Addleshaw Goddard‘s staff costs rose 12% from £57,000 to £63,600 in the 2014/15 financial year, the firm’s filings at Companies House show, after it paid larger bonuses and salaries to its employees.
The largest increase was in staff wages which grew by about 12% from just under £48m to a little over £54m despite the average number of persons employed during the year dropping 2% to 1,019 in 2015 from 1,042 in the previous year.
Fee-earner headcount fell 3% from 641 heads to 624 over the same period, while support staff heads also decreased by six down to 395. Pension costs at the firm also rose from £3,800 to £4,100.
In August last year, Addleshaws top of equity figure edged closer to the £1m goal, initially set by managing partner John Joyce in the firm’s revamped strategy, with the firm’s highest paid member taking home £936,000 – an increase of 67.5% increase from £560,000 the prior year. Addleshaws said this was paid to a continuing partner as it does not include retiring partners in its accounts.
We have had a strong year so felt it was necessary to place emphasis on reward,’ the firm’s chief finance officer Colin Brown told Legal Business, ‘we saw a substantial investment in staff costs that reflect the wider market but also a commitment to increase variable reward and if appropriate we will look to cast this theme again. Simply focusing on base salary is no longer appropriate, it doesn’t allow you to reward exceptional performances/contributions as quickly as we would like.’
Profits also shot up 19% to £57.3m from £48.2m for the financial year available for division amongst partners, while operating profit increased 16% to £60.4m from £52m
The firm’s filings also showed a net cash positive position for the first time since 2009, which the firm said was achieved through better financial management, improvements in working capital, an increased focus on billing and cash collection.
Turnover at the firm came in at £186.9m for the financial year, not including revenues from Addleshaw’s associated offices in the Middle East and Asia. With these added revenues, turnover hit £193m – up 12% from £171m in 2013/14.
‘We saw an uptick in transactions at the back-end of 2013/14 and this market confidence continued through the year, and in conjunction with a number of new mandates and panel wins underpinned the results for the year.’
Brown added: ‘Whilst a number of peer firms focus solely on London we have a very strong presence in both Leeds and Manchester, with partners in all offices increasingly leveraging our international presence to compete internationally.’