Interim Management Statement

RNS Number : 6250U

Northamber PLC

16 May 2008

16/05/08

Northamber plc

Interim Management Statement - 3rd Quarter to 31st March 2008

As reported in the 29th February 2008 release of our Interim Accounts to the end of December 2007, the slight improvement in trading for the first half year continued into the third quarter of our financial year.

Compared with the same period last year, gross margins continue to be under pressure as a result of continued price deflation, but were again offset by reductions in operating costs. In these financially challenged and testing times, we will continue to focus our considerable resources on contribution rather than the volume of sales.

The inherent value of cash is increasingly becoming the predominant comparative in this sector, as a result of the levels of trading risk and unrewarding revenue opportunities.

The Board believes marked improvements in margins will only be seen if vendors in this sector and our peer group deal coherently with the continued worsening of adequate returns on capital.

Since the end of our third quarter, increasingly difficult general market conditions clearly indicate why the market in our own sector is also deteriorating. To the extent that this is a result of the generally accepted impact of the 'credit crunch', the likely effect on trading is difficult to quantify. Our continued vigilance on monitoring all aspects of our business is our best defence against becoming unduly affected by adverse changing circumstances.

With the attention paid to working capital management and the constant appraisal of stock and debtors controls, our goal remains taking advantage of opportunities as they arise. The Board believes we shall continue to perform relatively reasonably, though it is difficult to be other than somewhat pessimistic in the near term.

However our balance sheet remains strong, with £11 million of cash prior to the recent capital reorganisation and £2.9 million returned to shareholders following the sale of the Arbroath investment property. We remain well placed to weather any short term macro economic storm, and we remain robust and risk averse within our market place.