Shares in credit hire and legal services firm Anexo (ANX:AIM) jump 10% to a new 12-month high of 194p after it reveals that this year’s pre-tax profits will ‘significantly exceed current market expectations’.
The company puts the raised guidance down to increased case settlements and an improvement in the funding of its working capital.
The increased level of settlements, cash collection and legal fees is thanks to the firm’s decision to open a new office in Bolton this year for its Bond Turner legal services subsidiary.
Also the decision to focus on more valuable claims has boosted the group’s average claim statistics and its underlying profitability.
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Anexo provides vehicle hire for not-at-fault drivers who are involved in an accident and who need a replacement car. The claimant’s car is taken to an approved repairer and they are supplied with a hire vehicle for the duration of the claim.
The at-fault driver’s insurance company picks up the bill for the repairs and the hire cost of the replacement vehicle, all handled by the legal team at Bond Turner, so the claimant gets an end-to-end service.
As well as an increase in cases and an increase in profitability, Anexo has managed down the cost of its working capital and secured what it describes as a ‘considerable improvement in its financing arrangements from both new and existing providers’.
It has also agreed new terms with its existing vehicle fleet insurer which will deliver ‘enhanced savings against the group’s original forecasts’ not just for the remainder of this year but also for next year.
Anexo has been a runaway success since listing in June 2018, reporting forecast-beating full-year results in April this year and now raising forecasts for the current year.
