- Reported pre-tax loss of £13.3mn after impairments
- Adjusted pre-tax profit of £0.4mn
- Exit from all litigation funding matters
- Focus on deleveraging balance sheet
- Previously downgraded full-year guidance maintained
The hefty first-half loss reported by professional services group RBG (RBGP:21p) had been flagged after the new management team announced they were exiting all of the group’s conditional fee arrangements and damages-based arrangements (‘Litigation funders LCM and RBG digest court ruling’, 27 July 2023).
Encompassing London’s mid-tier law firms Rosenblatt and Memery Crystal and corporate finance boutique Convex Capital, under previous management RBG had invested in 13 legal cases with a carrying value of £13.3m. The complete write-off of these litigation assets partly reflects the fact one case in which RBG had invested £9.3mn is now unlikely to deliver a positive outcome. It also reflects the new board’s decision to simplify and de-risk RBG’s balance sheet. Any successful outcome on the remaining cases will be booked as revenue in proportion to the stakes retained in the individual cases.