Insolvency specialist prepares for rise in activity as support measures begin to lift

Ric Traynor
X The Business Desk

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Begbies Traynor Group, the Manchester-based insolvency specialist, expects activity to pick up in the coming months as support mechanisms introduced by the Government during the pandemic start to lift.

The group is holding its annual general meeting today, and executive chairman, Ric Traynor will tell shareholders: “Last year was one of real progress for the group, in which we delivered a strong financial performance, representing another year of growth in revenue and adjusted profits, despite the impact of the COVID-19 pandemic, whilst making substantial investments which significantly increased the scale of the group and its capabilities.”

He said that, at this early stage of the group’s financial year, it remains confident of delivering market expectations for the full year, of adjusted profit before tax of between £17m-£18.5m, adding: “In the first quarter of the new financial year, commencing 1 May 2021, we have achieved double digit growth in revenue and profit reflecting the benefit of our recent acquisitions and the bounce back in activity from last year’s lockdowns.”

Over the last four financial years, Begbies has delivered compound annual growth in adjusted earnings per share of 20%, including 10% organic growth, and over the same period it has moved from net debt of £10.3m to net cash of £3.0m at the year end, while making value-enhancing acquisitions and delivering eight per cent compound growth in dividend per share.

In business recovery and financial advisory, the acquisitions completed in the previous financial year – CVR Global and David Rubin & Partners, acquired in January and March 2021, respectively – are performing well, in line with expectations, and, as reported in July, at the time of the group’s final results, integration activity has been completed as planned.

Mr Traynor said: “As we have previously reported, the insolvency market has been suppressed over the last 18 months due to government support measures. However, since May 2021, the Insolvency Service has reported month on month increases in insolvency appointments nationally.

“We expect this trajectory will continue in the final quarter of this calendar year, the second half of our financial year, as the support measures are progressively removed.”

The MAF Finance Group acquisition, completed in May 2021, is also performing well and in line with expectations, with synergy and cross selling opportunities being identified as the business is integrated into the group, he added.

He said: “Our property advisory and transactional services division is performing well, achieving year on year growth in revenue and profit from a more normalised trading performance compared to the lockdown impacted comparative period.

“The HNG chartered surveyors’ acquisition, completed in February 2021, is performing in line with expectations with integration on target for completion during the first half of our financial year.”

He also thanked new and existing shareholders for their support for the group’s share placing in March this year, saying the fundraise of £22m was significantly oversubscribed and provided the funding for both the DRP acquisition and future investments.

“Overall, the group remains in a very strong position. Our increased scale and capabilities provide us with the ability to continue to assist UK businesses as the economy recovers from the challenges of the pandemic.”