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Juridica to return 32p per share after announcing more losses

Juridica reports a total comprehensive loss of US$27.2 million (2015: US$34.2 million) or 24.67 cents per ordinary share for the six months ended 30 June 2016 due principally to:

  • a net unrealised loss of US$23.8 million generated from the change in valuation of the Company’s investments;
  • operating expenses of US$2.1 million;
  • a realised loss of US$800,000 from the write-off of two investments; and
  • other net negative adjustments of US$500,000

Its NAV per share fell to US$0.7783 / 58 pence from US$1.1432 / 77 pence. Partly this is down to their payment of an 8 pence per share dividend in June 2016 (US$0.1182 per share) b ut most of it relates to a total comprehensive loss of 19 pence per share (US$0.2467 per share).

The Board has decided that, following a review of the cash needs of the business for the run-off period and the July 2016 receipt of US$46.5 million from case settlements, it will declare a cash return of 32p per share (approximately US$47 million).

There were 13 active investments at 30 June 2016: five involve pure litigation; four are in special purpose vehicles relating to patent monetisation; and four either include residual assets obtained as collateral, pre-litigation settlement opportunities, or investments in other entities tied to litigation, (including the Company’s investment in its former Manager). During the six-month period ended 30 June 2016 there were settlements in the final two cases in the Company’s large antitrust and competition investment:

  • Case 5308-U – Settlement was reached during trial, generating US$69.1m in gross proceeds and cost reimbursement. After reserving for taxes and other contingencies, net proceeds of US$46.0m were received in July 2016. Additional proceeds from the release of excess reserves may be remitted to the Company once final tax returns are filed by the counterparty to our investment (no later than third quarter 2017).
  • Case 1008-A – A partial settlement was reached generating approximately US$600,000 in gross proceeds. After reserving for taxes and other contingencies, net proceeds of US$500,000 were received by the Company in July 2016. Additional proceeds of approximately US$1.0m are expected prior to 31 December 2017.

Further to the Company’s announcement of 18 November 2015, the Board has instructed its investment manager, Juridica Asset Management Limited, to seek resolution and monetisation of all the remainder of the company’s assets, where reasonably possible, prior to 31 December 2017. In addition, subsequent to 30 June 2016, the company has completed the wind-up of the debt facility with Fields Law Firm PLLC.

JIL : Juridica to return 32p per share after announcing more losses

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