Sellers: Strong progress in emissions and housing disrepair work
Anexo Group – the AIM-listed business that combines credit hire and legal services – has seen revenue and profit soar but will not pay an interim dividend so as to invest in attracting more car emissions cases.
It has also grown its relatively new housing disrepair practice rapidly.
Anexo – which owns the law firm Bond Turner – reported yesterday that revenue for the first half of 2022 was £69m, up 42% on the same period last year, with profit before tax of £14m a 53% jump.
Credit hire drove much of this; Bond Turner saw turnover rise 8% to £21m, with profit up from £1.5m last year to £2.5m this.
“The group remains committed to its strategy of increasing its claim settlement capacity, thereby maximising cash collections,” Anexo told investors.
At 247, the number of senior fee-earners employed at the end of June was 41% higher than a year before, and the overall number of legal staff rose 10% to 633.
This growth helped the continued growth in cash collections, which rose 20% to £68m.
“The group expects this revenue trend to continue as more of our staff reach maturity from a cash collection and settlement position.”
Anexo now has around 13,000 emissions claims against Volkswagen not affected by the recent settlement and said it was continuing to pursue other emissions cases. It has 4,000 cases against Mercedes Benz.
The company spent £1.3m in expanding its caseload in the first six month of the year and the announcement said: “The board believes there is a significant short-term opportunity to accelerate growth in emissions claims against specific vehicle manufacturers, as well as [housing disrepair] claims.
“Accordingly, the group has negotiated an increase in its loan agreement with Blazehill Capital, first announced on 11 May 2022, from £7.5m to £15m. The funds will be drawn down immediately to take advantage of this opportunity.”
The housing disrepair division now has 2,300 cases and made a profit of £2.4m in the first half of this year, compared to £1.1m in 2021.
Such was the “emissions opportunity” that the Anexo board has decided its money would be better spent on this than an interim dividend.
“The interests of the group and its shareholders would be best served by paying an annual dividend following the announcement of the group’s full year results,” shareholders were told.
Alan Sellers, barrister and executive chairman of Anexo Group, said: “We are proud of the social value of the services we offer. Anexo provides assistance to people who find themselves in an invidious position through no fault of their own, whether through being deprived of an essential vehicle or through living in substandard housing conditions, along with the other problems which may be exacerbated by such situations.
“We remain committed to providing help to those who might otherwise be unable to obtain redress.
“We continue to manage our vehicle fleet carefully and to maximise cash collections by identifying appropriate hire opportunities, particularly within the motorcycle sector; this allows for more efficient use of working capital whilst also increasing the overall number of case settlements.
“The strong progress being made in housing disrepair and emissions will underpin the continued growth in the core business, and the board remains confident in meeting market expectations for the year.”
Anexo’s share price has been on the slide this year, from an all-time high of 149p in January to an all-time low of 110p earlier this month. It closed yesterday up 2.7% at 114p.
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