UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of September 2021

Commission File Number: 001-39511

BURFORD CAPITAL LIMITED

(Translation of registrant’s name into English)

Oak House, Hirzel Street

St. Peter Port GY1 2NP, Guernsey

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

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This Report includes materials as an exhibit that have been published and made available by Burford Capital Limited (the “Company”) as of September 9, 2021.

This Report on Form 6-K is incorporated by reference into the Registration Statement on Form S-8 of the Company (Registration Number 333-249328).

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EXHIBIT INDEX

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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At a glance

Burford Capital is the leading global finance and asset management firm focused on law. Its businesses include litigation finance and risk management, asset recovery and a wide range of legal finance and advisory activities. Burford is publicly traded on the New York Stock Exchange and on the London Stock Exchange, and it works with companies and law firms around the world from its principal offices in New York, London, Chicago, Washington, Singapore and Sydney.

We assess our performance using a variety of alternative performance measures, which are explained on pages 12-14. Greater detail and explanation about the information provided below are set out in our “financial and operational review” beginning on page 15 and the key definitions beginning on page 11. Reconciliations can be found for the information provided below under “Data reconciliations” on pages 53-60.

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Financial summary

IFRS requires us to present financial statements that consolidate some of the limited partner interests in funds we manage as well as assets held on our balance sheet where we have a partner or minority investor. We refer to this presentation as “Consolidated”. To provide clarity on Burford as a stand-alone business, we furnish information on a non-IFRS basis that eliminates the effect of this consolidation. We refer to this presentation as “Burford-only”. We also strive to provide clarity on the business of Burford and its managed funds as a whole by furnishing information on a non-IFRS basis that reflects the contribution of both our consolidated and unconsolidated funds. We refer to this presentation as “Group-wide”. Throughout this document we use various terms associated with the Burford structure. These include “Burford-only”, the “Company”, “Group”, “Group-wide”, “Balance sheet”, “BOF”, “BOF-C” and the “Strategic Value fund”. These and other key terms are defined on pages 11-14. In addition, these and other terms we may use are defined in the Glossary of terms beginning on page 155 of our Annual Report for the year ended December 31, 2020 (the “2020 Annual Report”).

Reconciliations

The tables below provide a full reconciliation for 1H 2021 of the consolidated statement of comprehensive income and consolidated statement of financial position so that investors can relate our Burford-only performance discussion to our consolidated financial statements. A similar reconciliation for 1H 2020 is provided under the heading “Data reconciliations” in the “financial and operational review”.

1H 2021 Financials and comparison to 1H 2020

Statement of comprehensive income

*    The eliminated amounts arise from the services provided by the Group to the consolidated entities as investment manager and the Group’s investment as a limited partner in consolidated entities. These adjustments and eliminations do not have an effect on the net income or total net assets of the Company.

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Statement of financial position

*    The eliminated amounts arise from the services provided by the Group to the consolidated entities as investment manager and the Group’s investment as a limited partner in consolidated entities. These adjustments and eliminations do not affect the net income or total net assets of the Company.

**   Net asset value per share is total net assets divided by outstanding shares at period end.

***  Net asset value per fully diluted share is total net assets divided by fully diluted shares as set out in note 15 to our condensed consolidated financial statements included herein.

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Management statement

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Our business model

How we deliver value

Companies and law firms have valuable financial assets that take the form of commercial legal claims and defenses, settlements, judgments, awards and fee receivables. Burford helps clients unlock the value of these legal assets—which may otherwise remain illiquid or even invisible—by providing a range of financing and risk management solutions based on their expected future proceeds. We fund these solutions with capital from our own balance sheet and private investment funds we manage.

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Legal finance ▪ Includes our core litigation finance activities in which we provide capital against the future value of legal claims ▪ Also encompasses our asset recovery and legal risk management activities ​

Complex strategies ▪ Investment in underlying assets where the value to Burford as a principal is tied to the outcome of litigation or regulatory process ​

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Total portfolio

​ ​ ▪ Burford-only 64% ▪ Strategic capital 11% ▪ Private funds 25% ​ ​ $4.8b in our Group-wide portfolio ​

Asset management ▪ Managing private investment funds focused on legal finance assets ​

Post settlement ▪ Monetization of post-settlement and other legal receivables ▪ Deployments made only through funds ​

