Revenue and profit have fallen sharply at NAHL plc – the owner of National Accident Helpline and alternative business structure (ABS) National Accident Law – after “the most challenging six months” in its history.
Interim results for the first half of 2020 recorded a 22% fall in revenue to £20.2m – around three-quarters of which came from the consumer legal services division and the rest through the critical care division – with underlying operating profit tumbling 43% to £3.7m.
The company’s board has not reinstated dividends and recommended that no interim dividend be paid in respect of 2020.
The group is also a partner in joint venture ABSs: Your Law, with NewLaw Solicitors in Cardiff, and Law Together, with Manchester firm Horwich Cohen Coghlan.
As previously reported, NAHL took several measures in response to Covid-19, although only four staff remain furloughed, down from a high point of 82 (30% of total) in May. It will have claimed £400,000 from the Coronavirus Job Retention Scheme by the time it stops using it this this month.
During the six months, the group helped 21,563 customers with new personal injury claims or conveyancing transactions, issued 556 expert witness reports and initial needs assessments, and provided 1,125 clients with case management to support their rehabilitation.
Personal injury enquiry numbers were running at 30% in April compared to 2019, but by August had recovered somewhat to 70% of prior year volume.
“Management prioritised placement of enquiries into the panel to generate cash and improve levels of liquidity during this challenging period,” James Saralis, group chief financial officer, told investors.
“Once panel demand was satisfied, we prioritised placement to National Accident Law in order to continue to build scale, in line with our strategy. Enquiries into our joint venture ABS law firms were paused during April and reinstated gradually as lockdown was released.”
In line with widespread reports of a booming property market, NAHL’s conveyancing marketing business saw leads soar to 144% of pre-Covid levels during August.
Mr Saralis said: “The group has demonstrated its ability to respond to extreme challenges in the first half of the year. The flexibility in our business model, coupled with the changes we have made, position us well to respond to the economic recovery and continue to reduce net debt.”
Group chair Caroline Brown added: “The first half of 2020 has been the most challenging in NAHL’s history and I am very proud of how the group has responded to the Covid-19 pandemic.
“We are pleased to report that the business remained profitable and enjoyed strong free cash flow generation in the period.”
It emerged earlier this month that longstanding group chief executive Russell Atkinson had resigned and will leave at the end of September.
NAHL’s share price ended 2019 on 100p, down 7% on the year, and a long way from its 2015 peak of 404p.
Its shares crashed in February to 56p after it said uncertainty in the PI market would significantly affect its performance in 2020, and went as low as 34p as the whole market dived in response to the pandemic. The price slipped 3% this morning to 45p at the time of writing.