The listed owner of claims firm National Accident Law says its latest profit dip was to be expected as the nature of the business evolves.

In a trading update this week, NAHL Group said underlying profit for the first six months of 2022 is expected to be down 8% to £2.3m. The group said revenue is expected to increase by 6% to £20.8m and net debt will be down 7% from the start of this year to £14.5m.

NAHL said the fall in profit was due to the planned investment in National Accident Law and the group as a whole is still on course to meet market expectations for the full year.

The company last year announced its intention to funnel more enquiries from its panel firms to its in-house practice. A quarter of total enquiries this year have been distributed to National Accident Law, representing an increase of 61% compared to the first half of 2021. The firm NAL has increased the number of ongoing claims that it is processing to 9,884 claims, up from 7,918 claims at 31 December 2021.

National Accident Helpline generated almost 18,000 personal injury enquiries in the first six months of this year, representing a 27% increase on the first half of 2021 and suggesting that claims activity is coming back to normal following the periods of lockdown. In February 2022, the group concluded that it would reject tariff-only RTA 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.

NAHL continues to explore the potential sale of its residential conveyancing business, Homeward Legal, and reported that it experienced a slowdown in the first six months of this year, following two years of increased activity fuelled by the stamp duty holiday and sustained low interest rates.

Results for the first half of this year will be released at the end of September. Shares in NAHL rose almost 6% following the update, and are this morning trading at 36.7p.