REG - Burford Capital Ltd - 3Q24 Results & Quarterly Report
07/11/2024 13:00
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RNS Number : 3692L Burford Capital Limited 07 November 2024
November 7, 2024
Burford Capital Reports Third Quarter 2024 Results
Burford Capital Limited ("Burford"), the leading global finance and asset
management firm focused on law, today announces its unaudited financial
results at and for the three and nine months ended September 30, 2024.
In addition, Burford has made available an accompanying three and nine months
ended September 30, 2024 results presentation on its website at
http://investors.burfordcapital.com (http://investors.burfordcapital.com) and
at http://www.rns-pdf.londonstockexchange.com/rns/3692L_1-2024-11-7.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/3692L_1-2024-11-7.pdf) .
Christopher Bogart, Chief Executive Officer of Burford Capital, commented:
"We are having a great year as we enjoy the long-awaited momentum in the
portfolio. We have generated $556 million in Burford-only cash receipts YTD24
and $310 million just in 3Q24, setting new records. Our core portfolio net
realized gains are already in line with the previous annual peak, with $184
million in YTD24 up 49% from YTD23, and $56 million in 3Q24, around twice the
level of the 2023 and 2022 third quarters. Net realized gains in YTD24 reflect
a ROIC of 94% on realizations which remains above our historical track record.
We reported Burford-only net income attributable to shareholders of $136
million in 3Q24 and grew tangible book value to more than $10 per share for
the first time. And despite the team being focused on the very active
portfolio, new commitments are up substantially in 3Q24 over 3Q23."
Consolidated financial results
Summary statements of operations
Nine months ended Three months ended
September 30, September 30,
Consolidated (US GAAP) 2024 2023 % change 2024 2023 % change
($ in thousands, except per share data)
Capital provision income 469,494 1,016,113 -54% 270,988 504,513 -46%
Asset management income 6,654 5,767 15% 3,147 1,876 68%
Total revenues 453,062 794,329 -43% 249,114 368,873 -32%
Total operating expenses 115,182 150,999 -24% 46,893 53,068 -12%
Net income/(loss) attributable to Burford Capital Limited shareholders 159,452 510,427 -69% 135,643 272,542 -50%
Per diluted ordinary share 0.71 2.29 -69% 0.61 1.22 -50%
Summary statements of financial position
Consolidated (US GAAP) September 30, 2024 December 31, 2023 % change
($ in thousands, except per share data)
Capital provision assets 5,356,300 5,045,388 6%
Total Burford Capital Limited equity 2,432,109 2,290,858 6%
Book value per ordinary share 11.08 10.46 6%
Non-controlling interests 865,242 916,922 -6%
Total shareholders' equity 3,297,351 3,207,780 3%
Total liabilities and shareholders' equity 6,274,902 5,837,394 7%
In this announcement, references to "3Q24" and "YTD24" are to Burford's
financial results for the three and nine months ended September 30, 2024,
respectively, and references to "3Q23" and "YTD23" are to Burford's financial
results for the three and nine months ended September 30, 2023, respectively.
All figures in this announcement are presented on an unaudited consolidated
basis in accordance with the generally accepted accounting principles in the
United States ("US GAAP"), unless otherwise stated. Figures at and for the
three and nine months ended September 30, 2024 are not necessarily indicative
of the results that may be expected for the full year ending December 31,
2024.
In addition, in this announcement, the term "core portfolio" refers to
Burford-only capital provision direct.
Definitions, reconciliations and information additional to those set forth in
this announcement are available on Burford's website at
http://investors.burfordcapital.com.
Burford-only operational and financial review (non-GAAP)
Selected metrics(1)
Nine months ended September 30, Three months ended September 30,
Burford-only (non-GAAP) 2024 2023 % change 2024 2023 % change
($ in thousands)
Net realized gains/(losses) 184,164 123,539 49% 56,257 29,145 93%
Realizations 380,442 274,101 39% 164,704 79,158 108%
Cash receipts(2) 555,548 379,732 46% 310,491 132,794 134%
Deployments 263,103 304,432 -14% 72,277 55,986 29%
New commitments 443,451 448,682 -1% 100,861 17,648 472%
(1) Represents Burford-only capital provision-direct, unless noted otherwise.
(2) Represents Burford-only proceeds from capital provision-direct, capital
provision-indirect and asset management and other services.
