REG-Unaudited half-yearly financial report for the six months ended 30 September 2025
20/11/2025 15:15
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20 November 2025
Northern 3 VCT PLC
Half-yearly financial report for the six months ended 30 September 2025
Northern 3 VCT PLC is a Venture Capital Trust (VCT) managed by Mercia Fund
Management Limited. It invests mainly in unquoted venture capital holdings and
aims to provide long-term tax-free returns to shareholders through a
combination of dividend yield and capital growth.
Financial highlights:
Unaudited six months ended 30 September 2025 Unaudited six months ended 30 September 2024 Audited year ended 31 March 2025
Net assets £131.8m £129.7m £130.1m
Net asset value per share 89.2p 88.5p 90.0p
Return per share
Revenue 0.2p 0.4p 0.7p
Capital 1.4p 0.9p 4.1p
Total 1.6p 1.6p 4.8p
Dividend declared in respect of the period 2.0p 2.0p 4.5p
Cumulative return to shareholders since launch
Net asset value per share 89.2p 88.5p 90.0p
Dividends paid per share* 124.6p 120.1p 122.1p
Net asset value plus dividends paid per share 213.8p 208.6p 212.1p
Mid-market share price at end of period 84.0p 85.0p 84.0p
Share price discount to net asset value 5.8% 4.0% 6.7%
Tax-free dividend yield (based on the net asset value per share)** 5.1% 4.7% 5.0%
* Excluding interim dividend not yet paid.
** The dividend yield is calculated by dividing the dividends
declared in the 12 month period ended on each reference date by the net asset
value per share at the start of that period.
Chairman’s statement
Over the past six months, the UK economy has lagged behind international
peers, with sluggish growth and stubbornly high inflation. Speculation on the
upcoming UK government budget, global political tensions and trade wars
continue to influence market sentiment. Your Company has maintained its
long-term strategy of investing in promising early-stage businesses,
supporting its existing portfolio companies, and generating cash from
realisations where circumstances permit.
Venture capital investment activity and portfolio update
We are pleased to report an overall increase in the holding value of the
unquoted portfolio, with strong performances from a number of portfolio
companies increasing valuations by more than reductions in the valuations of
companies that have performed less well.
During the period, we made a new investment of £2.3 million in Thanks Ben, an
employee benefits orchestration platform. We have also invested £3.1 million
in ten existing portfolio companies. Since 30 September, £4.2 million has
been invested into seven companies, including a new investment into Space and
Time Limited (t/a Tesseract). Partial realisations were made in Buoyant
Upholstery, Fresh Approach, and Project Glow (trading as The Beauty Tech
Group) at our holding value, and in Angle plc, a listed investment, at a price
marginally below the 31 March 2025 holding value.
One further realisation has also completed, with Thanksbox Limited (t/a Mo)
returning £0.8 million, a £0.5 million uplift on June’s holding value.
Shortly after the end of the period, portfolio company Project Glow (trading
as The Beauty Tech Group) completed its IPO on the London Stock Exchange. This
was picked up by the press as an encouraging sign of activity returning to the
stock market, and is a really positive step for the company, which the
Northern VCTs have supported since 2018. As part of the transaction, we
realised 30% of our holding, generating proceeds of £2.3 million which was a
return of 5.8 times our original investment cost.
The £8.9 million portfolio of listed securities managed by RBC Brewin Dolphin
was liquidated and the funds were moved into a money market fund.
Results and dividend
The unaudited net asset value (NAV) per share at 30 September 2025 was 89.2
pence (90.0 pence (audited) on 31 March 2025). The total return per share
before dividends for the six months ended 30 September 2025 as shown in the
income statement was 1.6 pence, compared with 1.3 pence in the corresponding
period last year. The performance produced an unrealised increase of £2.7
million in the valuation of the investments.
It remains our objective to pay a dividend at least equivalent to 4.5% of the
opening NAV in each year. The Board has declared an interim dividend for the
year ending 31 March 2026 of 2.0 pence per share, which will be paid on 21
January 2026 to shareholders who are on the register on 19 December 2025
We continue to operate our dividend investment scheme, which enables
shareholders to invest their dividends in new ordinary shares free of dealing
costs and with the benefit of the tax reliefs available on new VCT share
subscriptions. We have included details of the scheme within the dividend
section of our website, which can be found at: www.mercia.co.uk/vcts/n3vct/.
Shareholder matters
As a result of the fully subscribed public share offer launched in January
2025, 6,596,320 shares were issued for gross proceeds of £6.0 million.
We continue to observe a sustained demand for long-term growth capital for
smaller companies in the UK. In order to continue to support our existing
portfolio and invest in new early-stage opportunities, we are currently
fundraising in conjunction with the other Northern VCTs. Full details of how
to participate in this are available on the Company’s website at
www.mercia.co.uk/vcts.
