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Adrian is a total disgrace and has destroyed shareholder value through poor decisions .. simple as
Awful placing price……..it looks to be a bad time in the markets for Companies to be needing funding and with global recession likely looming in the coming months then it’s probably going to be getting worse.
Recommend investors should be actively assessing their portfolios now and looking to offload similar at risk stocks where funding is likely needed by them within the next year or so.
Wise words - don't press the Buy button!!
What a complete sh*t show.
Talk about destruction of value.
Joke.
I can feel your finger hovering above the buy button CaneToad. Don’t do it!
Adrian has now taken this to new lows his disregard for shareholders stinks… when will he do the honourable thing and resign and give the 500k bonus back
Peel Hunt reported today: "continuing low levels of market wide capital markets activity". Presumaby it's similar at Arden.
I have been out of INCE for a few months now, and just looked in to see if i made the right call on crystalissing my losses.
Just want to say, thanks for your excellent posts; full of insight free from blarney. To may boards are full of baloney/agenda, so refreshing to see someone's posts that really inform decisions. I'm out, and i don't see me being back, but i think you do a great service to those LTH's here. Salute.
@ WW - my number comes from adding up the numbers they claim on the tombstones on their website. I have added them up since the start of their financial year (1st November). Maybe your number is a calendar YTD number ? As for the outlook for capital raising environment, clearly market is challenging but there are a huge number of AIM companies that have no choice but to come to market in the next 12 months. Question becomes is the surge likely at the beginning or end of that period and do Arden pick up a share of that work.
Hmm some insider selling By the looks of things. Wobbly I hear what you’re saying and it seems for most listed stocks certainly on aim there is no hope for anything. Basically all the small stocks are bankrupt? Do you think Ince can survive a recession?
I'm not sure where the figure of £55.8m raised comes from - the AP website has the figure YTD at c£30m. But even if your figure is correct with a number of the quoted deals 'shared' - in terms of fees, plus the loss of retainer fees (through the loss of their NOMAD clients), I feel sure the AP H1 numbers will not be pretty. With overheads running at c£8 pa in the last accounts and capital markets 'challenging' (in terms of raising funds) for the forseeable, the outlook for this 'new division' of Ince, doesnt look particularly rosy to me.
Just by way of context. Arden's financial year runs from 1st November to 31st October so we are @2/3 of the way through. So far for this financial year they have raised, on behalf of clients, £55.8 million but nothing since March. The year is still in the balance for them, a couple of decent sized placements and they are golden but if market stays shut for the next 4 months it will be a tough year.
@APD708 Sorry, I have not been very clear. My thought process is that if Arden raise capital on behalf of its clients, of between £80 -£100 million a year this would result in IPO/placement fees of @ £3 to £4 million. This when added to the @£3 to £3.5 million of market making, brokerage, wealth management and advisory fees they should be able to to do each year. This would result in Arden making an annual revenue of between £6 million and £7.5 million per year. ( So the additional revenue to the Ince Group on top of the @£ 100 million of revenue would be @ £6 - 7.5 million)
With the various cost savings such as board/listing costs and rationalisation of real estate foot print that level of revenue should result in Arden making a profit of between £1.5 million and £ 3 million per year. I think if Arden were to achieve this consistently then I think it can be judged as a successful transaction. I am confident in a good year that type of revenue should be comfortably possible, the question I have is can this be done on a consistent basis. For example the last few months would have been pretty tough one would suspect, it is a feast of famine business.
The above assessment is on a stand alone basis, there will be cross selling but I think it is quite hard at this point to quantify the level. After 12 or 18 months of joint operations we will have a better idea as to the extent of those benefits.
@erratum, "For the Arden transaction to be considered a good financial decision, Ince needs to raise a minimum @ GBP 80 - 100 million per annum for clients." - just curious to know your thought on this, do you mean on top of the circa £100 million annual revenue Ince does? So total annual revenue, close to £180 million?
For Ince specifically, I think the answer is that it is to be determined, as the mix of the business is in flux and they have been trying to tilt it towards more transactional work which also tends to be more cyclical although it still represents less than 10pct of their legal revenues. Arden adds an additional cyclical element but if it is a positive or a negative I think depends on the type of slow down we end up seeing. The optimistic scenario for Arden is that Aim is full of negative cashflow business and in this environment they will all need to go out and raise cash in pretty quick order and that Arden pick up corporate finance work. The alternative is that this does not happen. For the Arden transaction to be considered a good financial decision, Ince needs to raise a minimum @ GBP 80 - 100 million per annum for clients.
