**UNITED STATESSECURITIES AND EXCHANGE COMMISSION**

**Washington,D.C. 20549**

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**Form 10-Q**

**(Mark One)**

**x**                                 Quarterly report pursuant to Section 13 or 15(d) of theSecurities Exchange Act of 1934

**For thequarterly period ended June 30, 2006**

**o**                                   Transition report pursuant to Section 13 or 15(d) of theSecurities Exchange Act of 1934

**For thetransition periodfrom             to**

**Commission FileNumber: 000-19889**

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**South Hertfordshire United Kingdom Fund, Ltd.**

*Exact name of registrant as specified in charter*

| **Colorado**            | **84-1145140**          |
|-------------------------|-------------------------|
| *State of organization* | *I.R.S. employer I.D.#* |

 

**ntl House, Bartley Wood Business Park, Hook, Hampshire, RG27 9UP,England**

*Address of principalexecutive office*

**011 44 1256 752000**

*Registrant’s telephonenumber*

Indicate bycheck mark whether the registrant (1) has filed all reports required to befiled by Section 13 or 15(d) of the Securities Exchange Act of 1934during the preceding 12 months (or for such shorter period that the registrantwas required to file such reports), and (2) has been subject to suchfiling requirements for the past 90 days. Yes x  No o

Indicate bycheck mark whether the registrant is a large accelerated filer, an acceleratedfiler, or anon-accelerated filer. See definition of “accelerated filer and largeaccelerated filer’’ in Rule 12b-2 of the Exchange Act. (Check one):

Largeaccelerated filer o                     Acceleratedfiler o                     Non-acceleratedfiler x

Indicate bycheck mark whether the registrant is a shell company (as defined in Rule 12b-2of the Act). Yes o  No x

The number oflimited partnership units of the registrant outstanding as of August 1,2006 was 56,935.

 

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**TABLE OF CONTENTS**

|              | ** ** | ** **             | **Page  Number**                                                                                                     |
|--------------|------------|------------------------|----------------------------------------------------------------------------------------------------------------------|
| PART I  |       | FINANCIAL  INFORMATION | ** **                                                                                                           |
|         |       | Item 1.                | Financial Statements                                                                                                 |   |
|         |       |                   | Condensed Consolidated Balance Sheets as of  June 30, 2006 and December 31, 2005                           | 6 |
|         |       |                   | Condensed Consolidated Statements of Operations  for the Three and Six Months Ended June 30, 2006 and 2005 | 7 |
|         |       |                   | Condensed Consolidated Statements of Cash Flows  for the Six Months Ended June 30, 2006 and 2005                | 8 |
|         |       |                   | Notes  to Condensed Consolidated Financial Statements                                                                | 9-12 |
|         |       | Item 2.                | Management’s  Discussion and Analysis of Financial Condition and Results of Operations                          | 13-19 |
|         |       | Item 3.                | Quantitative  and Qualitative Disclosures About Market Risk                                                          | 20 |
|         |       | Item 4.                | Controls and  Procedures                                                                                             | 20 |
| PART II |       | OTHER INFORMATION      |                                                                                                                 |
|         |       | Item 5.                | Other Information                                                                                                    | 21 |
|         |       | Item 6.                | Exhibits                                                                                                             | 21 |
|         |       | SIGNATURES             | 22                                                                                                                   |

 

 

3

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**“Safe Harbor” Statement under the Private Securities Litigation ReformAct of 1995:**

Various statements contained in this document constitute “forward-lookingstatements” as that term is defined under the Private Securities LitigationReform Act of 1995. Words like “believe,” “anticipate,” “should,” “intend,” “plan,”“will,” “expects,” “estimates,” “projects,” “positioned,” “strategy,” andsimilar expressions identify these forward-looking statements, which involveknown and unknown risks, uncertainties and other factors that may cause ouractual results, performance or achievements or industry results to bematerially different from those contemplated, projected, forecasted, estimatedor budgeted, whether expressed or implied, by these forward-looking statements.These factors include:

·       NTL’s abilityto obtain and retain expected synergies from the merger of the legacy NTL andTelewest businesses and the acquisition of Virgin Mobile;

·       rates ofsuccess in executing, managing and integrating key acquisitions, including themerger with Telewest and the acquisition of Virgin Mobile;

·       NTL’sability to achieve business plans for the combined company;

·       NTL’sability to manage and maintain key customer relationships;

·       NTL’sability to fund debt service obligations through operating cash flow;

·       NTL’sability to obtain additional financing in the future and react to competitiveand technological changes;

·       NTL’sability to comply with restrictive covenants in NTL’s indebtedness agreements;

·       NTL’sability to control customer churn;

·       NTL’sability to compete with a range of other communications and content providers;

·       the effectof technological changes on NTL’s businesses;

·       thefunctionality or market acceptance of new products that NTL may introduce;

·       possiblelosses in revenues due to systems failures;

·       NTL’sability to maintain and upgrade its networks in a cost-effective and timelymanner;

·       NTL’sreliance on single-source suppliers for some equipment and software;

·       NTL’sability to provide attractive programming at a reasonable cost; and

·       the extentto which NTL’s future earnings will be sufficient to cover its fixed charges.

These and other factors are discussed inmore detail under “Risk Factors” and elsewhere in the Form 10-K ofNTL Holdings Inc. (then known as NTL Incorporated) that was filed with the SECon March 1, 2006. We assume no obligation to update the forward-lookingstatements to reflect actual results, changes in assumptions or changes infactors affecting these statements.

**Note Concerning NTL’s Reverse Acquisition of Telewest**

On March 3,2006, NTL Holdings Inc. (formerly known as NTL Incorporated) (“legacy NTL”)merged with a subsidiary of NTL Incorporated (formerly known as Telewest Global, Inc.)(“NTL”).

4

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**Exchange Rates**

The following table sets forth, for the periodsindicated, the high, low, period average and period end noon buying rate in theCity of New York for cable transfers as certified for customs purposes by theFederal Reserve Bank of New York expressed as U.S. dollars per £1.00. The noonbuying rate of the pound sterling on June 30, 2006 was $1.8491 per £1.00. 

| ** **                                       | ** ** | **U.S. Dollars per £1.00** | ** ** |
|--------------------------------------------------|------------|------------------------------------------------|------------|
| **Six months ended June 30** | ** ** | **Period End**                            | ** ** | **Average(1)** | ** ** | **High** | ** ** | **Low** | ** ** |
| 2005                                             |       |                                           | 1.79       |   |   |   | 1.87 |   |   | 1.84 |   | 1.79 |   |
| 2006                                             |       |                                           | 1.85       |   |   |   | 1.80 |   |   | 1.89 |   | 1.73 |   |

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(1)          Theaverage rate is the average of the noon buying rates on the last day of eachmonth during the relevant period.

