levels) date) for a fee (the premium). The sale of call or put options there is an extraordinary rebalance prior to the quarter end on stocks that are believed to be overpriced or underpriced, taking the index back to the 30% buffer levels as described. based on the assumption that the options will not be exercised, is referred to as an ‘options overwriting’ strategy. Revenue profit and revenue reserves Revenue profit is the net revenue income earned after The seller of the option collects a premium but, if the option deduction of fees and expenses allocated to the revenue subsequently expires without being exercised, there will be account and taxation suffered by the Group. Revenue

* Alternative Performance Measures.

140 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 reserves is the undistributed income that the Group keeps as reserves. Investment trusts do not have to distribute all the income they generate, after expenses. They may retain up to 15% of revenue generated which will be held in a revenue reserve. This reserve can be used at a later date to supplement dividend payments to shareholders.

Royalties Contracts that involve one party giving capital (funding) to a mining company in return for a percentage share of the revenues from one or more of the company’s assets.

Treasury shares Treasury shares are shares that a company keeps in its own treasury which are not currently issued to the public. These shares do not pay dividends, have no voting rights and are not included in a company’s total issued share capital amount for calculating percentage ownership. Treasury stock may have come from a repurchase or buy back from shareholders, or it may never have been issued to the public in the first place. Treasury shares may be reissued from treasury to the public to meet demand for a company’s shares in certain circumstances.

Yield* The yield is the amount of cash (in percentage terms) that is returned to the owners of the security, in the form of interest or dividends received from it. Normally, it does not include the price variations, distinguishing it from the total return.

31 December 31 December Page 2020 2019 Interim and final dividends paid/ payable (pence)1 104 20.30 22.00 (a) Ordinary share price (pence) 522.00 383.00 (b) Yield (c = a/b) (%) 3.9 5.7 (c)

1 Comprising dividends declared/paid for the twelve months to 31 December.

* Alternative Performance Measures.

Section 5: Additional information 141

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Section 6: Notice of annual general meeting 143

Notice is hereby given that the twenty seventh Annual at the date of this notice) provided that this authority General Meeting of BlackRock World Mining Trust plc will be shall (unless previously revoked) expire at the conclusion held at the offices of BlackRock at 12 Throgmorton Avenue, of the Company’s Annual General Meeting to be held in London EC2N 2DL on Thursday, 29 April 2021 at 11.30 a.m. 2022, but the Company shall be entitled to make offers to consider and, if thought fit, pass resolutions 1 to 12 as or agreements before the expiry of this authority which ordinary resolutions and resolutions 13 to 15 as special would or might require relevant securities to be allotted resolutions. after such expiry and the Directors may allot such securities pursuant to any such offer or agreement as if More information in respect of the contribution of each the power conferred hereby had not expired. Director to support their re-election is given in the Directors’ Report on page 60. Special resolutions 13. That in substitution for all existing authorities and Ordinary business subject to the passing of resolution numbered 12 1. T o receive the report of the Directors and the financial above, the Directors of the Company be and are hereby statements for the year ended 31 December 2020, empowered pursuant to sections 570 and 573 of the together with the report of the auditors thereon. Companies Act 2006 (the Act) to allot equity securities (as defined in section 560 of the Act) and to sell equity 2. T o approve the Directors’ Remuneration Report for the securities held by the Company as treasury shares (as year ended 31 December 2020, excluding any content defined in section 724 of the Act) for cash pursuant to relating to the remuneration policy of the Company. the authority granted by the resolution numbered 12 above, as if section 561(1) of the Act did not apply to any 3. T o declare a final dividend of 8.30p per ordinary share for such allotments and sales of equity securities, provided the year ended 31 December 2020. that this power:

4. To re-elect Mr D W Cheyne as a Director. (a) shall expire at the conclusion of the next Annual General Meeting of the Company to be held in 2022, 5. To re-elect Mr R P Edey as a Director. except that the Company may before such expiry make offers or agreements which would or might 6. To re-elect Ms J Lewis as a Director. require equity securities to be allotted or sold after such expiry and notwithstanding such expiry the 7. To re-elect Ms J Mosely as a Director. Directors may allot and sell equity securities in pursuance of such offers or agreements; 8. To re-elect Mr O Oliveira as a Director. (b) shall be limited to the allotment of equity securities 9. T o reappoint PricewaterhouseCoopers LLP as auditors and/or the sale of equity securities held in treasury of the Company to hold office until the conclusion of the for cash up to an aggregate nominal amount of next Annual General Meeting of the Company. £886,354 (representing 10% of the aggregate nominal amount of the issued share capital, 10. To authorise the Audit & Management Engagement excluding treasury shares, of the Company at the Committee to determine the auditors’ remuneration. date of this notice); and

Special business (c) shall be limited to the allotment and/or sale of Ordinary resolutions equity securities at a price of not less than the net asset value per share as close as practicable to the 11. That the Company shall continue in being as an allotment or sale. investment trust.