( )
Group-wide (non-GAAP) September 30, 2024 December 31, 2023 % change
($ in thousands)
Total portfolio 7,478,292 7,170,308 4%
Realizations in YTD24 of $216 million (YTD23: $195 million)
§ Realizations are on a record annual pace in 2024
o Core portfolio realizations of $380 million in YTD24 up 39% compared to YTD23
and diversified across 40 assets
o We continue to see progress in clearing the pandemic-driven backlog with about
half of the capital provision assets generating realizations in YTD24 being
from 2020 and prior vintages
o During YTD24, 10 assets have each generated more than $10 million in
realizations, with five of those assets each delivering $20 million or more
§ Net realized gains through 3Q24 are already near record annual levels
o Core portfolio net realized gains of $184 million in YTD24 up 49% compared to
YTD23, already in line with the previous annual peak of $186 million achieved
in the full year 2023
o YTD24 net realized gains reflect a ROIC of 94% on YTD24 realizations which
remains above our historical track record
§ Record cash generation underscores portfolio progress and healthy liquidity
o Cash receipts of $310 million in 3Q24 and $556 million in YTD24 driven by
realizations, collection of receivables and asset management income
§ New business remains solid
o Core portfolio new commitments of $443 million and deployments of $263 million
in YTD24 remain on a consistent pace even as substantial portfolio activity
places demands on team resources
o Definitive undrawn commitments of $727 million at September 30, 2024 up 25% in
YTD24 and support deployment activity looking forward
Selected financial metrics
Nine months ended Three months ended
September 30, September 30,
Burford-only (non-GAAP) 2024 2023 % change 2024 2023 % change
($ in thousands, except per share data)
Total revenues 394,688 725,927 -46% 226,033 344,013 -34%
Total operating expenses 112,977 150,377 -25% 46,011 52,801 -13%
Operating income/(loss) 281,711 575,550 -51% 180,022 291,212 -38%
Net income/(loss) 159,452 510,427 -69% 135,643 272,542 -50%
Burford-only (non-GAAP) September 30, 2024 December 31, 2023 $ change % change
($ in thousands, except per share data)
Tangible book value attributable to Burford Capital Limited 2,298,094 2,156,893 141,201 7%
Tangible book value attributable to Burford Capital Limited per ordinary share 10.47 9.85 0.62 6%
§ Net income in 3Q24 accelerated relative to the first half of the year
o 3Q24 net income attributable to Burford Capital Limited shareholders of $136
million, or $0.61 per diluted share
§ 3Q23 and YTD23 results benefited from substantial positive impact of
YPF-related capital provision income, which impacts 3Q24 and YTD24 comparisons
§ Within total revenues, 3Q24 was a strong quarter for capital provision income,
which is up significantly from prior year, excluding YPF-related assets impact
o 3Q24 Burford-only capital provision income of $205 million was driven, among
other things, by positive impact across the major valuation inputs of discount
rates, case milestones and duration
o Excluding YPF-related assets, which heavily impacted 2023 results,
Burford-only total net realized and unrealized gains were up 200% in 3Q24 and
17% in YTD24 compared to 3Q23 and YTD23, respectively
Selected portfolio metrics
Burford-only (non-GAAP) September 30, 2024 December 31, 2023 $ change % change
($ in thousands)
Deployed cost 1,645,667 1,573,531 72,136 5%
Plus: Fair value adjustments 1,967,677 1,814,070 153,607 8%
Fair value 3,613,344 3,387,601 225,743 7%
Undrawn commitments 1,562,125 1,396,061 166,064 12%
Total capital provision-direct portfolio 5,175,469 4,783,662 391,807 8%
Total capital provision portfolio(1) 5,215,932 4,840,117 375,815 8%
(1) Represents capital provision-direct and capital provision-indirect.
( )
§ Strong returns on realizations in YTD24 drove an increase in the cumulative
ROIC since inception from Burford-only capital provision-direct assets from
82% at December 31, 2023 to 84%, while cumulative IRR declined by 40 basis
points to 26% reflecting extended duration of certain assets (December 31,
2023: 27%)
Liquidity and capital
Burford-only (non-GAAP) September 30, 2024 December 31, 2023 $ change % change
($ in thousands)
Liquidity
Cash and cash equivalents 553,158 195,915 357,243 182%
Marketable securities 75,801 107,561 (31,760) -30%
Total liquidity 628,959 303,476 325,483 107%
Due from settlement of capital provision assets 64,489 185,267 (120,778) -65%
§ Burford-only cash and cash equivalents and marketable securities of $629
million at September 30, 2024 (December 31, 2023: $303 million)
o Strong liquidity position at September 30, 2024 augmented by $556 million of
Burford-only cash receipts in YTD24 and $275 million add-on offering to 2031
senior notes in January 2024
§ Burford-only due from settlement of capital provision assets of $64 million at
September 30, 2024 (December 31, 2023: $185 million), with 95% of December 31,
2023 balance collected in YTD24
§ Total debt outstanding of $1.8 billion at September 30, 2024 (December 31,
2023: $1.6 billion)
o Leverage remains well below covenant ceiling levels
Investor and analyst conference call
Burford will hold a conference call for investors and analysts at 10.00am EST
/ 3.00pm GMT on Thursday, November 7, 2024. The dial-in numbers for the
conference call are +1 (646) 307-1963 (USA) or +1 (800) 715-9871 (USA &
Canada toll free) / +44 (0)20 3481 4247 (UK) or +44 800 260 6466 (UK toll
free) and the access code is 1730316. To minimize the risk of delayed access,
participants are urged to dial into the conference call by 9.40am EST / 2.40pm
GMT.
A live webcast of the call will also be available at
https://events.q4inc.com/attendee/431913320
(https://events.q4inc.com/attendee/431913320) , and pre-registration at that
link is encouraged.
An accompanying 3Q24 results presentation for investors and analysts will also
be made available on Burford's website prior to the conference call at
http://investors.burfordcapital.com (http://investors.burfordcapital.com) .
Following the conference call, a replay facility for this event will be
accessible through the webcast at https://events.q4inc.com/attendee/431913320
(https://events.q4inc.com/attendee/431913320) .
For further information, please contact:
Burford Capital Limited
For investor and analyst inquiries:
Americas: Josh Wood, Head of Investor Relations - email +1 212 516 5824
(mailto:jwood@burfordcapital.com)
EMEA & Asia: Rob Bailhache, Head of EMEA & Asia Investor Relations - +44 (0)20 3530 2023
email (mailto:rbailhache@burfordcapital.com)
For press inquiries:
David Helfenbein, Vice President, Public Relations - email +1 (212) 516 5824
(mailto:dhelfenbein@burfordcapital.com)
Deutsche Numis - NOMAD and Joint Broker +44 (0)20 7260 1000
Giles Rolls
Charlie Farquhar
Jefferies International Limited - Joint Broker +44 (0)20 7029 8000
Graham Davidson
James Umbers
Berenberg - Joint Broker +44 (0)20 3207 7800
Toby Flaux
James Thompson
Yasmina Benchekroun
litigation finance (https://www.burfordcapital.com/) and risk management,
asset recovery and a wide range of legal finance and advisory activities.
