Final Results

Matrix Venture Fund VCT PLC
01 July 2003

Matrix Venture Fund VCT plc



Preliminary Results for the year ended 30 April 2003



Corporate Policy and Financial Highlights

for the year ended 30 April 2003



Objective



The objective of Matrix Venture Fund VCT plc ("Matrix Venture Fund") is to
provide private investors with an attractive return from a portfolio of
investments in fast-growing companies whose products or services depend to a
significant extent on the application of new technology, including :-



•                          Internet and e-business

•                          Information technology

•                          Telecommunications and media.

Venture Capital Trust Status



Matrix Venture Fund has been granted provisional approval under section 842AA of
the Income and Corporation Taxes Act 1988, and the Directors intend to conduct
the business of the Company so as to continue to comply with that section.



Performance Summary


                                                              30 April 2003        30 April 2002



Net asset value per Ordinary Share                                   64.39p               70.34p

Net assets                                                       £8,457,714           £9,271,657

Revenue and dividend

Earnings per Ordinary Share                                           0.51p                1.35p

Dividend per Ordinary Share                                           0.51p                1.35p





Chairman's Statement



It is a pleasure to present the third annual report and financial statements of
Matrix Venture Fund VCT plc. You will remember that the public offer launched on
10 May 2000 at 100 pence per share raised £12,388,237 (net).



Results for the year ended 30 April 2003



The results for the year ended 30 April 2003 are set out in the following pages.
The total return (after tax) attributable to the Ordinary Shareholders before
the recommended dividend was £(717,678) (2002: £(2,240,929)) and the net asset
value per Ordinary Share at 30 April 2003 was 64.39 pence compared with 70.34
pence for the year ended 30 April 2002.



Dividend



The Board recommends a dividend of 0.51 pence per Ordinary Share for the year
ended 30 April 2003 (2002: 1.35 pence) for Ordinary Shareholders on the register
at the close of business on 29 August 2003.  Subject to shareholder approval at
the Annual General Meeting on 10 September 2003, these payments should be
received on 24 September 2003. The after tax revenue return before net capital
losses was 0.51 pence per Ordinary Share for the year to 30 April 2003 (2002:
1.35 pence).



Overview



The climate for investing in technology companies has continued to be
challenging.



The third financial year of activity has seen a continued high volume of
proposals being received and evaluated by the Company's Venture Capital Fund
Advisers, Matrix Private Equity Limited.  Continued global turbulence and
unsettled quoted markets have led to low levels of corporate activity. This has
affected the unquoted market where many investment propositions have failed to
receive funding.  Previously unrealistic company valuations have now largely
been modified reflecting a more realistic balance between risk and reward. This
should make for a more profitable and stable environment when market confidence
returns.



As at 30 April 2003, £6.9 million had been committed to 12 companies. One new
investment was completed in this financial year, and follow-on funding has been
provided to three portfolio companies. Together, these investments represent an
aggregate investment of 55.8% of the net funds raised under the public offer.
As at 30 April 2003, the capital reserves showed a capital base of £8.5 million,
struck after a cumulative capital loss of £3.9 million. Details of the full
venture capital portfolio as at 30 April 2003 are given in the Venture Capital
Fund Adviser's Report.



The investments held by the Company have been valued in accordance with the
British Venture Capital Association guidelines under which unquoted investments
are not normally revalued above cost for at least 12 months after the date of
the acquisition. We will, in any event, always follow a consistent and prudent
valuation policy. The investments that are quoted on AIM and the fixed interest
securities are carried at market value.



VCT Qualifying Status



During the year the Company met all the requirements of the VCT legislation and
I am pleased to report that, following the year end, qualifies for full VCT
status.



Share Premium Account



Shareholders approved the cancellation of the Company's share premium account
at the Annual General Meeting held on 6 September 2002.  This cancellation was
sanctioned by the Court on 30 October 2002 and became effective on 2 November
2002.  The cancellation of the share premium account has created a special
reserve that can be used to fund buy-backs of the Company's Ordinary Shares when
the Directors consider that it is in the best interests of the Company to do so.



Conclusion



There is no doubt that economic conditions have deteriorated markedly since the
Fund was launched.  The quoted market has seen a very marked decline reflecting
the recession in the telecommunications sector and the slowing pace of growth in
other technology sectors.  The Board is encouraged that the majority of the
current portfolio is well funded and in some cases achieving excellent growth
rates.



