Dwf Share Discussion Threads

[tradertrev] 12/9/2023 15:55

Well, this feels like the easiest and lowest risk 10% I will have made in just over 3 months. Annualize that!

[brucie5] 21/7/2023 13:07

RCTurner221 Jul '23 - 13:05 - 165 of 167
0 0 0
Happy days though Bruce for us value investors!
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And where is there not value.

[boadicea] 21/7/2023 12:43

This is my fourth t/o offer this year.
Who will be next? - NCC, SYS, CNIC, SRT ...?

[rcturner2] 21/7/2023 12:05

Happy days though Bruce for us value investors!

[brucie5] 21/7/2023 11:50

Another one bites the dust!

[rcturner2] 11/7/2023 07:43

In my experience charges added to a system like this cannot be changed later, however when an invoice is raised there is nothing to stop the amount being adjusted at that point (up or down).

(edit I should add I am not a lawyer but I am a consultant who has worked in firms that employ lawyers so I have seen this close up)

[boadicea] 11/7/2023 07:27

An interesting charging system!
Is unbilled revenue inflation proofed? - i.e. if charged as "hours", are the hours eventually charged at the rate applicable to the time when they were incurred or at the rate on the date of billing? Given the speed at which the law works, the difference could be considerable.

[tomtrudgian] 11/7/2023 07:23

I agree unbilled revenue is important. It is absolutely vital if of an amount that leads the 2022 auditor to declare it a “key audit risk”, and for the 2021 auditor to mention the debt covenant ceiling.

Broadicea. Nothing is extraordinary in the “audit time lag”. I am unaware of any time lag anyway. What seems extraordinary is that both parties must have known the draft 2023 figures in early May, when the auditors stated their work. They negotiated this very complex deal and even agreed a price, omitting to tell the shareholders before being forced to by the press.

The date for publication of the 2023 audited accounts is absent too. “However this omission may be connected with the corporate negotiations currently in train” you say. I agree, but these negotiations are likely to be protracted arguments between the DWF board and PWC auditors as to how to present the accounts.

[ben value] 11/7/2023 07:11

Is there a bit of upside on this share if the potential offer is £1. What am I missing?

[rcturner2] 11/7/2023 06:21

As an example, which of these is performing better?

Firm A: £1m invoiced and £100k unbilled revenue

Firm B: £900k invoiced and £400k unbilled revenue

[rcturner2] 11/7/2023 06:19

Tom, unbilled revenue is an important measure, as it shows how the business is performing and what is likely to be invoiced in the (near) future. The lawyers I know have an annual target for billable hours and that will be tracked monthly. Of course these businesses need to be efficient in getting bills out, but unbilled revenue is a real and relevant financial metric for law firms.

[boadicea] 10/7/2023 22:01

What is extraordinary about the audit time lag? It seems a standard situation when annual audited accounts for any company are typically produced only 2 to 5 months after their year end. So 3 months after year end with the accounts for that year still awaited the "extraordinary" figure Tom quotes will be inevitable.
There is one notable omission from the recent update which is the expected issue date of the Preliminary accounts. However, this omission may be connected with the corporate discussions currently in train.

[pete160] 10/7/2023 21:55

I might be wrong, but most, if but not all, professional practices now have to include a justifiable figure for work in progress (uninvoiced work) in their year end accounts, and so it does in effect, go on to their tax return.HMRC cracked down on this a few years back, all part of their plan, like the upcoming quarterly returns and payments, to get tax revenue paid earlier.

[tomtrudgian] 10/7/2023 19:32

“Unbilled Revenue” was the term used by the auditors PWC when they specifically warned shareholders that the amount of it at DWF was a “key audit risk”. As DWF were allegedly at their banking covenant limit, why were fee invoices on account not issued before the year end, if recoverable?

I entirely agree an amount of uninvoiced work-in-progress is perfectly normal for solicitors partnerships. However no partners would add this amount to their HMRC tax return. Have DWF have felt it necessary to do so to protect their share price and banking support?

Although the latest audited accounts, they extraordinarily cover a period between 15 and 27 months ago!

[r9505571] 10/7/2023 16:23

Called the takeover but failed to act ?

[rcturner2] 10/7/2023 16:20

Tom, it might help to explain how a lot of legal services work.

When a lawyer works on a file they book their time usually on some sort of time recordal software. This is the "unbilled revenue" you refer to. It can be quite large as they will only invoice, either when a job is complete or at a specific time point.

It is perfectly normal arrangement in legal services.

[tomtrudgian] 10/7/2023 16:12

Always more difficult for an auditor to audit for the first time. Why? In practice they have to accept the previous year end’s figures, in particular for assets, or otherwise require prior year restatement. The assets (eg new computer and office equipment are depreciated over 4-10 years, and leasehold improvements over 10 years, etc, unusually
low). No provision is made for the Australian partners claim either.

I suggest potential investors study hard the unusually long auditor’s report. In particular they state as a “key risk” the valuation of unbilled revenue (fee invoices) at the 2022 year end, including unbilled expenses. Surely any firm invoices on time, even if on account. Billed revenue may be receivable, but unbilled?

Aleman, as you doubtless know there has been no legal offer at all, and can be withdrawn without cost. Apart from the 3% special dividend, your summary is correct but the offer is legally meaningless. The offeror has bought shares from which it may now profit from the enhanced share price when it sells.

When the current audited accounts are published, we shall see whether any buyer would ever have wished to pay 100p.

[aleman] 10/7/2023 11:23

I'm finding the offer terms could be clearer. I make it more simply:

(i) 100p cash
(ii) 35p cash + 65p in loan notes and/or prefs
(iii) 60p cash + 40p in loan notes and/or prefs

Is that what others understand the options to be?

[boadicea] 10/7/2023 10:38

If anyone at Liberum does well from this it will look uncomfortably suspicious!
I am steadily losing some of my better shares to modestly priced take-overs, buy-outs etc....NEXS, SUR, K3C.
Who will be next? CNIC? SYS? SRT?

[rcturner2] 10/7/2023 10:16

Nice one for today after the OSB disaster on Friday.

[jimmywilson612] 10/7/2023 09:46

just announced - 97p + 3p Special Dividend.

[jimmywilson612] 10/7/2023 09:44

Rumoured take over? - Inflexion in Talks to Buy UK Law Firm DWF Group, Sources Say

[boadicea] 05/7/2023 18:22

The market began picking up around last Thursday (29th June) but it seems that loose stock began to run out today. It looks too cheap if company performance is on track (imo) and a further advance is possible. I don't see any overt signs of an imminent predator.

[r9505571] 05/7/2023 16:52

Yes. Maybe a few pi's jumping in after Gresham House stake! Or insider buying pending a takeover?