The above ratesmay differ from the actual rates used in the preparation of the condensedconsolidated financial statements and other financial information appearing inthis quarterly report. Our inclusion of these exchange rates is not meant tosuggest that the pound sterling amounts actually represent these U.S. dollaramounts or that these amounts could have been converted into U.S. dollars atany particular rate, if at all.

Unless weotherwise indicate, all U.S. dollar amounts as of June 30, 2006 aretranslated to U.S. dollars at an exchange rate of $1.8491 to £1.00, all amountsdisclosed for the six months ended June 30, 2006 are based on an averageexchange rate of $1.7902 to £1.00, and all amounts disclosed for the six monthsended June 30, 2005 are based on an average exchange rate of $1.8737 to£1.00. All amounts disclosed as of December 31, 2005 are based on anexchange rate of $1.7188 to £1.00. All rates are based on the noon buying ratein the City of New York for cable transfers as certified for customs purposesby the Federal Reserve Bank of New York. U.S. dollar amounts for the threemonths ended June 30, 2006 and 2005 are determined by subtracting the U.S.dollar converted financial result for the three months ended March 31,2006 and 2005 from the U.S. dollar converted financial result for the sixmonths ended June 30, 2006 and 2005, respectively. The variation betweenthe 2006 and 2005 exchange rates has impacted the dollar comparisons.

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**SOUTH HERTFORDSHIREUNITED KINGDOM FUND, LIMITED(A LIMITED PARTNERSHIP)**

**Part I. Financialinformation**

**Item 1.**                        Financial statements

**CONDENSED CONSOLIDATED BALANCE SHEETS**
| ** **                                                                                             | ** ** | **June 30,  2006** | ** ** | **December 31,  2005** | ** ** |
|--------------------------------------------------------------------------------------------------------|------------|-------------------------|------------|-----------------------------|------------|
| ** **                                                                                             | ** ** | **(unaudited)**         | ** ** | **(see note)**         | ** ** |
| **Assets**                                                                                             |       |                    |       |                        |       |
| Fixed  assets, net                                                                                     |       | $                       | 65,225,002 |                        | $          | 63,195,826 |   |
| **Total assets**                                                                                       |       | $                       | 65,225,002 |                        | $          | 63,195,826 |   |
| **Liabilities and Partners’ Deficit**                                                             |       |                    |       |                        |       |
| Current  liabilities                                                                                   |       |                    |       |                        |       |
| Accounts payable to affiliates and related parties                                                     |       | $                       | 67,916,035 |                        | $          | 64,324,939 |   |
| Total  liabilities                                                                                     |       | 67,916,035              |       | 64,324,939                  |       |
| **Minority interest**                                                                                  |       |                    |       |                        |       |
| Minority  interest                                                                                     |       | 284,830                 |       | 707,259                     |       |
| **Partners’ Capital (Deficit)**                                                                   |       |                    |       |                        |       |
| General  Partner                                                                                       |       |                    |       |                        |       |
| Contributed capital                                                                                    |       | 1,000                   |       | 1,000                       |       |
| Accumulated deficit                                                                                    |       | (514,747                | )          | (502,583                    | )          |
|                                                                                                   |       | (513,747                | )          | (501,583                    | )          |
| Limited  Partners                                                                                      |       |                    |       |                        |       |
| Contributed  capital, net (56,935 units outstanding at June 30, 2006 and  December 31, 2005) |       | 48,817,997              |       | 48,817,997                  | )          |
| Accumulated deficit                                                                                    |       | (50,678,832             | )          | (49,474,599                 |
|                                                                                                   |       | (1,860,835              | )          | (656,602                    | )          |
| Accumulated  comprehensive loss                                                                        |       | (601,281                | )          | (678,187                    | )          |
| Total Partners’ deficit                                                                           |       | (2,975,863              | )          | (1,836,372                  | )          |
| **Total Liabilities and Partners’ Deficit**                                                       |       | $                       | 65,225,002 |                        | $          | 63,195,826 |   |

 

Note: The balance sheet at December 31,2005 has been derived from audited financial statements at that date.

See accompanying notes.

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**SOUTH HERTFORDSHIRE UNITED KINGDOM FUND,LIMITED(A LIMITED PARTNERSHIP)**

**CONDENSEDCONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)**

| ** **                                                             | ** ** | **Three months ended  June 30,** | ** ** | **Six months ended  June 30,** | ** ** |
|------------------------------------------------------------------------|------------|-------------------------------------------------|------------|-----------------------------------------------|------------|
| ** **                                                             | ** ** | **2006**                                        | ** ** | **2005**                                      | ** ** | **2006** | ** ** | **2005** | ** ** |
| **Revenues**                                                           |       | $                                               | 9,664,617  |                                          | $          | 9,974,629 |   | $ | 18,835,580 |   | $ | 20,221,924 |   |
| **Costs and expenses**                                                 |       |                                            |       |                                          |       |   |   |   |   |
| Cost  of goods sold (exclusive of depreciation shown separately below) |       | (2,516,703                                      | )          | (2,732,285                                    | )          | (4,974,289 | ) | (5,523,699 | ) |
| Selling,  general and administrative expenses                          |       | (25,015                                         | )          | (23,610                                       | )          | (45,630 | ) | (45,004 | ) |
| Management  fees and allocated overhead from the General Partner       |       | (4,482,599                                      | )          | (4,763,382                                    | )          | (8,505,595 | ) | (8,832,414 | ) |
| Other  charges                                                         |       | (240,430                                        | )          | (20,030                                       | )          | (398,137 | ) | (29,786 | ) |
| Depreciation                                                           |       | (1,770,911                                      | )          | (1,440,961                                    | )          | (3,490,886 | ) | (3,327,642 | ) |
| **Operating income**                                                   |       | 628,959                                         |       | 994,361                                       |       | 1,421,043 |   | 2,463,379 |   |
| **Other expenses**                                                     | ** ** | ** **                                      | ** ** | ** **                                    |       |   |   |   |   |
| Interest  payable to General Partner and affiliates                    |       | (1,445,781                                      | )          | (582,837                                      | )          | (2,948,840 | ) | (1,167,859 | ) |
| Exchange  (losses) gains                                               |       | (126,099                                        | )          | 106,390                                       |       | (149,482 | ) | 136,390 |   |
| **(Loss) income before minority interest**                             |       | (942,921                                        | )          | 517,914                                       |       | (1,677,279 | ) | 1,431,910 |   |
| Minority  interest income (expense)                                    |       | 247,616                                         |       | (162,724                                      | )          | 460,882 |   | (482,703 | ) |
| **Net (loss) income**                                                  |       | $                                               | (695,305   | )                                             | $          | 355,190 |   | $ | (1,216,397 | ) | $ | 949,207 |   |
| **Allocation of net (loss) income**                                    | ** ** | ** **                                      | ** ** | ** **                                    |       |   |   |   |   |
| General Partner                                                        |       | $                                               | (6,953     | )                                             | $          | 3,552 |   | $ | (12,164 | ) | $ | 9,492 |   |
| Limited Partners                                                       |       | (688,352                                        | )          | 351,638                                       |       | (1,204,233 | ) | 939,715 |   |
| **Net (loss) income**                                                  |       | $                                               | (695,305   | )                                             | $          | 355,190 |   | $ | (1,216,397 | ) | $ | 949,207 |   |
| **Net (loss) income per Limited Partnership unit**                     |       | $                                               | (12.09     | )                                             | $          | 6.18 |   | $ | (21.15 | ) | $ | 16.51 |   |
| **Average number of  Limited Partnership units outstanding**           |       | 56,935                                          |       | 56,935                                        |       | 56,935 |   | 56,935 |   |

