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Unicorn AIM VCT II has seen a net loss of just over £1.4 million for both its Ordinary Share Fund and the C Share Fund, compared to a gain of £1.6 million for the same period last year. Chairman Peter Andrews attributes this to tough market conditions for smaller quoted companies, where banks have tightened terms and investors are more risk averse.

The loss came in the half-yearly report for the six months ended 30 June 2008. ‘In the period under review, equity markets worldwide have been particularly weak as the impact of the banking crisis continues to undermine both investor and consumer confidence,’ Andrews notes.

He went on to add that a number of portfolio companies had been hit, such as Claimar Care, Discover Leisure, Maxima Holdings, Optimisa and Shieldtech, where profit warnings resulted in steep share price declines. In the Ordinary Share Fund the falls produced by these five companies accounted for over 70 per cent of the net decline generated by the qualifying portfolio overall.

Not all the news was bleak. Andrews says: ‘There is a healthy level of diversification in both Funds and a majority of investee companies appear to be weathering the storm well. The performances of Abcam (+40 per cent), Crawshaw Group (+37 per cent), IDOX (+22 per cent), and Pressure Technologies (+33 per cent) are all worthy of special mention.’

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