Eight years into its transatlantic union Hogan Lovells is finally gaining some momentum, posting another solid financial performance and passing the $2bn revenue mark in 2017.
Global turnover rose 6% to $2.036bn while profit per equity partner (PEP) returned to growth, rising 2% to $1.28m. The weak pound meant the firm experienced an 11% top line uptick to £1.58bn in sterling terms.
Revenue per lawyer grew 3% to $758,500 and headcount rose 3% to 2,685 in a year marked by a merger in Boston and 37 lateral hires.
This follows a mixed 2016, where the firm boosted turnover by 6% after years of lacklustre performance but PEP remained flat.
Chief executive Steve Immelt (pictured) said he was ‘very pleased’ with the firm’s latest results but told Legal Business of a challenging year as the uncertainty surrounding the start of Donald Trump’s administration in the US, Brexit and the UK general election had a ‘restraining effect on what people do and are planning to do’.
‘We had a lot of up and downs in work over the course of the year but the last few months were very strong,’ added Immelt, whose term was recently extended by a further two years until June 2020. ‘We go into 2018 with momentum and the macroeconomic outlook is more positive.’
Corporate and regulatory, which accounted for 32% and 16% of revenues respectively, had a ‘very strong year’ according to Immelt. The litigation, arbitration and employment group was the second largest contributor at 28%, while the finance team and intellectual property, media and technology group contributed 14% and 10% each.
Growth was slightly more subdued in London, where turnover rose 4% to £292.6m, although the London team led on one of the leading corporate mandates for the firm worldwide, the £3bn takeover of Paysafe by Blackstone and CVC, and saw the arrival of Freshfields investment funds veteran Jonathan Baird.
Most of the revenue came from the Americas, which brought in 52% of fee income followed by Europe at 41%. The firm was in expansion mode throughout the year in the US. In September it merged with Boston-based litigation and investigation firm Collora, taking on all of its 15 partners, while last spring it made a major Silicon Valley play with four corporate partners from Weil, Gotshal & Manges.
‘We do a tremendous amount of work in life sciences, so not having an office in Boston seemed like a gap,’ said Immelt. ‘So far it’s been terrific. We are working together on matters they brought with them.’
The firm also ventured into non-legal advice in London, launching a financial services regulatory consulting practice led by former PwC director Steve Murphy. Immelt said the practice was still ‘at an early stage but we continue to see opportunities to offer clients non-legal advice’.