Announcements

Northern Investors Company PLC.


RNS Number:1136M
Northern Investors Co PLC
15 November 2006

15 NOVEMBER 2006

NORTHERN INVESTORS COMPANY PLC

UNAUDITED INTERIM RESULTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2006


Northern Investors Company PLC is an investment trust managed by Northern
Venture Managers. Launched in 1984 and listed on the London Stock Exchange
since 1990, it invests mainly in unquoted venture capital holdings and aims to
provide high long-term returns to shareholders through a combination of income
yield and capital growth.


Financial highlights (comparative figures as at 30 September 2005 in italics):

2006 2005
* Net assets #51,437,000 #47,822,000

* Net asset value per share 260.8p 242.5p

* Share price 189.5p 210.5p

* Share price discount to
net asset value 27.3% 13.2%

* Return per share after tax:
Revenue 3.3p 3.3p
Capital 6.1p 1.4p
Total 9.4p 4.7p

* Interim dividend per share
proposed in respect of the period 2.0p 1.8p


For further information, please contact:

Northern Venture Managers Limited
Alastair Conn, Managing Director 0191 244 6000
Website: www.nvm.co.uk

Lansons Communications
Alison Boucher 020 7294 3616


CHAIRMAN'S STATEMENT


The Chairman of Northern Investors Company PLC, Peter Haigh, included the
following points in his statement to shareholders:


I reported in my statement to shareholders six months ago that in order to
improve performance the board had asked our managers to reposition the
investment portfolio over the next two years, with the objective of
concentrating a larger proportion of the company's assets on the twenty largest
holdings. This will be achieved by both increasing the average size of the new
investments acquired and reducing the number of holdings in the portfolio.


Over the six months to 30 September 2006 there was a net reduction of three in
the number of holdings, from 62 to 59, with two new investments totalling #2.7
million added to the portfolio. We have recently approved two more investments
totalling #5.5 million, both of which are currently in the process of due
diligence investigation, and a number of holdings are the subject of exit
discussions. The implementation of our portfolio strategy is therefore well
under way and I look forward to reporting further progress at the year end.


Net asset value and share price

The net asset value (NAV) per share at 30 September 2006 was 260.8p, an increase
of 7.6% over the corresponding figure at 30 September 2005. The share price at
30 September 2006 stood at a three-year low of 189.5p, representing a 27.3%
discount to NAV, although there has subsequently been an upward movement to
200p. Over the five year period to 30 September 2006 the company's NAV and
share price total return were +37.6% and -0.8% respectively, showing the extent
to which the share price has lagged behind the increase in NAV. The FTSE
All-Share index total return over the same period was +53.2%.


Revenue and dividend

Investment income for the half year was slightly higher than in the
corresponding period and the revenue return per share was unchanged at 3.3p.
The directors have declared an interim dividend of 2.0p per share, an 11.1%
increase over the preceding year. In the absence of unforeseen circumstances we
intend that the final dividend for the year will be at least maintained at last
year's level of 4.2p per share, making a total of not less than 6.2p for the
full year.


Investment portfolio

Additions to the portfolio in the half year totalled #3.2 million. The
principal new holdings are:

* Nightingales Holdings (#1,737,000) - mail order retailer of women's
clothing, Craven Arms

* Touchstone Asset Management (#970,000) - provider of property management
services, Bath

A further investment of #373,000 was made in AFI Aerial Platforms in April 2006
to finance a small acquisition. Subsequently an offer to acquire AFI was
received from Barclays Private Equity and the investment was sold for a total of
#3,685,000 in cash, an uplift of #760,000 over the carrying value (31 March 2006
valuation plus April 2006 addition at cost). Total income and capital receipts
over the life of the investment were equivalent to almost three times book cost,
representing a compound internal rate of return of over 80% per annum.


Other investment disposals, mainly loan stock repayments, generated proceeds of
#1.4 million. In addition to this, since the end of September the investment in
Submersible Television Surveys has been sold for #850,000 in cash, an uplift of
49% over the March 2006 valuation.