We have maintained our policy of being willing to buy back the Company’s
shares in the market to maintain liquidity, at a 5% discount to NAV. During
the period a total of 3,845,712 shares were purchased by the Company for
cancellation, representing 2.7% of the opening ordinary share capital.
VCT legislation and qualifying status
The Company has continued to meet the stringent and complex qualifying
conditions laid down by HM Revenue & Customs for maintaining its approval as a
VCT. The Investment Manager monitors the position closely and reports
regularly to the Board. Philip Hare & Associates LLP has continued to act as
independent adviser to the Company on VCT taxation matters.
Outlook
The portfolio continues to demonstrate resilience and growth potential. We
remain confident in the strength and quality of the portfolio, many of which
are well positioned to benefit from long-term structural trends. We will
continue to invest selectively through the cycle, supporting high-growth
businesses with strong fundamentals, while also seeking to deliver timely
realisations where opportunities arise. With a diversified portfolio and a
clear strategy for growth, we believe the Company is well placed to create
shareholder value in the years ahead.
On behalf of the Board
James Ferguson
Chairman
Statement of the Directors’ responsibilities
Responsibility statement
In accordance with Disclosure and Transparency Rule (DTR) 4.2.10, James
Ferguson (Chairman), Chris Fleetwood (Chair of the Audit Committee), Anna
Brown, Tim Levett, David Ovens and John Waddell, being the Directors of the
Company, confirm that to the best of their knowledge:
(a) The condensed set of financial statements, which has been prepared in
accordance with Financial Reporting Standard 104 “Interim Financial
Reporting” gives a true and fair view of the assets, liabilities, financial
position and profit of the Company as required by DTR 4.2.10;
(b) the half-yearly management report includes a fair review of the
information required by DTR 4.2.7, being an indication of important events
that have occurred during the first six months of the financial year and their
impact on the condensed set of financial statements;
(c) a description of the principal risks and uncertainties facing the Company
for the remaining six months of the financial year are set out under the
summary of principal risks and uncertainties below, in accordance with DTR
4.2.7; and
(d) there were no related party transactions in the first six months of the
current financial year that are required to be disclosed, in accordance with
DTR 4.2.8.
Principal risks and uncertainties
In accordance with DTR 4.2.7, the Board confirms that the principal risks and
uncertainties facing the Company have not materially changed from those
identified in the Annual Report and Financial Statements for the year ended 31
March 2025 (“the Annual Report”). The Board considers that the present
processes for mitigating those risks remain appropriate. Following the
admission of the Company’s largest investment on the London Stock Exchange
in October 2025, the Board has included stock market risk as an additional
principal risk to those included in the Annual Report. Stock market risk is
the risk of adverse price movements on the Company’s listed portfolio
holdings as a result of macroeconomic or other factors resulting in the
decline of the overall market.
The principal risks faced by the Company are:
* Availability of qualifying investments risk
* Credit risk
* Economic and geopolitical risk
* Financial risk
* Investment and liquidity risk
* Legislative and regulatory risk
* Operational risk
* Performance of the Investment Manager risk
* Stock market risk
* VCT qualifying status risk
A detailed explanation of the principal risks facing the Company can be found
in the Annual Report and Financial Statements for the year ended 31 March 2025
on pages 19 to 20, as well as in Note 18 on Financial Instruments on pages 65
to 68 of that report. Copies can be viewed or downloaded from the Company’s
website: www.mercia.co.uk/vcts.
Environmental, Social and Governance considerations
The Company is committed to conducting its affairs responsibly and considers
environmental, social and governance (ESG) issues as part of its operations.
More details of the Company’s considerations can be found in the Responsible
Investment section in the Annual Report and Financial Statements for the year
ended 31 March 2025 on pages 31 to 32.
Going concern
The Board has assessed the Company’s operation as a going concern. The
Company’s business activities, together with the factors likely to affect
its future development, performance and position are set out earlier in the
half-yearly management report. The Directors have satisfied themselves that
the Company’s cash position is adequate to enable the Company to continue as
a going concern under downside scenarios. The portfolio remains well funded
and the Manager’s investment team are ensuring that management teams
undertake adequate cost control and cashflow planning. The major cash outflows
of the Company (namely investments, share buy-backs and dividends) are within
the Company’s control. The Board’s assessment of liquidity risk and
details of the Company’s policies for managing its capital and financial
risks are shown in Note 18 of the Annual Report and Financial Statements for
the year ended 31 March 2025 on pages 65 to 68. Accordingly, the Directors
continue to adopt the going concern basis of accounting in preparing the
half-yearly report and financial statements.
Cautionary statement
This report may contain forward looking statements with regard to the
financial condition and results of the Company, which are made in the light of
current economic and business circumstances. Nothing in this report should be
construed as a profit forecast.