The time period for investment realisation has normally been between 3 and 5
years. In current depressed markets it should be expected that companies may
take longer to mature to a stage suitable for exit.  However, I am pleased to
inform shareholders that, on 18 June 2003, it was announced that Nasdaq listed
FindWhat.com plans to merge with Espotting Media (UK) Limited (Espotting) in a
transaction that values Espotting at $163 million.  If the investment in
Espotting was revalued to the anticipated consideration on the date of the
announcement, the net asset value per share would increase by approximately
10.6p.  The consideration is largely in shares and so the actual impact will
depend on the share price on realisation.  The deal is subject to customary
closing conditions, including respective company shareholder approvals, and is
expected to close in the fourth quarter of 2003.  The Board is hopeful that
further exits will be achieved in the next 12-24 months.



I would like to take this opportunity to thank all shareholders for their
continuing support of the Company and I very much hope to have the pleasure of
welcoming you to the Annual General Meeting on 10 September 2003.



Michael Cumming

Chairman

1 July 2003



Venture Capital Fund Adviser's Report



The Venture Capital Fund

Matrix Private Equity Limited advises the Company in respect of investments made
within the Venture Capital Fund.  During the year ended 30 April 2003, the team
received and evaluated over 500 investment proposals, from which Matrix Venture
Fund made one new investment into FootFall Limited, at a cost of £750,000.



In common with many other investors we have been focused on helping our existing
investee companies and have recommended three further investments of £24,443
into Sit-up.com Limited, £50,000 into Espotting Media (UK) Limited (Espotting)
and £142,857 into Monactive Limited over the past year.



During the year we have revalued our investment in Espotting upwards following
another round of finance achieved by the company at a higher valuation.  We have
not yet revalued the investment to take account of the planned sale of the
company referred to in the Chairman's Statement. We have also, in these
accounts, written down our investment in Callserve Communications Limited due to
the slower growth of the telecommunications sector and have taken a provision on
our investment in Flightstore Limited, which has suffered from the difficult
airline market in recent years, leading to lower growth.



This was the third period in which funds were available for investment in
qualifying companies for VCT purposes. The current investment portfolio of the
Company as at 30 April 2003 is detailed below.



Callserve Communications Limited

The company provides internet telephony services or Voice over Internet Protocol
("VolP") from PCs to telephones, worldwide.  Using software which is
pre-installed or downloaded from the company's website, a telephone caller can
use the internet to route a telephone call at a much reduced cost.  Matrix
Venture Fund invested as part of a syndicate arranged by KBC Peel Hunt, raising
£7.3m to finance the roll-out of the service and facilitate partnering
arrangements with software and hardware providers.



Results from the latest audited accounts for the year ended 31 March 2002:
turnover £2,681,239; loss before tax £4,885,152; net liabilities £363,814.


  Date of investment     Amount invested      Valuation       % Equity/       % of net assets
                                                            Voting Rights

     October 2000            £300,000         £150,000          0.43%              1.75%



Clarity Commerce Solutions plc

The company provides EPOS (electronic point of sale) solutions, Customer
Relationship Management ("CRM") products and services to the UK hospitality and
leisure markets.  It floated on AIM in July 2000, raising £2.5m primarily to
increase its marketing activities and acquire two small complementary
businesses.  The company has continued to be acquisitive and raised £2.6m via a
rights issue in October 2001.  The business has grown substantially in the last
year and is now trading profitably before amortisation of goodwill.



Results from the latest audited accounts for the year ended 31 March 2002:
turnover £7,620,000; loss before tax £221,000; net assets £7,367,000.


 Date of investment     Amount invested      Valuation   % Equity/Voting Rights  % of net assets
      July 2000             £250,000         £117,000            1.44%                1.37%



The investment is valued at the mid-market price on 30 April 2003 of 58.5p per
share.



e-go systems plc

The group provided Unified Messaging ("UM") services to global enterprises.  UM
consolidates messages delivered to voicemail, mobile phone, e-mail and fax into
one mailbox.  Telemesser (a subsidiary based in Israel) provided UM support
services, including CRM.  The enterprise UM service went live in May 2001.
Matrix Venture Fund invested as part of a £7.2m fund-raising in September 2001.
The group raised a further £5m to enable the business to expand and we invested
an additional £100,000 as part of this round in October 2001.  Although the
trial service was available in May 2001, technical problems delayed the launch
until January 2002.  At this stage the company was unsuccessful in obtaining
further funding and the business was placed into liquidation in January 2003.
It is unlikely that there will be a distribution to shareholders.



Results from the last audited accounts for the year ended 31 March 2000:
turnover £725,058; loss before tax £1,151,998; net assets £3,329,413.


