RNS Number : 7624Z
RBG Holdings PLC
27 January 2022
27 January 2022
RBG Holdings plc
("RBG" or the "Group")
Pre-Close Trading & Dividend Update
RBG Holdings plc (AIM: RBGP), the professional services group,
today publishes a pre-close trading update ahead of the publication
of its financial results for the twelve months ending 31 December
2021 on 29 March 2022.
The Board is pleased to announce that having completed a strong
final quarter, it now expects adjusted EBITDA for 2021 to be
approximately 10% ahead of current market expectations. As a result
of this, and the Board's continued confidence in the Group's growth
prospects, the Board intends to pay a second interim dividend of 3
pence per share in respect of the six months to 31 December 2021 on
25 February 2022 to shareholders on the register as of 4 February
2022. This brings the total dividend paid to shareholders in
respect of the 2021 financial year to 5 pence per share (2020: 3
pence per share).
The Group's balance sheet remains satisfactory with net debt at
GBP14.2 million (2020:net cash of GBP3.5 million). This change
reflects the acquisition of Memery Crystal in May 2021. The Group
has paid back GBP1 million of the GBP10 million term loan used to
fund the acquisition. The term loan will be paid down over five
years. Furthermore, the Group has used GBP5.2 million of the GBP15
million revolving credit facility announced in April 2021, so
significant headroom remains to support the Group's growth.
RBG Legal Services Limited
Following the completion of the acquisition of Memery Crystal in
May 2021, the Group combined its two law firms, Rosenblatt and
Memery Crystal, into a new legal services corporate entity called
RBG Legal Services Limited ("RBGLS").
RBGLS has two client-facing brands of 'Rosenblatt', for
contentious legal services, and 'Memery Crystal', for
non-contentious legal services. Overall, RBGLS has performed well,
benefitting from the increase in corporate and commercial
transactions and greater breadth and depth of expertise to service
the Group's growing client base.
The integration of the two firms' support functions is largely
complete, with the businesses set to move to a new practice
management software system in 2022. As set out at the time of the
acquisition, the two firms are proving to be highly complementary
and are sharing skills and resources, enhancing the Group's
offering to its combined client base. Furthermore, the successful
process of integrating Rosenblatt and Memery Crystal has led to a
sustained improvement in net margins of 29%, expected to rise
towards 35% over the medium-term as the benefits of the integration
The Group has two types of litigation assets - RBGLS's own
client matters, and litigation matters run by third-party
solicitors funded by LionFish Litigation Finance Limited
Both types of litigation investments not only have significant
return potential but represent an opportunity to extract additional
value from the Group's legal and commercial expertise and diversify
its sources of income. In 2022, the Group expects to report returns
on LionFish's litigation investments in place of the de-risking of
investments that has taken place to date.
In 2021 LionFish completed a further four investments bringing
the total investments made by LionFish since its inception in May
2020 to 10, with a total capital commitment of GBP10.5 million of
which GBP3.6 million has been deployed (as at 31 December 2021).
Disposals since inception total GBP6.4 million.
Convex Capital Limited ("Convex Capital")
The Group's specialist sell-side corporate finance boutique,
Convex Capital, successfully rebuilt its transaction pipeline in
2021. As a result, in the 2021 financial year, Convex Capital
completed 14 deals generating revenue of GBP9.4 million (2020: 2
deals, revenue of GBP1.6 million). Furthermore, as at 21 January
2022, Convex Capital has a strong pipeline of 22 deals with several
currently at various stages of completion.
Commenting Group CEO Nicola Foulston, said: "The Group has
continued its strong performance from the first six months, and has
followed an excellent 2020, with an even better 2021 result. Demand
for legal services remains strong, led by corporate and commercial
transactions, such as IPOs and real estate deals. The integration
of Memery Crystal has been successful with only the roll-out of new
practice management software to be completed. Both Rosenblatt and
Memery Crystal are working well together. Our client offering and
margin profile are moving in the right direction.
"We continue to build a portfolio of litigation investments
comprising both RBG's own client litigation investments and
third-party client litigation managed by other law firms through
LionFish which offer the potential for high returns for our
"Finally, our M&A business, Convex Capital, has sustained
its strong start to the year converting its pipeline. Given the
progress of the Group, and the structural growth drivers we are
exposed to, we enter 2022 with confidence."
RBG Holdings plc Via SEC Newgate
Nicola Foulston, CEO
Singer Capital Markets (Nomad and Tel: +44 (0)20 7496 3000
Shaun Dobson / Alex Bond (Corporate
Tom Salvesen (Corporate Broking)
SEC Newgate (for media enquiries) Tel: +44 (0)7540 106366
Robin Tozer/Isabelle Smurfit firstname.lastname@example.org
About RBG Holdings plc
RBG Holdings plc is a professional services group, which
comprises the following divisions:
RBG Legal Services Limited ("RBGLS")
RBGLS is the Group's legal services division which combines the
businesses previously operated by Rosenblatt Limited and Memery
Rosenblatt is one of the UK's pioneering legal practices and a
leader in dispute resolution. Rosenblatt provides a range of legal
services to its diversified client base, which includes companies,
banks, entrepreneurs and individuals. Complementing this is
Rosenblatt's increasingly international footprint, advising on
complex cross-jurisdictional disputes.
Memery Crystal offers legal services in a range of areas such as
corporate (including a market-leading corporate finance offering),
real estate, commercial, IP & technology (CIPT), banking &
finance, tax & wealth structuring and employment. Memery
Crystal is one of the leading legal practices in the UK to advise
the emerging cannabis sector on a wide range of business issues.
Memery Crystal offers a partner-led service to a broad range of
clients, from multinational companies, financial institutions and
owner-managed businesses to individual entrepreneurs.
LionFish Litigation Finance Limited
The Group also provides litigation finance in selected cases
through a separate arm, LionFish Litigation Finance Limited.
LionFish finances litigation matters being run by other solicitors
in return for a significant return on the outcome of those cases.
As such, the Company has two types of litigation assets -
Rosenblatt's own client matters, and litigation matters run by
third-party solicitors. LionFish is positioned to be a unique,
alternative provider to the traditional litigation funders.
Convex Capital Limited
Convex Capital is a specialist sell-side corporate finance
boutique based in Manchester. Convex Capital is entirely focused on
helping companies, particularly owner-managed and entrepreneurial
businesses, realise their value through sales to large corporates.
Convex Capital identifies and proactively targets firms that it
believes represent attractive acquisition opportunities.
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(END) Dow Jones Newswires
January 27, 2022 01:59 ET (06:59 GMT)
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