14th Jun 2019 14:18
(Alliance News) - Venture capital trust Unicorn AIM VCT PLC boosted its interim dividend Friday despite asset having declined in tough markets, as it continued to expect good longer term returns.
For the six months ended March, net asset value per share fell 7.7% to 144.4 pence from 156.4p the year prior. Compared to six months earlier, NAV per share declined 16% from 171.8p.
"This decline in net asset value reflects the difficult equity market conditions experienced during the period under review, which were most pronounced during the final quarter of 2018," Unicorn Chair Peter Dicks said. "Encouragingly, since the start of 2019, UK equity markets have experienced a recovery."
At the end of May, NAV per share stood at 155.7p.
"It is also important however, to highlight some of the key strengths of your company," Dicks added. "Over many years, the investment manager has constructed a portfolio of investments operating across a diverse range of sectors that, at an individual level, have generally proven their ability to achieve and maintain growth in revenues and profits over extended periods."
"These companies, although diverse in the type of products and services they offer, tend to be cash generative, conservatively managed and often have an established history of making dividend payments," Dicks continued. "The income received from these more mature investments is making an important contribution to the sustainability of your company's regular and attractive tax free dividends."
Unicorn proposed a 3.0p per share interim dividend, up 7.1% from 2.8p the year prior.
"Therefore, while total returns may potentially become more volatile over shorter time periods, your investment manager nonetheless remains confident in delivering healthy capital returns over the longer term, while also being able to generate sufficient distributable reserves to enable the board to declare a regular and reasonably predictable level of dividend payments to shareholders," Dicks said.
Shares in Unicorn AIM VCT were 0.7% lower at 136.00 pence in London on Friday.
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Unicorn Asset Management