 

See accompanying notes.

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**SOUTH HERTFORDSHIRE UNITED KINGDOM FUND,LIMITED(A LIMITED PARTNERSHIP)**

**CONDENSEDCONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)**

| ** **                                                                                | ** ** | **Six months ended  June 30,** | ** ** |
|-------------------------------------------------------------------------------------------|------------|-----------------------------------------------|------------|
| ** **                                                                                | ** ** | **2006**                                      | ** ** | **2005** | ** ** |
| **Cash flows from  operating activities**                                                 | ** ** | ** **                                    | ** ** | ** ** | ** ** |
| Net  (loss) income                                                                        |       | $                                             | (1,216,397 | ) | $ | 949,207 |   |
| Adjustments  to reconcile net (loss) income to net cash provided by operating activities: |       |                                          |       |   |   |
| Minority  interest (income) expense                                                       |       | (460,882                                      | )          | 482,703 |   |
| Depreciation                                                                              |       | 3,490,886                                     |       | 3,327,642 |   |
| Change in  operating assets and liabilities                                               |       |                                          |       |   |   |
| Decrease  in accounts payable to affiliates and related parties                           |       | (968,289                                      | )          | (4,167,632 | ) |
| **Net cash provided by operating activities**                                             |       | 845,318                                       |       | 591,920 |   |
| **Cash flows from investing activities**                                                  | ** ** | ** **                                    | ** ** | ** ** | ** ** |
| Purchase  of fixed assets                                                                 |       | (845,318                                      | )          | (591,920 | ) |
| **Net cash used in investing activities**                                                 |       | (845,318                                      | )          | (591,920 | ) |
| Movement  in cash                                                                         |       | —                                        |       | — |   |
| Cash  and cash equivalents at beginning of period                                         |       | —                                        |       | — |   |
| Cash and cash  equivalents at end of period                                               |       | $                                             | —     |   | $ | — |   |

 

See accompanying notes.

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**SOUTH HERTFORDSHIRE UNITED KINGDOM FUND, LIMITED (A LIMITED PARTNERSHIP)**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)**

**Note 1.   Basisof Presentation**

**Organizationand Business**

We are a Colorado limited partnership thatwas formed in December 1991 pursuant to the public offering of our limitedpartnership interests for the purpose of acquiring one or more cabletelevision/telephone systems in the United Kingdom, or U.K. Upon acquisition ofour system, our primary investment objective was to obtain capital appreciationin the value of our investment in the system over the term such investment isheld by us.

We hold 66.7% of the shares of NTL (SouthHertfordshire) Limited, or NTL South Herts, which is  principally engaged in the development,construction, management and operation of broadband communications networks fortelephone, cable television and internet services in the United Kingdom, orU.K. As a result of our ownership of 66.7% of the shares of NTL South Herts,for accounting purposes we have consolidated the results of NTL South Hertswith our results. NTL indirectly holds the remaining 33.3% of the shares of NTLSouth Herts. We are reliant on the support of NTL, the ultimate parent companyof the General Partner, to continue our operations as a going concern.

We, as well asNTL, file annual, quarterly, and current reports with the SEC. You may read andcopy any materials we or NTL file with the SEC at the SEC’s Public Reference Room at100 F Street, N.E., Washington D.C. 20549. You may obtain information on theoperation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.You may also access electronically the information we file with the SEC via itswebsite, located at http://www.sec.gov*.*

**Basis ofPresentation**

We haveprepared the accompanying unaudited condensed consolidated financial statementsin accordance with U. S. generally accepted accounting principles, or U.S.GAAP, for interim financial information and with the instructions to Form 10-Qand Rule 10-01 of Regulation S-X. Accordingly, they do not includeall of the information and footnotes required by U.S. GAAP for completefinancial statements. In the opinion of our management, all adjustments(consisting only of normal recurring adjustments) considered necessary for afair presentation have been included. Results of operations for the periodended June 30, 2006 are not necessarily indicative of results to beexpected for the full year ending December 31, 2006. For furtherinformation, refer to the consolidated financial statements and footnotesthereto included in our Annual Report on Form 10-K for the yearended December 31, 2005.

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**SOUTH HERTFORDSHIRE UNITED KINGDOM FUND, LIMITED (A LIMITED PARTNERSHIP)**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (Continued)**

**Note 2.**   Comprehensive (Loss) Income

Comprehensive (loss) income includes net (loss) income as well as othercomprehensive (loss) income. Our other comprehensive (loss) income consists ofchanges in cumulative translation adjustment. Comprehensive (loss) income comprises:
|                                           | ** ** | **Three months ended  June 30,** | ** ** | **Six months ended  June 30,** | ** ** |
|-------------------------------------------|------------|-------------------------------------------------|------------|-----------------------------------------------|------------|
| ** **                                | ** ** | **2006**                                        | ** ** | **2005**                                      | ** ** | **2006** | ** ** | **2005** | ** ** |
| Net  (loss) income                        |       | $                                               | (695,305   | )                                             | $          | 355,190 |   | $ | (1,216,397 | ) | $ | 949,207 |   |
| Foreign  currency translation adjustments |       | (56,556                                         | )          | 50,962                                        |       | (76,906 | ) | 54,321 |   |
| Comprehensive  (loss) income              |       | $                                               | (751,861   | )                                             | $          | 406,152 |   | $ | (1,293,303 | ) | $ | 1,003,528 |   |

 

**Note 3.**   Investment in Subsidiary

NTL (South Hertfordshire) Limited (“NTLSouth Herts”) is a U.K. corporation that owns and operates a cabletelevision/telephone system in the South Hertfordshire franchise area, locatedadjacent to the northwest perimeter of Greater London, England (the “SouthHerts System”).

