Manolete Partners (LON:MANO), the leading UK-listed insolvency litigation financing company, today announces its unaudited results for the six months ended 30 September 2019.
Steven Cooklin, Chief Executive Officer, commented:
“These are a strong set of interim results which showcase the excellent progress of the business since the IPO in December 2018. We continue to deliver stand-out returns for insolvency creditors and shareholders alike. We made 65 new case investments in the first six months of this financial year, benefitting from the availability of increased cash resources from the IPO and the establishment of our nationwide in-house legal team.
That total of 65 new case investments represents a 110% increase over the comparable six-month period last year and even exceeds the total 61 new cases signed over the full 12 months of the previous accounting year. We have achieved impressive double-digit growth in revenue, gross profit and EBIT during the period, delivering continued outstanding investment returns yielding an average money multiple of 2.9 times on 18 completed cases.
At the period end, there were 32 live cases already scheduled for either Alternative Dispute Resolution, trial or currently the subject of serious settlement offer negotiations. Indeed, six of these have already completed in October and November 2019 generating further gross proceeds of £762k, and we are excited by the case completion prospects for the second half of the year and beyond. With average completed case durations remaining constant at 11 months, we expect the record number of new case investments to translate into higher levels of realised profits and significant new cash generation over the next six to twelve months.”
Financial highlights:
· Investment in cases up 83% to £25.4m (H1 FY19: £13.9m, FY19 £18.2m)
· Revenue up 15% to £7.5m (H1 FY19: £6.5m)
· Gross profit up 50% to £6.6m (H1 FY19: £4.4m)
· EBIT up 37% to £4.5m (H1 FY19: £3.3m)
· Profit before tax up 42% to £4.3m (H1 FY19: £3.0m)
· Profit after tax up 41% to £3.5m (H1 FY19: £2.5m)
· Earnings per share up 41% to 7.9 pence (H1 FY19: 5.6 pence)
· Interim dividend proposed of 0.5p per share
· Net Assets of £30.9m (£28.0m as at 31 March 2019) and cash balances of £3.1m as at 30 September 2019 (£9.7m as at 31 March 2019)
· Fully unutilised £20m HSBC Revolving Credit Facility available
Operational highlights:
· During H1 FY20, investment into new cases rose by 110% to 65 (H1 FY19: 31). This exceeds the total number of 61 new cases signed for the entire 12 months of FY19
· Ongoing delivery of realised returns: 18 case realisations in the period (12 case realisations in H1 FY19, gross proceeds £5.5m), generating gross proceeds of £2.4m, over an average case duration of 11 months
· Average money multiple of 2.9 times for cases completed in H1 FY20 (3.6 times H1 FY19)
· High level of forthcoming potential case completions, with 32 live cases scheduled over the coming months for either Alternative Dispute Resolution (mediations and formal without prejudice settlement meetings), trial or currently the subject of settlement offers and negotiations. Six of these have been completed since the period end generating gross proceeds of £762k
· Average case duration across the full portfolio of 215 completed cases remains constant at 11 months (11 months H1 FY19)
· 72% increase in live cases: 131 in process as at 30 September 2019 (76 as at 30 September 2018). Live cases total currently 144 (as at 7 November 2019)
· 90% of live cases have been signed in the last 18 months. Only two cases remain ongoing from the FY17 vintage. 100% of earlier case vintages have been completed
· Roll-out of regional network of in-house lawyers completed. Manolete now has a proprietary network of highly experienced in-house insolvency solicitors based in: North West England, South West England & Wales, London, Eastern England, North East England, Midlands, Southern England and Scotland
· Recruitment of a new CFO in October 2019
