Unicorn AIM VCT plc ("the Company")
Interim Management Statement
For the period from 1 October 2008 to 31 January 2009
Introduction
The Company has prepared this Interim Management Statement (IMS) in accordance
with the Disclosure and Transparency Rules of the UK Listing Authority. The IMS
covers the four month period ended 31 January 2009, together with relevant
information up to the date of publication.
Investment Objective
The objective of the Company is to provide Shareholders with an attractive
return from a diversified portfolio of investments, predominantly in the shares
of AIM quoted companies, by maximising the stream of dividend distributions to
Shareholders from the income and capital gains generated by the portfolio.
It is also the objective that the Company should continue to qualify as a
Venture Capital Trust, so that Shareholders benefit from the taxation
advantages that this brings. To achieve this at least 70% of the Company's
total assets are to be invested in qualifying investments of which 30% by value
must be in ordinary shares carrying no preferential rights to dividends or
return of capital and no rights to redemption.
Performance
The four month period to 31 January 2009 witnessed a rapid and severe
deterioration in global economic conditions. The crisis in the banking sector
meant that lending effectively dried up, leading to an alarming rise in the
rate of job losses, home repossessions and corporate insolvencies.
Understandably, equity investors have become increasingly risk averse and this
has had a direct impact on the valuations of smaller, more illiquid quoted
companies.
During the period under review, the FTSE AIM AllShare Index fell by 34.9%
whilst the Hoare Govett Smaller Companies Index declined by 20.7%.
The Company has not been immune from the wider market turmoil. Over the same
period, Net Asset Values (after adding back dividends paid) fell by 19.8% in
the Ordinary Share Fund, by 19.1% in the S2 Share Fund and by 7.2% in the S3
Share Fund.
Performance in the Funds has been affected by profit warnings and funding
issues reported by a number of investee companies, reflecting the increasingly
difficult trading environment in which they now operate. Despite these
setbacks, the decline in Net Asset Value (NAV) experienced by each Fund was
substantially smaller than that produced by the FTSE AIM AllShare Index.
As at 31 January 2009 the unaudited NAV of the Ordinary Share Fund was 46.6
pence per share. The unaudited NAV of the S2 Share Fund was 58.9 pence per
share whilst the unaudited NAV of the S3 Share Fund was 71.0 pence per share.
Dividends
Dividends were declared and paid during the period amounting to 3 pence per
share to holders of Ordinary Shares, 2 pence per share to holders of S2 Shares
and 1 pence per share to holders of S3 Shares.
Material Transactions
The Company made one VCT qualifying investment during the period at a total
cost of £310,000. The investment was in the form of a Convertible Loan Note to
Snacktime Plc and was split between the three Funds on a pro-rata basis.
The Ordinary Share Fund made one partial disposal realising proceeds of £
65,000.
No other transactions took place during the period under review.
Top 10 Equity Holdings at 31 January 2009
Ordinary Share Fund Percentage of Fund
Abcam 9.7%
Mears 8.6%
Maxima Holdings 6.5%
Glisten 5.3%
Mattioli Woods 5.0%
Supporta 3.7%
Avingtrans 3.5%
Clerkenwell Ventures 3.3%
Unicorn Free Spirit Fund 3.0%
SnackTime 2.7%
Total 51.3%
S2 Share Fund Percentage of Fund
Abcam 11.5%
Unicorn UK Smaller Companies Fund 10.8%
Unicorn Mastertrust Fund 8.0%
Mattioli Woods 7.3%
Maxima Holdings 6.6%
Cohort 6.5%
Amber Taverns (Prefs) 4.0%
Driver Group 3.8%
Clerkenwell Ventures 3.7%
Mears 3.4%
Total 65.6%
S3 Share Fund Percentage of Fund
Unicorn Outstanding British Companies 10.5%
Fund
Animalcare Group 7.8%
Unicorn Free Spirit Fund 7.8%
Unicorn Mastertrust Fund 7.7%
Unicorn UK Smaller Companies Fund 7.4%
Tracsis 7.0%
Unicorn UK Income Fund 7.0%
SnackTime 5.3%
Melorio 3.8%
IS Pharma 3.7%
Total 68.0%
Material Events
Management fees for Venture Capital Trusts became exempt from VAT from 1
October 2008. HM Revenue & Customs (HMRC) has accepted claims for VAT incurred
on management fees up to this date. The Investment Manager submitted a claim to
HMRC which has now been settled in full. The Net Asset Values have been
upwardly adjusted by 2.0 pence per Ordinary Share, by 1.0 pence per S2 Share
and by 0.2 pence per S3 Share to reflect the impact of these repayments.
Share buybacks
During the period the Company bought back 131,546 Ordinary shares at 25p per
share.
Other than described above, there were no material events during the period
from 1 October 2008 to 31 January 2009.
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