Legal Business Blogs

Financials 2013/14: Bird & Bird LLP accounts show fall in profits as firm ramps up headcount

Bird & Bird’s latest limited liability partnership (LLP) accounts show turnover at the firm grew 5% from €293m to just under €309m in the year to 30 April 2014, but that profit at the LLP was down 5% from €60.3m to €57.1m as staffing costs rose.

The firm’s net current assets on its consolidated balance sheet also dropped 15% from just under €108m in 2013 to just over €91m as the amount owed to creditors due within one year rose from €62m to €89m. Similarly, the firm’s net current assets on its LLP balance sheet fell from over €82m down to €65m.

Staff costs at the firm went up 10% from €128m to €142m while overall salaries at the firm grew from just under €105m to €115m while other expenses associated to staff costs also increased by a huge 40%. The rise was driven by the average number of persons (excluding partners) employed by the firm going up 9% with fee-earner headcount growing from 856 in 2013 to 926 in 2014, and support heads increasing from 738 to 806.

The average number of partners, in comparison, was roughly the same at 233 in 2014, but the highest paid partner received €911,000 – considerably less than in 2013 when the highest paid took home just over €1m.

Around this time last year, Bird & Bird’s turnover was up 8% to €293m from €270m the previous year, while profit was down 7% from nearly €65m in 2012 to €60.3m in 2013.

The tech-centric firm recently committed to a pre-let that will see it pay £8.28m a year to lease 12/14 New Fetter Lane. The agreement, which weighs in at £58.11 per sq ft, makes the annual cost of the property worth 38% of Bird & Bird’s current leasehold expenditure globally.

The firm also restructured its debt last year with Paul Colvin, chief financial officer at Bird & Bird saying to Legal Business: ‘We have always been very proud of the fact that we have a conservative approach to our finances, and a number of recent high profile cases have shown that approach was sensible.’

Colvin added: ‘However, the value of ensuring we have a strong balance sheet and a very transparent position on our liabilities – for example by ensuring we do not have “off-balance sheet borrowing” – really shone through during our discussions earlier this year about restructuring our finances. We had a wide choice of banks who were keen to support us and the end result is a very substantial saving for the firm, so we are delighted!’