ANEXO GROUP PLC-Final Results

ANEXO GROUP PLC-Final Results

Final Results

"Continuing revenue growth laying the groundwork for a drive towards cash"

Anexo Group plc (AIM: ANX), the specialist integrated credit hire and legal services provider, announces its final results for the year ended 31 December 2022 (the 'period' or 'FY2022).

Financial Highlights

2022

2021

% movement

Total revenues (£'000s)

138,329

118,237

+17.0%

Operating profit (£'000s)

30,416

27,350

+11.2%

Adjusted1 operating profit before exceptional items (£'000s)

30,241

27,728

+9.0%

Adjusted1 operating profit margin (%)

21.9

23.5

-6.8%

Profit before tax (£'000s)

24,093

23,746

1.5%

Adjusted1 profit before tax and exceptional items (£'000s)

23,918

24,124

-0.8%

Adjusted2 basic EPS (pence)

16.5

16.8

-1.8%

Total dividend for the year (pence)

1.5

1.5

-

Equity attributable to the owners of the Company (£'000s)

146,347

128,224

+14.1%

Net cash used in operating activities (£'000s)

-3,132

-7,307

+57.1%

Net debt balance (£'000s)

73,124

62,014

+17.9%

Note: The basis of preparation of the consolidated financial statements for the current and previous year is set out in the Financial Review below.

1. Adjusted operating profit and profit before tax: excludes sharebased payment charges in 2021 and 2022. A reconciliation to reported (IFRS) results is included in the Financial Review below.

2. Adjusted EPS: adjusted PBT less tax at statutory rate divided by the weighted number of shares in issue during the year.

Financial and Operational KPIs

·          During 2022, we saw the continued improvement in a number of key performance measures (detailed below).  Financial performance has been strong, despite continued delays in the court system. Opportunities within the Credit Hire division remain strong, following the introduction of the Civil Liabilities Act 2021 (which has caused a number of competitors to withdraw from the market), but the Group has been careful to manage its fleet size prudently, especially in the light of the lower than expected vehicle contributions from the major insurance contract announced in November 2021. Consequently, although the average number of vehicles on hire rose year on year, the fleet numbers at the end of the year declined 26.9% to 1,730 (2021: 2,366). The number of new cases funded during the year also declined slightly, falling 2.7% to 9,986 (2021: 10,265).

·          Our ability to fund growth in our hire business has been supported by ongoing investment in legal staff. In 2022, the number of senior fee earners grew by 6.8% to reach 253 at the year end. This investment has driven increased cash collections in the year despite the challenges of the reduced operation of the court system. Much of the investment will start to impact during 2023 and beyond, reflecting both the shorter life cycle of a typical housing disrepair claim and the time a new credit hire starter takes to reach settlement maturity.

KPI's

2022

2021

% movement

Total revenues (£'000s)

138,329

118,237

+17.0%

Gross profit (£'000s)

105,776

91,481

+15.6%

Adjusted operating profit (£000's)

30,241

27,728

+9.1%

Adjusted operating profit margin (%)

21.9%

23.5%

-6.8%

Vehicles on hire at the year-end (no)

1,730

2,366

-26.9%

Average vehicles on hire for the year (no)

1,892

1,834

+3.2%

Number of hire cases settled

7,922

6,187

+28.0%

Cash collections from settled cases (£'000s)

146,090

119,007

+22.8%

New cases funded (no)

9,986

10,265

-2.7%

Legal staff at the period end (no)

678

634

+6.9%

Average number of legal staff (no)

646

590

+9.5%

Total senior fee earners at period end (no)

253

237

+6.8%

Average senior fee earners (no)

240

201

+19.4%

Commenting on the Final Results, Alan Sellers, Executive Chairman of Anexo Group plc, said:

"I am pleased to report a solid performance for FY2022. Revenues for the Group have continued to grow across all divisions. As always, we have managed our vehicle numbers carefully and funded those cases which we feel offer the best opportunities for utilising working capital most efficiently.  The success of this strategy is reflected in the growth in cash collections driven by the continued investment in high quality staff across our three legal services offices.

We continue to be excited by the opportunities within Housing Disrepair, which has more than doubled its case portfolio during the year, as well as fresh activity on emissions claims. A focus on prudent case management will enable the Group to concentrate on cash generation and a reduction in overall debt during FY2023."

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