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Burford-only $2.8b total assets, including ▪ $2.0b capital provision portfolio ▪ $0.4b cash and cash management investments Funded by ▪ $1.6b shareholders’ equity ▪ $1.1b debt ​

Strategic capital $1.0b pooled sovereign wealth fund (SWF) arrangement ▪ $667m from SWF ▪ $333m from Burford-only Profit split ▪ 60% to Burford-only ▪ 40% to the SWF

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Private funds $2.6b assets under management, including funds currently in their investment period: ▪ $0.7b BOF-C Fund ▪ $0.4b BAIF Fund ▪ $0.3b BOF Fund

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Details on the figures contained on pages 7 and 8 can be found in the “Financial and operational review” section starting on page 15 and “Key definitions” on page 11.

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Burford-only realizations from concluded capital provision-direct portfolio since inception in 2009 Recoveries

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Shareholders We work to deliver superior risk-adjusted returns uncorrelated to the stock market or economy, creating the conditions for attractive total shareholder returns.

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$1.7b Total recoveries

$0.8b Profits from recoveries

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$0.9b Deployed capital returned from recoveries

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Companies Our solutions allow businesses to derive financial value from their legal assets, increase working capital and use their capital more efficiently.

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Returns 95% ROIC

​ 30% IRR

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Law firms 93 AmLaw 100 and 90 of the 100 largest global law firms, along with numerous respected litigation boutiques, have sought our capital and services to meet the growing and complex needs of their clients and facilitate growth for their firms.

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Group-wide cash receipts $0.2b 1H 2021

​ $4.4b since inception

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Fund investors We strive to safeguard and enhance billions of dollars of endowment, pension fund and other investor capital of which we are stewards.

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Burford-only cash receipts

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Bondholders We manage our liquidity and capital prudently, through judicious oversight of our asset portfolio and sparing use of external finance, supporting predictable returns for our note holders.

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$63m 1H 2021

$2.7b since inception

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Employees We recruit diversely, encourage inclusion and intellectual growth, and develop professionals who succeed.

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Society Legal finance enables meritorious commercial disputes to be resolved and monetized. This leads to efficient resource allocation augmenting productivity and increasing economic growth. ​

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Forward-looking statements

In addition to statements of historical fact, this report contains “forward-looking statements” within the meaning of Section 21E of the US Securities Exchange Act of 1934, as amended (the “Exchange Act”). The disclosure and analysis set forth in this report include assumptions, expectations, projections, intentions and beliefs about future events in a number of places, particularly in relation to our operations, cash flows, financial position, plans, strategies, business prospects, changes and trends in our business and the markets in which we operate. These statements are intended as “forward-looking statements”. In some cases, predictive, future-tense or forward-looking words such as “aim”, “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “forecast”, “guidance”, “intend”, “may”, “plan”, “potential”, “predict”, “projected”, “should” or “will” or the negative of such terms or other comparable terminology are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. In addition, we and our representatives may from time to time make other oral or written statements which are forward-looking statements, including in our periodic reports that we file with the US Securities and Exchange Commission (“SEC”), other information sent to our security holders, and other written materials. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and are based on numerous assumptions and that our actual results of operations, including our financial condition and liquidity and the development of the industry in which we operate, may differ materially from (and be more negative than) those made in, or suggested by, the forward-looking statements contained in this report. In addition, even if our results of operations, including our financial condition and liquidity and the development of the industry in which we operate, are consistent with the forward-looking statements contained in this report, those results or developments may not be indicative of results or developments in subsequent periods.

Factors that might cause future results to differ include, but are not limited to, the following:

Except as required by law, we undertake no obligation to update or revise the forward-looking statements contained in this report, whether as a result of new information, future events, a change in our views or expectations or otherwise. New factors emerge from time to time, and it is not possible for us to predict all of these factors. Further, we cannot assess the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward-looking statement.

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Definitions

Definitions of certain terms used in this report are provided in the sections titled “Key definitions” beginning on page 11 of this Report. These and other terms that we use from time to time are included under “Glossary of Terms” starting on page 155 of our 2020 Annual Report.

Basis of presentation of financial information

We report under International Financial Reporting Standards, as issued by the International Accounting Standards Board (IFRS).

