Interim Management Statement
Unicorn AIM VCT plc
Interim Management Statement
For the period from 1 April 2010 to 31 July 2010
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 July 2010, 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
Equity markets were weak for much of the period under review as fears over a
European sovereign debt crisis grew and the possibility of a double-dip
recession re-surfaced. However, a strong rebound in July repaired much of the
damage.
The FTSE AIM All-Share Index fell by 2.5%, whilst the FTSE All-Share Index
suffered more significantly, recording a decline of 6.7%.
The Fund performed relatively well over the same period, with Net Asset Value
(NAV) decreasing by 0.4%. The NAV is calculated on a total return basis, after
adding back dividends paid. No dividends were paid in the period.
As at 31 July 2010 the unaudited NAV was 94.2 pence per share, compared to an
unaudited NAV of 94.6 pence per share as at 31 March 2010.
Material Transactions
There were a number of material transactions during the period under review.
A further £750,000 qualifying investment was made in Green Compliance, which
aims to acquire businesses operating in the `blue collar' compliance market.
A qualifying follow-on investment of £100,000 was also made in Keycom to help
fund working capital requirements.
New non-qualifying investments included;
ACM Shipping, one of the world's leading shipbrokers;
Capital Pub Company, a portfolio of predominantly freehold London pubs;
Elementis, a manufacturer of speciality chemicals;
Hargreaves Services, provider of services to customers in the energy sector;
Huntsworth, a global public relations company;
London Capital Group, spread betting and foreign exchange trading;
Office2Office, procurement and supply of business & office products;
Optos, manufacture & marketing of retinal imaging devices;
Parseq, payments processing & data analytics services;
Renold, a manufacturer of chains, gears and couplings;
Sagentia, technology consultants; and
Scott Wilson, engineering consultants.
The new non-qualifying investments predominantly consist of companies with
market capitalisations in excess of £50m, which have strong balance sheets, are
inherently cash generative and which, in the Manager's opinion, offer
attractive upside potential. The total cost of new investments made in the
period was just over £4m.
During the four month period under review capital realisations from the sale of
investments amounted to almost £2.5m with the majority coming from our exit
from Glisten which was acquired during the period by the Finnish food group
Raisio Oyj. The profit on disposal of Glisten amounted to £886,000.
The Fund's holding in Scott Wilson, which was acquired in the period at a total
cost of £204,000, was subsequently sold after the company received two bid
approaches from trade buyers, realising total proceeds of £478,000.
Top 10 Equity Holdings at 31 July 2010
Stock % of Fund
Abcam 14.8%
Unicorn UK Smaller Companies Fund 7.0%
Green Compliance 5.6%
Mears 4.7%
Mattioli Woods 3.7%
Unicorn UK Income Fund 3.2%
Animalcare Group 3.2%
SnackTime 3.1%
Kiotech 2.9%
Unicorn Mastertrust Fund 2.7%
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Total 50.9%
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Material Events
In the four months to 31 July 2010, a total of 1,294,796 Unicorn AIM VCT
Ordinary Shares were purchased for cancellation at an average price of 75.6
pence per share.
After the period end a further 78,558 shares were purchased at a price of 82
pence per share.
There were no other material events during the period from 1 April 2010 to 31
July 2010.