Burford is publicly traded on the New York Stock Exchange (NYSE: BUR) and the
London Stock Exchange (LSE: BUR), and it works with companies and law firms
around the world from its offices in New York, London, Chicago, Washington,
DC, Singapore, Dubai, Sydney and Hong Kong.
www.burfordcapital.com (http://www.burfordcapital.com) .
About Burford Capital
Burford Capital is the leading global finance and asset management firm
focused on law. Its businesses include litigation finance
(https://www.burfordcapital.com/) and risk management, asset recovery and a
wide range of legal finance and advisory activities. Burford is publicly
traded on the New York Stock Exchange (NYSE: BUR) and the London Stock
Exchange (LSE: BUR), and it works with companies and law firms around the
world from its offices in New York, London, Chicago, Washington, DC,
Singapore, Dubai and Hong Kong.
For more information, please visit www.burfordcapital.com.
condensed consolidated and Burford-only statements of operations for the three
and six months ended June 30, 2024 and 2023, the condensed consolidated and
Burford-only statements of financial position at June 30, 2024 and December
31, 2023 and corresponding reconciliations from consolidated to Burford-only
financial results. Furthermore, the tables below set forth certain additional
reconciliations for financial information contained in this announcement.
Summary financial statements and reconciliations
The tables below set forth summaries of the condensed consolidated and
Burford-only statements of operations for the three and nine months ended
September 30, 2024 and 2023, the condensed consolidated and Burford-only
statements of financial position at September 30, 2024 and December 31, 2023
and corresponding reconciliations from consolidated to Burford-only financial
results. Furthermore, the tables below set forth certain additional
reconciliations for financial information contained in this announcement.
Summary condensed consolidated statements of operations
Three months ended Nine months ended
September 30, September 30,
($ in thousands) 2024 2023 2024 2023
Revenues
Capital provision income/(loss) 270,988 504,513 469,494 1,016,113
(Less)/Plus: Third-party interests in capital (35,152) (140,412) (46,640) (235,944)
provision assets
Asset management income/(loss) 3,147 1,876 6,654 5,767
Services and other income/(loss) 10,131 2,896 23,554 8,393
Total revenues 249,114 368,873 453,062 794,329
Total operating expenses 46,893 53,068 115,182 150,999
Operating income/(loss) 202,221 315,805 337,880 643,330
Finance costs and loss on debt extinguishment 34,399 29,013 101,432 70,690
Foreign currency transactions (gains)/losses (1,510) (9,811) (951) (21,149)
Income/(loss) before income taxes 169,332 296,603 237,399 593,789
Benefit from/(provision for) income taxes (11,468) 531 (21,761) (15,550)
Net income/(loss) 157,864 297,134 215,638 578,239
Net income/(loss) attributable to Burford Capital Limited shareholders 135,643 272,542 159,452 510,427
Net income/(loss) attributable to Burford Capital Limited shareholders per
ordinary share
Basic $0.62 $1.24 $0.73 $2.33
Diluted $0.61 $1.22 $0.71 $2.29
Summary Burford-only statement of operations
Three months ended Nine months ended
September 30, September 30,
($ in thousands) 2024 2023 2024 2023
Revenues
Capital provision income 204,961 324,995 342,224 676,402
Asset management income 11,110 16,141 29,270 41,182
Services and other income 9,962 2,877 23,194 8,343
Total revenues 226,033 344,013 394,688 725,927
Operating expenses 46,011 52,801 112,977 150,377
Operating income 180,022 291,212 281,711 575,550
Net income 135,643 272,542 159,452 510,427
Net income per share:
Basic $0.62 $1.24 $0.73 $2.33
Diluted $0.61 $1.22 $0.71 $2.29
Reconciliation of summary condensed consolidated statement of operations to
summary Burford-only statement of operations
Three months ended September 30, 2024
(GAAP) (Non-GAAP)
Elimination of third-party interests
($ in thousands) Consolidated BOF-C Colorado Advantage Fund Other Burford-only
Capital provision income 270,988 (18,742) (34,546) (10,257) (2,482) 204,961
(Less): Third-party interests in capital provision assets (35,152) - 34,518 - 634 -
Asset management income 3,147 7,963 - - - 11,110
Services and other income 10,131 (165) - - (4) 9,962
Total revenues 249,114 (10,944) (28) (10,257) (1,852) 226,033
Operating expenses 46,893 62 (28) (96) (820) 46,011
Operating income 202,221 (11,006) - (10,161) (1,032) 180,022
Net income/(loss) 157,864 (11,006) - (10,161) (1,054) 135,643
Three months ended September 30, 2023
(GAAP) (Non-GAAP)
Elimination of third-party interests
($ in thousands) Consolidated Strategic Value Fund BOF-C Colorado Advantage Fund Other Burford-only
Capital provision income 540,513 (845) (36,193) (140,690) (8,368) 6,578 324,995
(Less): Third-party interests in capital provision assets (140,412) - - 140,699 - (287) -
Asset management income 1,876 16 14,249 - - - 16,141
Services and other income 2,896 (1) (3) - - (15) 2,877
Total revenues 368,873 (830) (21,947) 9 (8,368) 6,276 344,013
Operating expenses 53,068 (637) 73 9 (76) 364 52,801
Operating income 315,805 (193) (22,020) - (8,292) 5,912 291,212
Net income/(loss) 297,134 (193) (22,020) - (8,292) 5,913 272,542
Nine months ended September 30, 2024
(GAAP) (Non-GAAP)
Elimination of third-party interests