    Date of investment       Amount invested     Valuation       % Equity/        % of net assets

                                                               Voting Rights
 September 2000/ October        £600,000            Nil            3.00%                Nil
           2001
                                                                                       





Espotting Media (UK) Ltd

Espotting is the UK's leader in performance-based advertising through search
engines, allowing advertisers to bid against each other for key words in order
to achieve prominence in search engine results.  Espotting raised two rounds of
funds; in December 2001 and again in August 2002, to finance working capital and
an expansion of the business into Europe.  Matrix Venture Fund has invested
£550k in total.  The company has continued to grow rapidly since our investment.
  On 18 June 2003, Espotting announced plans to merge with Nasdaq listed
FindWhat.com (see Chairman's Statement).



Results from the latest audited accounts for the year ended 31 March 2001
turnover £45,044: loss before tax £1,915,995; net liabilities £1,915,994.


  Date of investment     Amount invested      Valuation     % Equity/ Voting     % of net assets
                                                                 Rights
    December 2001/           £550,000         £732,471            2.4%                8.59%

     August 2002





Flightstore Inflight Retailing Limited

Flightstore uses existing seatback entertainment systems to create an airline
branded, electronic and interactive magazine experience containing branded
retailers and advertisers on long haul flights.  It raised £3m in March 2002.
The service is now installed on 3 airlines comprising 24 aircraft and has
secured orders from a further 3 airlines.



Results from the latest audited accounts for the year ended 31 December 2002:
turnover £44,147; loss before tax £858,119; net assets £819,802.

 Date of investment     Amount invested      Valuation      % Equity/ Voting     % of net assets
                                                                 Rights
     March 2001             £750,000         £375,000            11.6%                4.39%



FootFall Limited

FootFall provides business performance information that is derived from the
monitoring and analysis of pedestrian traffic flow in shopping centres and
retail outlets.  The company raised £2.65m from a syndicate of investors in June
2002.  The company continues to show strong year-on-year growth.



Results from the latest audited accounts for the year ended 31 March 2002:
turnover £1,663,857; loss before tax £2,589,446; net assets £1,381,077.

 Date of investment     Amount invested      Valuation      % Equity/ Voting     % of net assets
                                                                 Rights
      June 2002             £750,000          At cost            5.76%                8.79%



Image Com Limited

The company's core expertise was in providing the technology to enable high
quality live video images to be transmitted over telephone networks by
compressing and decompressing the images at either end.  The company raised
several rounds of funding from Thompson Clive, who then invested a further
£750,000 alongside a similar sum from Matrix Venture Fund to fund the
development of new business.  Additional funds of £750,000 were raised in
October 2001, with the Fund investing £150,000.  Due to a serious liquidity
crisis arising partly from another party failing to complete its investment, the
business was placed into liquidation in January 2003.  It is unlikely that there
will be a distribution to shareholders.



Results for 9 months ended 31 January 2002; turnover £1,585,157; loss before tax
£1,468,000; net liabilities £175,000.


  Date of investment     Amount invested      Valuation       % Equity/       % of net assets
                                                            Voting Rights

    December 2000/           £900,000            Nil            21.22%              Nil

     October 2001                                                                 





Magicalia Limited

Magicalia has established a network of six community websites focused on
enthusiast-based participation sports such as cycling, golf, fishing and outdoor
activities.  It also has a growing online contract publishing business whereby
Magicalia licenses their technology platform to existing online publications.
The company raised £1m from a syndicate of investors in March 2001.  The
business continues to grow and expand its membership base.



Results from the latest audited accounts for the year ended 31 December 2001:
turnover £94,894; loss before tax £500,573; net assets £801,822.


  Date of investment     Amount invested      Valuation       % Equity/       % of net assets

                                                            Voting Rights
      March 2001             400,000           At cost          12.73%             4.69%



Monactive Limited

Monactive is a leading provider of software asset management tools, having
developed products based on innovative technology including automatic
recognition, and a client-based, rather than server-based approach (i.e. using
resident agents on PCs) to monitor software usage.  The company raised £1.75m
from a syndicate of investors in March 2001, and a further £500,000 in January
2003.

Results from the latest audited accounts for the year ended 31 July 2002:
turnover £1,548,645; loss before tax £982,394; net liabilities £893,077.


  Date of investment     Amount invested      Valuation       % Equity/       % of net assets

                                                            Voting Rights
     March 2001/             £642,857          At cost          13.6%              7.54%

     January 2003





Sit-up.com Limited

The company provides interactive broadcasting material for digital TV and the
internet.  The first service is Bid-up.TV, the UK's first interactive TV-based
auction site.  Bid-up.TV auctions create an opportunity for manufacturers and
distributors to sell a wide range of products across Sky, Telewest and other
platforms.  The company also owns Screenshop, an infomercial channel broadcast
on Sky.  Matrix Venture Fund initially invested £500,000 as part of a £2.2m
syndicate.  A further £150,000 was provided when the business raised over £5m of
expansion capital in February 2001 and £250,000 was invested in March 2002 as
part of a £1.65m loan syndicate.  This loan has now been repaid.  The business
raised approximately £5m of development capital in July 2002 and Matrix Venture
Fund invested £24,443 as part of that round.  The business continues to show
strong annualised growth.



