City round-up: Anexo Group; Speedy Hire

Anexo Group has reported a “successful 2021”, boosting revenue and profit levels.

The Liverpool-based specialist integrated credit hire and legal services provider, with offices in Bolton and Leeds, published figures for the year to December 31, 2021, today, that revealed a 36.2% increase in turnover of £118.237m, and a 52.9% boost to pre-tax profits of £23.746m.

Net debt rose by 53.1% to £62m and the total dividend of 1.5p per share remains the same as the previous year.

Anexo said opportunities in the credit hire division have never been so strong, following the introduction of the Civil Liabilities Act 2021, and the group has deployed increasing working capital facilities and reinvested significant levels of cash collections into the new case portfolio.

Consequently, the number of new cases funded rose from 7,535 to 10,265, an increase of 36.2%. This investment is supported by growth in cash collections, which rose by 21.5% in the year to reach £119m in 2021.

It said its ability to fund growth in its core business has been supported by investment in legal staff. In 2021, the number of senior fee earners grew by 45% to reach 237 at the year end. This investment has driven increased cash collections in the year, despite the challenges of the reduced operation of the court system.

Much of the investment will start to impact during 2022 and beyond, reflecting the life cycle of a typical credit hire claim and the time a new starter takes to reach settlement maturity.

Anexo is pursuing an emissions class action against Volkswagen AG and its subsidiaries and a court date for the case has been scheduled for January 2023, although it said, prior to this it will seek to negotiate settlement of the case. The company is representing around 13,000 cases.

The company, having undertaken its own research, is also pursuing a similar case against car manufacturer Mercedes-Benz and is to start actively sourcing claims against the car maker, as it has successfully done for VW. To support the case, Anexo sourced an additional £3m of funding in November 2021 to cover the anticipated marketing costs.

During the latter part of 2020 the group created a new team within its legal services division, Bond Turner, to deal with claims arising from housing disrepair. This team expanded rapidly during 2021. During the year it successfully settled some 500+ claims. At the end of the year, it had a portfolio of more than 1,500 ongoing claims. With further investment planned into 2022, the housing disrepair team is expected to generate a significant contribution to earnings in 2022 and beyond.

Anexo also announced today that Dr Julian Addison and Mike Branigan will be appointed to the board with immediate effect, having been nominated by DBAY Advisors Limited under the terms of the shareholder agreement announced on November 12, 2020. The shareholder agreement gives DBAY the right to appoint up to three non-executive directors and, therefore, Brian Corrway, who joined the board as an appointee of DBAY in November 2021, will step down from the board with immediate effect.

Liz Sands is also standing down from the board with immediate effect. Liz has been a member of the board since the IPO in June 2018. The company will look to fill her former sub-committee positions on the risk and regulation and remuneration committees in due course.

Alan Sellers, executive chairman, said: “I am pleased to report that the group has had a successful 2021, building on the achievements of 2020.

“The results demonstrate the resilience of the group’s business model, as we improved on last year’s cash collections, whilst still facing uncertainty due to the COVID-19 pandemic. Group revenues in 2021 increased by over a third compared to the previous year.

“Opportunities within the credit hire division have never been so strong. As a result, the group has focused considerable resource here and has seen the number of new cases funded rise substantially.

“The board remains focused on long term growth, and we are confident that there are significant opportunities that exist in 2022 to build upon our successful platform. The growth of our housing disrepair division throughout 2021, as well as our already resilient business model, presents an exciting outlook for the year ahead.”

Panmure Gordon analyst, Robert Plant, said: “Anexo’s FY21 results have a positive tone and we highlight the outlook comment that ‘while uncertainties remain given the current environment, I continue to have great confidence in the strategy post COVID and look to the future with continued optimism.

“Adjusted operating profit was £27.7m, three per cent above our forecast of £27.0m. We have maintained our FY22 EPS but raised our FY23 EPS by 10% to account for the good trading prospects across the businesses. We increase our DCF-based target price by nine per cent, from 235p to 255p.”

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Russell Down

Speedy Hire, the Newton-le-Willows-based plant hire group, announced today that chief executive, Russell Down, is to retire.

After seven years with the company he has told the board of his intention to step down, but will remain with the business until a successor is in place, to ensure a smooth and orderly transition.

The recruitment process for a replacement is under way.

Russell joined Speedy in April 2015 as group finance director and assumed the role of chief executive in July 2015.

The group has been transformed over this period, having improved its service proposition, grown service revenues, developed a market-leading ESG proposition, sold its Middle East operations, significantly expanded its presence within the SME and retail markets and digitised its internal and external operations.

As previously announced the group expects to report results in line with its expectations on May 24, 2022.

Chairman, David Shearer, said: “I would like to thank Russell personally and on behalf of the board for his significant contribution as chief executive over the last seven years. Under his leadership, the business has been transformed and is now well positioned for future growth with an ambitious management team. We wish him well for the future.”

Russell Down said: “I am proud to have been chief executive at Speedy for the last seven years and of all we have achieved during this period.

“We are leading the hire market with our digital offering, customer service proposition and ESG strategy, and also have a growing presence in the retail sector. The business is performing well, has a strong balance sheet and is well positioned for future growth.”