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It has been a rough two months for Neil Woodford and his former devotees but today he earned a little respite as Burford Capital released results.
The litigation funder posted some stellar half-year numbers, with profits up 36% to $225 million (£180 million) and revenue climbing 40% to $287 million.
Woodford has held a 9% stake in the firm since he started Woodford Investment Management in April 2014 and, according to analysts, saw the value in the litigation funding space well before other money managers on the street.
Jamie Donald, an analyst at Liberum, said: “He saw where this industry was going and how it is growing. Burford shares price has grown over 1000% in five years.”
Donald added there is still plenty to come from Burford, adding that litigation funding is increasingly being used by corporate firms to take legal costs off the books.
He continued: “Three years ago only 40% of corporates had heard of litigation funding. Now it’s 80%. Litigation is hugely costly, so firms are handing it over to litigation financiers and sharing the payout if the case is won.”
Shares in Burford were up 5%, or 71p, to 1734p at the bell, while rival Manolete Partners added 11p to 494p and Litigation Capital Management climbed 0.5p to 99.4p.
Among the blue-chips, the FTSE 100 was treading water, up just 6.98 points to 7508.44.
The index was being held back by software firm Sage after it said software services revenue fell 15.5% to £195 million for first nine months of the year.
Sage, which wants to be like US giants Adobe and Autodesk, has been trying to shift its customer base towards a software subscription model.
Brokers said there was little evidence the strategy is working and the shares lost 11%, or 91p, to 725p.
Elsewhere, utilities firms were also struggling as analysts at JPMorgan said an election looks increasingly likely this year under Prime Minister Boris Johnson. If so then it increases the risk of Labour leader Jeremy Corbyn coming to power and the sector and other utilities companies being nationalised.
SSE dropped 6%, or 77p, to 1087.5p, Centrica was down 1.1p to 87.8p and Royal Mail was off 17.1p to 206.9p.
But there was some cheer for investors on the FTSE 250 as Wizz Air posted profits up 42% to €72.4 million (£64.7 million) for its first quarter on the back of passenger numbers increasing 20% to 10.4 million.
The shares added 123p to 3728p.
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