14. That in substitution for the Company’s existing authority 12. That in substitution for all existing authorities, the to make market purchases of ordinary shares of 5p Directors of the Company be and they are hereby each in the Company (Shares), the Company be and is generally and unconditionally authorised pursuant to hereby generally and, subject as hereinafter appears, section 551 of the Companies Act 2006 (the Act), to unconditionally authorised in accordance with section exercise all the powers of the Company to allot relevant 701 of the Companies Act 2006 (the Act) to make market securities in the Company (as described in that section) purchases of Shares (within the meaning of section 693 up to an aggregate nominal amount of £886,354 (being of the Act) provided that: 10% of the aggregate nominal amount of the issued share capital, excluding treasury shares, of the Company

144 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 (a) the maximum number of Shares hereby authorised to be purchased shall be 26,572,895 or if less, that number of Shares which is equal to 14.99% of the Company’s issued share capital (excluding treasury shares) as at 29 April 2021;

(b) the minimum price (exclusive of expenses) which may be paid for any such Share shall be 5p being the nominal value per share;

(c) the maximum price (exclusive of expenses) which may be paid for any such Share shall be the higher of (i) 105% of the average of the middle market quotations (as derived from the Official List) of the Shares for the five dealing days prior to the date on which the market purchase is made and (ii) the higher of the price quoted for (a) the last independent trade of and (b) the highest independent bid for, any number of Shares on the trading venue where the purchase is carried out; and

(d) unles s renewed, the authority hereby conferred shall expire at the conclusion of the next Annual General Meeting of the Company in 2022 save that the Company may, prior to such expiry, enter into a contract to purchase Shares under the authority hereby conferred and may make a purchase of Shares pursuant to any such contract notwithstanding such expiry.

All Shares purchased pursuant to the above authority shall be either:

(i) held, sold, transferred or otherwise dealt with as treasury shares in accordance with the provisions of the Act; or

(ii) cancelled immediately upon completion of the purchase.

15. That the draft Articles of Association produced to the meeting and marked ‘A’ (and for the purposes of identification initialled by the Chairman of the meeting) be hereby approved and adopted as the Articles of Association of the Company, in substitution for, and to the exclusion of, the existing Articles of Association.

By order of the Board

CAROLINE DRISCOLL For and on behalf of BlackRock Investment Management (UK) Limited Company Secretary 4 March 2021

