Northern AIM VCT PLC – Final Results

20th December 2005


RNS Number:9355V
Northern AIM VCT PLC
20 December 2005

20 DECEMBER 2005

NORTHERN AIM VCT PLC

PRELIMINARY RESULTS
FOR THE YEAR ENDED 31 OCTOBER 2005

Northern AIM VCT PLC is a Venture Capital Trust (VCT) managed by Northern
Venture Managers. The trust was launched in October 2000; its portfolio of
VCT-qualifying investments is focussed on companies quoted on the Alternative
Investment Market (AiM) but also includes a number of later-stage unquoted
holdings.

Financial highlights – year ended 31 October 2005:
(comparative figures as at 31 October 2004 in italics)
2005 2004

* Net assets #14,051,000 #13,751,000

* Shares in issue at year end 23,706,789 21,387,449

* Net asset value per share 59.3p 64.3p

* Profit/(loss) on ordinary activities
Before tax:
Revenue #205,000 #215,000
Capital #(74,000) #508,000
Total #131,000 #723,000

* Earnings/(loss) per share:
Revenue 0.8p 0.9p
Capital (0.2)p 2.4p
Total 0.6p 3.3p

* Dividend per share:
Revenue 0.8p 0.8p
Capital 3.2p 6.0p
Total 4.0p 6.8p

* Cumulative return to shareholders
since launch:
Dividends per share 12.3p 8.3p
Net asset value plus dividends
per share 71.6p 72.6p

* Share price at end of year 58.0p 62.5p

For further information, please contact:
Northern Venture Managers Limited
Norman Yarrow, Investment Director 0131 260 1000
Website: www.nvm.co.uk

Lansons Communications
Alison Boucher 020 7294 3616

NORTHERN AIM VCT PLC

CHAIRMAN’S STATEMENT

The Chairman of Northern AIM VCT PLC, James Dawnay, included the following
points in his statement to shareholders:

The year in summary

The FTSE AiM index rose by over 18% during the first four months of the
financial year, but after subsequent fluctuations showed an increase of only 3%
over the year as a whole. As in the previous year, the state of the market has
been heavily influenced by mining and resources stocks, and it is also notable
that a number of overseas companies have joined the market. During the year
Northern AIM VCT’s funds have generally remained 85-90% invested in AiM and
unquoted venture capital holdings, with our managers taking opportunities to
trade stocks in order to realise cash for new investment and for distribution
for shareholders. Dividends totalling 4.0p per share have been declared in
respect of the year.

Net asset value

The net asset value per share as at 31 October 2005, before deducting dividends
declared, was 63.3p. This represents a fall of 1.6% from the net asset value of
64.3p at 31 October 2004; over the same period, on a total return basis, the
FTSE AiM index rose by 3.7%. The company’s AIM portfolio achieved a positive
return over the year but the performance of the unquoted investments was
disappointing after a strong run over the preceding three years.

Investments

During the year ten new AiM-quoted holdings were added to the portfolio at a
cost of #2.1 million and two unquoted investments were completed at a cost of
#0.5 million. The ratio of AIM quoted to unquoted investments in the venture
capital portfolio has remained steady during the year at approximately 60:40.
The portfolio is discussed in greater detail in the investment manager’s review
in the annual report.

Earnings and dividend

Investment income for the year totalled #449,000, marginally down from the
previous year. Earnings per share, which includes capital gains realised on
investment sales to the extent that the proceeds exceed the last year-end
valuation of the relevant investment, fell from 3.3p to 0.6p. In declaring a
dividend the directors can also take account of gains realised during the year
which had previously been recognised as unrealised revaluation surpluses; we
declared an interim dividend of 2.0p per share (last year 1.8p) and propose a
final dividend also of 2.0p per share (last year 5.0p), making a total for the
year of 4.0p. Last year’s total of 6.8p reflected the substantial capital gains
realised in that period. The proposed final dividend will, subject to
shareholders’ approval at the annual general meeting, be paid on 3 March 2006 to
shareholders on the register on 3 February 2006.

The dividend investment scheme introduced by the company in December 2004 was
taken up by 15% of shareholders, representing approximately 12% of the company’s
issued capital. #196,000 was reinvested in ordinary shares during the year,
with subscribers benefiting from the attractive tax reliefs currently available
on new VCT investments.

VCT qualifying status

The company has throughout the year met the qualifying conditions laid down by
the Inland Revenue for maintaining its approval as a venture capital trust. The
board continues to retain PricewaterhouseCoopers LLP as advisers on VCT taxation
matters.

