Insolvency funder makes rapid progress during lockdown

Cooklin: Excited by prospects

Insolvency litigation funder Manolete Partners has had a strong lockdown, with revenue, profit and new case investments all rising sharply, its half-year results have shown.

In the six months to 30 September, the AIM-listed company reported revenue up 153% to £19m and profit after tax up 49% to £5.2m, with gross profits on realised cases leaping 440% to £4m.

It concluded 52 cases during the six months – almost as many as in the whole of the last financial year (54) – while the number of new case investments rose by 69% to 110.

Manolete currently has 214 live cases, with the average case duration remaining constant at around 11 months.

While a lot of businesses have been deferring or cancelling dividends because of Covid, Manolete has proposed an interim dividend of 1.17p, having paid 0.5p last year.

Chief executive Steven Cooklin said: “The board is keeping a close watch on the effects of Covid-19 as well as the government economic support measures and the impact these two opposing factors may have on the level of corporate insolvencies and personal bankruptcies in the short and longer term.”

He said a further 10 cases have been completed in October, with another 40 cases scheduled for alternative dispute resolution or currently the subject of “serious settlement offer negotiations”.

“Alongside favourable macro-economic trends, this granular data underpins our excitement at the prospects for the second half of the year and beyond.

“This performance reflects Manolete’s core strengths: market-leading position, operating in a specialist sector where Manolete can buy almost all cases – Manolete is not a mere passive ‘funder’ – significant first-mover advantage and deeply embedded relationships with all key stakeholders in the turnaround, restructuring and insolvency community, nurtured over our 11-year operating history.”

Manolete’s shares rose 7.5% to 301p on the announcement, but the share price continues to struggle since an anonymous attack in July on the company’s model.

Manolete’s shares reached a high of 585p in May after rapidly recovering from the market-wide dip caused by lockdown, but tumbled to 410p in the wake of the attack and have continued to fall steadily since.

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