Job seekers are not the only ones celebrating an increase in vacancies after easing Covid restrictions. After a predictably difficult restraint, shares in recruitment consulting firm PageGroup closed 42 percent higher in 2021 as the labor market continues to face bleak economic forecasts.
According to a December trade update, full-year operating profit is expected to reach £ 165 million, ahead of previous guidance. The third quarter of 2021 was particularly strong, with gross profit across the group exceeding 2019 levels.
PageGroup’s revival coincides with record vacancies in the UK and a decline in new applications for US unemployment benefits. Indeed, growth in the Americas was particularly impressive compared to 2019, even though it was one of the regions worst affected during the pandemic.
PageGroup CEO Steve Ingham saw an opportunity and dropped 480,000 shares over the Christmas period for more than £ 3 million. The price that Ingham insured was 125 percent higher than April 2020’s low of 280p.
No reason was given for the alienation, which more than halved Ingham’s stake in PageGroup.
Macroeconomic turmoil – including more Covid constraints linked to the Omicron variant, supply chain issues and inflation – could still affect PageGroup’s performance in a number of its markets in 2022. In October, the group also warned against uncertainty about how quickly customers could reopen their offices.
The outlook for the labor market is therefore not exactly positive. In addition, figures published by the Office for National Statistics indicate that the UK’s appointments are starting to slow down, with the rate of vacancy growth slowing between September and November 2021.
Commenting on PageGroup’s half-year results for the summer, Ingham said that “at this stage of the recovery it is not clear whether the improved performance is still the result of pent-up supply and demand, or a sustainable trend”. For now, the jury is still out.
Managers of litigation financiers buy a dip after share price drop
Litigation financing no longer seems to be the definitive bet that some investors first thought it was.
Burford Capital showed a loss of $ 67.5m for the first half of 2021, compared to a profit of $ 187.9m in the same period a year earlier, as it recorded a $ 79m non-cash accrual levy linked to potential employee benefit plan benefits.
Investment bank Close Brothers also recently decided to withdraw from the market after discussing its impairment charges against Novitas, a legal funder it bought in 2017.
The company said the risk profile of Novitas was “no longer compatible with our long-term strategy and risk appetite”.
However, investments are still being made in the sector, with both Gateley and Mishcon de Reya partnerships with funders in September.
Litigation Capital Management is also increasing activity, after completing an initial $ 200 million closure of its second fund in October. He plans to raise a total of $ 300 million, after appropriating 91 percent of the capital from his $ 150 million first fund.
Among the cases he agreed to in 2021 were a lawsuit against Carillion’s former auditors KPMG after the outsourcing group’s collapse in 2018 and one against French electrical retailer Darty of a liquidator of the former Comet Group business.
Litigation Capital Management’s share price fell from 104p to 80p on December 17 after announcing that executive vice president Nick Rowles-Davies had been fired on charges of gross misconduct related to cost claims. The share price then recovered to close 52 percent for 2021 at 100p, with chairman Jonathan Molds and CEO Patrick Moloney both buying the dip.
Molds bought 725,000 shares, bringing its holdings to 975,000, or 0.82 percent of the total. Moloney bought 50,000 shares through ATE Holdings, a wholly owned Australian entity. This increases the size of its stake to 8.56 percent.