Top-up share issue

The top-up issue of new ordinary shares during the year raised a total of #2.0
million before expenses. On behalf of the board I would like to thank existing
and new shareholders for their support.

Share buy-back policy

During the year the company purchased 823,580 of its own shares in the market
for cancellation, representing approximately 3.9% of the opening share capital.
At the annual general meeting a resolution will be proposed to renew the
directors’ authority to re-purchase up to 10% of the issued capital and your
board intends, subject to market conditions, to continue to use this authority
to buy back shares at a discount of not more than 10% to net asset value.

Presentation of financial statements

With effect from 1 November 2005, the start of the new financial year, the
company will be required to follow several changes in generally accepted
accounting principles in the UK, as part of the process of bringing UK
accounting practice into line with international standards. The main changes
will be to the valuation of quoted investments, which will in future be carried
at bid price rather than mid-market; the treatment of unrealised gains and
losses on revaluation of investments, which will be included in the profit and
loss account; and the treatment of dividends payable by the company, which will
not be recognised as a liability until formally declared. Had these changes
taken effect at 31 October 2005, net asset value would have been reduced by 0.9p
per share as a result of valuing quoted investments at bid price but would have
increased by 2.0p through the exclusion of the proposed final dividend. The
interim accounts for the six months ending 30 April 2006 will be drawn up on the
new basis, with comparative figures re-stated as appropriate.

Prospects

Our managers have continued to concentrate on investments with a track record of
profitability, good management and attractive growth prospects. Although the
returns from the portfolio this year have been less than we would have hoped, we
believe that our strategy is sound and we expect to see an improvement in
performance over the coming year.

James Dawnay

Chairman

The audited financial statements for the year ended 31 October 2005 will show
the results set out below.

PROFIT AND LOSS ACCOUNT

for the year ended 31 October 2005

Year ended 31 October 2005 Year ended 31 October 2004
Revenue Capital Total Revenue Capital Total

#000 #000 #000 #000 #000 #000
Profit recognised in the year
on realisation of investments – 179 179 – 787 787

Income 449 – 449 468 – 468
Investment management fee (84) (253) (337) (93) (279) (372)
Other expenses (160) – (160) (160) – (160)
—— —— —— —— —— ——
Profit/(loss) on ordinary activities
before tax 205 (74) 131 215 508 723
Tax on ordinary activities (15) 15 – (13) 13 –
—— —— —— —— —— ——
Profit/(loss) on ordinary activities
after tax 190 (59) 131 202 521 723
Dividends (187) (759) (946) (171) (1,288) (1,459)
—— —— —— —— —— ——
Retained profit/(loss) for the year 3 (818) (815) 31 (767) (736)
—— —— —— —— —— ——

Earnings/(loss) per share 0.8p (0.2)p 0.6p 0.9p 2.4p 3.3p

Dividend per share 0.8p 3.2p 4.0p 0.8p 6.0p 6.8p

STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES

for the year ended 31 October 2005

Year ended 31 October 2005 Year ended 31 October 2004
Revenue Capital Total Revenue Capital Total
#000 #000 #000 #000 #000 #000
Profit/(loss) on ordinary activities
after tax 190 (59) 131 202 521 723
Unrealised losses on
revaluation of investments – (499) (499) – (1,183) (1,183)
—— —— —— —— —— ——
Total recognised gains and losses
during the year 190 (558) (368) 202 (662) (460)
—— —— —— —— —— ——

NOTE OF HISTORICAL COST PROFITS AND LOSSES

for the year ended 31 October 2005

Year ended 31 October 2005 Year ended 31 October 2004
Revenue Capital Total Revenue Capital Total
#000 #000 #000 #000 #000 #000
Reported profit/(loss) on ordinary
activities before tax 205 (74) 131 215 508 723
Realisation of investment revaluation
gains of prior years – 586 586 – 534 534
—— —— —— —— —— ——
Historical cost profit/(loss) for the
year before tax 205 512 717 215 1,042 1,257
—— —— —— —— —— ——
Historical cost profit/(loss) for the
year after taxation and dividends 3 (232) (229) 31 (233) (202)
—— —— —— —— —— ——

BALANCE SHEET

as at 31 October 2005

31 October 2005 31 October 2004
#000 #000
Venture capital investments:
Quoted on AiM 7,686 7,040
Unquoted 4,762 4,728
——- ——-
12,448 11,768
Quoted smaller company investments – 291
——- ——-
Total fixed asset investments 12,448 12,059
——- ——-
Current assets:
Debtors 59 49
Cash at bank 2,079 2,766
——- ——-
2,138 2,815
Creditors (amounts falling due
within one year) (535) (1,123)
——- ——-
Net current assets 1,603 1,692
——- ——-

