Interim Results

Aurora Investment Trust PLC
18 October 2004


Aurora Investment Trust plc.
Announcement of half-yearly results



CHAIRMAN'S REVIEW

Half Year Results:  NAV 174.81p; - 5.8%


The net asset value fell during the first six months of the current year,
declining by 5.5% from 185.65p to 174.81p per share.  Given that out goal is one
of making money for our shareholders, that cannot be considered a satisfactory
result but it should be pointed out that six months is a very short time period.
Our portfolio, of which more later, is exposed to certain companies whose share
prices did not do well during the period - those involved in technology and
financial services in particular.  We also performed rather less well than our
competitors and than our benchmark, the FT Actuaries All-Share Index, which fell
only 1.3%.  Having said that, I can report that since our half year end we have
had something of a recovery in our fortunes, our net asset value having
recovered to 191.2p per share - leaving us just ahead of our benchmark.

The share price I am afraid did even worse, falling by 10.4% to 154.5p, thereby
creating a larger discount to the net asset value - 11.9% (v 9.3%).  Obviously
during a difficult period for an investment trust company, the demand for its
shares is going to be affected and indeed ours was.  However, as is mentioned
later we remain basically optimistic for the outlook for our portfolio and have
no plans to change the investment strategy we have been pursuing for a number of
years and which has stood us in good stead.


Portfolio Performance: Total Assets: £33.0m; -4.2%

The value of the total assets fell by 4.2% to £33.0 million; our borrowings
stood at £6.6 million, so that shareholders' net assets fell by the 5.8%
(reported above) to £26.4 million.  The UK stock market has essentially marked
time but within that there has been a marked difference in the performance of
different sectors.  The big concern for the UK has been interest rates: how much
further would they rise and what damage would they do to the economy?  Our own
portfolio has been, and indeed remains, geared to the belief that interest rates
would not rise to very high levels during this cycle and that therefore those
companies whose shares are traditionally regarded as interest rate sensitive but
who have good long term growth prospects would not be unduly affected by the
rise in interest rates.  For this first half that proved to be the case for our
investments in the house building sector, which rose in value by 5%. However our
investments in the financial sector, another traditionally interest rate
sensitive sector, fell by 8% and would have been a little worse but for the good
performance of our holdings in two Irish banks. Our Irish investments, a core
part of our investment strategy, performed well.

We had one or two investments in the technology sector that performed poorly. 
The sector as a whole, worldwide, did not do well but perhaps more than any
other sector individual companies have their own story to tell; expectations
tend to be exaggerated one way or the other so that share price performances can
be very volatile.  Such was the case for our investments in, for instance,
Emblaze Systems and Gresham Computing both of whose share prices declined
materially during the period, leading to a markedly lower valuation for both
holdings.  However we remain enthusiastic about the long term prospects of both
companies.

The rest of the portfolio performed reasonably well - backed by the surprisingly
good performance of the house builders, to which I have already referred.


Outlook: uncertain for the stock market; good for our portfolio (we believe!)

Rising interest rates, rising oil prices and an unsettled situation in the
Middle East have created that uncertainty which stock markets don't like. 
Investors are worried about the re-emergence of inflation on the back of higher
energy and money costs and the consequent economic slow down that will result. 
And while we believe there are indeed a number of causes for concern about
inflation, we retain our view that in the longer term we are in a
disinflationary, maybe deflationary, world.  Providing that the major central
banks, those of the USA, the EU, Japan and the UK, do not allow inflation to
take hold in the way that it did in the middle 1970s (when the price of oil
quadrupled and when our economies were more sensitive to a change in the price
of oil than they are now), then rising oil prices are more likely to act as a
tax increase and thence result in a slow down in economic growth.

However we are not so worried about the outlook as to believe that those
companies represented in our portfolios cannot continue to prosper.  Quite to
the contrary, we remain enthusiastic about their prospects; we believe that the
individual valuations of their shares are reasonable enough for us to be able to
make money from them in the medium term, which would allow us to fulfil our goal
of making money for our shareholders.


