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Financials 2016/17: Stephenson Harwood revenues climb 11% as PEP falls 9%

Stephenson Harwood has posted another year of growth with revenues up 11% to £176m. The firm, however, saw a drop of 9% in its profits per equity partner (PEP), the number dipping to £708,000, partly due to the effect of the Brexit vote last June. 

The firm’s revenues jumped by £18,000 this financial year from last year’s £158m figure, a 9% increase on the previous year. PEP also grew during the 2015/16 financial year by 1% to £774,000, an £11,000 leap.

In 2014/15 firm, the firm’s revenues increased by an impressive 20%. Although those figures were boosted by fees from several multi-year matters, the firm said that even discounting those payments it still achieved an underlying 16% growth rate.

Discussing the firm’s revenues current increase, Stephenson Harwood chief executive Sharon White (pictured) told Legal Business : ‘We were all shocked by the Brexit result and it did certainly impact on our transactional teams, particularly real estate and corporate.’

‘In the autumn we saw some of those deals come back on track as well as new activity. We’ve ended up having strong performances in all of our practice groups and all of our offices,’ she said.

On the firm’s small fall in PEP, White said they were ‘expecting [the drop], and as much as anything it’s about balancing the investment we need for the longer term health and growth of the firm against the short term.’

The firm has invested over the last five years, when it grew 50% in revenue terms. ‘Our PEP figure this year is still strong and compares well to our peer firms,’ White said. 

‘If you look at our PEP figures over the last few years in 2013/14 we were just over the $500,000 mark. We had big leaps up in the coming two financial years. We always regarded those fabulous years with the knowledge that we may not be able to sustain quite so heavy heights,’ she added.

The firm recruited three King & Wood Mallesons partners in the wake of its European collapse earlier this year, including former UK private equity co-head Jonathan Pittal.

Private equity partners Warren Allan and Gabriel Boghossian also joined the firm, bringing experience advising clients such as Bowmark Capital, Lloyds Banking Group, Unicredit Bank AG, Risk Capital Partners, Core Capital, SL Capital Partners, Pantheon Ventures, Lexington Capital Partners, Temasek, Goldman Sachs Vintage Fund, Oak Hill Capital Partners and Unigestion SA.

Separately, three lawyers were promoted to partner in the firm’s reduced promotion round this year, including commercial litigation lawyers Donna Newman, Sophie Schultz and finance lawyer George Vaughton in the firm’s London office.

Stephenson Harwood also made up one local finance partner, Elton Chan, to the firm’s Hong Kong office. Its largest ever nine partner intake took place in 2016.

This March, the firm also re-appointed its management team. Stephenson Harwood’s supervisory council extended White’s existing term for a further two years, her original three-year term was due to expire this September.

Senior partner Roland Foord was elected for a second term. He will continue in the role for a further three years, reduced from the previous five-year term.