($ in thousands) Consolidated BOF-C Colorado Advantage Fund Other Burford-only
Capital provision income 469,494 (51,760) (47,372) (23,302) (4,836)
342,224
(Less): Third-party interests in capital provision assets (46,640) - 47,272 - (632) -
Asset management income 6,654 22,616 - - - 29,270
Services and other income 23,554 (350) - - (10) 23,194
Total revenues 453,062 (29,494) (100) (23,302) (5,478) 394,688
Operating expenses 115,182 152 (100) (370) (1,887) 112,977
Operating income 337,880 (29,646) - (22,932) (3,591) 281,711
Net income/(loss) 215,638 (29,646) - (22,932) (3,608) 159,452
Nine months ended September 30, 2023
(GAAP) (Non-GAAP)
Elimination of third-party interests
($ in thousands) Consolidated Strategic Value Fund BOF-C Colorado Advantage Fund Other Burford-only
Capital provision income 1,016,113 (1,052) (84,429) (235,731) (20,373) (1,874) 676,402
(Less): Third-party interests in capital provision assets (235,944) - - 235,710 - 234 -
Asset management income 5,767 108 35,307 - - - 41,182
Services and other income 8,393 (1) (5) - - (44) 8,343
Total revenues 794,329 (945) (49,127) (21) (20,373) (2,064) 725,927
Operating expenses 150,999 (933) 290 (21) (279) (321) 150,377
Operating income 643,330 (12) (49,417) - (20,094) (1,743) 575,550
Net income/(loss) 578,239 (12) (49,417) - (20,094) (1,711) 510,427
Summary condensed consolidated statement of financial position
($ in thousands) September 30, December 31, 2023
2024
Total assets 6,274,902 5,837,394
Total liabilities 2,977,551 2,629,614
Total Burford Capital Limited equity 2,432,109 2,290,858
Non-controlling interests 865,242 916,922
Total shareholders' equity 3,297,351 3,207,780
Basic ordinary shares outstanding 219,421,376 218,962,441
Total shareholders' equity attributable to Burford Capital Limited per basic 11.08 10.46
ordinary share
Total shareholders' equity per basic ordinary share 15.03 14.65
Reconciliation of summary consolidated statement of financial position to
summary Burford-only statement of financial position
September 30, 2024
(GAAP) (Non-GAAP)
Elimination of third-party interests
($ in thousands) Consolidated BOF-C Colorado Advantage Fund Other Burford-only
Total assets 6,274,902 (602,059) (733,574) (199,160) (81,977) 4,658,132
Total liabilities 2,977,551 - (733,574) (52) (17,902) 2,226,023
Total shareholders' equity 3,297,351 (602,059) - (199,108) (64,075) 2,432,109
December 31, 2023
(GAAP) (Non-GAAP)
Elimination of third-party interests
($ in thousands) Consolidated BOF-C Colorado Advantage Fund Other Burford-only
Total assets 5,837,394 (634,239) (686,304) (222,413) (78,574) 4,215,864
Total liabilities 2,629,614 - (686,304) (100) (18,204) 1,925,006
Total shareholders' equity 3,207,780 (634,239) - (222,313) (60,370) 2,290,858
Reconciliation of components of realizations from a consolidated basis to a
Group-wide basis
Three months ended September 30, 2024
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only Other funds BOF-C Group-wide
Capital provision-direct 231,891 (67,187) 164,704 58,567 33,431 256,702
Capital provision-indirect 22,274 (18,562) 3,712 18,562 - 22,274
Post-settlement - - - 34,940 - 34,940
Total realizations 254,165 (85,749) 168,416 112,069 33,431 313,916
Three months ended September 30, 2023
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only Other funds BOF-C Group-wide
Capital provision-direct 89,162 (10,004) 79,158 16,539 12,243 107,940
Capital provision-indirect 19,575 (6,228) 13,347 6,228 - 19,575
Post-settlement - - - 20,050 - 20,050
Total realizations 108,737 (16,232) 92,505 42,817 12,243 147,565
Nine months ended September 30, 2024
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only Other funds BOF-C Group-wide
Capital provision-direct 515,475 (135,033) 380,442 124,912 88,152 593,506
Capital provision-indirect 43,544 (36,287) 7,257 36,287 - 43,544
Post-settlement - - - 87,442 - 87,442
Total realizations 559,019 (171,320) 387,699 248,641 88,152 724,492
Nine months ended September 30, 2023
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only Other funds BOF-C Group-wide
Capital provision-direct 335,414 (61,313) 274,101 89,915 64,944 429,010
Capital provision-indirect 59,219 (39,317) 19,902 39,002 - 58,904
Post-settlement - - - 118,307 - 118,307
Total realizations 394,633 (100,630) 294,003 247,224 64,944 606,221
Reconciliation of components of deployments from a consolidated basis to a
Group-wide basis
Three months ended September 30, 2024
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only Other funds BOF-C Group-wide
Capital provision-direct 88,769 (16,492) 72,277 5,400 15,947 93,624
Capital provision-indirect 9,371 (7,818) 1,563 7,817 - 9,380
Post-settlement - - - 10,308 - 10,308
Total deployments 98,150 (24,310) 73,840 23,525 15,947 113,312
Three months ended September 30, 2023
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only Other funds BOF-C Group-wide
Capital provision-direct 69,690 (13,704) 55,986 4,379 21,819 82,184
Capital provision-indirect 32,257 (26,881) 5,376 26,881 - 32,257
Post-settlement - - - 7,466 - 7,466
Total deployments 101,947 (40,585) 61,362 38,726 21,819 121,907
Nine months ended September 30, 2024
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only Other funds BOF-C Group-wide
Capital provision-direct 332,788 (69,685) 263,103 12,763 73,498 349,364
Capital provision-indirect 68,106 (56,755) 11,351 56,755 - 68,106