Registered Office: 12 Throgmorton Avenue London EC2N 2DL

Section 6: Notice of annual general meeting 145

Notes: entitled to attend and vote at the meeting in respect of the number of shares registered in their name at such time. If the 1. A member entitled to attend and vote at the meeting meeting is adjourned, the time by which a person must be convened by the above Notice is entitled to appoint one entered on the register of members of the Company in order or more proxies to exercise all or any of the rights of the to have the right to attend and vote at the adjourned meeting member to attend, speak and vote in his place. A proxy need is 6.00 p.m. two days prior to the time of the adjournment. not be a member of the Company. If a member appoints more Changes to the register of members after the relevant times than one proxy to attend the meeting, each proxy must be shall be disregarded in determining the rights of any person appointed to exercise the rights attached to a different share to attend and vote at the meeting. or shares held by the member. 8. In the case of joint holders, the vote of the senior holder 2. To appoint a proxy you may use the Form of Proxy enclosed who tenders a vote whether in person or by proxy shall be with this Annual Report. To be valid, the Form of Proxy, accepted to the exclusion of the votes of the other joint together with the power of attorney or other authority (if any) holders and, for this purpose, seniority will be determined under which it is signed or a notarially certified or office copy by the order in which the names stand in the register of of the same, must be completed and returned to the office of members of the Company in respect of the relevant joint the Company’s registrar in accordance with the instructions holding. printed thereon as soon as possible and in any event by not later than 11.30 a.m. on 27 April 2021. Amended instructions 9. Shareholders who hold their shares electronically may must also be received by the Company’s registrar by the submit their votes through CREST, by submitting the deadline for receipt of proxies. Alternatively you can vote or appropriate and authenticated CREST message so as to be appoint a proxy electronically by visiting eproxyappointment. received by the Company’s registrar not later than 48 hours com. You will be asked to enter the Control Number, the before the start of the meeting. Instructions on how to vote Shareholder Reference Number and PIN which are printed on through CREST can be found by accessing the following the form of proxy. The latest time for the submission of proxy website: euroclear.com/CREST. Shareholders are advised votes electronically is 11.30 a.m. on 27 April 2021. that CREST and the internet are the only methods by which completed proxies can be submitted electronically. 3. Completion and return of the Form of Proxy will not prevent a member from attending the meeting and voting in person. 10. If you are a CREST system user (including a CREST personal member) you can appoint one or more proxies or give an 4. Proxymity Voting – If you are an institutional investor you instruction to a proxy by having an appropriate CREST may also be able to appoint a proxy electronically via the message transmitted. To appoint one or more proxies or to Proxymity platform, a process which has been agreed by give an instruction to a proxy (whether previously appointed the Company and approved by the Registrar. For further or otherwise) via the CREST system, CREST messages must information regarding Proxymity, please go to www. be received by Computershare (ID number 3RA50) not later proxymity.io. Your proxy must be lodged by 11.30 a.m. on than 48 hours before the time appointed for holding the 27 April 2021 in order to be considered valid. Before you meeting. For this purpose, the time of receipt will be taken can appoint a proxy via this process you will need to have to be the time (as determined by the timestamp generated agreed to Proxymity’s associated terms and conditions. It is by the CREST system) from which Computershare is able important that you read these carefully as you will be bound to retrieve the message. CREST personal members or other by them and they will govern the electronic appointment of CREST sponsored members should contact their CREST your proxy. sponsor for assistance with appointing proxies via CREST. 5. Any person receiving a copy of this Notice as a person For further information on CREST procedures, limitations nominated by a member to enjoy information rights under and system timings please refer to the CREST manual. The section 146 of the Companies Act 2006 (a Nominated Company may treat as invalid a proxy appointment sent by Person) should note that the provisions in Notes 1 and 2 CREST in the circumstances set out in Regulation 35(5)(a) of above concerning the appointment of a proxy or proxies to the Uncertificated Securities Regulations 2001. attend the meeting in place of a member, do not apply to a 11. If the Chairman, as a result of any proxy appointments, is Nominated Person as only shareholders have the right to given discretion as to how the votes subject of those proxies appoint a proxy. However, a Nominated Person may have a are cast and voting rights in respect of those discretionary right under an agreement between the Nominated Person proxies, when added to the interest in the Company’s and the member by whom he or she was nominated to be securities already held by the Chairman, result in the appointed, or to have someone else appointed, as proxy Chairman holding such number of voting rights that he has for the meeting. If a Nominated Person has no such proxy notifiable obligation under the Disclosure Guidance and appointment right or does not wish to exercise it, he/she may Transparency Rules, the Chairman will make the necessary have a right under such agreement to give instructions to the notifications to the Company and the Financial Conduct member as to the exercise of voting rights at the meeting. Authority. As a result, any member holding 3% or more of 6. Nominated Persons should also remember that their main the voting rights in the Company, who grants the Chairman point of contact in terms of their investment in the Company discretionary proxy in respect of some or all of those voting remains the member who nominated the Nominated Person rights and so would otherwise have a notification obligation to enjoy the information rights (or perhaps the custodian under the Disclosure Guidance and Transparency Rules, or broker who administers the investment on their behalf). need not make a separate notification to the Company and Nominated Persons should continue to contact that member, the Financial Conduct Authority. custodian or broker (and not the Company) regarding any 12. Any question relevant to the business of the meeting may changes or queries relating to the Nominated Person’s be asked at the meeting by anyone permitted to speak at the personal details and interest in the Company (including any meeting. A shareholder may alternatively submit a question administrative matter). The only exception to this is where the in advance by a letter addressed to the Company Secretary Company expressly requests a response from the Nominated at the Company’s registered office. Under section 319A of Person. the Companies Act 2006, the Company must answer any 7. Pursuant to regulation 41 of the Uncertificated Securities question a shareholder asks relating to the business being Regulations 2001, only shareholders registered in the dealt with at the meeting, unless (i) answering the question register of members of the Company by not later than 6.00 would interfere unduly with the preparation for the meeting p.m. two days prior to the time fixed for the meeting shall be or involve the disclosure of confidential information; (ii) the