For and on behalf of the Board:
James Ferguson
Chairman
20 November 2025
Investment portfolio
As at 30 September 2025 (unaudited)
Description Cost £000 Valuation £000 % of net assets by value
Fifteen largest venture capital investments
Project Glow Topco (t/a The Beauty Tech Group) Online marketplace for home-use beauty products 1,301 7,363 5.6
Pure Pet Food Production of organic pet food 1,512 6,237 4.7
Pimberly Product information management software 1,910 3,342 2.5
Rockar E-commerce and fulfilment platform for new car sales 1,660 3,095 2.3
Tutora (t/a Tutorful) Website to help parents and students find private tutors 2,973 2,973 2.3
Risk Ledger Cyber security focused on supply chain risk 1,556 2,713 2.1
Semble Practice management software for healthcare clinicians/clinics 2,126 2,651 2.0
Netacea AI-powered cyber security consultancy 2,577 2,577 2.0
Forensic Analytics Call data communications analytics software 2,519 2,519 1.9
Broker Insights Platform connecting insurers and brokers 2,366 2,488 1.9
Send Technology Solutions Platform for insurers, reinsurers, and managing general agents 2,098 2,459 1.9
IDOX* Document content software 530 2,378 1.8
Ridge Pharma Sale of pharmaceuticals (branded, generics, specials) 1,345 2,302 1.7
Thanks Ben Employee benefits orchestration platform 2,293 2,293 1.7
Turbine Simulated Cell Technologies Simulation of cell reaction to treatment of complex disease 2,005 2,250 1.7
Fifteen largest venture capital investments 28,771 47,640 36.1
Other venture capital investments 60,979 51,181 38.9
Total venture capital investments 89,750 98,821 75.0
Net current assets 32,956 25.0
Net assets 131,777 100.0
Extracts from the unaudited half-yearly financial statements for the six
months ended 30 September 2025 are set out below:
Condensed income statement
For the six months ended 30 September 2025
Unaudited six months ended Unaudited six months ended Audited year ended
30 September 2025 30 September 2024 31 March 2025
Revenue Capital Total Revenue Capital Total Revenue Capital Total
Notes £000 £000 £000 £000 £000 £000 £000 £000 £000
Gain on disposal of investments - 294 294 - 1,065 1,065 - 2,902 2,902
Movements in fair value of investments - 2,703 2,703 - 1,063 1,063 - 4,299 4,299
- 2,997 2,997 - 2,128 2,128 - 7,201 7,201
Dividend and interest income 3 993 - 993 1,227 - 1,227 2,692 - 2,692
Investment management fee 4 (313) (937) (1,250) (284) (852) (1,136) (582) (1,810) (2,392)
Other expenses (287) - (287) (284) - (284) (545) - (545)
Return before tax 393 2,060 2,453 659 1,276 1,935 1,565 5,391 6,956
Tax on return (35) 35 - (111) 111 - (585) 585 -
Return after tax 6 358 2,095 2,453 548 1,387 1,935 980 5,976 6,956
Return per share 0.2p 1.4p 1.6p 0.4p 0.9p 1.3p 0.7p 4.1p 4.8p
Condensed balance sheet
As at 30 September 2025
Unaudited 30 September 2025 Unaudited 30 September 2024 Audited 31 March 2025
Notes £000 £000 £000
Fixed assets
Investments 98,821 94,812 103,231
Current assets
Debtors 124 613 2,295
Cash and cash equivalents 33,013 34,394 24,862
33,137 35,007 27,157
Creditors (amounts falling due within one year) (181) (163) (279)
Net current assets 32,956 34,844 26,878
Net assets 131,777 129,656 130,109
Capital and reserves
Called-up equity share capital 7,387 7,323 7,226
Share premium 68,128 61,979 62,268
Capital redemption reserve 1,384 1,076 1,192
Capital reserve 44,644 55,868 50,538
Revaluation reserve 9,070 2,152 7,632
Revenue reserve 1,164 1,258 1,253
Total equity shareholders' funds 131,777 129,656 130,109
Net asset value per share 7 89.2p 88.5p 90.0
Condensed statement of changes in equity
Non-distributable reserves Distributable reserves
Called up share capital Share premium Capital redemption reserve Revaluation reserve Capital reserve Revenue reserve Total
£000 £000 £000 £000 £000 £000 £000
Six months ended 30 September 2025 (unaudited)
At 1 April 2025 7,226 62,268 1,192 7,632 50,538 1,253 130,109
Return after tax - - - 1,438 657 358 2,453
Dividends paid - - - - (3,276) (447) (3,723)
Net proceeds of share issues 353 5,860 - - - - 6,213
Shares purchased for cancellation (192) - 192 - (3,275) - (3,275)
At 30 September 2025 7,387 68,128 1,384 9,070 44,644 1,164 131,777
Six months ended 30 September 2024 (unaudited)
At 1 April 2024 6,858 51,738 934 2,674 58,846 1,446 122,496
Return after tax - - - (522) 1,909 548 1,935
Dividends paid - - - - (2,502) (736) (3,238)
Net proceeds of share issues 607 10,241 - - - - 10,848
Shares purchased for cancellation (142) - 142 - (2,385) - (2,385)
