Chairman's update for shareholders - 2 July 2009

Thursday 2 July 2009


Chairman's update for shareholders - 2 July 2009
Investment performance
Although Starvest  has  maintained  its position  this  quarter,  the
investment performance has been mixed.  At 30 June 2009, the  closing
portfolio net  asset  value was  marginally  ahead at  £4.3m,  a  10%
increase in the nine  months since 30  September 2008.  However,  the
net asset value per share has not moved in the quarter since 31 March
2009.
Starvest  now  uses  closing  bid  prices  or  the  Directors'  lower
valuation, if deemed appropriate.  This prudent valuation basis first
adopted when preparing the Starvest annual financial statements at 30
September 2008 has proved to be fully justified.
Company statistics

                          30 June   31 March 31 December 30 September
                             2009       2009        2008         2008
                                                  At BID       at BID
                           At BID     at BID      values       values
                           values     values
Trading portfolio value     £4.3m     £4.25m      £3.92m        £3.9m
Company asset value net    £3.62m     £3.62m      £3.23m        £3.4m
of debt
Net asset value - fully     10.01      10.01  8.98 pence   9.06 pence
diluted per share           pence      pence
Share price - mid       9.5 pence 6.25 pence     6 pence       12.25p
Share price discount to        5%        37%         33%  35% premium
fully diluted net asset
value
Market capitalisation      £3.31m     £2.18m      £2.09m       £4.28m


Comment
Market conditions  remain fragile.   However, there  are early  signs
that underlying prices for raw  materials are hardening which in  due
course will impact on  share prices.  For example,  in July 2008  the
price of nickel was $22,000 per tonne; by October 2008 it had  fallen
to $9,000 since when it has gradually recovered to $16,000.  Although
even at this level it  may be below the  cost of production for  many
miners, it remains a positive change.
The junior explorers in which Starvest is predominantly invested  are
not generating  cash,  rather they  are  consumers of  cash  as  they
continue  with  their  exploration  programmes  towards  establishing
proven resources.  In the economic circumstances of the past year  it
has been extremely difficult for many of them to raise the  essential
new cash  except at  a discount  to those  market prices  which  were
common a  year ago.   These  tough circumstances  continue so  it  is
unsurprising that the values of some investments have fallen and will
take time to recover.
On the other hand, we are delighted to note that some of our investee
companies are making significant advances with their programmes, some
even drawing close to generating revenue  so we hope for share  price
improvements in the near future.
The Board  continues to  believe  that it  has within  its  portfolio
investments with considerable potential and  is hoping for an  upturn
during 2010, possibly earlier for some.
Shareholders who wish to  receive electronic copies of  announcements
are invited to register their email  address on the home page of  the
Company website: www.starvest.co.uk.

R Bruce Rowan
Chairman & Chief Executive
2 July 2009



Enquiries to:
Bruce Rowan, Chairman 020 7486 3997 or John Watkins, Finance Director
07768 512404; [e-mail]
Gerry Beaney or Colin Aaronson Grant Thornton UK LLP 020 7383 5100                                                                                                       lely responsible for the content of this announcement.