Anexo Group’s law firm, Bond Turner, is experiencing rapid expansion, particularly in its housing disrepair and group litigation sectors.
- Despite a 32% drop in legal services revenue, the firm reported significant growth in staff and a 14% increase in housing disrepair revenue.
- Legal services profit before tax fell substantially, attributed to settlement impacts and increased staffing costs.
- The credit hire segment of the business, however, saw revenue growth of 22% and an 86% rise in profits, partially offsetting other declines.
- Overall, Anexo Group foresees future profitability growth through potential settlements in diesel emissions claims.
The law firm Bond Turner, owned by the listed company Anexo Group, has shown remarkable growth in its operations, particularly in the areas of housing disrepair and group litigation. The firm’s headcount increased by 10% to 761 staff by the end of June 2024, with a notable 18% rise in the number of senior fee-earners.
However, despite these expansions, the firm’s legal services revenue saw a 32% decrease compared to the same period in the previous year. This decline was attributed largely to costs associated with a confidential settlement with Volkswagen over diesel emissions claims. Conversely, the firm experienced a 14% increase in housing disrepair revenue, reflecting its strategic focus in this practice area.
Substantial pressures were placed on profit before tax for legal services, which plummeted from £14 million to £3.3 million, a situation impacted by the VW settlement and the costs involved in increasing the business’s workforce. Conversely, the firm’s other operations in credit hire services demonstrated robust growth with a revenue increase of 22% to £35 million and profits rising by 86% to £4.1 million.
Despite the mixed financial outcomes, Anexo Group remains optimistic about future growth prospects. The company has invested heavily in diesel emissions claims, which by mid-2024 included 12,000 clients for the Mercedes Benz case and another 25,000 clients against brands such as Vauxhall, BMW/Mini, Peugeot/Citroen, and Renault/Nissan. The settlement of these claims is projected to significantly enhance the group’s profitability and improve cash flow, although the timeline for these outcomes remains uncertain.
The group’s financial strategy included securing a £30 million loan facility with Callodine Commercial Finance, of which £20 million has been drawn. This move is aimed at providing financial headroom and lowering capital costs, while restructuring existing loans. Additionally, an agreement with Secure Trust Bank PLC extended funding terms, indicating a proactive financial management approach amid rising net debt, which stood at £68 million by the end of June.
While facing current financial challenges, Anexo Group’s strategic directions and investments signal potential for future stability and growth, particularly from ongoing legal claims.
