Litigation Capital Manag... Share Discussion Threads

[daz] 14/3/2023 12:44

I asked a question on whether any of the long running cases should be written off, as there are quite a number open for 48 months or more. Unfortunately it wasn't answered, which is disappointing to say the least.
I have a suspicion that the average IRR of cases is being inflated because cases not resolved but which perhaps should be written off are not included.
I may have got this wrong but without the question being answered you have to be cautious.

[makinbuks] 14/3/2023 12:01

I didn't like Maloney's answer to whether the performance fee of A$3.2m on Carilion could be clawed back. As always he talked round it a lot but essentially so far as I could tell said yes it could

[nchanning] 14/3/2023 09:15

Broke : Looking at 6 month/ 1 year returns from lumpy litigation finance providers and applying a multipleWoke: Looking at long term growth in book value per share and applying an appropriate multiple of book value , whilst remaining cognisant that this may improve dramatically as a result of fees from the fund management business

[robsy2] 14/3/2023 08:54

Indeed Riverman.

[riverman77] 14/3/2023 08:30

Not surprised at all by these results - once again any case wins completely swamped by costs. Will need a huge step up in case wins before they start generating any decent cashflow.

[spectoacc] 14/3/2023 08:25

The fund management side seems more interesting at least. But overall, if resolution times are taking longer, then capital is being committed for longer, costs are potentially higher, & returns are diluted over a longer timeframe. Hard to tell if we're at the worst of that and improving from here, or not.

[jonwig] 14/3/2023 08:19

Indeed - not at all impressed. And a mountain to climb with all these high and rising expenses.

[robsy2] 14/3/2023 08:18

Let’s see what they have to say in the presentation.

[robsy2] 14/3/2023 08:06

On the face of it a pretty awful set of results.The costs are there but the income is delayed.

[luweiluwei] 09/3/2023 21:06

We should be seeing news of cases finishing on average every two weeks for the rest of the year.

[jackson83] 09/3/2023 17:20

maybe we will see 90p on results day ?

[blueball] 09/3/2023 13:05

Stay long.

[jonwig] 09/3/2023 13:00

Gross profit comes after "Litigation service expense", and other expenses seem to be partly fixed. With LIT last year it was (AU$ '000):

Lit Revenue.... 47,350
Lit expense....(16,340)
Gross Pft...... 31,060
Other exp......(20,380)

Have I got the breakdown right?

[riverman77] 09/3/2023 12:56

I'm not saying they're misleading anyone and I hold some of these names myself as expect to see some big case wins starting to come through. But they do make a big point of highlighting their historic IRRs on cases, but tend to keep quiet about their much lower ROEs which is ultimately the key metric that will drive shareholder returns. I'm sure there are some investors who get very excited about the IRRs and just need to be aware of this.

[maddox] 09/3/2023 12:45

Yes, but they don't present the return on a single case or historic case portfolio as anything other than the performance at the case level. They certainly do not mislead investors that a 30% IRR equates to 30% ROE - so I fail to understand why this point needs to be made.

[riverman77] 09/3/2023 12:14

And the other thing to remember is these are gross profits - all the litigation companies like to mention their very strong case returns, but once accounting for all their staff and other costs they are barely breaking even (although things should improve on that front as more case wins start to come through). So when the likes of Burford keep talking about historic 30% IRR that definitely does not translate to 30% return on equity.

[makinbuks] 09/3/2023 11:54

Two years would be short, a couple of years ago I think they quoted 28 months but through the pandemic it lengthened significantly.

[daz] 09/3/2023 11:51

Agree Riverman, a 70% return on a case described as 'mature' must be a couple of years old at least.
While any success is welcome, I suspect LIT may have compromised a little on the settlement just to get the case closed.

[makinbuks] 09/3/2023 11:22

Very welcome news of some wins recently. Next results are going to be an interesting read and I hope we get some webinar presentations to back them up. I'm still wondering how the corporate structure is looking with the move to the UK and the sacking of the main UK director. Been very quiet on that front

[riverman77] 09/3/2023 11:03

While any win is good, returns don't seem to be as good as what they've historically delivered. Not sure how long this has been running, but they mention delays so on an IRR basis probably fairly low.

[walter walcarpets] 09/3/2023 09:46

jonwig21 Dec '18 - 13:38 - 1 of 1540
0 0 0
IPO Press coverage:

jonwig posting in 2018 - new to you???

[jonwig] 09/3/2023 08:27

It's new to me, but I'm new to this company. Figures translated into GBP (forex 0.56):

LCM expects to receive revenue of approximately £7.84 million. That amount includes capital invested of approximately £4.62 million together with an expected gross profit of approximately £3.22 million. The Company's final revenue and profit figures are subject to change pending final distribution of settlement monies and cash is expected to be received in the next 30 days.

Gross profit to June 2022 was £17.4m.

[dagoberia] 09/3/2023 08:17

Did we already know about this LIT win? And they are just confirming settlement, or is this a new win? Thanks

[jackson83] 08/3/2023 16:35

nice volume today as gamblers buy in on hope of good results ... maybe funky finance Mateus is going pump this again to 130p lol

[jonwig] 28/2/2023 17:52

Robsy, thanks!

There's surprisingly little on the web about this project, but here's Panthera's RNS with lots of financial and operational details: