Litigation Capital Management shares slide after weaker first half
By Josh White
Date: Wednesday 29 Jan 2025
(Sharecast News) - Litigation Capital Management reported realisations of AUD 52m (£26.08m) for the first half of the 2025 financial year on Wednesday, achieving a multiple of invested capital of 3.7x despite four case wins and three losses.
The AIM-traded firm said the results included the successful international arbitration claim against the Republic of Poland, which was announced in October.
On a fair value basis, the realisations were expected to contribute AUD 4m to total income for the period.
Fair value movements on ongoing cases provided a net positive contribution of AUD 1m, though that was offset by an AUD 7m write-down following the trial loss in the Queensland Electricity case in December.
After accounting for operating expenses, finance costs, foreign exchange movements, and tax, LCM said it expected to report a post-tax loss of about AUD 8m, compared to a profit of AUD 7.3m in the same period a year earlier.
Net debt widened to AUD 40.1m as of 31 December, from AUD 8.9m at the end of the prior financial year, reflecting increased investment in ongoing cases.
To support future growth, LCM secured a new $75m credit facility in December.
New investment commitments during the period totalled AUD 25m, down from AUD 90m in the first half of the 2024 financial year.
The company attributed the decline to a temporary reduction in the number of high-quality opportunities meeting its investment criteria, but said it remained confident in future capital deployment.
"While the first half of the 2025 financial year has been a period of mixed results, we are pleased with the strong realisations achieved and the ongoing progress of our portfolio," said chief executive officer Patrick Moloney.
"The high multiple on invested capital reflects the value we continue to generate from our disciplined approach to dispute financing.
"We remain confident in our ability to deploy capital effectively and to deliver attractive returns for our stakeholders as we move into the second half of the financial year."
At 1340 GMT, shares in Litigation Capital Management were down 9.22% at 82.44p.
Reporting by Josh White for Sharecast.com.
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