Juridica Investments NAV reduced by 77.78% during 2016, still aiming to monetise all investments by the end of 2017

Juridica Investments has announced its results for the year ended 31 December 2016. During the year, the company’s NAV fell by US$0.8891 to US$0.2541 (a reduction of 77.78%). Dividends paid to investors during 2016 totalled 40 pence per share (bringing total life-to-date dividends to £1.036 per share). 2016 saw a total comprehensive loss of US$37.8 million, which the company says is primarily attributable to realised and unrealised loss totalling US$30.7 million. It says that a significant proportion of this (US$24.5 million) was reported in its 30 June 2016 interim accounts.

During the year ended 31 December 2016, final settlements occurred in the last two cases in the Company’s large antitrust and competition investment.  Net proceeds remitted to the Company totalled US$46.5 million which funded part of the dividends paid in 2016. The year also saw a net reduction in the valuation of the Company’s investments of US$20.3 million whilst three investments, representing a total of US$1.1 million of 2015 year end NAV were written off due to (i) adverse judicial decisions with limited opportunity for appeal; or (ii) adverse market conditions. The company says that a total of 11 investments remain active with four being litigation related, four relating to special purpose vehicles (SPV), and three being non-litigation and non-SPV.

The Board of Directors announced on 18 November 2015 that it would not make any new investments (other than further funding of existing investments) and that it would seek to make distributions to shareholders in the most appropriate manner, following the completion of investments. The Board says that it, and the Company’s Manager, continue to work to monetise all of the Company’s remaining investments by 31 December 2017.

In terms of the ongoing cases, Case 1008-A saw a partial settlement reached generating approximately US$2.2 million, in gross proceeds. After reserving for taxes and other contingencies, net proceeds of US$500,000 were received by the Company in July 2016. Although the case continues, the Board says that it determined that the quantum of potential additional returns was not worth the additional investment required to continue to retain an interest in the case. Investment 3608-A has come to completion relative to the underlying cases but remains active until residual reserves are transferred to the Company. Case 2709-E and Case 5009-S are both being appealed for decisions adverse to the company’s position. Case 1410 won its initial appeal to increase damages, however both parties have now filed further legal appeals. Case 114107, an investment the company made in early 2015, had several partial settlements in 2015 and 2016 providing for US$1.7 million in total proceeds.  In March 2017, the Company received additional proceeds of US$890,000 which completed the Company’s interest in this case.  Total proceeds received by the Company for this case was $US2.6 million on an investment of US$1.3 million.

Four investments are in special purpose vehicles (SPV).  These investments began in 2014. The company says that, regarding ACK / Smooth3D, after extensive investigation it was determined that the inventions had no commercial value and during 2016, approximately US$330,000 of excess investment was returned to the Company. The remaining investment is a negotiable note. As to Rich Media, 25 patent filings occurred in 2016 and, as of 31 December 2016, none have been issued and all remain under review by the United States Patent and Trademark Office. Monetisation of this vehicle continues. As to GrandiOS, 37 US domestic patents have been filed, and as of 31 December 2016, 23 patents have either been granted or allowed by the United States Patent and Trademark Office. Monetisation efforts continue. As to ProSports, 55 domestic patent filings have been made and, as of 31 December 2016, 14 patents have been granted or allowed by the United States Patent and Trademark Office. The company says that a shareholder partner is the National Football League Players Association. Marketing is underway.

For the remainder of the Company’s investments, those that are not litigation or SPV, the Company began 2016 with four.  During 2016, one investment, specifically Investment 1610 is facing potential bankruptcy and has been written off.  Of the three remaining investments, two of them (investments 7313 and 6609-S) are facing enhanced risk and their respective fair value has been reduced accordingly.  The final investment is the Company’s interest in its former investment manager, JCML 2007 Limited (JCML 2007) and retains value equal to the Company’s share of JIL stock held by JCML 2007.

Juridica Investments NAV reduced by 77.78% during 2016, still aiming to monetise all investments by the end of 2017 : JIL

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