Interim Management Statement

Unicorn AIM VCT plc Interim Management Statement For the period from 1 October 2010 to 31 December 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 three month period ended 31 December 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 The final three months of 2010 delivered strong returns from UK equity indices. The FTSE AIM AllShare Index produced a total return of almost 20% in the period, whilst the FTSE SmallCap Index and the FTSE AllShare Index rose by 8.6% and 7.3% respectively. Despite very limited exposure to Mining and Oil & Gas sectors, which contributed significantly to strong AIM Index performance, the Fund nonetheless registered healthy gains over the same period, with Net Asset Value (NAV) increasing by 8.5%. The NAV is calculated on a total return basis, after adding back dividends paid. No dividends were paid in the period. As at 31 December the unaudited NAV was 113.03 pence per share, compared to an audited NAV of 104.15 pence per share as at 30 September 2010. Material Transactions There were a number of material transactions during the period under review. Amber Taverns, an unquoted operator of public houses in the North West of England was acquired for cash by a private equity firm. Total proceeds from the disposal of Amber Taverns amounted to more than £5.3m and the monies were received shortly after your Company's financial year end. The sale of this investment generated a 2.7x return on book cost and a capital profit of £3.3m. Mount Engineering,a specialist engineering group, was acquired for cash by Cooper Controls in an all cash transaction. Proceeds on disposal amounted to £ 351k, generating a capital profit of £51k. Shieldtech, which specialised in the manufacture and supply of body armour systems to police forces and the MOD failed to secure a number of significant expected orders. As a result of these order delays and because the Group had built a central overhead designed to accommodate a much larger entity, the Company continued to absorb cash and suffer significant losses. Despite a successful fundraising in May 2009, the company remained under-capitalised. In addition, the hoped for orders failed to materialise and in October 2010, the Board of Shieldtech announced that it had appointed administrators to the Company. The remaining value of this investment has therefore been written down to zero. Five new VCT qualifying investments were made in the period:- Accumuli,a holding company with a strategy focused on building through acquisitions, a substantial Managed IT Security Services business Hangar 8, one of Europe's largest operators of privately owned passenger jet aircraft with a fleet of 21 aircraft currently under management Instem Life Science Systems, a developer of software and solutions to the life sciences research market, helping pharmaceutical companies to manage their early stage research and development activities Omega Diagnostics,a provider of diagnostic products to hospitals, laboratories and clinics in over 100 countries - its operations revolve around food intolerance tests and the diagnosis of infectious diseases. Specialist Energy Group,a market leader in the manufacture of boiler circulating pumps for use in the power generation and oil & gas sectors It is pleasing to report that each of these new holdings has made a positive initial contribution to performance. The total cost of new qualifying investments in the period was £2.4m. A further £962k of VCT qualifying capital was committed to secondary fundraisings in four companies already held; Brady, Green Compliance, IDOX and IS Pharma. New non-qualifying investments were made in Stadium Group, a manufacturer of electronics and power products andVP Group, a specialist equipment rental group. In the non-qualifying portfolio, the holdings in Tangent Communicationsand Xaar were increased, whilst partial disposals were made in Hargreaves Services, Mears, Parseq, Renew andRobert Walters. The total cost of new investments made in the period was just under £4m, whilst the proceeds from realisations and disposals amounted to £7.1m. Top 10 Equity Holdings at 31 December 2010 Stock % of fund Abcam 12.0% Unicorn UK Smaller Companies Fund 7.0% Mattioli Woods 4.6% Green Compliance 3.9% Mears 3.4% Unicorn UK Income Fund 3.2% Kiotech 3.0% Animalcare Group 2.8% Unicorn Mastertrust Fund 2.7% SnackTime 2.5% Total 45.1% Material Events In the three months to 31 December 2010, a total of 353,541 Unicorn AIM VCT Ordinary Shares were purchased for cancellation at a price of 99 pence per share. After the period end, a further 885,227 shares were purchased for cancellation at a price of 98 pence per share. All resolutions proposed at the Annual General Meeting (AGM) held on 7 January 2011 were approved by Shareholders and a final dividend of 4 pence per share in respect of the financial year ended 30 September 2010 was paid to shareholders on 14 January 2011. An Offer for Subscription to raise up to £15m by way of an issue of New Shares opened on 14 December 2010 and will close on 30 June 2011, unless extended or fully subscribed before this date. The resolutions proposing the Offer were approved by Shareholders at the AGM held on 7 January 2011. Further details relating to the Offer can be found on Unicorn Asset Management's website; www.unicornam.com. There were no other material events during the period from 1 October 2010 to 31 December 2010.
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