NTL South Herts is owned 66.7% by thePartnership and 33.3% by NTL. NTL also owns the General Partner. The GeneralPartner provides consulting services to the Partnership and may delegate someor all of the consulting services to NTL or to other affiliates.

NTL, throughits subsidiaries including its interest in NTL South Herts, provides broadbandinternet access, telephone and television services to approximately5.0 million residential on-net customers as at June 30, 2006.

**Note 4.**   Transactions with Affiliated Parties

*Consultingand Management Fees*

An affiliate ofthe General Partner is entitled to be paid a consulting fee by NTL South Herts.During the construction phases of the South Herts System, this consulting feewas 2% of construction costs. Since completion of construction of each portionof the system, the consulting fee for the completed portion has been 5% of thegross revenue, excluding revenue from the sale of cable television/telephonesystems. The consulting fee is calculated and payable monthly. Consulting feespaid or payable by NTL South Herts for the three months ended June 30,2006 and 2005 were $483,230 and $498,731. Consulting fees paid or payable byNTL South Herts for the six months ended June 30, 2006 and 2005 were$941,779 and $1,011,096, respectively. These amounts were expensed in theConsolidated Statements of Operations.

*DistributionRatios and Reimbursement*

Any partnershipdistributions made from cash flow (defined as cash receipts derived fromroutine operations, less debt principal and interest payments and cashexpenses) are allocated 99% to the limited 

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**SOUTH HERTFORDSHIRE UNITED KINGDOM FUND, LIMITED (A LIMITED PARTNERSHIP)**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (Continued)**

**Note 4.**   Transactionswith Affiliated Parties (Continued)

partnersand 1% to the General Partner. Any distributions other than interest income onlimited partner subscriptions earned prior to the acquisition of thePartnership’s first cable television system or from cash flow, such as from thesale or refinancing of a system or upon dissolution of the Partnership, will bemade as follows: 99% to the limited partners and 1% to the General Partneruntil any negative balances in the limited partners’ capital accounts arereduced to zero; 100% to the General Partner until any negative balance in itscapital account is reduced to zero; 99% to the limited partnersand 1% to the General Partner until the balance in the limited partners’capital is equal to their adjusted capital contribution plus a 12% return; 100%to the General Partner until the balance on its capital account is equal to itsadjusted capital contribution, and any remaining income or gain shall beallocated 75% to the limited partners and 25% to the General Partner.

The General Partner and its affiliates areentitled to reimbursement from NTL South Herts for direct and indirect expensesallocable to the operation of the South Herts System, and from the Partnershipfor direct and indirect expenses allocable to the operation of the Partnershipwhich include but are not limited to, rent, supplies, telephone, travel, andsalaries of any full or part-time employees. The General Partner believes thatthe methodology used in allocating these expenses is fair and reasonable.During the three months ended June 30, 2006 and 2005, reimbursement madeby NTL South Herts and the Partnership to the General Partner or its affiliatesfor any allocable direct and indirect expenses totaled $3,999,369 and$4,264,651 respectively. During the six months ended June 30, 2006 and2005, reimbursement made by NTL South Herts and the Partnership to the GeneralPartner or its affiliates for any allocable direct and indirect expensestotaled $7,563,816 and $7,821,318 respectively.

The GeneralPartner and its affiliates may make advances to, and defer collection of feesand allocated expenses owed by, the Partnership, although they are not requiredto do so. The Partnership is charged interest on such advances and deferredamounts at a rate equal to the General Partner’s or certain affiliates’effective average cost of debt financing from unaffiliated entities, which doesnot differ from their weighted average cost of debt financing. For the threemonths ended June 30, 2006 and 2005, aggregated interest, bank fees andfinance charges relating to non-permanent loans of $1,413,353 and $546,330,respectively, was charged by affiliates of the General Partner. For the sixmonths ended June 30, 2006 and 2005, aggregated interest, bank fees and financecharges relating to non-permanent loans of $2,882,381 and $1,093,340,respectively, was charged by affiliates of the General Partner. The GeneralPartner charged interest on advances for the three months ended June 30,2006 and 2005 of $32,428 and $36,507, respectively. For the six months ended June 30,2006 and 2005 the General Partner charged interest on advances of $66,459 and$74,519, respectively.

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**SOUTH HERTFORDSHIRE UNITED KINGDOM FUND, LIMITED (A LIMITED PARTNERSHIP)**

**NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (Continued)**

**Note 5.**   Fixed Assets

Fixed assets consist of:
|                                               | ** ** | **Estimated  useful lives** | ** ** | **June 30,  2006** | ** **  | **December 31,  2005** | ** ** |
|-----------------------------------------------|------------|----------------------------------|------------|-------------------------|-------------|-----------------------------|------------|
| Cable  network and other electrical equipment |       | 5-30  years                      |       | $                       | 189,103,369 |                        | $          | 174,966,272 |   |
| Building  and other equipment                 |       | 5-30  years                      |       | 7,896,324               |        | 7,397,187                   |       |
|                                          |       |                             |       | 196,999,693             |        | 182,363,459                 |       |
| Accumulated  depreciation                     |       |                             |       | (131,774,691            | )           | (119,167,633                | )          |
|                                          |       |                             |       | $                       | 65,225,002  |                        | $          | 63,195,826 |   |

 

**Note 6.**   Commitments and Contingent Liabilities

We have no significant contractualobligations and commercial commitments as of June 30, 2006.

We are from time to time subject to legalproceedings and claims that arise in the ordinary course of our business. Inthe opinion of the management, the amount of ultimate liability with respect tothese actions will not materially affect our financial position, results ofoperations or liquidity.

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**Item 2.**                        Management’s Discussion and Analysis of Financial Condition andResults of Operations

**Overview**

We are a Colorado limited partnership thatwas formed in December 1991 pursuant to the public offering of our limitedpartnership interests for the purpose of acquiring one or more cabletelevision/telephone systems in the U.K. Upon acquisition of our system, ourprimary investment objective was to obtain capital appreciation in the value ofour investment in the system over the term such investment is held by us.

We hold 66.7% of the shares of NTL SouthHerts, which is principally engaged in the development, construction,management and operation of broadband communications networks for telephone,cable television and internet services in the U.K. As a result of our ownershipof 66.7% of the shares of NTL South Herts, for accounting purposes we haveconsolidated the results of NTL South Herts with our results. NTL indirectlyholds the remaining 33.3% of the shares of NTL South Herts. We are reliant onthe support of NTL, the ultimate parent company of the General Partner, tocontinue our operations as a going concern.

We derive our revenue principally frommonthly fees and usage charges. Our packaging of services and pricing aredesigned to encourage our customers to use multiple services like dualtelephone and broadband, dual telephone and television or triple telephone,television and internet access.