IFRS requires us to present financials that consolidate some of the limited partner interests in funds we manage as well as assets on our balance sheet where we have a partner or minority investor. We refer to this presentation as “Consolidated”. We endeavor to provide clarity on Burford as a stand-alone business by furnishing information on a non-IFRS basis that eliminates the effect of this consolidation. We refer to this presentation as “Burford-only” or “balance sheet”. We also strive to provide clarity on the business of Burford and its managed funds as a whole by furnishing information on a non-IFRS basis that reflects the contribution of both our consolidated and unconsolidated managed funds. We refer to this presentation as “Group-wide”. See page 53 for important information about non-IFRS financial measures, including a reconciliation of these non-IFRS items to our financial statements prepared in accordance with IFRS.

We use Burford-only and Group-wide financial measures, which are calculated and presented using methodologies other than in accordance with IFRS, to supplement our analysis and discussion of our operating performance. We believe Group-wide financial measures, including Group-wide information on our capital provision assets and undrawn commitments, are useful to investors because they convey the scale of our existing (in the case of Group-wide capital provision assets) and potential future (in the case of Group-wide undrawn commitments) business and the performance of all legal finance assets originated by us. Although we do not receive all of the returns of our managed funds, we do receive performance fees as part of our income. Further, we believe that Group-wide performance, including the performance of our managed funds, is an important measure by which to assess our ability to attract additional capital and to grow our business, whether directly or through managed funds. These non-IFRS financial measures should not be considered as a substitute for, or superior to, financial measures calculated in accordance with IFRS.

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Our financial statements are presented in US dollars.

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Key definitions

Definitions related to Burford’s activities

Throughout this report, we will refer to our activities as follows:

Our funding sources, however, are not organized based on these services but by expected return, risk and life of the assets we originate. We use our balance sheet and certain dedicated funds to provide capital for higher-risk, higher-return, longer-lived assets such as those created in our legal finance business. We typically use dedicated funds, in which our balance sheet is an investor, to provide capital for the kind of lower-risk, lower-return, shorter-lived assets that typify complex strategies activities. And we use still other dedicated funds (without balance sheet investment) for low risk, low return, very short-lived assets, such as post-settlement and law firm receivables financing.

To present our business in line with this stratification of asset types, we provide our financing and other services through three principal operating segments:

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Definitions related to Burford’s business structure

We use Burford-only and Group-wide financial measures, which are calculated and presented using methodologies other than in accordance with IFRS, to supplement our analysis and discussion of our operating performance. We believe Group-wide financial measures, including Group-wide information on our capital provision assets and undrawn commitments, are useful to investors because they convey the scale of our existing (in the case of Group-wide capital provision assets) and potential future (in the case of Group-wide undrawn commitments) business and the performance of all legal finance assets originated by us. Although we do not receive all of the returns of our funds, we do receive performance fees as part of our income. Further, we believe that Group-wide performance, including the performance of our managed funds, is an important measure by which to assess our ability to attract additional capital and to grow our business, whether directly or through managed funds. These non-IFRS financial measures should not be considered as a substitute for, or superior to, financial measures calculated in accordance with IFRS.

To that end, throughout this report, we will refer to our funding configuration as follows:

Definitions related to calculating returns

Alternative performance measures:

This report presents certain unaudited alternative performance measures (APMs), which are not presented in accordance with IFRS.

The presentation of APMs is for informational purposes only and does not purport to present what our actual results of operations and financial condition would have been, nor does it project our results of operations for any future period or our financial condition at any future date. The presentation of APMs set out in this report is based on available information and certain assumptions and estimates that we believe are reasonable. Our APMs measure certain performance of our assets to the end of the period and include concluded and partially concluded portfolios (as described below).

In discussing cash returns and performance of our asset management business, we refer to several metrics that we have applied consistently for many years in our financial disclosure:

We use the term to encompass: (i) Entirely concluded legal finance assets where we have received all proceeds to which we are entitled (net of any entirely concluded losses); (ii) the portion of legal finance assets where we have received some proceeds (for example, from a settlement with one party in a multi-party case), but where the case is continuing with the possibility of receiving additional proceeds; and (iii) legal finance assets where the underlying litigation has been resolved and there is a promise to pay proceeds in the future (for example, in a settlement that is to be paid over time) and there is no longer any litigation risk involved in the asset.

