£RBGP
RBGP (Rosenblatt), the professional service group has a current £52m market capitalisation at 60p a share. The interim results were released on the 16/9, for the period to 30/6 and the CEO and FD spoke to a group of investors yesterday, following the results institutional meeting on the day. ‘There has been an incredible demand for legal service in lockdown’ the CEO, Nikki Foulston stated.
Rosenblatt joined AIM on the 8/5/18 at 95p a share being a leading independent City law firm and raised approximately £43m, giving the PLC a market cap of £76m. The shares did reach 130p two years ago. The raised cash was to provide investment capital to fund in house litigation and for strategic acquisitions. Since the float, RBGP (the new name) has set up a third-party litigation division called Lionfish ( begun in May ) and after buying Convex Capital, a boutique sells side corporate financier based in Manchester. As highlighted by the 1H numbers, the core legal resolution dispute business performed very well with rising revenues & profitability. However the newly bought Convex capital business pipeline quick disappeared (along with any potential profits) as CV-19 concerns took hold.
Some weeks later, on the 6/10, RBGP issued another RNS this time giving FY financial guidance having chosen not at the interim results. Convex Capital had booked fees in excess of £1.2m and Lionfish, the newly formed litigation division monitised two cases for £1.1m. Based on current management forecasts the group revenue is now expected to be between £24m and £26m, while in 2019 it was £23.7m. This was missing from the 1H RNS!
1H revenue was £12m, up 17% with EBITDA £2.6m (£1.8m in 2019 if £2m of case realised gains are removed), EPS was 1.35p and no interim dividend declared. Eight litigation investments were live at the end of June (with £3.8m of sunk legal time) and three more litigation investments were made since the results period end. The 11 cases have an investment worth of £4.6m. The 1H business highlight was the core Rosenblatt legal service revenues, being £11.7m and up 42% with £0.9m of WIP to add in the future. Within the legal corporate division revenues were £3.3m, up 335% and the average revenue per fee earner at £497k. Lionfish has so far approved 6 cases and executed on three with 23 under review. Within Lionfish, Islero has been set…