The principalcomponents of our expenses other than interest include payroll and otheremployee related costs; interconnection costs paid to other carriers related totelephone services; television programming costs; marketing and selling costs;repairs and maintenance; facility related costs, like rent, utilities andrates; and allowances for doubtful accounts. Our expenses include certain coststhat are charged by a subsidiary of NTL for the provision of network servicesand support, the use of NTL’s national backbone telephone network for carriageof our telephone traffic, as well as the provision of technical infrastructureand network capacity by NTL for our subscription internet access service anddigital television services, the provision of corporate services, includingfinance, legal, human resources and facility services, and for the provision ofIT services, including our use of the related IT equipment.

**SelectedOperating Data**

We set forth in the following table certain data concerning ourfranchise at June 30, 2006 and December 31, 2005:

| ** **                         | ** ** | **June 30,  2006** | ** ** | **December 31,  2005** | ** ** |
|------------------------------------|------------|-------------------------|------------|-----------------------------|------------|
| Homes  passed(1)                   |       |                    | 94,653     |                        |       |   | 94,350 |   |   |
| Homes  marketable(2)               |       |                    | 94,653     |                        |       |   | 94,350 |   |   |
| Total  customers                   |       |                    | 36,923     |                        |       |   | 36,975 |   |   |
| Digital  cable subscribers         |       |                    | 22,551     |                        |       |   | 21,709 |   |   |
| Analog  cable subscribers          |       |                    | 1,598      |                        |       |   | 2,332 |   |   |
| Broadband  internet subscribers    |       |                    | 22,096     |                        |       |   | 20,078 |   |   |
| Telephony  subscribers             |       |                    | 31,981     |                        |       |   | 31,927 |   |   |
| Penetration  (homes marketable)(3) |       |                    | 39.0       | %                           |       |   | 39.0 | % |   |
| Churn(4)                           |       |                    | 1.4        | %                           |       |   | 1.0 | % |   |

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(1)          Homes passed is the number of homes that have had ducting buriedoutside.

(2)          Homes marketable refers to the number of homes within our servicearea that can potentially be served by our network with minimal connectioncosts.

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(3)          Penetration rate measures the number of subscribers for our servicesdivided by the number of marketable homes that our services pass.

(4)          Customer churn is calculated by taking the total disconnects duringthe month and dividing them by the average number of customers during themonth. Average monthly churn during the quarter is the average of the threemonthly churn calculations within the quarter.

***Factors affecting our business***

***CustomerChurn.******  ***Customer churn is a measure of the number of customers who stopusing our services. An increase in our customer churn can lead to increasedcosts and reduced revenue. We continue to focus on improving our customerservice and enhancing and expanding our service offerings to existing customersin an effort to manage our customer churn rate. Although our ability to reduceour customer churn rate beyond a base level is limited by factors likecustomers moving outside our network service area, in particular during thesummer season, managing our customer churn rate is a significant component ofour business plan. Our customer churn rate may increase if we are unable todeliver our services over our network without interruption or if we fail tomatch offerings by our competitors.

***Competition.******  ***Our abilityto acquire and retain customers and increase revenue depends on our competitivestrength. There is significant competition in our markets, including throughother broadband service providers, telephone services offered by BT,alternative internet access services like DSL, which is offered by BT, digitalsatellite services offered by BSkyB and digital terrestrial television offeredby Freeview. If competitive forces prevent us from charging the prices forthese services that we plan to charge, or if our competition is able to attractour customers or potential customers we are targeting, our results ofoperations will be adversely affected.

***CapitalExpenditures.******  ***Our business requires substantial capital expenditures on acontinuing basis for various purposes, including expanding, maintaining andupgrading our network, investing in new customer acquisitions, and offering newservices. If we do not continue to invest in our network, our ability to retainand acquire customers may be hindered. Therefore, our liquidity and theavailability of cash to fund capital projects are important drivers of ourrevenue. When our liquidity is restricted, so is our ability to meet ourcapital expenditure requirements. We believe that our cash from operations andcash from NTL will be sufficient for our cash requirements through June 30,2007.

***CurrencyMovements.******  ***Because revenue and expenses from our principal operations aredenominated primarily in pounds sterling but we report our financial results inU.S. dollars, our financial results are impacted by currency fluctuations,which are unrelated to our underlying results of operations.

***Seasonality.******  ***Some revenuestreams are subject to seasonal factors. For example, telephone usage revenueby customers and businesses tends to be slightly lower during summer holidaymonths. Our customer churn rates include persons who disconnect service becauseof moves, resulting in a seasonal increase in our churn rates during the summermonths when higher levels of U.K. house moves occur and students leave theiraccommodations between school years.

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***Three months ended June 30, 2006 and2005***

We present below summarized consolidated financial information for thethree months ended June 30, 2006 and 2005:

| ** **                                   | ** ** | **Three months ended  June 30,** | ** ** | ** ** | ** ** | **Three months ended  June 30,** | ** ** | ** ** | ** ** |
|----------------------------------------------|------------|-------------------------------------------------|------------|------------|------------|-------------------------------------------------|------------|------------|------------|
| ** **                                   | ** ** | **2006**                                        | ** ** | **2005**   | ** ** | **%**                                           | ** ** | **2006**   | ** ** | **2005** | ** ** | **%** | ** ** |
| Revenue                                      |       | $                                               | 9,664,617  |       | $          | 9,974,629                                       |       | (3.1       | )          | £ | 5,291,703 |   | £ | 5,371,807 |   | (1.5 | ) |
| Cost  of goods sold                          |       | (2,516,703                                      | )          | (2,732,285 | )          | (7.9                                            | )          | (1,377,170 | )          | (1,471,391 | ) | (6.4 | ) |
| Selling,  general and adminstrative expenses |       | (25,015                                         | )          | (23,610    | )          | 6.0                                             |       | (13,733    | )          | (12,702 | ) | 8.1 |   |
| Management  fees and allocated overhead      |       | (4,482,599                                      | )          | (4,763,382 | )          | (5.9                                            | )          | (2,457,062 | )          | (2,561,418 | ) | (4.1 | ) |
| Other  charges                               |       | (240,430                                        | )          | (20,030    | )          | 1,100.3                                         |       | (132,465   | )          | (10,736 | ) | 1,133.8 |   |
| Depreciation                                 |       | (1,770,911                                      | )          | (1,440,961 | )          | 22.9                                            |       | (969,173   | )          | (777,941 | ) | 24.6 |   |
| Operating  income                            |       | 628,959                                         |       | 994,361    |       | (36.7                                           | )          | 342,100    |       | 537,619 |   | (36.4 | ) |
| Interest  expense                            |       | (1,445,781                                      | )          | (582,837   | )          | 148.1                                           |       | (790,086   | )          | (313,820 | ) | 151.8 |   |
| Exchange  (losses) gains                     |       | (126,099                                        | )          | 106,390    |       | (218.5                                          | )          | (70,166    | )          | 56,922 |   | (223.3 | ) |
| Net  (loss) income before minority interests |       | (942,921                                        | )          | 517,914    |       | (282.1                                          | )          | (518,152   | )          | 280,721 |   | (284.6 | ) |
| Minority  interests                          |       | 247,616                                         |       | (162,724   | )          |                                            |       | 135,831    |       | (88,355 | ) |   |   |
| Net (loss)  income                           |       | $                                               | (695,305   | )          | $          | 355,190                                         |       | (295.8     | )          | £ | (382,321 | ) | £ | 192,366 |   | (298.7 | ) |

