Begbies anticipates positive conditions on the other side of pandemic

Ric Traynor, Begbies Traynor

Insolvency specialist Begbies Traynor Group reports a strong financial performance in the six months to October 31.

In a trading update this morning, the Manchester-based group said revenue in the period grew by around 10%, with adjusted profit before tax growing by approximately 25%, having absorbed the downside impact of lockdown in the first few months of the financial year.

The group has maintained its strong financial position with net cash at October 31, of £0.7m (30 April 2020: net debt of £2.8m, 31 October 2019: net debt of £2.3m) and significant levels of headroom within its committed bank facilities.

Overall, the board expects results for the full year to be at least in line with current market consensus – adjusted profit before tax of £9.8m – which would represent a further year of growth.

The group’s business recovery and financial advisory division has performed well in the first half, despite the subdued insolvency market resulting from the Government’s COVID-19 financial support measures.

It has increased market share of new insolvency appointments in the period, which, together with an increase in average case size, has partially mitigated the weakness in the wider market.

These developments, combined with the first time contribution from prior year acquisitions, has enabled the division to record growth in revenue and profits on the comparative period.

The property advisory and transactional services division has delivered a robust performance in the period, having absorbed the downside impact of the lockdown in the first few months of the financial year.

The division has generated solid operating margins with strong performance from the building consultancy business, which partially offset the downside from service lines which were impacted by the Spring lockdown.

The board said these impacted service lines have all shown a strong recovery in performance in recent months.

Begbies said today that it will report its half year results for the six months ended October 31, 2020 on Tuesday, December 8, 2020.

Executive chairman, Ric Traynor, said: “I am pleased to report a continuing strong financial performance in the first six months of the financial year, which is testament to how our teams continue to deliver excellent client service in a challenging environment.

“We anticipate continuing our recent financial track record of growth for the year as a whole, ensuring we are well placed to invest in our successful organic and acquisitive growth strategy.

“Overall, our medium-term outlook remains positive, especially once the economy exits this current period of uncertainty.”

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