TIDMRBGP
RNS Number : 1308N
RBG Holdings PLC
28 January 2021
28 January 2021
RBG Holdings plc
(the "Group")
Pre-Close Trading Update & Investor Presentation
Convex Capital Update
Capital Markets Day
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 year ending 31 December 2020 on 20
April 2021.
The Board expects the Group's revenue (including realised gains)
and EBITDA to exceed analysts' expectations. Furthermore, the
Group's balance sheet remains resilient with net cash of GBP 3.5
million as of 31 December 2020 (2019: GBP1.9 million).
As a result, the Board is pleased to announce it intends to pay
a dividend of 3 pence per share in respect of the 2020 financial
year on 26 February 2021 to shareholders on the register as of 5
February 2021.
The Board believes that the performance in 2020 demonstrates the
Group's resilience despite the challenges presented by the
pandemic. The Group's law firm, Rosenblatt Limited ("RBL"), had its
most successful year in terms of revenue, EBITDA and gross margin
which exceeded 40 per cent. LionFish Litigation Finance (UK) Ltd
("LionFish") which finances litigation matters being run by other
solicitors, using the expertise of RBL, was launched on 1 May 2020.
As of 28 January 2021, LionFish had investments in seven cases and
is seeing a regular flow of opportunities. Finally, while the
pandemic made deal completion difficult, Convex Capital Limited
("Convex Capital"), the Group's specialist sell-side corporate
finance boutique continued to build a strong pipeline of deal
opportunities. The Board expects to see an increase in M&A
activity in 2021 driven by the economic conditions and the possible
changes to the Capital Gains Tax regime. These trends will benefit
both Convex Capital and RBL.
Convex Capital Update and Shares Transactions
Since 1 January 2021, Convex Capital has completed one
transaction, receiving fee income of GBP525,000.
As previously announced, Convex Capital was heavily impacted by
Covid-19 in 2020, which caused material short-term disruption to
the completion of transactions .
Convex Capital completed three deals in 2020 and has converted
its strong pipeline into several active deals over the second half
of 2020. The new financial year has started positively with one
deal already completed, and another waiting Competition and Markets
Authority sign off, with positive progress on several other
deals.
The Convex Capital senior management team have agreed for 2021
to exchange their fixed base salary arrangements for a flexible
commission structure directly linked to income from completed
deals. Under the terms of this scheme Convex Capital management
will instruct N+1 Singer to use 50% of commission earned to acquire
shares in RBG Holdings in the open market [1] .
This new commission scheme replaces the deferred consideration
arrangements under the sale and purchase agreement with the Convex
Capital sellers, announced at the time of the acquisition in
September 2019. This deferred consideration was due to be payable
one year after completion of the purchase, based on certain
performance criteria, which were not met due to the pandemic. The
relevant provision will be released in the accounts for the year
ended 31 December 2020.
Investor Communications and Capital Markets Day
Chief Executive, Nicola Foulston and Chief Financial Officer,
Robert Parker will participate in an investor presentation via the
Investor Meet Company platform on 3 February 2021 at 10 a.m.
Investors can sign up to Investor Meet Company for free:
www.investormeetcompany.com/rbg-holdings-plc/register-investor
Investors who have already registered and added to meet the
Group will be automatically invited.
Furthermore, the Group will host a Capital Markets Day for
investors and analysts on 24 February 2021 from 10 a.m. to 12 p.m.
The event will include presentations from Group CEO, Nicola
Foulston, and the Managing Directors of each of the Group's
divisions: Rosenblatt Limited, Convex Capital Limited and LionFish
Litigation Finance (UK) Ltd, followed by a live Q&A.
Invitations will be sent in due course. If you wish to attend,
please email : RBGP_CMD@n1singer.com
Commenting Group CEO Nicola Foulston, said: "The Group has
demonstrated its resilience during a very challenging year. Our law
firm, RBL has achieved its best financial performance since it was
founded. Following the launch of LionFish, we are building a
portfolio of litigation investments which offer the potential for
high returns for our shareholders. The Group's M&A business,
Convex Capital, naturally saw its ability to complete deals
hindered by the lockdowns. However, the business has built a strong
pipeline, and we expect higher levels of M&A activity in the
current financial year. We are looking forward to the year ahead
with confidence."
Enquiries:
RBG Holdings plc Via SEC Newgate
Nicola Foulston, CEO
N+1 Singer (Nomad and Broker) Tel: +44 (0)20 7496 3000
Shaun Dobson / Alex Bond (Corporate
Finance)
Tom Salvesen (Corporate Broking)
SEC Newgate (for media enquiries) Tel: +44 (0)7540 106366;
Robin Tozer/Tom Carnegie rbg@secnewgate.co.uk
About RBG Holdings plc
RBG Holdings plc is a professional services group, which
includes one of the UK's pioneering law firms, Rosenblatt Limited
("RBL"), which is a leader in dispute resolution.
RBL provides a range of legal services to its diversified client
base, which includes companies, banks, entrepreneurs and
individuals. Complementing this is the Company's increasingly
international footprint, advising on complex cross-jurisdictional
matters. RBL's practice areas include dispute resolution, financial
crime, corporate, banking and finance, insolvency and financial
restructuring, construction and projects, employment, financial
services, IP/technology/media, real estate, regulatory and tax
resolution.
The Group also provides litigation finance in selected cases
through a separate arm, LionFish Litigation Finance (UK) Ltd.
LionFish finances litigation matters being run by other solicitors
in return for a significant return on the outcome of those cases.
As such, the Group has two types of litigation investments - RBL'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.
The Group also owns Convex Capital Limited, a specialist
sell-side corporate finance boutique, based in Manchester. Convex
is entirely focussed on helping companies, particularly
owner-managed and entrepreneurial businesses, realise their value
through sales to large corporates. Convex identifies and
proactively targets firms that it believes represent attractive
acquisition opportunities.
[1] The authority granted by management under the scheme is
irrevocable and non-discretionary, and during a Close Period the
Board has no power to invoke any changes to the authority. Any
purchases will be undertaken at the sole discretion of N+1 Singer
Limited. The Group confirms that it currently has no unpublished
price sensitive information.
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END
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