 

*Revenue*

For the threemonths ended June 30, 2006, revenue decreased by 3.1% to $9.7 million from$10.0 million in 2005 and revenue expressed in pounds sterling decreased by1.5% to £5.3 million in 2006 from £5.4 million in 2005. The decrease isprimarily due to increased competition that has given rise to reduced revenuesthrough increased discounts partly offset by higher broadband revenue due to anincrease in the numbers of broadband subscribers served by the South Herts system to 22,096 at June 30,2006 compared with 17,267 at June 30, 2005.

*Expenses*

*Costs of goods sold.**  *For the three months ended June 30, 2006, costs of goods solddecreased by 7.9% to $2.5 million from $2.7 million in 2005 and cost of goodssold expressed in pounds sterling decreased by 6.4% to £1.4 million in 2006from £1.5 million in 2005. Costs of goods sold as a percentage of revenuedeclined to 26.0% for the three months ended June 30, 2006, from 27.4% for2005 due to the increased number of broadband subscribers.

*Selling, general and administrative expenses.**  *For the three monthsended June 30, 2006, selling, general and administrative expensesincreased slightly to $25,015 or £13,733 from $23,610 or £12,702 in 2005.

*Management fees and allocated overhead.**  *For the threemonths ended June 30, 2006, management fees and allocated overheaddecreased by 5.9% to $4.5 million from $4.8 million in 2005, and managementfees and allocated overhead expressed in pounds sterling decreased by 4.1% to£2.5 million in 2006 from £2.6 million in 2005. The business of NTL South Hertsis managed as an integral part of NTL. The combined costs of managing thelarger group are allocated to each entity within the NTL group, including NTLSouth Herts, on a consistent and proportional basis according to the level oftrading in that entity. The General Partner considers this to be a fair andreasonable method as management as an integral part of a larger group to reapbenefits of synergy maximizes returns.

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*Other charges.**  *For the threemonths ended June 30, 2006, other charges increased to $240,430 from $20,030in 2005. Other charges in the three months ended June 30, 2006 includedrestructuring costs allocated to us by a subsidiary of NTL in respect of leaseexit costs in connection with properties that have been vacated and redundancycosts following NTL’s reverse acquisition of Telewest. For the three monthsended June 30, 2005 other charges comprised employee severance and relatedcosts in connection with the call center consolidation program. Chargesallocated to us by a subsidiary of NTL are made on the basis of an allocationformula appropriate to each category of charge based on a reasonablemethodology given the facts and circumstances.

*Depreciation expense*

For the threemonths ended June 30, 2006, depreciation expense increased to $1.8 millionfrom $1.4 million in 2005 due to network assets transferred from anaffiliate as at December 31, 2005, together with increased capital spendon premise equipment for new customers offset by foreign exchange movement.

*Interest expense*

For the threemonths ended June 30, 2006, interest expense increased to $1,445,781 from$582,837 in 2005. This increase is due to two changes to the interest expensecharging policies which were implemented, as permitted by the PartnershipAgreement, in the fourth quarter of 2005. Since October 1, 2005, interesthas been charged on the full amount of non-permanent loans provided to us byour affiliates, rather than just the proportion thereof relating to unpaidmanagement fees paid on our behalf by an affiliate of the General Partner. Alsofrom October 1, 2005, we have been charged our allocation of the bank feesand deferred financing costs relating to NTL’s senior credit facilities. Wepaid no cash interest for the three months ended June 30, 2006 and 2005.

*Exchange (losses) gains*

For the threemonths ended June 30, 2006, foreign currency exchange losses were $126,099as compared with gains of $106,390 for 2005. The change in exchangegains/(losses) is primarily attributable to fluctuations in the valuation ofthe U.S. dollar on certain of our assets and transactions, which aredenominated in pounds sterling. Our results of operations will continue to beaffected by foreign exchange rate fluctuations.

*Minority Interest*

As of June 30,2006, NTL South Herts’ assets exceeded its liabilities and we have thereforerecognized a minority interest credit of $247,616 representing a 33.3% share ofNTL South Herts’ net loss for the three months ended June 30, 2006. Forthe three months ended June 30, 2005 we recognized a minority interestcharge of $162,724.

*Net (loss) income*

For the threemonths ended June 30, 2006, net loss was $695,305 as compared with netincome of $355,190 in 2005 primarily due to the increase in interest expenseand reduction in revenue described above.

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***Six months ended June 30, 2006 and2005***

We present below summarized consolidated financial information for thesix months ended June 30, 2006 and 2005:

| ** **                                   | ** ** | **Six months ended  June 30,** | ** ** | ** ** | ** ** | **Six months ended  June 30,** | ** ** | ** ** | ** ** |
|----------------------------------------------|------------|-----------------------------------------------|------------|------------|------------|-----------------------------------------------|------------|------------|------------|
| ** **                                   | ** ** | **2006**                                      | ** ** | **2005**   | ** ** | **%**                                         | ** ** | **2006**   | ** ** | **2005** | ** ** | **%** | ** ** |
| Revenue                                      |       | $                                             | 18,835,580 |       | $          | 20,221,924                                    |       | (6.9       | )          | £ | 10,521,495 |   | £ | 10,792,509 |   | (2.5 | ) |
| Cost  of goods sold                          |       | (4,974,289                                    | )          | (5,523,699 | )          | (9.9                                          | )          | (2,778,622 | )          | (2,948,017 | ) | (5.7 | ) |
| Selling,  general and adminstrative expenses |       | (45,630                                       | )          | (45,004    | )          | 1.4                                           |       | (25,489    | )          | (24,019 | ) | 6.1 |   |
| Management  fees and allocated overhead      |       | (8,505,595                                    | )          | (8,832,414 | )          | (3.7                                          | )          | (4,751,198 | )          | (4,713,889 | ) | 0.8 |   |
| Other  charges                               |       | (398,137                                      | )          | (29,786    | )          | 1,236.7                                       |       | (222,398   | )          | (15,897 | ) | 1,299.0 |   |
| Depreciation                                 |       | (3,490,886                                    | )          | (3,327,642 | )          | 4.9                                           |       | (1,949,998 | )          | (1,775,974 | ) | 9.8 |   |
| Operating  income                            |       | 1,421,043                                     |       | 2,463,379  |       | (42.3                                         | )          | 793,790    |       | 1,314,713 |   | (39.6 | ) |
| Interest  expense                            |       | (2,948,840                                    | )          | (1,167,859 | )          | 152.5                                         |       | (1,647,213 | )          | (623,290 | ) | 164.3 |   |
| Exchange  gains (losses)                     |       | (149,482                                      | )          | 136,390    |       | (209.6                                        | )          | (83,500    | )          | 72,792 |   | (214.7 | ) |
| Net  (loss) income before minority interests |       | (1,677,279                                    | )          | 1,431,910  |       | (217.1                                        | )          | (936,923   | )          | 764,215 |   | (222.6 | ) |
| Minority  interests                          |       | 460,882                                       |       | (482,703   | )          |                                          |       | 257,447    |       | (257,620 | ) |   |   |
| Net (loss)  income                           |       | $                                             | (1,216,397 | )          | $          | 949,207                                       |       | (228.1     | )          | £ | (679,476 | ) | £ | 506,595 |   | (234.1 | ) |

