Judging by the double-digit bounce in Burford Capital’s (BUR) shares, the litigation finance provider’s rehabilitation with investors was aided by news of a jump in group-wide cash realisations of almost a third and a 49 per cent increase in realised gains during the first half of the year. On the face of it, the latter was even more impressive given that the rise in gains was without any contribution from the Petersen claim, which delivered $98m (£75.7m) during the same period last year.
However, if one focuses on core cash realisations, the $820m headline realisation figure is less impressive, as analysts at Peel Hunt point out. After excluding elements including returns from capital invested in funds it manages and $262m in cash that has not yet been received, the level of core cash received was just $46m.
New business also suffered as legal activity slowed during lockdown, resulting in group-wide commitments tumbling by almost three-quarters and deployments 42 per cent lower.
Peel Hunt forecasts adjusted pre-tax profits of $193m and EPS of 88c for the full-year, rising to $278m and 127c in 2021.
| BURFORD CAPITAL (BUR) | ||||
| ORD PRICE: | 727p | MARKET VALUE: | £ 1.59bn | |
| TOUCH: | 726-729p | 12-MONTH HIGH: | 988p | LOW: 250p |
| DIVIDEND YIELD: | NIL | PE RATIO: | 14 | |
| NET ASSET VALUE: | 786c | NET DEBT: | 22% | |
| Half-year to 30 Jun | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (c) | Dividend per share (c) |
| 2019 | 292 | 227 | 101 | 4.17 |
| 2020 | 255 | 189 | 69.2 | nil |
| % change | -13 | -17 | -31 | - |
| Ex-div: | na | |||
| Payment: | na | |||
| £1=$1.26 | ||||