Net assets 14,051 13,751
——- ——-

Capital and reserves:
Called-up equity share capital 1,185 1,069
Share premium 11,846 9,900
Capital redemption reserve 72 31
Revaluation reserve 164 1,249
Profit and loss account 784 1,502
——- ——-
Total equity shareholders’ funds 14,051 13,751
——- ——-
Net asset value per share 59.3p 64.3p

CASH FLOW STATEMENT

for the year ended 31 October 2005
Year ended Year ended
31 October 2005 31 October 2004
#000 #000 #000 #000
Cash flow statement
Net cash outflow from operating activities (51) (48)

Taxation:
Corporation tax paid – –

Financial investment:
Purchase of investments (2,627) (2,559)
Sale/repayment of investments 1,918 4,531
—— ——
Net cash (outflow)/inflow from financial investment (709) 1,972

Equity dividends paid (1,541) (521)
—— ——
Net cash (outflow)/inflow before financing (2,301) 1,403

Financing:
Issue of ordinary shares 2,218 –
Share issue expenses (115) –
Purchase of ordinary shares for cancellation (489) (267)
—— ——
Net cash inflow/(outflow) from financing 1,614 (267)
—— ——
(Decrease)/increase in cash at bank (687) 1,136
—— ——
Reconciliation of profit before tax to
net cash flow from operating activities

Profit on ordinary activities before tax 131 723
(Increase)/decrease in debtors (10) 18
Increase/(decrease) in creditors 7 (2)
Profit recognised on realisation of investments (179) (787)
—— ——
Net cash outflow from operating activities (51) (48)
—— ——
Analysis of movement in net funds
1 November 2004 Cash flows 31 October 2005
#000 #000 #000
Cash at bank 2,766 (687) 2,079
—— —— ——

INVESTMENT PORTFOLIO SUMMARY

as at 31 October 2005
Valuation % of net assets

#000 by valuation
Venture capital investments
(* denotes unquoted, others traded on AiM)
DMN Installations* 1,411 10.0
Stainton Metal Company* 860 6.1
Pilat Media Global 660 4.7
Aero Inventory 613 4.4
Longhirst Group* 577 4.1
Crantock Bakery* 554 3.9
1st Dental Laboratories 463 3.3
Media Square 423 3.0
PM Group 404 2.9
Bond International Software 382 2.7
SectorGuard 364 2.6
Cello Group 364 2.6
Andor Technology 331 2.4
IG Doors* 315 2.2
GB Industries* 295 2.1
——- ——
Fifteen largest venture capital investments 8,016 57.0
Zenith Hygiene Group 295 2.1

Inspicio 280 2.0
Belgravium Technologies 279 2.0
Colliers CRE 272 1.9
Prologic 266 1.9
Spectrum Interactive 261 1.9
Pivotal Laboratories* 250 1.8
Fountains 245 1.7
Sovereign Oilfield Group 243 1.7
Widney 236 1.7
IDOX 234 1.7
KCS Global Holdings* 234 1.7
John Laing Partnership* 225 1.6
Computer Software Group 222 1.6
Quadnetics Group 220 1.6
Atlantic Global 158 1.1
PKL Holdings 150 1.1
The 4Less Group 84 0.6
First Artist Corporation 82 0.6
AdVal Group 53 0.4
Fulcrum Pharma 40 0.3
OMG 37 0.2
Hartest Holdings 32 0.2
Bank Restaurant Group 28 0.2
Warthog 6 –
——- ——
Total fixed asset investments 12,448 88.6
——- ——
Net current assets 1,603 11.4
——- ——
Net assets 14,051 100.0
——- ——

The above summary of results for the year ended 31 October 2005 does not
constitute statutory financial statements within the meaning of Section 240 of
the Companies Act 1985 and has not been delivered to the Registrar of Companies.
Statutory financial statements will be filed with the Registrar of Companies
in due course; the independent auditors’ report on those financial statements
under Section 235 of the Companies Act 1985 is unqualified and does not contain
a statement under Section 237(2) or (3) of the Companies Act 1985.

The proposed final dividend of 2.0p per share for the year ended 31 October 2005
will, if approved by shareholders, be paid on 3 March 2006 to shareholders on
the register at the close of business on 3 February 2006.

The full annual report including financial statements for the year ended 31
October 2005 is expected to be posted to shareholders on 11 January 2006 and
will be available to the public at the registered office of the company at
Northumberland House, Princess Square, Newcastle upon Tyne NE1 8ER.

ENDS

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The company news service from the London Stock Exchange
END

FR FELSUSSISEEE