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In most instances, concluded assets both conclude and result in receipt of all cash proceeds associated with the asset in the same period. Sometimes, non-cash assets are received or cash will be paid over time. In those instances, a balance sheet due from settlement of capital provision assets receivable is recorded, in which event we estimate the future date we expect to receive cash for purposes of calculating return or other metrics such as IRR and WAL. When proceeds are ultimately received, we adjust our presentation of returns to reflect actual proceeds and timing.

For purposes of calculating returns, we must consider how to allocate the costs associated with an asset in the event of a partial conclusion. Our approach to cost allocation depends on the type of asset:

In the past, we have sometimes referred to “duration” of our legal finance assets to give an indication of their tenor. Duration and WAL are often used somewhat interchangeably in finance, but technically we are analyzing WAL (where time is weighted by cash flows) rather than duration (where time is weighted by the present value of those cash flows).

Unlike our IRR and ROIC calculations, using the aggregate cash flows from the portfolio in making our portfolio level computations will not readily work with WAL computations because our funded assets are originated in different timeframes. Instead, in calculating a portfolio WAL, we compute a weighted average of the individual asset WALs. In doing this, we weight the individual WALs by the costs deployed on the asset and also by the amount of recoveries on the individual assets.

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These financial measures are presented as (i) we use them to monitor our financial results and (ii) we believe they are useful to investors, securities analysts and other interested parties. The APMs, as defined by us, may not be comparable to similarly titled measures as presented by other companies due to differences in the way our APMs are calculated. Even though the APMs are used to assess our financial position and financial results, and these types of measures are commonly used by investors, they have important limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our consolidated financial position or results of operations. Consistent with how management assesses Burford’s business, we also present certain of these APMs on a (1) Consolidated basis, (2) Burford-only basis and (3) Group-wide basis.

In addition to these measures of cash returns and asset life, we also refer to one other non-IFRS financial alternative performance measures in this report:

We believe that cash receipts is an important measure of our operating and financial performance and is useful to management and investors when assessing the performance of our Burford-only capital provision assets. See page 57 for a reconciliation of cash receipts to proceeds from capital provision assets.

For a full list of terms we use to discuss our business, please see the Glossary of Terms beginning on page 155 of our 2020 Annual Report.

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Financial and operational review

We have organized the topics in this Financial and operational review in the way that we think about and manage Burford’s business.

In 2020, we registered with the SEC as a Foreign Private Issuer (“FPI”), which allowed us to continue to report under IFRS and issue annual results on Form 20-F and semi-annual interim results on Form 6-K. We test for continued status as an FPI and application of the related rules each year as of June 30. As of June 30, 2021, our shareholder profile analysis concluded that we continue to meet the FPI definition and remain entitled to FPI status through 2022. However, notwithstanding our continuation of FPI status, we are considering conversion to US Generally Accepted Accounting Principles (“US GAAP”) for our year end 2021 financial statements.

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Financial and operational review
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Consolidated operating results

Set forth below is a discussion of our consolidated results of operations as reported under IFRS. This “financial and operational review” also contains a discussion of certain alternative performance measures (APMs) (some of which are presented on a non-IFRS basis) that are also used by management to review our ongoing operations. These APMs and non-IFRS measures are supplemental and should not be considered as a substitute for, or superior to, our consolidated results of operations as reported under IFRS.

Six months ended June 30, 2021, compared to six months ended June 30, 2020

The following table provides an overview of our consolidated results of operations for the six-month periods ended June 30, 2021 and 2020.

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Overview of 1H21 results

In the first half of 2021, we saw robust levels of new business, including new commitments and deployments both at record levels. This level of activity suggests that the slowdown in new business in early 2020 from Covid has moderated and that we are finding considerable opportunities to deploy capital. Nonetheless, Covid has continued to impact the pace and progression of matters in our portfolio. The portfolio as a whole was quiet in the period and capital provision income in the first half of 2021 decreased compared to the first half of 2020, as both realized and unrealized gains decreased. A key driver of the decrease in realized gains was the significant realized gains during the year-ago period, primarily from a set of ten related assets, that did not recur. In addition, in the period we changed our accounting estimate of expense associated with certain carry arrangements to accrue these expenses as we make fair value adjustments, matching potential future gains with potential future expenses. Also, the profit-sharing arrangement with the asset recovery business was terminated in the period except for a small number of grandfathered cases continuing under a new arrangement. These changes resulted in $79 million non-cash accruals related principally to prior fair value gains. The combination of these non-cash accruals and the moderate level of asset realizations was the key driver of the $67 million accounting loss in the period. Adjusting for non-cash items (particularly fair value adjustments and the non-cash accruals), profit after tax would have been $17 million.¹

¹ The $17 million profit after tax figure removes all non-cash items, including unrealized gains arising from fair value adjustments of $2 million, non-cash accruals of $79 million, other non-cash gains of $3 million, and $10 million of unrealized gains arising from third-party share of fair value adjustments.