Post-settlement - - - 39,836 - 39,836
Total deployments 400,894 (126,440) 274,454 109,354 73,498 457,306
Nine months ended September 30, 2023
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only Other funds BOF-C Group-wide
Capital provision-direct 401,215 (96,783) 304,432 17,362 97,775 419,569
Capital provision-indirect 145,051 (120,876) 24,175 120,876 - 145,051
Post-settlement - - - 43,272 - 43,272
Total deployments 546,266 (217,659) 328,607 181,510 97,775 607,892
Reconciliation of consolidated proceeds from capital provision assets to
Burford-only cash receipts
($ in thousands) Three months ended September 30, 2024 Three months ended September 30, 2023
Consolidated proceeds from capital provision assets 395,943 132,147
Less: Elimination of third-party interests (91,185) (7,074)
Burford-only total proceeds from capital provision assets 340,758 125,073
Burford-only proceeds from capital provision-direct assets 301,345 105,915
Less: Funding of financial liabilities at fair value through profit or loss (2,583) -
Burford-only proceeds from capital provision-direct assets (adjusted) 298,765 105,915
Burford-only proceeds from capital provision-indirect assets 3,413 19,158
Burford-only total proceeds from capital provision assets 302,175 125,073
Consolidated asset management income 3,147 1,876
Plus: Eliminated income from funds 7,963 14,265
Burford-only asset management income 11,110 16,141
Less: Non-cash adjustments((1)) (9,389) (10,409)
Burford-only proceeds from asset management income 1,721 5,732
Burford-only proceeds from marketable security interest and dividends 4,567 2,062
Burford-only proceeds from other income 2,028 (73)
Burford-only proceeds from other items 6,595 1,989
Cash receipts 310,491 132,794
(1) Adjustments for the change in asset management receivables accrued during
the applicable period but not yet received at the end of such period.
($ in thousands) Nine months ended September 30, 2024 Nine months ended September 30, 2023
Consolidated proceeds from capital provision assets 768,848 440,154
Less: Elimination of third-party interests (248,062) (94,587)
Burford-only total proceeds from capital provision assets 520,786 345,567
Burford-only proceeds from capital provision-direct assets 500,595 319,236
Less: Funding of financial liabilities at fair value through profit or loss (2,583) -
Burford-only proceeds from capital provision-direct assets (adjusted) 498,012 319,236
Burford-only proceeds from capital provision-indirect assets 20,191 26,331
Burford-only total proceeds from capital provision assets 518,203 345,567
Consolidated asset management income 6,654 5,767
Plus: Eliminated income from funds 22,616 35,415
Burford-only asset management income 29,270 41,182
Less: Non-cash adjustments((1)) (12,081) (12,137)
Burford-only proceeds from asset management income 17,189 29,045
Burford-only proceeds from marketable security interest and dividends 15,136 3,625
Burford-only proceeds from other income 5,020 1,495
Burford-only proceeds from other items 20,156 5,120
Cash receipts 555,548 379,732
(1) Adjustments for the change in asset management receivables accrued during
the applicable period but not yet received at the end of such period.
Reconciliation of consolidated portfolio to Group-wide portfolio
September 30, 2024
(GAAP) (non-GAAP)
Elimination of
($ in thousands) Consolidated third-party Burford-only Other funds BOF-C Group-wide
interests
Capital provision assets - direct:
Deployed cost 2,172,043 (526,376) 1,645,667 362,230 459,211 2,467,108
Plus: Fair value adjustments 2,946,300 (978,623) 1,967,677 168,275 227,300 2,363,252
Fair value 5,118,343 (1,504,999) 3,613,344 530,505 686,511 4,830,360
Capital provision assets - indirect:
Deployed cost 205,831 (174,918) 30,913 174,918 - 205,831
Plus: Fair value adjustments 32,126 (23,156) 8,970 23,156 - 32,126
Fair value 237,957 (198,074) 39,883 ( ) 198,074 - 237,957
Total capital provision assets 5,356,300 (1,703,073) 3,653,227 ( ) 728,579 686,511 5,068,317
Post-settlement assets:
Deployed cost - - - 217,352 - 217,352
Plus: Fair value adjustments - - - 44,301 - 44,301
Fair value - - - 261,653 - 261,653
Undrawn commitments:
Capital provision-direct 1,987,200 (425,075) 1,562,125 107,578 416,320 2,086,023
Capital provision-indirect 3,479 (2,899) 580 2,899 - 3,479
Post-settlement - - - 58,820 - 58,820
Total undrawn commitments 1,990,679 (427,974) 1,562,705 169,297 416,320 2,148,322
Total portfolio 7,346,979 (2,131,047) 5,215,932 1,159,529 1,102,831 7,478,292
December 31, 2023
(GAAP) (non-GAAP)
Elimination of
third-party
($ in thousands) Consolidated interests Burford-only Other funds BOF-C Group-wide
Capital provision assets - direct:
Deployed cost 2,116,304 (542,773) 1,573,531 416,318 428,110 2,417,959
Plus: Fair value adjustments 2,743,575 (929,505) 1,814,070 180,169 220,363 2,214,602
Fair value 4,859,879 (1,472,278) 3,387,601 596,487 648,473 4,632,561
Capital provision assets - indirect:
Deployed cost 164,259 (125,508) 38,751 125,508 - 164,259
Plus: Fair value adjustments 21,250 (15,490) 5,760 15,490 - 21,250
Fair value 185,509 (140,998) 44,511 ( ) 140,998 - 185,509
Total capital provision assets 5,045,388 (1,613,276) 3,432,112 737,485 648,473 4,818,070
Post-settlement assets:
Deployed cost - - - 253,062 - 253,062
Plus: Fair value adjustments - - - 45,792 - 45,792
Fair value - - - 298,854 - 298,854