In terms of their legal business, historically Ince's areas of speciality hold up pretty well in a recessionary environment, much of the shipping work and Insurance work is not cyclical and dispute resolution work (with a lag) may even see a beneficial impact. Given the large proportion of international business the weak pound will also be a positive. My expectation is that the core business will see revenue growth of 0% to +5% in a mild downturn and -5% to -10% in a serve downturn. This would be on a like for like basis and increased headcount and fee inflation might add positively to these numbers. I note that there has been a bit of a spurt in onboard new fee earners in the last month or so. It is also worth noting that the last 6 weeks has seen them announce the closing of a number of 6 or 7 transactional deals they have been working on. It is not clear if this is an indication of increased activity in this area or a new policy to highlight this type of work.
@erratum: many thanks on the comments. Yes, I've been in Manolete before, but I think we've missed the boat on that one for now; it's also becoming expensive on an earnings basis (forward pe: 30). I expect that Ince have a little bit of insolvency work, but I'm in the dark as to how much the core of their business would perform in tough times.
Manolete are insolvency specialists, Begbiges have a speciality in corporate restructuring and Buford principally provides finance to law firms. So tougher economic times are likely to directly benefit them. Don't know much about Gateley so not sure about that one.
As there are several lawyers on this channel. It would be useful if one of you could comment on how you see earnings & profitability holding up in a recession. I see the share prices for some of the Ince competitors holding quite up well against the market, including: Begbies Traynor, Burford, Gateley and Manolete. While Knights, Keystone and DWF seem to be dropping along with Ince.
@BitterestPill - I disagree with your assessment but either-way I think we can agree that the significant bulk of the departures happened a number of years ago.
If I understand your original point correctly, I think it was how do they replace the revenue from these departed fee earners. I would contend the revenue reduction from these fee earner departures in FY2019 or FY2020 has already been lapped by subsequent full year accounts/ trading updates. In the LP you highlighted previously, we can see that membership has been stable over the last 12 months. We can also see that groups headline revenue numbers reported at 31.03.21 and 31.03.22 (from recent trading update) were (roughly) the same. So unless we are seeing a significant net decline in fee earners since 31.03.22 I cannot see the current/ go forward revenue hole that you can see.
That's not correct. Those legacy Ince partners who stayed were all appointed to the LLP on 31 December 2018, at the time of the liquidation, as is clearly shown on Companies House. The 34 are all people who have quit Ince/Gordon Dadds under the current management. Those are the facts.
@CaneToad. .... all the best to you. We will get the next financial snapshot from the company in September so that will give you the opportunity to get the confirmation you need to either buy back in or pat yourself on the back for dodging the bullet.
Found it, thank you for this. With you number have gone right back to the founding of the LP i 2015 to get those numbers. So for this LP as you can see the vast majority of that number left/were let go, when it went in to receivership (prior to the takeover) and a handful more during the COVID lock down period (the company announced a round of redundancies then). Part of the stated strategy during the takeover was to reduce the number of unprofitable partners and clearly this was a big part of why the "Old"Ince was not profitable and hence why it went in to receivership.
If you look over the last year it is 6 departures and 6 appointments so it is stable for this LP and appear to be expanding for others.
@erratum. You have grossly misrepresented what I said. Your version of my statements are materially different to the words that I used.
What I said were the following. They can be easily checked from my recent posting history. Your words are made up!
1) "I wondered if the dividend was prudent or even legal".
I said that, because they had announced that they had maxed their RCF. I don't consider it prudent for company with limited cash to be paying a dividend. According to the Companies Act 2006 a dividend be paid only if there are sufficient distributable profits. It's difficult to determine, hence my use of the word 'wondered'.
2) "Arden itself never being very profitable"
This is a true statement. It is very different to what you claimed that I said.
3) "Trying to be 'right' is lethal in investing"
Go and read a few investment books, e.g. Minervini, where you'll read precisely what I said.
No, I mean partners. Ince in the UK is made up of various Limited Liability Partnerships. Ince Gordon Dadds AP LLP , for example, has been 35 of 84 partners resign.
Not partners but these 7 new fee earners were also announced last week
"We are pleased to share that we are growing our Piraeus office with the addition of three shipping litigators, three ship finance experts, and an additional mariner to the admiralty team.
To learn more, click here: https://fal.cn/3p66G
Welcome Ioanna Gavriiloglou, Henry Stockley, Christos Palimeris, Anthi Kekatou, Io - Georgia Papadimitriou, Domniki Symeonoglou and Michel Farach to the team! "
As I say partners come and go, below is the announcement of one arriving 5 days ago (posted on their linkedin page)
"We are pleased to announce that Stephen Chan, a seasoned commercial litigator, has joined Ince as a new Partner in our Hong Kong office.
Stephen's appointment highlights our commitment to further expand our dispute resolution practice across the region."