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Capital provision income

Capital provision income of $87 million for the six months ended June 30, 2021, represents a 67% decrease from $261 million for the six months ended June 30, 2020, and reflects a lower level of portfolio activity during the period. Realized gains on capital provision assets of $87 million for the six months ended June 30, 2021, were down 58% from $208 million for the six months ended June 30, 2020. The six month period ended June 30, 2020, included $172 million of realized gains from a set of ten related assets, which did not recur. This decrease in capital provision income also was partially driven by a decrease in unrealized gains (net of previously recognized unrealized gains transferred to realized gains) on capital provision assets. Fair value adjustments (net of previously recognized unrealized gains) for the six months ended June 30, 2021, were $2 million, compared to $57 million for the six months ended June 30, 2020. See note 6 to our condensed consolidated financial statements for further details.

Asset management income

Asset management income for the six months ended June 30, 2021, was $4 million, essentially unchanged from the six months ended June 30, 2020, and consisted entirely of management fees in both periods. There were no performance fees earned in either period.

Cash management income and bank interest

Cash management income and bank interest increased to $1 million for the six months ended June 30, 2021, compared to a loss of $2 million for the six months ended June 30, 2020. The increase was primarily due to interest earned on higher cash and cash management balances in the six months ended June 30, 2021, and $2 million in realized losses on the disposal of cash management assets during the six months ended June 30, 2020.

Foreign exchange gains/(losses)

Foreign exchange losses were reduced to $3 million for the six months ended June 30, 2021, from a loss of $5 million for the six months ended June 30, 2020. The lower loss was due to a decrease in the impact of foreign-exchange movements on the values of our non-US-dollar-denominated assets held by subsidiaries with US dollar functional currency.

Third-party share of gains relating to interests in consolidated entities

We consolidate two fund entities, the Strategic Value fund and BOF-C fund, in which we are both the appointed investment advisor and have a significant financial interest. With respect to the Strategic Value fund, Burford has a significant investment in the fund in addition to earning management and incentive fees as the investment advisor. With respect to the BOF-C fund, under the co-investing arrangement with the sovereign wealth fund (SWF), Burford receives reimbursement of expenses from BOF-C up to a certain level before Burford or the SWF receives a return of capital. After the repayment of capital, Burford then receives a portion of the return generated from the assets held by BOF-C. Accordingly, under both fund arrangements, Burford is deemed to control the funds under IFRS as it is exposed, or has rights, to variable returns from its involvement with the funds and has the ability to affect those returns through its power over the funds.

Third-party share of gains relating to interests in consolidated entities reflects the performance of entities that we consolidate under IFRS but that are not wholly owned.

Operating expenses

Operating expenses – general for the first half of 2021 of $40 million represents an 11% increase from $36 million for the six months ended June 30, 2020. This increase was driven by higher compensation expense from an increase in headcount, partially offset by lower travel and marketing expense because of the Covid pandemic.

Operating expenses in the period also included non-cash charges arising from a change in our accounting estimate related to certain carry arrangements. As further described in our 2020 Annual Report, we award to certain employees a participation in the actual cash performance of litigation matters, on a vintage year basis, which we call our “carry plan.” Given that we do not pay employees under this carry plan on the basis of unrealized fair value gains, pursuant to IAS-19, we have historically recognized carry plan expense only upon realizations for the related assets, without regard to fair value movements. However, as more cases have concluded and we have further validation of our predictive models in general and across asset types, our confidence in our modelling and valuation methodology has continued to increase and we believe it is appropriate to change our accounting estimate of that expense under IFRS and accrue expense related to certain carry arrangements as we make fair value adjustments. In 2021 and future periods, we will

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accrue this expense as we make fair value adjustments, matching potential future gains with potential future expenses. This change in accounting estimate caused us to accrue a $45 million non-cash charge related to prior fair value adjustments on legal finance assets. Of this charge, 70% was related to the substantial positive fair value adjustments on the YPF-related assets in prior periods.

