Legal Business Blogs

Not about PEP: OC looks long-term after surpassing €300m with 11% revenue growth

The leadership at Osborne Clarke (OC) is conscious of any complacency creeping in after more than doubling in size in the last five years.

The firm recorded another year of double-digit growth internationally in 2018/19, up 11% to €304 last year and with non-UK revenue growing slightly to account for 44% of turnover. Growth was a little slower in the UK, up 8% to £150m as net profit rose 3% to £63m.

Profit per equity partner (PEP), however, fell slightly to £703,000 from £711,000.

‘We feel that we’ve found a method of working which seems to work for Osborne Clarke, our clients and our people, and therefore each year is just about the next iteration of what we’ve been doing,’ international chief executive Simon Beswick (pictured) told Legal Business.

UK managing partner Ray Berg added: ‘We’re thinking in a much more long-term way, rather than just, “What’s the PEP number going to be at the end of the year?” It’s about not allowing any complacency to creep in: it worked this year, so how can we do it better?’

Beswick said the firm had been surprised at how resilient the business had been this year, given the political and economic certainty. The firm has been adding global offices over the last five years, more recently in Sweden and Shanghai as well as its Hong Kong outpost officially becoming known as Osborne Clarke following a regulatory period of association.

He said that building out that international network had added resilience to the firm, with the continental European business – where the firm made key lateral hires in the Netherlands, Belgium and Italy – having a particularly strong year. Beswick said there was opportunity for greater growth in Asia, but finding the right talent in that jurisdiction was proving more challenging.

The slower UK growth reflected both the overall market and relative size of the firm now, said Berg – who in October last year was re-elected managing partner until 2023 – with the performance broadly in line with what it had budgeted.

‘It was an odd year that started slowly, built up a head of steam, slowed down against post-Christmas with Brexit shenanigans, then picked up a head of steam again, which might just be another spike before a slowdown again,’ he told Legal Business. ‘I’m going to be referencing Brexit and uncertainty for the rest of my days as managing partner. The real challenge for all firms and businesses is being able to discern any trends, it jumps around.’

OC has been gradually building up its OC Solutions team over the last five years, too, adding a German team of six people about 18 months ago to bring the overall number to 14. That team is charged with finding bespoke solutions to client needs – it developed a cloud-based platform for Vodafone’s legal property work – rather than simply selling technology or different ways of working to clients.

Beswick said the firm was looking ahead to understand what the future market conditions would look like but was confident OC had found the strategy it would stick to, having overseen dramatic growth over the last five or so years.

‘Each year we’re effectively trying to do the same thing while upping the bar a bit as each year goes by. We’ve enjoyed success now for a number of years, success drives success and gives your people a bit more confidence.’