Undrawn commitments:
Capital provision-direct 1,801,627 (405,566) 1,396,061 126,560 396,646 1,919,267
Capital provision-indirect 71,662 (59,718) 11,944 59,718 - 71,662
Post-settlement - - - 62,455 - 62,455
Total undrawn commitments 1,873,289 (465,284) 1,408,005 248,733 396,646 2,053,384
Total portfolio 6,918,677 (2,078,560) 4,840,117 1,285,072 1,045,119 7,170,308
Reconciliation of consolidated to Burford-only cash and cash equivalents and
marketable securities
September 30, 2024 December 31, 2023
(GAAP) (Non-GAAP) (GAAP) (Non-GAAP)
($ in thousands) Consolidated Elimination of third-party interests Burford-only Consolidated Elimination of third-party interests Burford-only
Cash and cash equivalents 574,014 (20,856) 553,158 220,549 (24,634) 195,915
Marketable securities 75,801 - 75,801 107,561 - 107,561
Total cash and cash equivalents and marketable securities 649,815 (20,856) 628,959 328,110 (24,634) 303,476
Reconciliation of consolidated to Burford-only due from settlement of capital
provision assets
September 30, 2024 December 31, 2023
(GAAP) (Non-GAAP) (GAAP) (Non-GAAP)
($ in thousands) Consolidated Elimination of third-party interests Burford-only Consolidated Elimination of third-party interests Burford-only
Due from settlement of capital provision assets 64,489 - 64,489 265,540 (80,273) 185,267
Reconciliation of consolidated to Burford-only net realized gains/(losses) on
capital provision-direct assets
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only total Burford-only Capital provision-direct Burford-only Capital provision-indirect
Net realized gains/(losses) for the three months ended September 30, 2024 86,940 (30,450) 56,490 56,257 233
Net realized gains/(losses) for the three months ended September 30, 2023 37,566 (7,440) 30,126 29,145 981
(GAAP) (Non-GAAP)
($ in thousands) Consolidated Eliminations and adjustments Burford-only total Burford-only Capital provision-direct Burford-only Capital provision-indirect
Net realized gains/(losses) for the nine months ended September 30, 2024 262,273 (76,736) 185,537 184,164 1,373
Net realized gains/(losses) for the nine months ended September 30, 2023 171,331 (46,811) 124,520 123,539 981
Reconciliation of consolidated to Burford-only capital provision income
Three months ended September 30, 2024 Three months ended September 30, 2023
(GAAP) (Non-GAAP) (GAAP) (Non-GAAP)
($ in thousands) Consolidated Elimination of third-party interests Burford-only Consolidated Elimination of third-party interests Burford-only
Net realized gains/(losses) 86,940 (30,450) 56,490 37,566 (7,440) 30,126
75,684 (554) 75,130 46,125 (32,339) 13,786
Fair value adjustment during the period, net of previously recognized
unrealized gains/(losses) transferred to realized gains/(losses)
(excluding-YPF)
Income on capital provision assets, excluding YPF 162,624 (31,004) 131,620 83,691 (39,779) 43,912
Fair value adjustment during the period, net of previously recognized 104,135 (34,546) 69,589 417,920 (140,690) 277,230
unrealized gains/(losses) transferred to realized gains/(losses) (YPF-only)
Other 4,229 (477) 3,752 2,902 951 3,853
Total capital provision income 270,988 (66,027) 204,961 504,513 (179,518) 324,995
Nine months ended September 30, 2024 Nine months ended September 30, 2023
(GAAP) (Non-GAAP) (GAAP) (Non-GAAP)
($ in thousands) Consolidated Elimination of third-party interests Burford-only Consolidated Elimination of third-party interests Burford-only
Net realized gains/(losses) 262,273 (76,736) 185,537 171,331 (46,811) 124,520
63,406 (3,322) 60,084 142,799 (57,472) 85,327
Fair value adjustment during the period, net of previously recognized
unrealized gains/(losses) transferred to realized gains/(losses)
(excluding-YPF)
Income on capital provision assets, excluding YPF 325,679 (80,058) 245,621 314,130 (104,283) 209,847
Fair value adjustment during the period, net of previously recognized 141,782 (47,372) 94,410 695,238 (235,731) 459,507
unrealized gains/(losses) transferred to realized gains/(losses) (YPF-only)
Other 2,033 160 2,193 6,745 303 7,048
Total capital provision income 469,494 (127,270) 342,224 1,016,113 (339,711) 676,402
Reconciliation of consolidated undrawn commitments to Burford-only undrawn
commitments
September 30, 2024
Elimination of
third-party
interests
($ in thousands) Consolidated Burford-only
Definitive 931,730 (204,768) 726,962
Discretionary 1,011,019 (220,307) 790,712
Total legal finance undrawn commitments 1,942,749 (425,075) 1,517,674
Legal risk (definitive) 44,451 - 44,451
Total capital provision-direct undrawn commitments 1,987,200 (425,075) 1,562,125
Capital provision-indirect undrawn commitments 3,479 (2,899) 580
Total capital provision undrawn commitments 1,990,679 (427,974) 1,562,705
December 31,2023
Elimination of
third-party
interests
($ in thousands) Consolidated Burford-only
Definitive 768,311 (188,313) 579,998
Discretionary 977,733 (211,196) 766,537
Total legal finance undrawn commitments 1,746,044 (399,509) 1,346,535
Legal risk (definitive) 55,583 (6,057) 49,526
Total capital provision-direct undrawn commitments 1,801,627 (405,566) 1,396,061
Capital provision-indirect undrawn commitments 71,662 (59,718) 11,944
Total capital provision undrawn commitments 1,873,289 (465,284) 1,408,005
Reconciliation of tangible book value attributable to Burford Capital Limited
per ordinary share
