February 3, 2020 / 8:27 AM / 24 days ago

UPDATE 1-Britain's Burford expects 2019 profit to fall

(Adds background on Muddy Waters, details on balance sheet from statement, share movement)

Feb 3 (Reuters) - Burford Capital, the litigation funder embroiled in a stand-off with short-seller Muddy Waters, said on Monday profit for 2019 would be lower partly due to a fall in potential earnings because of certain investments.

The UK-listed company added that it closed the first half of 2019 with an “unusually high level” of settlement due from investment receivables on its balance sheet. The amount due totalled $173 million.

The company, which finances litigation and takes a cut from payouts, has seen its market value halve since Muddy Waters took a short position in the company last August.

The company, later that month, disclosed its plans for a U.S. listing and replaced its finance chief over investor concerns about her marriage to the chief executive officer.

Burford said in a statement on Monday that 2019 net realised gains would be about $20-30 million lower year-on-year, while forecasting roughly $50-70 million decline in net unrealised gains for the same period.

Net realised gains are what Burford gets from the resolution of an investment minus legal costs, while net unrealised gains stem from revisions to the estimated value of an investment case depending on how the matter develops.

Shares fell 3.3% to 610 pence by 0817 GMT. (Reporting by Muvija M in Bengaluru Editing by Saumyadeb Chakrabarty)

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