Market report: Burford Capital could benefit if Covid-19 legal disputes stack up

If there’s one set of people who usually benefit from a crisis, it’s the lawyers.

Divorce solicitors have seen work spike globally as the lockdown tests couples, and there have been plenty of corporate disputes too.

Rubbing its hands at the conflict was litigation financier Burford Capital, which had a disastrous 2019, but today saw its share price surge back as it signalled a wave of coronavirus-related work.

AIM-listed Burford, which funds legal actions then shares the profits if its side wins, informed investors that, in the first four months of the year, it has obtained court results or arbitral awards that, if paid in full, would generate “substantial income” of around £400 million.

It added: “Covid-19 has disrupted a vast number of contractual and other arrangements and there will inevitably be significant litigation over the allocation of responsibility, including questions such as the scope of business interruption insurance and the limits of the force majeure doctrine.”

The company also said 2019 pre-tax profits were 24% lower at $239.7 million. In warned in February that fewer cases closed last year than in 2018.

Burford shares fell heavily last August after the company came under attack from short seller Muddy Waters which questioned its accounting practices.

Since then Burford has restructured its board while Muddy Waters’ other target, healthcare giant NMC, looks set to delist after its collapse. Shares in Burford surged 80.8p, or more than 19%, to 487.7p. NMC shares are suspended.

Online trading platform Plus 500 has been another winner from the virus crisis as heightened volatility of trading across global financial markets has spurred an increase in customer trading. Shares in Plus500 were up 49p to 1288p.

On the FTSE 250 shares in builders merchant Travis Perkins gained 26p to 1046.28p. Although the building materials business said April revenues slumped from a year earlier, due to a number of site closures, it today said it has been reopening some branches since April 20.

The Wickes owner said that will give greater support to large construction firms and subcontractors as they restart construction sites.

T he FTSE 250 was trading up modestly, up 90.24 points to 16042.96.

The FTSE 100 was 23.71 points higher at 5870.5.

UK Oil & Gas said that it had cut costs due to low oil prices. It wasn’t enough to convince investors and shares in UK Oil & Gas, which has been testing for oil at a site near Gatwick Airport called Horse Hill, dipped 0.07p to 0.25p

Aim-listed Gaming Realms today impressed investors with bullish comments about the first quarter. The company, which develops games for mobile phones, said licensing revenues in the first three

months of the year surged, and it is operating ahead of forecasts. It launched games during the period with partners such as Sky Betting and Gaming.

Gaming Realms added that sales in 2019 improved 11.5% to £6.9 million.

The shares were up more than 9%, or 0.74p, to 8.27p in early trading.