In addition, we have taken a $34 million non-cash charge related to the grandfathering of a small number of cases following the termination of a profit-sharing arrangement in our asset recovery business. The arrangement, which dated from the acquisition of the asset recovery business in 2015, was terminated in 2021, following the team’s integration within our core business. The grandfathered cases are at an advanced stage of activity. The accrual represents potential profit-sharing expense on the successful conclusion of those cases and relates to the carrying value of those matters, including the fair value adjustments in prior periods.

Finance costs

Finance costs of $26 million for the six months ended June 30, 2021, increased from $20 million for the six months ended June 30, 2020, reflecting the issuance of $400 million aggregate principal amount of senior notes due 2028 in April 2021 (“April 2021 US Debt Issuance”). In June 2021, we repurchased £24 million ($33 million) aggregate principal amount of our 6.50% notes due 2022 at a purchase price of 105%, which resulted in a $2 million loss in the period but which will reduce interest expense going forward.

Taxation

We had a taxation credit for the six months ended June 30, 2021, of less than $1 million, primarily driven by our loss before tax for the period. Cash taxes for the six months ended June 30, 2021, were less than $1 million, reflecting taxable income in certain tax jurisdictions. For the six months ended June 30, 2020, taxation expense was $37 million.

Segments

We have three operating business segments: (i) Capital provision, which consists of the provision of capital to the legal industry or in connection with legal matters, both directly and through investment in the Group’s managed funds; (ii) asset management activities; and (iii) services and other corporate, which consists of the provision of services to the legal industry, including litigation insurance and other corporate activities. All of our segment income is aligned with the corresponding line items of the income statement.

The following table provides a breakdown of our income by operating segment for the six months ended June 30, 2021, and 2020.

The following table sets forth our income in the capital provision operating segment net of the third-party interest amounts for the six months ended June 30, 2021, and 2020.

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The following tables provide a breakdown of our profit/(loss) before taxation by operating segment for the six months ended June 30, 2021, and 2020. Operating expenses in the capital provision segment for the six months ended June 30, 2021, include non-cash charges related to a change in accounting estimate of expense associated with certain carry arrangements to accrue these expenses as we make fair value adjustments.

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Cash flows

The following table sets forth the principal components of our cash flows for the six months ended June 30, 2021, and 2020.

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Net cash inflow/(outflow) from operating activities

Net cash flow from operating activities decreased from a cash inflow of $94 million for the six months ended June 30, 2020, to a cash outflow of $439 million for the six months ended June 30, 2021. The cash outflow was primarily due to our funding of capital provision assets and investment in cash management assets in the period, which is included in investing activities but considered part of our liquidity.

The following table sets forth the principal components of our net cash inflow/(outflow) from operating activities for the six months ended June 30, 2021, and 2020.

Net cash INFLOW/(outflow) from investing activities

Net cash flow from investing activities was less than $1 million for the six months ended June 30, 2020, and the six months ended June 30, 2021. Investing activities generally are the purchases of fixed assets.

Net cash (outflow)/inflow from financing activities

Net cash flow from financing activities increased from an outflow of $20 million for the six months ended June 30, 2020, to an inflow of $309 million for the six months ended June 30, 2021. The increase was primarily driven by the April 2021 US Debt Issuance.

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Financial instruments

We have issued five series of debt securities through finance subsidiaries. Four of these are listed on the London Stock Exchange’s Order Book for Retail Bonds. As of June 30, 2021, Burford Capital PLC had outstanding (i) £62 million (net of repurchased amounts) aggregate principal amount of 6.50% notes due 2022, (ii) £100 million aggregate principal amount of 6.125% notes due 2024 and (iii) £175 million aggregate principal amount of 5.000% notes due 2026. As of June 30, 2021, Burford Capital Finance LLC had outstanding $180 million aggregate principal amount of 6.125% notes due 2025.

In addition, we completed the April 2021 US Debt Issuance, which is our first US debt issuance pursuant to Rule 144A. As of June 30, 2021, Burford Global Finance LLC had outstanding $400 million aggregate principal amount of 6.25% notes due 2028.