Among the remaining portfolio companies, John Laing Partnership (housebuilder)
and CGI Group (fire and safety glass manufacturer) have continued to report
excellent progress and are now our two largest holdings. By contrast we have
taken the precaution of making full provision against the investment of #901,000
in IRIS Technology (developer of remote data monitoring systems); as is
sometimes the case with early-stage holdings, the company has suffered
frustrating delays in the build-up of sales revenues for its technically
advanced products and we have recognised this for valuation purposes whilst
continuing to support the company's ongoing development.


Board of directors

I am pleased to report that the board has been strengthened through the
appointment of Mark Nicholls, formerly head of private equity at Royal Bank of
Scotland and head of corporate finance at Warburgs, who joined the board on 3
July 2006. We look forward to benefiting from his contribution to the future
development of the company.


Prospects

We have set out a clear medium-term strategy and will continue the process of
implementation. The flow of potential investment opportunities is currently
strong and we expect to complete some substantial new investments during the
second half of the financial year, whilst seeking to capitalise on several
realisation opportunities which our managers are currently working on. We
believe that this approach should deliver good returns to shareholders in the
future.


Peter Haigh

Chairman


The unaudited interim financial statements for the six months ended 30 September
2006 are set out below.


INCOME STATEMENT

(unaudited) for the six months ended 30 September 2006


Six months ended Six months ended
30 September 2006 30 September 2005
Revenue Capital Total Revenue Capital Total
#000 #000 #000 #000 #000 #000
Gain/(loss) on disposal of
investments held at fair value - 1,084 1,084 - 164 164
Unrealised adjustments to fair value
of investments - 425 425 - 380 380
------ ------ ------ ------ ------ ------
- 1,509 1,509 - 544 544
Income 1,179 - 1,179 1,159 - 1,159
Investment management fee (186) (434) (620) (186) (434) (620)
Other expenses (179) - (179) (161) - (161)
------ ------ ------ ------ ------ ------
Return on ordinary activities
before tax 814 1,075 1,889 812 110 922
Tax on ordinary activities (166) 125 (41) (161) 161 -
------ ------ ------ ------ ------ ------
Return on ordinary activities
after tax 648 1,200 1,848 651 271 922
------ ------ ------ ------ ------ ------
Return per share 3.3p 6.1p 9.4p 3.3p 1.4p 4.7p


Year ended 31 March 2006
Revenue Capital Total
#000 #000 #000
Gain/(loss) on disposal of
investments held at fair value - (1,074) (1,074)
Unrealised adjustments to fair value
of investments - 3,871 3,871
------ ------ ------
- 2,797 2,797
Income 2,363 - 2,363
Investment management fee (372) (868) (1,240)
Other expenses (327) - (327)
------ ------ ------
Return on ordinary activities
before tax 1,664 1,929 3,593
Tax on ordinary activities (336) 615 279

------ ------ ------
Return on ordinary activities
after tax 1,328 2,544 3,872
------ ------ ------
Return per share 6.7p 12.9p 19.6p


RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS

(unaudited) for the six months ended 30 September 2006


Six months ended Six months ended Year ended
30 September 2006 30 September 2005 31 March 2006
#000 #000 #000
Equity shareholders' funds
at 1 April 2006 50,417 47,639 47,639
Return on ordinary activities after tax 1,848 922 3,872
Dividends recognised in the period (828) (739) (1,094)
------- ------- -------
Equity shareholders' funds
at 30 September 2006 51,437 47,822 50,417
------- ------- -------


BALANCE SHEET

(unaudited) as at 30 September 2006


30 September 2006 30 September 2005 31 March 2006
#000 #000 #000
Fixed asset investments held
at fair value
Unquoted 38,399 38,399 38,201
Quoted 3,210 5,207 3,833
------- ------- -------
Total fixed asset investments 41,609 43,606 42,034
------- ------- -------
Current assets:
Investments 6,817 1,658 3,737
Debtors 648 302 472
Cash at bank 2,439 2,290 4,241
------- ------- -------
9,904 4,250 8,450
Creditors (amounts falling due
within one year) (76) (34) (67)
------- ------- -------
Net current assets 9,828 4,216 8,383
------- ------- -------

