The global management of Dentons are well known sceptics of the significance of profit per equity partner (PEP) but its UK and Middle East business is happily talking up 36% growth in the metric, rebounding from last year’s drop to boast a £651,000 figure.
The firm released today (8 June) what regional chief executive Jeremy Cohen described its ‘strongest ever set of financial results’, in which its top line grew 22% to £203.1m.
This was naturally bolstered by revenue from legacy Scottish firm Maclay Murray & Spens, which merged with Dentons in November last year. That brought three new offices in Aberdeen, Edinburgh and Glasgow into the firm’s network, increasing UK lawyer headcount to more than 800. Partner numbers grew to 207 from last year’s 160.
Cohen said that without the merger, revenue would have grown 9%.
‘As the global platform of Dentons grows and integrates more strongly, we get more opportunities through that,’ he told Legal Business. ‘The UK and Middle East are very international places, so we get more international work.’
The eye-catching rise in PEP follows a disappointing 2016/17, when it fell 9% to £481,000 amid a modest 1% increase in revenue to £166.4m.
Cohen commented: ‘Last year we had made a lot of investment, hired a lot of people, built out our practices, took on a new office in Watford – things we are very pleased to see are growing well.
Since 2013/14, Dentons’ top line has grown 39%, with PEP rising 60%. He added: ‘It’s the five-year trend that tells the real story.’
The firm’s work around the Carillion collapse was one of the key sources of revenues this year. It has been advising the Cabinet Office and the liquidator.
‘The restructuring part of the business is stronger than it has been for some time,’ Cohen said.
On the corporate side, Dentons advised KKR on the due diligence and carve-out aspects of its £6bn acquisition of Unilever’s spreads businesses and real estate investment company Aprirose as it bought QHotels for £525 million.
Dentons has recently reshuffled its regional management. Cohen was in December re-elected regional chief executive until 2021 after his role changed last summer to only cover Europe and the Middle East. The firm established a separate governance for Africa at the same time, led by Noor Kapdi. Dentons also made the unusual move of hiring a non-lawyer to run its day-to-day operations, appointing former RBS director Lisa Sewell as managing director, replacing Brandon Ransley who retired earlier this year.
Cohen concluded: ‘It’s probably been a much stronger market environment this year than many of us would have anticipated. We all have to expect some degree of volatility [for the next financial year]. That does not mean that it won’t be a strong year.’