Shares in legal services business Anexo (ANX:AIM) rally 5% to 139p after the firm reports its maiden set of full year results as a listed company.
Revenues for the 12 months to 31 December are up 25% to £56.5m while operating profits before listing costs are up 14% to £17.2m, ahead of expectations as the company flagged in January.
Anexo combines a credit hire business and a wholly-owned legal services business and targets not-at-fault motorists who don’t have the financial means or access to a replacement vehicle in the event of an accident.
UK law allows not-at-fault motorists who are considered to be ‘impecunious’ (lacking financial means) to hire a replacement vehicle and recover the credit-hire costs from the at-fault driver’s insurance company.
Anexo not only provides the hire vehicle, its legal services team recovers the hire charge, recovery charge and repair costs from the at-fault insurer.
According to the latest research on the litigation sector by Arden Partners, Anexo has an even higher success rate than stock market darlings such as Burford Capital (BUR:AIM) and Manolete (MANO:AIM).
With regulation and lack of scale impacting the thousands of small high street personal injury operators, Anexo is increasing its market share hand over fist.
However the aim isn’t to grow turnover just for the sake of it: profitability and above all cash are key metrics.
Therefore the focus is on growing the legal team and in particular, hiring high-quality experienced litigators so that more claims are settled and more cash is recovered from the firm’s significant portfolio of cases.
Part of the £25m raised in the IPO in June last year went towards opening a new office in Bolton, and hiring has gone so well that executive chairman Alan Sellers can envisage opening another office in the not too distant future.
