Unicorn Asset Management Regulatory News (UAV)

Unicorn AIM VCT plc ("the Company")

Interim Management Statement 

For the period from 1 April 2021 to 30 June 2021

Introduction

This voluntary Interim Management Statement (IMS) covers the three month period ended 30 June 2021, together with relevant information up to the date of publication. 

Investment Objective

The Company's objective is to provide Shareholders with an attractive return from a diversified portfolio of investments, predominantly in the shares of AIM quoted companies, by maintaining a steady flow of dividend distributions to Shareholders from the income as well as capital gains generated by the portfolio.

It is also the objective that the Company should continue to qualify as a Venture Capital Trust ("VCT"), so that Shareholders benefit from the taxation advantages that this brings. To achieve this, at least 80% for accounting periods commencing on or after 6 April 2019 (previously 70%) of the Company's total assets are to be invested in qualifying investments of which 70% by VCT value (30% in respect of investments made before 6 April 2018 from funds raised before 6 April 2011) must be in ordinary shares, which carry no preferential rights (save as permitted under VCT rules) to dividends or return of capital and no rights to redemption.

Performance  

The Company's portfolio of investments performed reasonably well with net asset value per share continuing to increase steadily over the quarter.

As at 30 June 2021, the unaudited net asset value was 247.6 pence per share, which represents an increase of +6.7% on the audited closing net asset value of 232.1 pence per share as at 31 March 2021. UK equity indices also continued their strong run, with the FTSE AIM All-Share Index generating a total return of +4.5%, while the FTSE All-Share Index delivered a total return of +5.6% over the same period.

The portfolio remains predominantly composed of investments in businesses listed on the Alternative Investment Market (AIM). A good number of these investee companies are relatively mature and, as such, most of these businesses have remained profitable, despite the difficulties posed by the ongoing COVID-19 pandemic.

The number and value of new VCT qualifying investments completed in the period was healthy and the pipeline of promising opportunities continues to strengthen. As a result, all key HMRC tests continue to be met. At the period end, an estimated 86.6% of total assets (assessed in accordance with VCT rules) was invested in VCT qualifying companies.

Despite the increased risks associated with early stage investment and the uncertainty created by the COVID-19 pandemic, the Investment Manager is confident that the portfolio, as a whole, has the potential to continue delivering attractive total returns over the longer term.

Material Transactions

During the period under review, four new VCT qualifying investments were completed, costing £9.2 million in total. One follow-on VCT qualifying investment was also made at a total cost of £0.5m.

Approximately £0.3 million was raised from the partial disposal of two holdings during the period. In addition, the Company's entire holding in Wey Education was sold, following a successful takeover bid from Inspired Education Group. This disposal realised proceeds of over £4.6 million and a capital profit of almost £2.5 million.

The purpose of disposals is threefold; to ensure stock specific risk is contained, to lock in capital profits for future distribution to Shareholders via dividend payments, and to help manage liquidity requirements.

Top Ten VCT Qualifying Holdings as at 30 June 2021

Share Buy-Backs

During the period from 1 April to 30 June 2021, the Company bought back 592,273 of its own Ordinary Shares for cancellation, at a price of 210 pence per share. As at 30 June 2021, there were 149,758,626 Ordinary Shares in issue. After the period end, a further 293,191 Ordinary Shares were purchased for cancellation at a price of 215 pence per share.

Interim Dividend

As previously advised, the Board declared an interim dividend of 3.0 pence per share in respect of the Company's half year ended 31 March 2021. This interim dividend will be paid on 12 August 2021 to Shareholders who were on the register on 15 July 2021.

Issue of Equity

During the period, a total of 1,129,286 new Ordinary Shares were issued in the new tax year at prices ranging between 237.4p and 238.2p per share under the Offer for Subscription, which launched on 28 January 2021. The Offer closed on 11 February 2021 having raised approximately £15 million before costs.

Material Events

There were no material events during the period under review.

Chris Hutchinson

Director, Unicorn Asset Management

Investment Manager

23 July 2021