Nahl Group Regulatory News (NAH)

Prior to publication, the information contained within this announcement was deemed by the Group to constitute inside information for the purposes of Regulation 11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310. With the publication of this announcement, this information is now considered to be in the public domain.

1 August 2022

NAHL Group PLC

("NAHL" or the "Group")

Half Year Trading Update

NAHL (AIM: NAH), the leading UK marketing and services business focused on the UK consumer legal market, is pleased to provide a trading update for the first half of its current financial year, covering the six months to 30 June 2022 ("the Period").

Group results

During the Period, the Group continued to perform in line with the Board's expectations. Revenues are expected to increase by 6% to £20.8m (H1 2021: £19.5m), while underlying operating profit is expected to decrease by approximately 8% to £2.3m (H1 2021: £2.5m) due to the planned investment in the Group's fully integrated law firm, National Accident Law ("NAL"). The Group has made further progress in reducing net debt and at 30 June 2022, net debt was £14.5m, down 7% from £15.5m at 31 December 2021. 

The Board expects the Group to meet market expectations for the full year.

Divisional performance

Within the Consumer Legal Services division, National Accident Helpline generated almost 18,000 personal injury enquiries in the Period. This represented a 27% increase on the first half of 2021. In February 2022, the Group concluded that it would reject tariff-only road traffic accident claims, as they were no longer economically viable to process following the introduction of the Civil Liability Act in 2021. As a result, enquiries processed since this point are of a higher value.

The increase in enquiry numbers was achieved by gaining market share in a claims market that has remained subdued following the introduction of the Civil Liability Act reforms and the ongoing impact of the COVID-19 pandemic during the Period. The Board continues to anticipate market growth over the longer term and with this in mind, in June 2022, National Accident Helpline launched a new TV advertising campaign, intended to further strengthen its brand position and contribute to volume growth. This TV advertising campaign will continue in the Autumn. 

The Group continued to grow and invest in NAL to create a higher margin business. 25% of total enquiries were distributed to NAL in the Period, representing an increase in the number of enquiries allocated to NAL of 61% compared to the first half of 2021. NAL demonstrated the growing maturity of its book of claims, by collecting £1.5m of cash from settlements in the Period, which was 50% more than the same period in the prior year. At the end of the Period, NAL had increased the number of ongoing claims that it was processing to 9,884 claims, up from 7,918 claims at 31 December 2021.

The Group's residential conveyancing business, Homeward Legal, experienced a slowdown in the second quarter of 2022 in line with the wider market, following two years of increased activity fuelled by the stamp duty land tax holiday and sustained low interest rates. The Group continues to explore the potential sale of Homeward Legal and a further update will be provided when appropriate. The Group's property search business, Searches UK, proved more resilient in the Period, and attracted several new customers in the first half of the year.

The Critical Care division (Bush & Co.) continued its planned investment in the business and progressed its recovery from the effects of the COVID-19 pandemic. The number of expert witness reports completed and issued to customers increased by 11% in the Period, compared to last year, and the number of new instructions for expert witness reports was also up by 11%. Whilst average case management revenues remain below pre-COVID-19 levels, due to the new mix of face-to-face and online work, the business delivered 12% growth in the number of initial needs assessments ("INAs") completed in the Period, 19% growth in new instructions for INAs and maintained a strong book of ongoing case management clients generating recurring monthly revenue. The business has also recruited 41 new associates in key specialisms and now works with 96 case managers and 115 expert witnesses across the UK. 

Notice of Interim results

NAHL expects to announce its results for the six months ended 30 June 2022 on 27 September 2022.

James Saralis, CEO of NAHL, commented:

"The performance of the Group in the first half of the year was in line with our expectations and we continue to make progress in both of our divisions. In Consumer Legal Services, the 50% increase in cash from settlements is clear evidence of the growing maturity of our law firm, National Accident Law, and it is pleasing that our market leading brand, National Accident Helpline, grew the number of personal injury enquiries it generated by 27%. Separately, our Critical Care division has developed a strong pipeline of work, reaping the benefits of targeted investments made in marketing and business development, and recruited 41 new associates to support growth.

"Despite the current macro-economic uncertainty, based on our performance in H1, the Board expects the Group to meet market expectations for the full year."

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Notes to Editors

NAHL Group plc (AIM: NAH) is a leader in the Consumer Legal Services market. The Group provides services and products to individuals and businesses in the through its two divisions:

· Consumer Legal Services provides outsourced marketing services to law firms through National Accident Helpline and Homeward Legal; and claims processing and conveyancing services to individuals through Your Law, Law Together and National Accident Law. In addition, it also provides property searches through Searches UK.

· Critical Care provides a range of specialist services in the catastrophic and serious injury market to both claimants and defendants through Bush & Co.

More information is available at www.nahlgroupplc.co.uk, www.national-accident-helpline.co.uk, www.national-accident-law.co.uk and www.bushco.co.uk.