Alex Hammond-Chambers
Chairman
18 October 2004




CONSOLIDATED STATEMENT OF TOTAL RETURN

                                        6 months to   6 months   6 months      6 months    6 months   6 months
                                        31 Aug.      to 31 Aug. to 31 Aug.     to 31 Aug. to 31 Aug. to 31 Aug.
                                           2004         2004       2004           2003        2003       2003

                                          Revenue     Capital     Total         Revenue    Capital     Total
                                           £'000       £'000      £'000          £'000      £'000      £'000
Gains/(losses) on investments
               Realised                      -           67         67             -         866        866
               Unrealised                    -        (1,629)    (1,629)           -        7,621      7,621

Exchange differences on overdraft            -          (67)       (67)            -         (32)       (32)
Realised gains/(losses) of trading           -           -          -              68         -          68
subsidiary
Unrealised gains/(losses) of trading        (46)         -         (46)           214         -         214
subsidiary

Income                                      417          -         417            554         -         554

Investment management fees                  (73)        (73)      (146)           (58)      (617)      (675)
Other expenses                              (90)         -         (90)           (80)        -         (80)

Return on ordinary activities before
finance costs and taxation                  208       (1,702)    (1,494)          698       7,838      8,536

Interest payable and similar charges -      (72)        (72)      (144)           (38)       (38)       (76)
bank overdraft interest

Return on ordinary activities

Before taxation                             136       (1,774)    (1,638)          660       7,800      8,460

Taxation                                     -           -          -              2          -          2
Return on ordinary activities after
taxation
                                            136       (1,774)    (1,638)          662       7,800      8,462

Dividends                                    -           -          -              -          -          -

Transfers to/from reserves                  136       (1,774)    (1,638)          662       7,800      8,462

Return per ordinary share                   0.9p      (11.74p)   (10.84p)        4.38p      51.63p     56.01p





SUMMARISED CONSOLIDATED BALANCE SHEET
                                                               At 31 August    At 31 August    At 28 February
                                                                   2004            2003             2004
                                                                   £'000           £'000           £'000

Fixed assets - Investments at market value                        32,791          30,147        34,851

Current asset investments                                            143           1,088             -
Other current assets                                                 187             481           906
                                                                     330           1,569           906

Bank loan                                                        (6,578)         (4,397)       (6,406)
Performance fee                                                        -           (559)         (490)
Other current liabilities                                          (134)           (138)         (814)
                                                                 (6,712)         (5,094)       (7,710)

Net current liabilities                                          (6,382)         (3,525)       (6,804)

Total net assets                                                  26,409          26,622        28,047

Share capital                                                      3,777           3,777         3,777
Share premium account                                             10,997          10,997        10,997
Capital reserves                                                  10,835          10,832        12,609
Revenue reserve                                                      800           1,016           664

Equity shareholders funds                                         26,409          26,622        28,047

Net asset value per ordinary share                               174.81p         176.22p       185.65p





CONSOLIDATED CASH FLOW STATEMENT
For the six months ended 31 August 2004
                                                                            2004                 2003
                                                                           £'000                £'000

Net Cash Outflow from Operating Activities                                 (560)                (495)

Servicing of Finance
Interest paid                                                               (85)                (103)

Taxation
Taxation (paid)/recovered                                                    (7)                   36

Financial Investment
Payments to acquire fixed asset investments                              (2,185)              (5,257)
Receipts on disposal of fixed asset investments                            2,432                5,489
Net Cash Inflow from Investing Activities                                    247                  232

Equity Dividends Paid                                                      (431)                (468)

Net Cash Outflow/(inflow) before Financing                                 (836)                (798)

Decrease/(increase) in Cash                                                (836)                (798)




RECONCILIATION OF NET DEBT
                                                                           £'000                £'000

Decrease in cash in the period                                             (836)                (798)

Translation difference                                                      (67)                 (32)
Movement in net debt in the period                                         (903)                (830)
Net debt at 1 March 2004                                                 (5,567)              (3,322)
Net debt at 31 August 2004                                               (6,470)              (4,152)




NOTES

These financial statements are not the Group's statutory accounts for the
purposes of Section 240 of the Companies Act 1985. They are unaudited.

The revenue column of the Statement of Total Return is the consolidated profit
and loss account of the Group, comprising Aurora Investment Trust plc and AIT
Trading Limited.

All revenue and capital items in the above statement derive from continuing
operations.  No operations were acquired or discontinued in the period.

Returns per share and net assets per share are based on 15,107,250 shares in
issue throughout the period and at the Balance Sheet date (2003: 15,107,250
shares)

Income is derived entirely from investments, with the exception of bank interest
of £2,639 (2003: £5,391).

In accordance with the stated policy of the Group, the directors do not
recommend an interim dividend.  The final dividend in respect of the year ending
on 28 February 2005 is expected to be paid in July 2005.

This interim report is being sent to shareholders and copies will be made
available to the public at the registered office of the Group.


SECRETARY & REGISTERED OFFICE
Cavendish Administration Limited
Crusader House
145-157 St John Street
London EC1V 4RU


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