Results from the latest audited accounts for the year ended 31 December 2001:
turnover £25,961,848; loss before tax £7,475,490; net assets £11,487,713.


  Date of investment     Amount invested      Valuation       % Equity/       % of net assets

                                                            Voting Rights
    October 2000/            £675,591         £459,188          1.59%              7.93%

    February 2001/

      July 2002





The Directors of Matrix Private Equity Limited responsible for advising on the
Venture Capital Investments are:



Helen Sinclair, Managing Director (Age 37).  Helen is an experienced venture
capitalist with over fifteen years deal doing experience.  She has an MBA from
INSEAD Business School and was at 3i plc for seven years where she gained
wide-ranging experience of investing in and managing a portfolio of companies.
She joined Matrix Private Equity in May 2000 and was made Managing Director in
February 2003, upon Mark Burgess' departure for Australia.



Ashley Broomberg, Director (Age 33).  Ashley is a chartered accountant with a
background in strategy consulting.  He has an MPhil in Finance from the
University of Cambridge and previously worked at Arthur D Little, where he
specialised in transaction support for TMT transactions, and was prior to this
at Andersens.  He joined Matrix Private Equity in June 2001.



Statement of Total Return

Year ended 30 April 2003


                                                                Year ended 30 April 2003
                                                           Revenue           Capital             Total
                                                                 £                 £                 £

Gains and losses on investments                                  -         (680,522)         (680,522)

Income                                                     349,189                 -           349,189

Investment management fees                                (39,785)         (119,353)         (159,138)

Other expenses                                           (227,921)                 -         (227,921)
                                                      ------------       -----------      ------------

Return on ordinary activities before
taxation                                                    81,483         (799,875)         (718,392)

Tax on ordinary activities                                (14,396)            15,110               714
                                                        ----------         ---------         ---------

Return attributable to equity
shareholders                                                67,087         (784,765)         (717,678)

Dividends in respect of equity shares                     (66,994)                 -          (66,994)
                                                      ------------      ------------      ------------
Transfer to/(from) reserves                                     93         (784,765)         (784,672)
                                                      ------------      ------------      ------------

Return to shareholders per Ordinary Share                    0.51p           (5.96)p           (5.45)p






                                                                   Year ended 30 April 2002
                                                                  Revenue           Capital             Total
                                                                        £                 £                 £

Gains and losses on investments                                         -       (2,278,674)       (2,278,674)

Income                                                            469,379                 -           469,379

Investment management fees                                       (60,094)         (180,282)         (240,376)

Other expenses                                                  (186,596)                 -         (186,596)
                                                              -----------      ------------      ------------
Return on ordinary activities before
taxation                                                          222,689       (2,458,956)       (2,236,267)

Tax on ordinary activities                                       (44,352)            39,690           (4,662)
                                                              -----------       -----------       -----------
Return attributable to equity
shareholders                                                      178,337       (2,419,266)       (2,240,929)

Dividends in respect of equity shares                           (177,938)                 -         (177,938)
                                                              -----------    --------------    --------------
Transfer to/(from) reserves                                           399       (2,419,266)       (2,418,867)
                                                              -----------    --------------    --------------

Return to shareholders per Ordinary Share                           1.35p          (18.35)p          (17.00)p




The Statement of Total Return incorporates the profit and loss account of the
Company.



All revenue and capital items in the Statement of Total Return derive from
continuing operations.



The Company has only one class of business and derives its income from
investments in shares, securities, loans and bank deposits.



Balance Sheet

As at 30 April 2003


                                                             30 April 2003        30 April 2002
                                                                         £                    £

Fixed Assets
Venture capital investments                                      3,626,615            3,493,099
Fixed interest securities                                                -            5,047,590
Money market investments                                         1,643,385              810,979
                                                              ------------        -------------
                                                                 5,270,000            9,351,668

Current Assets
Debtors and prepayments                                             77,363              155,639
Cash at bank                                                     3,259,824               14,679
                                                             -------------          -----------
                                                                 3,337,187              170,318


Creditors: amounts falling due within one year                   (149,473)            (250,329)
                                                               -----------          -----------

