3rd Feb 2020 11:05
(Alliance News) - Burford Capital Ltd said Monday it recorded "exceptional" growth in 2019, with its Core Litigation unit reporting a sharp rise in commitments.
In 2019, Burford's group commitments rose 24% to USD1.57 billion from USD1.27 billion in 2018. The company's Core Litigation unit saw commitments rise 30% to USD854 million and Post-Settlement rising 78% to USD299 million.
Complex Strategies commitments slipped 14% year on year to USD330 million.
"This level of new business shows the persistent demand for Burford's capital in the legal market and Burford's ability to lead its industry in meeting that demand," the company said. 2019's commitments were the highest in Burford's history.
Total deployments in 2019 were flat year on year at USD1.07 billion.
"Burford has regularly seen annual fluctuations in deployment levels and ascribes no significance to them given the unpredictability of timing and the wide variety of deal structures in use," the company explained.
Cash proceeds rose 23% to USD997 million.
Burford added: "As we have long made clear, we can neither predict nor control the timing of the generation of litigation returns. Burford is not a business for those focused on short-term profits or for those who eschew volatility and seek predictability. We finance large, complex commercial claims."
Looking towards its 2019 results, Burford expects income and profit to be lower than in 2018 on the expectation of USD50 million to USD70 million less in net unrealised gains in 2019.
"We are entirely unconcerned about that, and as January 2020 has proved, circumstances can change quickly in our business. We focus on cash, and the best value outcome for shareholders from our investments, rather than managing realisations to an accounting year-end. We can't control when courts rule or matters resolve - and in many instances we make more money from delay because of the pricing structure of our legal finance assets," Burford added.
Chief Executive Christopher Bogart said: "Burford had an exceptional year of growth in 2019, including a 30% increase in core litigation finance commitments, positioning the business favourably for the years ahead, while our returns remained robust and even inched higher than before. We are delighted that 2020 is off to a brisk start, and we were also pleased to see the capital structure benefits of our new strategic capital arrangements."
Shares in Burford Capital were up 4.8% in London on Monday at 660.50 pence each.
By Paul McGowan; [email protected]
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