 

*Revenue*

For the sixmonths ended June 30, 2006, revenue decreased by 6.9% to $18.8 millionfrom $20.2 million in 2005 and revenue expressed in pounds sterlingdecreased by 2.5% to £10.5 million in 2006 from £10.8 million in 2005. Thedecrease is primarily due to increased competition that has given rise toreduced revenues through increased discounts partly offset by higher broadbandrevenue due to an increase in the numbers of broadband subscribers served bythe South Herts system to 22,096 at June 30, 2006 compared with 17,267 at June 30,2005.

*Expenses*

*Costs of goods sold.**  *For the six months ended June 30, 2006, costs of goods solddecreased by 9.9% to $5.0 million from $5.5 million in 2005 and cost of goodssold expressed in pounds sterling decreased by 5.7% to £2.8 million in 2006from £2.9 million in 2005. The reduction in cost of sales is primarily areflection of reduced revenue. Costs of goods sold as a percentage of revenuedeclined to 26.4% for the six months ended June 30, 2006, from 27.3% for2005 due to the increased number of broadband subscribers.

*Selling, general and administrative expenses.**  *For the sixmonths ended June 30, 2006, selling, general and administrative expensesincreased slightly to $45,630, or £25,489, from $45,004, or £24,019, in 2005due to the increased number of broadband subscribers.

*Management fees and allocated overhead.**  *For the sixmonths ended June 30, 2006, management fees and allocated overheaddecreased by 3.7% to $8.5 million from $8.8 million in 2005 but management feesand allocated overhead expressed in pounds sterling increased by 0.8% to £4.8million in 2006 from £4.7 million in 2005. The business of NTL South Hertsis managed as an integral part of NTL. The combined costs of managing thelarger group are allocated to each entity within the NTL group, including NTLSouth Herts, on a consistent and proportional basis according to the level oftrading in that entity. 

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The GeneralPartner considers this to be a fair and reasonable method as management as anintegral part of a larger group to reap benefits of synergy maximizes returns.

*Other charges.**  *For the sixmonths ended June 30, 2006, other charges increased to $398,137 from$29,786 in 2005. Other charges in the six months ended June 30, 2006included restructuring costs allocated to us by a subsidiary of NTL in respectof lease exit costs in connection with properties that have been vacated andredundancy costs following NTL’s reverse acquisition of Telewest. For the sixmonths ended June 30, 2005 other charges comprised employee severance andrelated costs in connection with the call center consolidation program. Chargesallocated to us by a subsidiary of NTL are made on the basis of an allocationformula appropriate to each category of charge based on a reasonablemethodology given the facts and circumstances.

*Depreciation expense*

For the six monthsended June 30, 2006, depreciation expense increased to $3.5 million from$3.3 million in 2005 due to increased capital spend on premise equipmentfor new customers offset by foreign exchange movement.

*Interest expense*

For the sixmonths ended June 30, 2006, interest expense increased to $2,948,840 from$1,167,859 in 2005. This increase is due to two changes to the interest expensecharging policies which were implemented, as permitted by the PartnershipAgreement, in the fourth quarter of 2005. Since October 1, 2005, interesthas been charged on the full amount of non-permanent loans provided to us byour affiliates, rather than just the proportion thereof relating to unpaidmanagement fees paid on our behalf by an affiliate of the General Partner. Alsofrom October 1, 2005, we have been charged our allocation of the bank feesand deferred financing costs relating to NTL’s senior credit facilities. Wepaid no cash interest for the six months ended June 30, 2006 and 2005.

*Exchange (losses) gains*

For the sixmonths ended June 30, 2006, foreign currency exchange losses were $149,482as compared with gains of $136,390 for 2005. The change in exchange(losses)/gains is primarily attributable to fluctuations in the valuation ofthe U.S. dollar on certain of our assets and transactions, which aredenominated in pounds sterling. Our results of operations will continue to beaffected by foreign exchange rate fluctuations.

*Minority Interest*

As of June 30,2006, NTL South Herts’ assets exceeded its liabilities and we have thereforerecognized a minority interest credit of $460,882 representing a 33.3% share ofNTL South Herts’ net loss for the six months ended June 30, 2006. For thesix months ended June 30, 2005 we recognized a minority interest charge of$482,703.

*Net (loss) income*

For the sixmonths ended June 30, 2006, net loss was $1,216,397 as compared with netincome of $949,207 in 2005 primarily due to the increase in interest expenseand reduction in revenue described above.

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**CondensedConsolidated Statement of Cash Flows**

In the sixmonths ended June 30, 2006, we generated $845,318 from our operatingactivities compared with $591,920 in the six months ended June 30, 2005,and used it to purchase fixed assets including customers installations. Ourcash provided by operating activities has increased primarily due to theincrease in the amount due to affiliates. A significant proportion of theaccounts payable to affiliates is transacted in pounds sterling translated atclosing rates for balance sheets, whereas the movement in the accounts payableto affiliates in the cash flow statement is translated at the average rate forthe period, consequently this value does not equate to the movement between thebalances on the opening and closing balance sheets. When the rates varysignificantly between the opening and closing positions, or when the averagerate varies significantly from the closing rates, the impact of foreignexchange will also be significant.

**Liquidityand Capital Resources**

We have no financing independent of NTL. Weare reliant upon the support of NTL to continue our operations. As of June 30,2006, we had consolidated current liabilities of $67.9 million due to NTL groupcompanies compared with $64.3 million as of December 31, 2005.