The trust deeds and indenture governing our debt securities contain certain covenants. Our debt issuances in the UK bond market contain one significant financial covenant, which is a leverage ratio requirement that we maintain a consolidated level of net debt (debt less cash and cash management assets) of less than 50% of our tangible assets (total assets less intangibles). Our April 2021 US Debt Issuance contains financial covenants that, in order for Burford to incur additional debt, restrict certain payments and require that we take certain actions, including requiring us to have a total debt-to-tangible -equity ratio of less than 1.5 or 2.0 to 1 (depending on the specific action). As of June 30, 2021, we were in compliance with all of the covenants under the trust deeds and indenture, as applicable.

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Financial and operational review
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Burford-only results

The remainder of the “financial and operational review” focuses primarily on Burford-only results, removing from our results the impact of certain consolidated entities. In the “Data reconciliation” section beginning on page 53, we provide a full reconciliation of the consolidated statement of comprehensive income and consolidated statement of financial position so that investors are able to relate our performance discussion in this “financial and operational review” with our published accounts. The tables below provide a reconciliation of the consolidated statement of comprehensive income and consolidated statement of financial position for 1H 2021 and, for comparison, the Burford-only results for 1H 2020. A similar reconciliation for 1H 2020 can be found in the “Data reconciliations” section on page 54 of the “financial and operational review”.

1H 2021 Financials and comparison to 1H 2020

Statement of comprehensive income

*    The eliminated amounts arise from the services provided by the Group to the consolidated entities as investment manager and the Group’s investment as a limited partner in consolidated entities. Accordingly, these adjustments and eliminations do not have an effect on the net income or total net assets of Burford.

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Statement of financial position

*    The eliminated amounts arise from the services provided by the Group to the consolidated entities as investment manager and the Group’s investment as a limited partner in consolidated entities. Accordingly, these adjustments and eliminations do not affect the net income or total net assets of Burford.

**   Net asset value per share is total net assets divided by outstanding shares at period end.

***  Net asset value per fully diluted share is total net assets divided by fully diluted shares as set out in note 15 to our condensed consolidated financial statements included herein.

Overview of 1H 2021 results

In the first half of 2021, we saw robust levels of new business, including new commitments and deployments both at record levels. This level of activity suggests that the slowdown in new business in early 2020 from Covid has moderated and that we are finding considerable opportunities to deploy capital. Nonetheless, Covid has continued to impact the pace and progression of matters in our portfolio. The portfolio as a whole was quiet in the period, and capital provision income in the first half of 2021 decreased compared to the first half of 2020, as both realized and unrealized gains decreased. A key driver of the decrease in realized gains was the significant realized gains during the year-ago period, primarily from a set of ten related assets, which did not recur. In addition, in the period we changed our accounting estimate of expense associated with certain carry arrangements to accrue these expenses as we make fair value adjustments, matching potential future gains with potential future expenses. Also, the profit-sharing arrangement with the asset recovery business was terminated in the period except for a small number of grandfathered cases continuing under a new arrangement. These changes resulted in $79 million in non-cash accruals related principally to prior period fair value gains. The combination of these non-cash accruals and the moderate level of asset realizations was the key driver of the $67 million accounting loss in the period. With adjustments for non-cash items (particularly fair value adjustments and the non-cash accruals), profit after tax would have been $17 million.²

Realizations from capital provision ASSETS

Capital provision-direct asset realizations of $141 million in the first half of 2021 represented a 54% decrease from $308 million in the first half of 2020, primarily from realizations on a set of ten related assets in 1H 2020 that did not recur. During the first half of 2021, realizations were sourced entirely from capital provision-direct assets, while 36% of realizations in 1H 2020 were sourced from capital provision-indirect assets.

² The $17 million profit after tax figure removes all non-cash items, including unrealized losses arising from fair value adjustments of $8 million, non-cash accruals of $79 million, and other non-cash gains of $3 million.

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Of our $141 million in realizations in 1H 2021, $103 million was related to the previously announced resolution of the Akhmedov judgment enforcement matter, which concluded late in the period. As a result, there was an increase in due from settlement receivables at June 30, 2021, compared to December 31, 2020. Burford received its full cash entitlement related to that matter in July 2021. Similarly, a significant portion of the realizations that occurred in the first half of 2020 gave rise to receivables at June 30, 2020, almost all of which were collected by year end 2020.

Burford-only income on capital provision-direct assets