146 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 answer had already been given on a website in the form of an 16. Further information regarding the meeting which the answer to a question; or (iii) it is undesirable in the interests Company is required by section 311A of the Companies of the Company or the good order of the meeting that the Act 2006 to publish on a website in advance of the meeting question be answered. (including this Notice), can be accessed at blackrock.com/ uk/brwm. 13. Any corporation which is a member can appoint one or more corporate representatives who may exercise on its behalf all 17. As at the date of this report, the Company’s issued share of its powers as a member provided that, if it is appointing capital comprised 177,270,814 ordinary shares of 5 pence more than one corporate representative, it does not do each, excluding shares held in treasury. Each ordinary so in relation to the same shares. It is therefore no longer share carries the right to one vote and therefore the total necessary to nominate a designated corporate representative. number of voting rights in the Company on 4 March 2021 is Representatives should bring to the meeting evidence of their 177,270,814. appointment, including any authority under which it is signed. 18. No service contracts exist between the Company and any of 14. Under section 527 of the Companies Act 2006, members the Directors, who hold office in accordance with letters of meeting the threshold requirements set out in that section appointment and the Articles of Association. have the right to require the Company to publish on a website a statement setting out any matter relating to: (i) the audit of the Company’s accounts (including the auditors’ report and the conduct of the audit) that are laid before the meeting; or (ii) any circumstance connected with an auditor of the Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in accordance with section 437 of the Companies Act 2006. The Company may not require the members requesting such website publication to pay its expenses in complying with sections 527 or 528 of the Companies Act 2006. Where the Company is required to place a statement on a website under section 527 of the Companies Act 2006, it must forward the statement to the Company’s auditors not later than the time when it makes the statement available on the website. The business which may be dealt with at the meeting includes any statement that the Company has been required under section 527 of the Companies Act 2006 to publish on a website. 15. Under sections 338 and 338A of the Companies Act 2006, members meeting the threshold requirements in those sections have the right to require the Company: (i) to give, to members of the Company entitled to receive notice of the meeting, notice of a resolution which may properly be moved and is intended to be moved at the meeting; and/or (ii) to include in the business to be dealt with at the meeting any matter (other than a proposed resolution) which may be properly included in the business. A resolution may properly be moved or a matter may properly be included in the business unless: (a) (in the case of a resolution only) it would, if passed, be ineffective (whether by reason of inconsistency with any enactment or the Company’s constitution or otherwise); (b) it is defamatory of any person; or (c) it is frivolous or vexatious. Such a request may be in hard copy form or in electronic form and must identify the resolution of which notice is to be given or the matter to be included in the business, must be authorised by the person or persons making it, must be received by the Company not later than 17 March 2021, being the date six weeks clear before the meeting and (in the case of a matter to be included in the business only) must be accompanied by a statement setting out the grounds for the request.

Section 6: Notice of annual general meeting 147

Be ScamSmart

Investment scams are designed to look like genuine investments

Spot the warning signs Have you been: • contacted out of the blue • promised tempting returns and told the investment is safe • called repeatedly, or • told the offer is only available for a limited time? If so, you might have been contacted by fraudsters.

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1 Reject cold calls If you’ve received unsolicited contact about an investment If you suspect that you have been approached by opportunity, chances are it’s a high risk investment or a fraudsters please tell the FCA using the reporting form at scam. You should treat the call with extreme caution. www.fca.org.uk/consumers. You can also call the The safest thing to do is to hang up. FCA Consumer Helpline on 0800 111 6768 If you have lost money to investment fraud, you should

2 Check the FCA Warning List report it to Action Fraud on 0300 123 2040 or online at The FCA Warning List is a list of firms and individuals we www.actionfraud.police.uk know are operating without our authorisation. Find out more at www.fca.org.uk/scamsmart 3 Get impartial advice you hand over any money. Seek advice from someone Remember: if it sounds too good to be true, it probably is!

SGN001

148 BlackRock World Mining Trust plc l Annual Report and Financial Statements 31 December 2020

Job No: 44037 Proof Event: 17 Black Line Level: 6 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600 Job No: 44037 Proof Event: 4 Black Line Level: 1 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600

BlackRock World Mining Trust plc Annual Report and Financial Statements 31 December 2020 Annual Report

blackrock.com/uk/brwm

Job No: 44037 Proof Event: 13 Black Line Level: 1 Park Communications Ltd Alpine Way London E6 6LA Customer: BlackRock Project Title: World Mining Annual Rpt 2020 T: 0207 055 6500 F: 020 7055 6600