Annual report and financial statements - NVM Private Equity Ltd.

Chairman’s Statement
Developments in the investment portfolio during the
year are reviewed in greater detail in the Business
Review on pages 6 to 12.
James Dawnay
Overview of the year
The AiM market index rose strongly over the first
half of the company’s financial year but fell back
subsequently to end the year up by only 0.8%.
Northern AIM VCT's funds have remained over
90% invested in AiM-quoted and unquoted venture
capital holdings, producing a marginally negative
return over the year. A dividend of 1.0p per share
has been declared.
Performance
The net asset value per share as at 31 October 2006
was 57.6p, compared with 60.4p (re-stated) at
31 October 2005. Before deducting dividends of
2.0p which were charged to reserves during the year,
the total return was minus 0.8p per share,
equivalent to 1.3% of the opening net asset value.
Over the same period the FTSE AiM total return
index increased by 1.6%.
Presentation of accounts
The introduction of new UK financial reporting
standards has led to changes in the way in which the
company's annual accounts are presented. The old
Profit and Loss Account, Statement of Total
Recognised Gains and Losses and Note of Historical
Cost Profits and Losses have been replaced by an
Income Statement which includes all recognised
gains and losses for the year in a single table.
Quoted investments are now valued at bid rather
than mid-market price, and proposed dividends are
no longer included in the year-end balance sheet.
The comparative figures for the year ended
31 October 2005 have been re-stated accordingly.
Dividend
At the half-year stage I reported that the board had
decided not to declare an interim dividend and to
review the position at the year end. The revenue
return per share for the year was 0.4p and this will
be distributed by way of final dividend, together
with a capital dividend of 0.6p representing part of
the gains realised on investment sales during the
year. The proposed final dividend therefore totals
1.0p per share and will, subject to shareholders’
approval at the annual general meeting, be paid on
2 March 2007 to shareholders on the register on
2 February 2007.
Investments
During the year five new AiM-quoted holdings were
added to the portfolio at a cost of £1.3 million and
one new unquoted investment was completed at a
cost of £248,000. The proportion of the company’s
investments represented by AiM-quoted holdings
has remained virtually unchanged at 64%. As in the
previous year, the AiM holdings achieved a positive
return overall but there was a small net reduction in
the value of the unquoted portfolio as a result of
disappointing trading performance from three of
our companies.
The directors believe it is important that they
achieve an appropriate balance between maximising
dividend distributions and maintaining the
company’s capital base and hence its long-term
viability. This year’s dividend is therefore at a lower
level than those declared in the two preceding years.
However we are well aware that tax-free
distributions to shareholders are one of the main
attractions of VCTs, and your board and managers
are clearly focused on the need to resume a higher
rate of dividend in the near future by achieving
improved investment returns.
PAGE 2 Northern AIM VCT PLC Annual Report and Accounts 2006