Legal and professional services firm RBG (RGBP:AIM) posted a sharp increase in revenues and earnings, excluding investment gains, for the six months to 30 June, with a particularly strong performance from its corporate division.

However, the board’s decision to postpone a decision on dividends until the end of the year, when it expects to have better visibility on the full year and the outlook for 2021, triggered selling with the shares off 12% to 63.5p in morning trading.

Revenues for the half year were up 17% to £12 million although the firm recorded no investment gains during the period whereas it took £2 million of realised gains in the first half last year. Excluding gains, revenues were up 46%, while earnings before interest, taxes, depreciation and amortisation (EBITDA) rose 44% to £2.6 million.

Income from legal services was up 42% to £11.7 million, excluding work in progress (WIP) of £0.7 million, with dispute resolution revenues up 13% and corporate revenues up a staggering 335% to £3.3 million or more than the whole of 2019.

According to chief executive Nicola Foulston, the RBL law business is working ‘flat out’ and is having its best ever year, while the mergers and acquisitions (M&A) division – which saw a number of deals delayed or cancelled due to Covid – has seen a significant increase in opportunities since the half year.

Meanwhile the in-house third-party litigation finance business, which in May became a separately-branded operation called LionFish, is ‘flying’ with over 100 potential cases for funding already received.

Despite the uncertain economic outlook and the timing of future investment gains, Foulston is unequivocal about the firm’s strengths and the direction of travel. ‘The Group is performing well in a very testing environment and remains well positioned as we progress through the second half. We have worked hard to grow our services, adapt to changing client needs and build out our new litigation finance business.

‘There is a growing demand for our legal services with many clients turning to us to help them manage issues during the crisis. With the potential return of the higher-margin litigation investment sales and M&A fees, we look forward to the coming months with cautious optimism.’


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Issue Date: 16 Sep 2020