Major litigation funder admits caseload hit by Covid delays

Litigation funder Burford Capital has reported that more than 40% of its cases have been delayed by Covid-19 this year, citing court date postponements and a reluctance to settle disputes. 

According to a performance update for the six months ended 30 June 2021, filed with the London Stock Exchange, the pandemic continued to have an impact on the pace and progression of matters in Burford’s portfolio, with 43% of cases experiencing Covid delays.

‘These issues are only a matter of timing; no clients have discontinued cases because of Covid delays and, indeed, as a result of how we often price our deals, our ultimate returns may increase because of the passage of time,’ the group said.

'We believe that 43% of our matters have incurred Covid-related delays, ranging from court date postponements to delays in the provision of discovery to slower settlement activity given the absence of a looming trial date to engender settlement.'

‘In short, almost nothing bad happened - just less happened than in some other periods,’ it said.

While the progression of cases has been slow, Burford reported record levels of new commitments and deployments in its half-year update, saying it has found ‘considerable opportunities’ for investment. 

The funder has deployed $399m (£291m) group-wide, of which $215m (£156.8m) was Burford-only. These figures are more than three times higher than those filed in the flrst half of 2020 and 'well in excess' of its prior record deployments in the first half of 2018.

Chief executive Christopher Bogart said: ‘We are very pleased with the level of new business activity we saw in the first half of 2021 and with the continuing strength of our portfolio, notwithstanding a fairly quiet period for portfolio resolutions.’

Despite the group’s optimistic outlook, however, it anticipates a net loss after tax of approximately $70m (£51m), the bulk of which it attributes to non-cash accruals.

Yesterday morning, shares in Burford Capital were down 6.44% at 792.9p but have since recovered and currently stand at 847p.