At 30 September 2024 7,323 61,979 1,076 2,152 55,868 1,258 129,656
Year ended 31 March 2025
At 1 April 2024 6,858 51,738 934 2,674 58,846 1,446 122,496
Return after tax - - - 4,958 1,018 980 6,956
Dividends paid - - - - (4,980) (1,173) (6,153)
Net proceeds of share issues 626 10,530 - - - - 11,156
Shares purchased for cancellation (258) - 258 - (4,346) - (4,346)
At 31 March 2025 7,226 62,268 1,192 7,632 50,538 1,253 130,109
Condensed statement of cash flows
For the six months ended 30 September 2025
Unaudited six months ended Unaudited six months ended Audited year ended
30 September 2025 30 September 2024 31 March 2025
£000 £000 £000
Cash flows from operating activities
Return before tax 2,453 1,935 6,956
Adjustments for:
(Gain)/loss on disposal of investments (294) (1,065) (2,902)
Movements in fair value of investments (2,703) (1,063) (4,299)
(Increase)/decrease in debtors 2,171 314 82
(Decrease)/increase in creditors (98) 5 121
Net cash inflow/(outflow) from operating activities 1,529 126 (42)
Cash flows from investing activities
Purchase of investments (5,638) (6,476) (16,126)
Sale/repayment of investments 13,045 4,793 9,647
Net cash inflow/(outflow) from investing activities 7,407 (1,683) (6,479)
Cash flows from financing activities
Issue of ordinary shares 6,396 11,323 11,653
Share issue expenses (183) (475) (497)
Purchase of ordinary shares for cancellation (3,275) (2,385) (4,346)
Equity dividends paid (3,723) (3,238) (6,153)
Net cash inflow/(outflow) from financing activities (785) 5,225 657
Net increase/(decrease) in cash and cash equivalents 8,151 3,668 (5,864)
Cash and cash equivalents at beginning of period 24,862 30,726 30,726
Cash and cash equivalents at end of period 33,013 34,394 24,862
Other matters
The unaudited financial statements are prepared in accordance with accounting
policies consistent with Financial Reporting Standard 102 (“FRS102”),
Financial Reporting Standard 104 (“FRS104”) - Interim Financial Reporting,
with the Companies Act 2006 and the 2014 Statement of Recommended practice,
‘Financial Statements of Investment Trust Companies and Venture Capital
Trusts’ (“the SORP”) (updated in July 2022) issued by the Association of
Investment Companies (“AIC”). The condensed financial statements comply
with FRS 104, applying the recognition and measurement principles of FRS 102.
The financial statements have been prepared on a going concern basis.
The preparation of the financial statements requires management to make
judgements and estimates that affect the application of policies and reported
amounts of assets, liabilities, income and expenses. The most critical
estimates and judgements relate to the determination of carrying value of
investments at fair value through profit and loss (“FVTPL”) in accordance
with FRS 102 sections 11 and 12. The Company values investments by following
the International Private Equity and Venture Capital Valuation (“IPEV”)
Guidelines as updated in 2022.
The accounting policies have been applied consistently throughout the period.
Full details of principal accounting policies are disclosed in Note 1 on page
57 of the Annual Report and Financial Statements for the year ended 31 March
2025. The significant accounting estimates and judgements applied are
consistent with those disclosed in the Annual Report for the year ended 31
March 2025.
The interim dividend of 2.0 pence per share for the year ending 31 March 2026
will be paid on 21 January 2026 to shareholders on the register on 19 December
2025.
The calculation of the return per share is based on the return after tax for
the six months ended 30 September 2025 and on 149,765,566 (30 September 2024:
147,760,918) ordinary shares, being the weighted average number of shares in
issue during the period.
The calculation of net asset value per share is based on the net assets at 30
September 2025 divided by the 147,737,417 (30 September 2024: 146,458,027)
ordinary shares in issue at that date.
The half-yearly financial report is being sent to shareholders and copies will
be made available to the public at the registered office of the Company,
Companies House, the National Storage Mechanism and also electronically at
www.mercia.co.uk/vcts.
The contents of the Mercia Asset Management PLC website and the contents of
any website accesible from hyperlinks on the Mercia Asset Management PLC
website (or any other website) are not incorporated into, nor form part of,
this announcement. Recent news on Northern 3 VCT
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