Net assets 51,437 47,822 50,417
------- ------- -------
Capital and reserves
Called-up equity share capital 4,930 4,930 4,930
Share premium 12,694 12,694 12,694
Capital redemption reserve 225 225 225
Capital reserve:
Realised 26,091 24,857 24,542
Unrealised 5,645 3,406 5,994
Revenue reserve 1,852 1,710 2,032
------- ------- -------
Total equity shareholders' funds 51,437 47,822 50,417
------- ------- -------
Net asset value per share 260.8p 242.5p 255.7p


CASH FLOW STATEMENT

(unaudited) for the six months ended 30 September 2006


Six months ended Six months ended Year ended
30 September 2006 30 September 2005 31 March 2006
#000 #000 #000 #000 #000 #000
Cash flow statement
Net cash inflow from
operating activities 172 287 847
Taxation:
Corporation tax paid - - -
Financial investment:
Purchase of investments (3,204) (3,358) (4,327)
Sale/repayment of investments 5,138 3,893 8,687
------ ------ ------
Net cash inflow from
financial investment 1,934 535 4,360
Equity dividends paid (828) (739) (1,094)
------ ------ ------
Net cash inflow before use
of liquid resources and financing 1,278 83 4,113
Net cash inflow/(outflow) from
management of liquid resources (3,080) 948 (1,131)
Net cash inflow from financing - - -
------ ------ ------
Increase/(decrease) in cash at bank (1,802) 1,031 2,982
------ ------ ------
Reconciliation of revenue return
before tax to net cash flow from
operating activities
Revenue return on ordinary activities
before tax 814 812 1,664
(Increase)/decrease in debtors (217) (61) 48
Increase/(decrease) in creditors 9 (30) 3
Management fees charged to capital (434) (434) (868)
------ ------ ------
Net cash inflow from
operating activities 172 287 847
------ ------ ------
Reconciliation of movement
in net funds
1 April 2006 Cash flows 30 September 2006
#000 #000 #000
Short-term investments 3,737 3,080 6,817
Cash at bank 4,241 (1,802) 2,439
------ ------ ------
Net funds 7,978 1,278 9,256
------ ------ ------


INVESTMENT PORTFOLIO SUMMARY

as at 30 September 2006


Company Valuation % of net assets
#000 by valuation
John Laing Partnership 4,076 7.9
CGI Group 2,428 4.7
Longhirst Group 1,834 3.6
Nightingales Holdings 1,737 3.4
DMN 1,720 3.3
IG Doors 1,620 3.2
Envirotec 1,457 2.8
Union Snack 1,294 2.5
Weldex (International) Offshore 1,291 2.5

Alaric Systems 1,175 2.3
------- ------
Ten largest investments 18,632 36.2
Computer Software Group* 1,081 2.1
Arrow Industrial Group 1,080 2.1
Crantock Bakery 1,061 2.1
Pivotal Laboratories Holdings 1,000 1.9
TFB Group 995 1.9
Liquidlogic 994 1.9
Touchstone Asset Management 970 1.9
Submersible Television Surveys 850 1.7
Stainton Metal Company 825 1.6
Abermed Group 800 1.6
------- ------
Twenty largest investments 28,288 55.0
Other investments 13,321 25.9
------- ------
Total fixed asset investments 41,609 80.9
Net current assets 9,828 19.1
------- ------
Net assets 51,437 100.0
------- ------
*Quoted on Alternative Investment Market


The above summary of results for the six months ended 30 September 2006 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.
The figures for the year ended 31 March 2006 have been extracted from the
audited financial statements for that year, which have been delivered to the
Registrar of Companies; the independent auditors' report on those financial
statements under Section 235 of the Companies Act 1985 was unqualified.

The calculation of the revenue and capital return per share is based on the
return on ordinary activities after tax for the period and on 19,720,940
ordinary shares, being the number of shares in issue during the period.

The proposed interim dividend of 2.0p for the year ending 31 March 2007 will be
paid on 5 January 2007 to shareholders on the register at the close of business
on 8 December 2006.

A copy of the interim report is expected to be posted to shareholders on 25
November 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


This information is provided by RNS
The company news service from the London Stock Exchange
END

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