($ in thousands, except share data) September 30, 2024 December 31, 2023
Total Burford Capital Limited equity 2,432,109 2,290,858
Less: Goodwill (134,015) (133,965)
Tangible book value attributable to Burford Capital Limited 2,298,094 2,156,893
Basic ordinary shares outstanding 219,421,376 218,962,441
Tangible book value attributable to Burford Capital Limited per ordinary share $10.47 $9.85
consolidated financial results in accordance with US GAAP. US GAAP requires us
to present financial statements that consolidate some of the limited partner
interests in private funds we manage as well as assets held on our balance
sheet where we have a partner or minority investor. We therefore refer to
various presentations of our consolidated financial results as follows:
Definitions and use of non-GAAP financial measures and alternative performance
measures
Burford reports its consolidated financial results in accordance with US GAAP.
US GAAP requires us to present financial statements that consolidate some of
the limited partner interests in private funds we manage as well as assets
held on our balance sheet where we have a partner or minority investor. We
therefore refer to various presentations of our consolidated financial results
as follows:
• Consolidated refers to assets, liabilities and activities that include those
third-party interests, partially owned subsidiaries and special purpose
vehicles that we are required to consolidate under US GAAP. At the date of
this announcement, the major entities where there is also a third-party
partner in, or owner of, those entities include Burford Opportunity Fund C LP,
Burford Advantage Master Fund LP, Colorado Investments Limited ("Colorado")
and several other entities in which Burford holds investments where there is
also a third-party partner in, or owner of, those entities.
• Burford-only refers to assets, liabilities and activities that pertain only to
Burford on a proprietary basis, excluding any third-party interests and the
portions of jointly owned entities owned by others.
• Group-wide refers to the totality of assets managed by Burford, including
those portions of the private funds owned by third parties and including
private funds that are not consolidated within Burford's consolidated
financial statements. Group-wide is therefore the sum of Burford-only and
non-controlling interests in consolidated and non-consolidated private funds.
Group-wide does not include third-party interests in capital provision assets,
the economics of which have been sold to those third parties, which do not
meet the criteria to be recognized as a sale under US GAAP. This includes the
third-party interests in Colorado and other capital provision asset
subparticipations.
We subdivide our capital provision assets into two categories:
• Direct, which includes all of our capital provision assets that we have
originated directly (i.e., not through participation in a private fund) from
our balance sheet. We also include direct (i.e., not through participation in
a private fund) complex strategies assets in this category.
• Indirect, which includes our balance sheet's participations in one of our
private funds (i.e., Burford Advantage Master Fund LP).
We also use certain unaudited alternative performance measures, including:
• Internal rate of return ("IRR") is a discount rate that makes the net present
value of a series of cash flows equal to zero and is expressed as a percentage
figure. We compute IRR on concluded (including partially concluded) legal
finance assets by treating that entire portfolio (or, when noted, a subset
thereof) as one undifferentiated pool of capital and measuring actual and, if
necessary, estimated inflows and outflows from that pool, allocating costs
appropriately. IRRs do not include unrealized gains or losses.
• Return on invested capital ("ROIC") from a concluded asset is the absolute
amount of realizations from such asset in excess of the amount of expenditure
incurred in financing such asset divided by the amount of expenditure
incurred, expressed as a percentage figure. ROIC is a measure of our ability
to generate absolute returns on our assets. Some industry participants express
returns on a multiple of invested capital ("MOIC") instead of a ROIC basis.
MOIC includes the return of capital and, therefore, is 1x higher than ROIC. In
other words, 70% ROIC is the same as 1.70x MOIC.
Other unaudited alternative performance measures and terms we use include:
• Commitment is the amount of financing we agree to provide for a legal finance
asset. Commitments can be definitive (requiring us to provide financing on a
schedule or, more often, when certain expenses are incurred) or discretionary
(allowing us to provide financing after reviewing and approving a future
matter). Unless otherwise indicated, commitments include deployed cost and
undrawn commitments.
• Deployment refers to the financing provided for an asset, which adds to our
deployed cost in such asset.
• Deployed cost is the amount of financing we have provided for an asset at the
applicable point in time.
• Fair value adjustment is the amount of unrealized gain or loss recognized in
our consolidated statements of operations in the relevant period and added to
or subtracted from, as applicable, the asset or liability value in our
consolidated statements of financial position.
