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Redde sees 150% rise in profits from joint venture ABSs

Stock exchange: Turnover and profits up at Redde

Accident management group Redde plc – which owns NewLaw Solicitors – has seen profits from the law firm’s five alternative business structure (ABS) joint ventures increase by nearly 150%, its half-year results have shown.

The £1.95m profit from five active joint ventures in the last six months of 2018 – up from £817,000 in the same period of 2017 – formed part of Redde’s 7.6% increase in profit before tax to £23.6m. This was from a turnover up 15% at £291m.

Sales growth principally reflected a 15% growth in the number of credit hires together with a 7.7% increase in the total number of repairs undertaken.

Redde told investors that NewLaw’s newest ABS joint venture, Your Law [1] – launched by National Accident Helpline in mid-2017 – “has continued to build its case load and consequently its levels of settlements provide an increased contribution from this source”.

It continued: “This is an encouraging development for the business and, with a greater proportion of non-RTA cases under management, this ABS continues to represent an exciting growth potential for the group.

“This, together with the growth in NewLaw’s employers’ liability and medical negligence practice… gives further cause for optimism.”

The other ABS Redde owns, credit hire specialist practice Principia Law, “made satisfactory progress increasing the level of its activities”.

Chief executive Martin Ward reported “increased levels of interest” from both at-fault and not-at-fault insurers in Redde’s wide service offering.

“These developments support the group’s one-stop-shop approach, which provides the potential to further grow and develop more vehicle incident and accident management services for both business and insurance partners.

“This will in turn support the group’s position as a leader in vehicle mobility, rapid roadside recovery, repair, legal and other support services.”

Redde has also launched a bespoke, digital, protocol portal link “which enables further claim processing efficiencies for both protocol insurers and the group and the provision of real-time claim settlement status”.

Redde’s shares fell 15% to 159p on the announcement.