Anexo, the specialist integrated credit-hire and legal services business, has reported a record performance for FY 19 with numbers in line with previous guidance. The year saw good cash generation following the decision to focus on the Legal Services business while holding back growth of the Credit Hire business. A 0.5p final dividend strikes a balance between cash conservation and confidence in the outlook for the Group in uncertain times. Given the impact of COVID-19 on the wider operating environment, we think that the key focus should be on the Group’s current positioning and its preparedness to operate in the evolving business environment. Although there is no update on guidance for estimates, we believe that the business is wellplaced – particularly since the recent £7.5 million fundraise which underpinned the Group’s options to accelerate growth without diminishing existing cash resources.
Anexo, as well as having a significant book of business to mine, will accelerate the expansion of its advocacy and specialist litigation team and to continue recruitment within the Legal Services business. It will also proceed with the opening of a new office in Leeds and will look to expand its vehicle fleet to add further new business.
With road traffic volumes continuing to recover as COVID-19 restrictions are lifted, Anexo’s core business should continue to see plenty of new business opportunities in the UK credit hire market for EDGE and Bond Turner.
The VW emissions case holds particular promise for Anexo and it has put in place further funding through which it can secure further cases while mitigating its exposure to ongoing expenses.
All Anexo’s businesses have remained fully operational during the lockdown period and the Group has started FY 20 well. It has seen high levels of cash collection and we expect the impact of new recruits into Bond Turner to continue to support growth in case settlements and cash collections as their case portfolios mature.
Group revenues in FY 19 increased by 38.9% to £78.5 million (FY 18: £56.5 million) and adjusted profit before tax for the period increased by 43% to £23.1 million (FY 18: £16.1 million).