(Alliance News) - Burford Capital Ltd on Thursday posted a first-half profit fall as the Covid-19 pandemic hit new business, but litigation finance firm and asset manager noted it is now a step closer to beginning trading on the New York Stock Exchange.
Burford shares were 16% higher at 726.20 pence each in London on Thursday morning.
Total income - which includes both capital provision and asset management income - fell 12% year-on-year to USD252.9 million in the six months to June 30, from USD287.0 million.
Pretax profit dropped 15% to USD197.9 million from USD233.3 million a year earlier.
"Covid-19 lockdown impacted new business in the period, with group-wide commitments down 74% to USD195 million and deployments 42% lower at USD258 million," the company added.
Burford added that the litigation environment is improving and it expects a "significant volume of disputes arising from the pandemic in the years to come".
Chair Peter Middleton said: "For the first time since Burford's launch in October 2009, the business was tested in the first half of 2020 by a historic global economic downturn. These financial results show that Burford passed this test with flying colours, recovering USD820 million from concluded assets, significantly increasing cash and further strengthening liquidity.
"These outcomes do two things. First, they demonstrate the capacity of the portfolio to generate attractive cash profits. Second, they end any question about Burford being able to repeat the selection and management of outperforming matters. We look forward to implementing the company's plans to list on the New York Stock Exchange alongside its UK listing."
Burford added on Thursday that the US Securities & Exchange Commission declared the company's US registration statement effective, the final hurdle before it can begin trading in New York.
Trading of its shares on the NYSE is expected to begin on October 19.
By Eric Cunha; ericcunha@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
Burford Capital (BUR)