Re-enforcing what is already shaping up to be a robust year for major US-bred advisers, Reed Smith is the latest major law firm to announce robust growth with revenues rising 7% in 2014 to reach $1.15bn.
Growth in the world’s two dominant legal hubs – New York and London – helped to propel revenue and profitability at the firm, which last year received mandates from Barclays Bank, Sky and AstraZeneca. Revenue for the 700-partner firm increased from $1.07bn in 2013 to $1.15bn while profit per equity partner climbed 6% from $1.14m to $1.2m. Revenue per lawyer growth was more subdued, rising 2% from $691,000 to $703,000.
Reed Smith attributed the results to its focus on five core business sectors: financial services; life sciences and health; energy and natural resources; shipping and transport; and media and entertainment.
London, now the firm’s largest office with 373 lawyers, has been growing quickly. The office, which now generates well over £125m annually – has hired 15 partners in the past 12 months and promoted seven London lawyers to the partnership at the start of the year.
One of the firm’s biggest mandates arrived in London from Marathon Asset Management, with partners Tamara Box and Iain Balkwill advising on the acquisition, restructuring and financing of an €850m portfolio of non-performing loans.
Reed Smith’s Houston office, which opened in February 2013, also made an impact on the firm’s revenues having since grown to 45 lawyers.
Sandy Thomas, global managing partner at Reed Smith, said: ‘Reed Smith achieved solid financial results in 2014. Work flow into and out of our offices across our platform has never been stronger and that underscores a key asset – our single global partnership.’
He added: ‘Reed Smith begins 2015 with enviable forward momentum. Our newest offices in Singapore and Houston are fully integrated into our operations, and their performance in 2014 exceeded our expectations.’
Thomas has launched a five-year plan to drive growth in the firm’s corporate practice, particularly in the US. Initiatives have also been rolled out to improve productivity, including growing its client value team, which manages mandates and prices work. The team launched in 2012 in Pittsburgh and now has 15 members globally, including three in London.
Reed Smith’s announcement is the latest in a string of robust 2014 results to so far emerge from leading US law firms, with Latham & Watkins establishing itself as a pace-setter last month after confirming that its revenues were up more than $300m.
With a resilient national economy powering US-bred advisers, UK rivals look set to face increasingly intense competition in Europe.