Historically,our principle source of cash was the net proceeds of our offerings of limitedpartnership interests and our principal uses of cash have been capitalcontributions to NTL South Herts in order to fund our proportionate share ofthe construction costs of the South Herts System. Accordingly, until such timeas NTL South Herts begins to pay dividends on its ordinary shares (which is notexpected in the foreseeable future) we will be required to fund ouradministrative expenses by additional issuances of limited partnershipinterests or from borrowings. It is unlikely that we will be able to sell debtor equity securities in the public markets at least in the short term or toobtain financing from commercial banks. Accordingly, we are dependent on NTLfor funds to cover operating expenses, and will continue to be dependent uponNTL to meet our liquidity requirements for the foreseeable future. We expectthat cash from our operations in 2006 will be utilized fully for the purchaseof fixed assets including connecting new customers to our networks.

**Off-BalanceSheet Transactions**

As of June 30, 2006, we had nooff-balance sheet transactions.

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**Item 3.**                        Quantitative and Qualitative Disclosures About Market Risk

The functionalcurrency of NTL South Herts is pounds sterling and all revenue andsubstantially all costs are incurred in pounds sterling. We report in U.S.dollars. Therefore, we are exposed to fluctuations in the pound sterling toU.S. dollar exchange rate.

The aggregatepotential loss from a hypothetical one-percent fall in the pound sterling/U.S.dollar exchange rate is approximately $14,000 for the six months ended June 30,2006.

We have no debt other than amounts due to affiliates.As of June 30, 2006, we had approximately $67.9 million in amounts due toNTL. Interest on amounts due to affiliates is at a variable rate based on theaverage rate incurred by NTL. Therefore we are exposed to changes in NTL’sborrowing rate. The aggregate potential loss from a hypothetical one-percentagepoint increase in the interest rate is approximately $313,000 for the sixmonths ended June 30, 2006.

**Item 4.**                        Controls and Procedures

(a)*   Disclosure Controls and Procedures.*   Ourmanagement, with the participation of the Chief Executive Officer and ChiefFinancial Officer of NTL*, has evaluated theeffectiveness of our disclosure controls and procedures (as such term isdefined in Rules 13a-15(e) and 15d-15(e) under theSecurities Exchange Act of 1934, as amended, or the Exchange Act) as of the endof the period covered by this report. Based on such evaluation, NTL’s ChiefExecutive Officer and Chief Financial Officer have concluded that, as of theend of such period, these controls and procedures are effective to ensure thatinformation required to be disclosed by the registrant in the reports theregistrant files or submits under the Exchange Act is recorded, processed,summarized, and reported within the time periods specified in the SEC’s rules andforms. These disclosure controls and procedures include, without limitation,controls and procedures designed to ensure that information required to bedisclosed by the registrant in the reports that it files or submits isaccumulated and communicated to the registrant’s management, including NTL’schief executive officer and chief financial officer, as appropriate to allowtimely decisions regarding required disclosure.

(b)*   Changesin Internal Control Over Financial Reporting.  **On March 3, 2006, legacy NTLcompleted the reverse acquisition of Telewest. As a consequence of theintegration of the legacy NTL and legacy Telewest businesses, NTLexpects to make material changes to its internal control over financialreporting and we will disclose all material changes resulting from thistransaction in our future quarterly and annual reports. Other than as statedabove, there were no changes in our internal control over financial reporting(as such term is defined in Rules 13a-15(f) and 15d-15(f) underthe Exchange Act) during the fiscal quarter to which this report relates thathave materially affected, or are reasonably likely to materially affect, ourinternal control over financial reporting.*

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*                    The Partnership has no Chief Executive Officer or Chief FinancialOfficer. Robert Mackenzie and Robert Gale are Directors of ntl DirectorsLimited, which is a corporate director of NTL Fawnspring Limited, the generalpartner of the Partnership.

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**Part II. Other Information**

**Item 5.**                        Other Information

None.

**Item 6.**                        Exhibits

| 31.1 |   | Certification of Chief Executive  Officer,* pursuant to Rule 13(a)-14(a) and Rule 15d-14(a) of  the Exchange Act.                |
|------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------|
| 31.2 |   | Certification of Chief Financial  Officer,* pursuant to Rule 13(a)-14(a) and Rule 15d-14(a) of  the Exchange Act.                |
| 32.1 |   | Certifications of CEO and CFO* Pursuant  to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of  the Sarbanes Oxley Act of 2002. |

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*                    The Partnership has no Chief Executive Officer or Chief FinancialOfficer. Robert Mackenzie and Robert Gale are Directors of ntl DirectorsLimited, which is a corporate director of NTL Fawnspring Limited, the generalpartner of the Partnership.

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**SIGNATURES**

Pursuant to therequirements of the Securities Exchange Act of 1934, the registrant has dulycaused this report to be signed on its behalf by the undersigned thereunto dulyauthorized.

|        |   | SOUTH HERTFORDSHIRE UNITED  KINGDOM FUND, LTD. |
|--------|--------|------------------------------------------------|
|   |   | a Colorado limited partnership                 |
|   |   | By:                                            |   | NTL  Fawnspring Limited,  its General Partner |
|   |   | By:                                            |   | /s/ Robert  Mackenzie |   |
|   |   |                                           |   | Robert Mackenzie  Director of ntl Directors Limited  Corporate director of NTL Fawnspring Limited, the General Partner of South  Hertfordshire United Kingdom Fund, Ltd. |

 

Dated:  August 9, 2006

Pursuant to therequirements of the Securities Exchange Act of 1934, this report has beensigned below by the following persons on behalf of the registrant and in thecapacities and on the dates indicated.

|                      | **Name** | ** **                                                                                                  | ** ** | ** **           | **Title** | ** ** | ** ** | ** ** | **Date** | ** ** |
|----------------------|----------|-------------------------------------------------------------------------------------------------------------|------------|----------------------|-----------|------------|------------|------------|----------|------------|
| /s/ Robert Mackenzie |     | Director of  ntl Directors Limited, Corporate                                                               |       | August 9,  2006 |
| Robert Mackenzie     |     | director of  NTL Fawnspring Limited, the General Partner of South Hertfordshire United  Kingdom Fund, Ltd.* |       |                 |
| /s/ Robert Gale      |     | Director  of ntl Directors Limited, Corporate                                                               |       | August 9,  2006 |
| Robert  Gale         |     | director of NTL Fawnspring Limited, the  General Partner of South Hertfordshire United Kingdom Fund, Ltd.*  |       |                 |

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*                    The Partnership has no Chief Executive Officer or Chief FinancialOfficer. Robert Mackenzie and Robert Gale are Directors of ntl DirectorsLimited, which is a corporate director of NTL Fawnspring Limited, the generalpartner of the Partnership.

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