Huge growth for Quindell’s legal services division
Terry: maiden dividend
Alternative business structure Quindell plc today proclaimed itself the largest personal injury law firm in the UK and the “largest public company law firm globally” as it announced its results for the first half of 2014.
Quindell’s legal services division recorded revenues of £180m, a huge jump on the £75m in the first half of 2013, with EBITDA (earnings before interest, tax, depreciation and amortization) of £101m – more than three times the figure last year.
This meant its EBITDA margin was a huge 56%, compared to 42% in 2013.
Quindell had 110,000 cases in progress as at 30 June 2014. Quindell’s cash flow has been a concern of commentators, and the company said this level of work meant it was on track to collect around £500,000 per business day from its legal services business by 30 June, rising to £750,0000 and £1m by the third and fourth quarters of 2014 respectively.
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With approaching 3,000 staff in the UK and 1,000 more globally, the group said it is now servicing over 600,000 consumers each year.
It today also announced solicitor Stefan Borson as new group chief legal and communications officer. He was previously chief executive of Redbus Media Group, originally qualifying in 2000 with Addleshaw Goddard.
Across the whole business, Quindell’s revenues increased 119% to £357m, which it attributed “primarily to strong organic and synergistic growth; businesses acquired in the last 12 months represented less than 10% of revenue”.
The company’s overall EBIDTA was £156m, and profit before tax £154m.
Quindell chairman Rob Terry said: “I am delighted to announce Quindell’s strong results for the first half of this year. We have performed well against all of our KPIs and have delivered the expected growth, as evidenced by the group turning cash flow positive in July. As part of Quindell’s continued growth and confidence in future prospects, a maiden dividend of 0.15p was paid in May.”
Nonetheless, Quindell continues to fight allegations over the stability of its business, and confirmed yesterday that it had begun legal proceedings in the US against Gotham City Research, whose publication of a report into Quindell earlier this year saw the share price crash.
It also said it would sue a blogger for the website ShareProphets, whom it accused of “[regurgitating] in an even less professional and more defamatory manner… certain allegations made by Gotham City Research”. At the same time, Quindell published a six-page rebuttal of the allegations.
Yesterday’s announcement bolstered the share price, which closed at 210p, but in early trading today, it was down 9%.
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