AIM-listed Fairpoint Group has sold its medico-legal business to Premex to support the company’s working capital needs, it announced today.
Fairpoint is transforming itself into a legal services business, on the back of four law firm acquisitions since June 2014, having previously focused on debt management services.
However, it is in the middle of a restructuring and just yesterday warned investors that they would not see the benefits of this until 2018, as its 2017 performance will drop.
Fairpoint has sold PIX Limited for £1.2m in cash, with the money “used to support the working capital requirements of the group”.
Established in 2012 to work with Simpson Millar – the first firm Fairpoint bought – PIX offers medical records and reporting services, and disbursement funding support.
Fairpoint has entered into a three year strategic partnership with Premex for on-going medical records and reporting services, which it told investors “is expected to deliver operational efficiencies and improvements to working capital”.
The unaudited gross assets of PIX as at 31 December 2016 was £1.6m and the unaudited operating profit for PIX for 2016 was £100,000.
Yesterday’s announcement showed that Fairpoint’s revenue from legal services jumped 32% to £41.8m as a result of the full-year benefit of the Colemans acquisition in August 2015 – putting it around 70th in the list of the country’s law firms by revenue – but they are likely to dip 15% this year.
The growth of the legal services division in 2016 was offset by the anticipated halving of revenues in the debt solutions division to £11.1m.
Fairpoint said the simplification of the group to focus on legal services, “as well as the cost benefit of the restructuring”, should lead to an improved trading performance from next year.