Net current assets                                               3,187,714             (80,011)
                                                             -------------        -------------
Net assets                                                       8,457,714            9,271,657
                                                             -------------        -------------

Capital and reserves
Called up share capital                                            131,360              131,806
Capital redemption reserve                                             446                    -
Share premium account                                                    -           12,256,431
Cancelled share premium account                                 12,227,160                    -
Capital reserve - realised                                       (959,815)            (383,852)
Capital reserve - unrealised                                   (2,941,929)          (2,733,127)
Revenue reserves                                                       492                  399
                                                              ------------       --------------
                                                                 8,457,714            9,271,657
                                                              ------------        -------------

Net asset value per Ordinary Share                                  64.39p               70.34p






Cash Flow Statement

Year ended 30 April 2003


                                                                          Year           Year
                                                                         ended            ended
                                                                      30 April         30 April
                                                                          2003             2002
                                                                             £                £

Net cash inflow/(outflow) from operating activities                     55,156        (180,950)

Taxation
UK corporation tax paid                                                (3,948)                -
                                                                   -----------      -----------
Net cash inflow/(outflow)                                               51,208        (180,950)
                                                                   -----------      -----------

Capital expenditure and financial investment
Purchase of investments - fixed income securities                  (2,613,686)     (12,394,340)
Purchase of investments - equities and loan stock                  (1,018,448)        (950,000)
                                                                 -------------    -------------
                                                                   (3,632,134)     (13,344,340)
                                                                 -------------    -------------
Disposals of fixed income securities                                 7,615,686        7,202,573
Disposals of equities and loan stock                                   250,000                -
                                                                 -------------    -------------
Net cash inflow/(outflow) from investing activities                  4,233,552      (6,141,767)


Dividends
Equity dividends paid                                                (177,938)        (123,140)
                                                                  ------------      -----------

Net cash inflow/(outflow) before financing and
liquid resource management                                           4,106,822      (6,445,857)

Management of liquid resources
Movement in money market and other deposits                          (832,406)        6,384,538


Financing
Purchase of own shares                                                (29,271)                -
                                                                   -----------      -----------
Net cash outflow from financing                                       (29,271)                -
                                                                   -----------      -----------

                                                                  ------------     ------------
Net cash inflow/(outflow) as at 30 April 2003                        3,245,145         (61,319)
                                                                  ------------      -----------



The Company held gilts and bonds primarily as investments and not as liquid
resources.  Accordingly, movements in the holdings of these investments are
shown within investing activities in the Cash Flow Statement rather than within
management of liquid resources.



Notes



1.                   Return per share



The revenue return per Ordinary Share is based on the net revenue from ordinary
activities after taxation of £67,087 (2002: £178,337) and on 13,168,879 (2002:
13,180,612) Ordinary Shares, being the weighted average number of Ordinary
Shares in issue during the year.

The capital return per Ordinary Share is based on net realised capital losses of
£149,833 (2002: £208,639), net unrealised capital losses of £634,932 (2002:
£2,210,627) and 13,168,879 (2002: 13,180,612) Ordinary Shares.

2.         Dividend

The Directors recommend a final dividend of 0.51p (2002: 1.35p) per Ordinary
Share to Ordinary Shareholders on the register at the close of business on 29
August 2003.  Subject to shareholders approval at the Annual General Meting on
10 September 2003 the payment should be received on 24 September 2003.

3.         Net asset value per share

Net asset value per Ordinary Share is based on net assets at the year end, and
on 13,136,004 Ordinary Shares (2002: 13,180,612), being the number of Ordinary
Shares in issue on that date.

4.                   On 18 June 2003, the US holding company of one of the
Company's investments, Espotting Media (UK) Ltd, announced plans to merge with a
NASDAQ listed company, FindWhat.com.

If the Company's investment in Espotting was revalued to the anticipated
consideration on the date of the announcement, the Net Asset Value per share
would increase by approximately 10.6p.

5.         The financial information set out in these statements does not
constitute the Company's statutory accounts for the years ended 30 April 2003
and 30 April 2002 but is derived from those accounts. Statutory accounts for the
year ended 30 April 2002 have been delivered to the Registrar of Companies and
those for year ended 30 April 2003 will be delivered following the Company's
Annual General Meeting. The auditors have reported on those accounts: their
reports were unqualified and did not contain statements under Section 237 (2) or
(3) of the Companies Act 1985.



6.         The Annual Report will be circulated by post to all shareholders
shortly and copies will be available thereafter to members of the public from
the Company's registered office.



7.         The Annual General Meeting will be held on 10 September 2003 at the
offices of Matrix-Securities Limited, Gossard House, 7-8 Savile Row, London W1S
3PE.






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