12th Sep 2018 12:22
LONDON (Alliance News) - Anexo Group PLC on Wednesday said its profit in the first half of the year fell after a decision was made to focus on settling existing claims rather than generating new ones.
Anexo provides credit hire to motorists who cannot access replacement vehicles, assists with repair and recovery, and handles associated personal injury claims.
The company's pretax profit dropped 38% in the six months to June 30, down at GBP5.3 million from GBP8.5 million the year before as it focused on motorcycle claims and existing claims settlements over new claims generation.
The company said that this move "resulted in reduced activity during the six months ended December 2017 and into the first half of 2018" and that, as a result, trading fell behind on a year-to-year basis.
The company has since reversed its focus on settling claims after a decision to float on the London AIM market in June this year, which raised GBP25.0 million before expenses. These funds have allowed the company to increase both its sales representatives and vehicles on hire and thus the number of claims.
Revenue increased to GBP23.5 million from GBP22.9 million year-on-year but depreciation, transaction costs, and administrative expenses all detracted from profit.
Most notably, transaction costs of GBP1.4 million were incurred in the period from the initial public offering, where none were recorded the year before. Moreover, depreciation doubled to GBP605,867 from GBP307,051. There was also a modest increase in administrative expenses to GBP8.8 million from GBP8.1 million.
Anexo said that while it does not intend to pay an interim dividend, it has recommended a 1.5 pence per share dividend for the full 2018 year.
"Following our successful admission to AIM in June this year, we are pleased to report that Anexo has continued to make positive operational and financial progress. With the funds raised at the initial public offering now underpinning our expansion, we continue to grow our credit hire division through the investment in fleet, quality staff and systems," said Anexo Executive Chairman Alan Sellers.
Shares in Anexo were trading up 1.7% at 116.92 pence on Wednesday.
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