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Hogan Lovells International posts 26% PEP boost as firm moves to pay down pension liability

Hogan Lovells International, which covers the firm’s operations outside of the US, has seen an 8% increase in turnover compared to the previous year, according to the firm’s filings on Companies House. This saw revenue jump from £591m in 2015 to £638.2m for the year ended April 2016.

An increase in turnover has coincided with a boost in profit per equity partner (PEP). Equity members took home on average £879,000 in 2016, a 26% increase from 2015’s figure of £698,000. The average number of members at the firm has remained effectively the same, increasing to 303 from 302.

For the calendar year 2015, Hogan Lovells’ global PEP was £817,000. This means PEP outside the US is 8% higher than the firmwide figure.

There was also a rise in the number of fee earners at the firm. An increase from 1,531 in 2015 to 1,564 in 2016 saw staff costs rise 4% from £254m to £264m.

Partners at the firm are also set to pay in additional capital as part of a drive to boost Hogan Lovells’ capital reserves. These payments will increase by 8% per year until 2021, equating to around £10m each year.

According to the accounts, the firm last valued its pension scheme in April 2015 and the valuation showed a deficit of £5.1m. The firm paid deficit contributions of £1.5m for the year ended 30 April 2016, and has plans to pay £1.9m until April 2019 and £0.6m in May 2019.

At the start of the year, the firm promoted 29 new partners, including three in London. This round of promotions is an increase on 2016’s figure, where 24 lawyers were promoted to partner.