• Portfolio includes deployed cost, net unrealized gains or losses and undrawn
commitments.
• Realization: A legal finance asset is realized when the asset is concluded
(i.e., when litigation risk has been resolved). A realization will result in
us receiving cash or, occasionally, non-cash assets, or recognizing a due from
settlement receivable, reflecting what we are owed on the asset.
• Realized gain / loss reflects the total amount of gain or loss, relative to
cost, generated by a legal finance asset when it is realized, calculated as
realized proceeds less deployed cost, without regard for any previously
recognized fair value adjustment.
• Unrealized gain / loss represents the fair value of our legal finance assets
over or under their deployed cost, as determined in accordance with the
requirements of the applicable US GAAP standards, for the relevant financial
reporting period (consolidated statements of operations) or cumulatively
(consolidated statements of financial position).
• YPF-related assets refers to our Petersen and Eton Park legal finance assets,
which are two claims relating to the Republic of Argentina's nationalization
of YPF S.A., the Argentine energy company.
We also use certain non-GAAP financial measures, including:
• Book value per ordinary share is calculated by dividing total Burford Capital
Limited equity by the number of ordinary shares issued and outstanding.
• Cash receipts represent cash generated during the reporting period from our
capital provision assets, asset management income and certain other items,
before any deployments into financing existing or new assets. Cash receipts
are a non-GAAP financial measure and should not be considered in isolation
from, as a substitute for, or superior to, financial measures calculated in
accordance with US GAAP. The most directly comparable measure calculated in
accordance with US GAAP is proceeds from capital provision assets as set forth
in our consolidated statements of cash flows. We believe that cash receipts
are an important measure of our operating and financial performance and are
useful to management and investors when assessing the performance of our
Burford-only capital provision assets.
• Tangible book value attributable to Burford Capital Limited is calculated by
subtracting intangible assets (such as goodwill) from total Burford Capital
Limited equity. Tangible book value attributable to Burford Capital Limited
per ordinary share is calculated by dividing tangible book value attributable
to Burford Capital Limited by the total number of outstanding ordinary shares.
Each of tangible book value attributable to Burford Capital Limited and
tangible book value attributable to Burford Capital Limited per ordinary share
is a non-GAAP financial measure and should not be considered in isolation
from, as a substitute for, or superior to, financial measures calculated in
accordance with US GAAP. The most directly comparable measure calculated in
accordance with US GAAP is total Burford Capital Limited equity as set forth
in our consolidated statements of financial position. We believe that tangible
book value attributable to Burford Capital Limited per ordinary share is an
important measure of our financial condition and is useful to management and
investors when assessing capital adequacy and our ability to generate earnings
on tangible equity invested by our shareholders.
Non-GAAP financial measures should not be considered in isolation from, as
substitutes for, or superior to, financial measures calculated in accordance
with US GAAP.
This announcement does not constitute an offer to sell or the solicitation of
an offer to buy any ordinary shares or other securities of Burford.
This announcement does not constitute an offer of any Burford private fund.
Burford Capital Investment Management LLC, which acts as the fund manager of
all Burford private funds, is registered as an investment adviser with the
US Securities and Exchange Commission. The information provided in this
announcement is for informational purposes only. Past performance is not
indicative of future results. The information contained in this announcement
is not, and should not be construed as, an offer to sell or the solicitation
of an offer to buy any securities (including, without limitation, interests or
shares in any of Burford private funds). Any such offer or solicitation may be
made only by means of a final confidential private placement memorandum and
other offering documents.
Forward-looking statements
This announcement contains "forward-looking statements" within the meaning of
Section 21E of the US Securities Exchange Act of 1934, as amended, regarding
assumptions, expectations, projections, intentions and beliefs about future
events. These statements are intended as "forward-looking statements". In some
cases, predictive, future-tense or forward-looking words such as "aim",
"anticipate", "believe", "continue", "could", "estimate", "expect",
"forecast", "guidance", "intend", "may", "plan", "potential", "predict",
"projected", "should" or "will" or the negative of such terms or other
comparable terminology are intended to identify forward-looking statements,
but are not the exclusive means of identifying such statements. In addition,
Burford and its representatives may from time to time make other oral or
written statements that are forward-looking, including in its periodic reports
that Burford files with, or furnishes to, the US Securities and Exchange
Commission, other information made available to Burford's security holders and
other written materials. By their nature, forward-looking statements involve
known and unknown risks, uncertainties and other factors because they relate
to events and depend on circumstances that may or may not occur in the future.
Burford cautions that forward-looking statements are not guarantees of future
performance and are based on numerous assumptions, expectations, projections,
intentions and beliefs and that Burford's actual results of operations,
including its financial position and liquidity, and the development of the
industry in which it operates, may differ materially from (and be more
negative than) those made in, or suggested by, the forward-looking statements
contained in this announcement. Significant factors that may cause actual
results to differ from those Burford expects include, among others, those
discussed under "Risk Factors" in Burford's annual report on Form 20-F for the
year ended December 31, 2023 filed with the US Securities and Exchange
Commission on March 28, 2024 and other reports or documents that Burford files
with, or furnishes to, the US Securities and Exchange Commission from time to
time. In addition, even if Burford's results of operations, including its
financial position and liquidity, and the development of the industry in which
it operates are consistent with the forward-looking statements contained in
this announcement, those results of operations or developments may not be
indicative of results of operations or developments in subsequent periods.
Except as required by applicable law, Burford undertakes no obligation to
update or revise the forward-looking statements contained in this
announcement, whether as a result of new information, future events or
otherwise.
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