15 FEBRUARY 2017
NORTHERN INVESTORS COMPANY PLC
UNAUDITED NET ASSET VALUE AS AT 31 DECEMBER 2016
Northern Investors Company PLC ("the Company") is a private equity investment trust managed by NVM Private Equity LLP. The Company was launched in 1984 and has been listed on the London Stock Exchange since 1990. In July 2011 shareholders approved a change in investment strategy whereby the Company ceased making new investments and began an orderly realisation of its portfolio with a view to returning capital to shareholders. The Company has subsequently returned a total of £83.5 million to shareholders by way of tender offers, redemption of B shares and dividend distributions.
Net asset value
The unaudited net asset value per ordinary share as at 31 December 2016 was 735.2 pence (30 September 2016 (unaudited) 728.6 pence). The net asset value at 31 December 2016 is stated before taking account of the return of 250 pence per share to shareholders during January 2017 through the allotment and redemption of B shares as described below. Had the redemption of B shares taken place as at 31 December 2016, then the pro forma unaudited net asset value per ordinary share as at that date, adjusting only for the return of capital but ignoring the associated B share dividend and related costs, would have been 485.2 pence per ordinary share.
The number of ordinary shares in issue at 31 December 2016 was 2,496,767 (30 September 2016 2,496,767).
For the purposes of calculating the net asset value per share, unquoted investments are carried at fair value as at 31 December 2016 as determined by the directors.
Net assets at 31 December 2016 comprised the following:
| % of | ||
| £000 | net assets | |
| Unquoted investments at fair value as determined | ||
| by the directors | 13,482 | 73.4 |
| Net current assets/(liabilities): | ||
| Cash and near-cash balances | 7,387 | 40.2 |
| Provision for performance-related management fee | (2,411) | (13.1) |
| Other debtors less creditors | (101) | (0.5) |
| ---------- | -------- | |
| Net assets | 18,357 | 100.0 |
| ---------- | -------- |
Investment portfolio
During the quarter ended 31 December 2016 the company sold its investment in Crantock Bakery for cash proceeds of £171,000. The original cost of the investment was £215,000 and the directors' valuation as at 30 September 2016 was nil.
Contingent assets
At 31 December 2016 there was a contingent asset of £1,015,000 not recognised in the company's financial statements in respect of potential deferred proceeds from sales of investee companies which occurred prior to that date. The extent to which these proceeds will be received in due course is dependent on future events.
In 2013 the company brought a claim against HM Revenue & Customs to recover VAT paid on investment management fees in the period from 1990 to 2009, to the extent that the amounts overpaid had not been previously recovered by the company, together with compound interest. The claim arises from a decision by the European Court of Justice that the UK Government had breached EC law by levying VAT on the provision of investment management services to investment trust companies in the relevant period. The company's claim has, by agreement with HMRC, been stayed pending the outcome of similar litigation involving other investment trust companies which is currently in progress. The directors consider that the outcome of the claim, and if successful the timing and quantum of any recovery by the company, cannot be foreseen with any certainty at this stage. The lead litigation was heard in the Supreme Court in May 2016 and the Court's judgement has not yet been handed down.
Allotment and redemption of B shares
During January 2017 the company returned £6.2 million to shareholders through a bonus issue and redemption of B preference shares of 50 pence ("B shares"). 12,483,825 B shares were allotted to ordinary shareholders on 20 January 2017 pro rata to their holdings of ordinary shares, and were redeemed on 24 January 2017 in accordance with their terms at a price of 50 pence per B share, equivalent to a return of capital of 250 pence per ordinary share. The redemption proceeds were paid to shareholders on 31 January 2017.
Enquiries:
Northern Investors Company PLC
Nigel Guy/Christopher Mellor 0191 244 6000
Stifel Nicolaus Europe
Neil Winward/Mark Bloomfield/Gaudi le Roux 020 7710 7600
Website: www.nvm.co.uk
Neither the contents of the NVM Private Equity LLP website nor the contents of any website accessible from hyperlinks on the NVM Private Equity LLP website (or any other website) is incorporated into, or forms part of, this announcement.