The firm was a stand-out performer in 2017, but Allen & Overy (A&O) could not keep up the blistering pace for a second year as the London leader today (6 July) confirmed a solid but unspectacular 4% hike to its top line, sending revenues up £54m to £1.57bn.
The result was matched by a 4% increase in profit per equity partner (PEP), which hit £1.64m, while pre-tax profits were up 3% to £690m. The performance leaves A&O as the second largest Magic Circle firm in revenue terms.
The firm said that growth was led by its practices in Western Europe and the CEE region, as well as its ‘advanced delivery businesses’, which covers its large Belfast legal services centre and its New Law operations like Peerpoint and aosphere. Capital markets and tax were also highlighted for strong growth.
The results are comparable to the 2017/18 performances announced earlier this week by Clifford Chance and Freshfields Bruckhaus Deringer, in contrast to 2017 when A&O led its peers with a 16% increase in fees.
Even with less flattering exchange rate movements through the latest financial year, A&O saw some slowdown in growth, though it remains the most consistently expansive of London’s big four law firms.
But while A&O can take more cheer from its post-banking crisis form than most City rivals, the hard reality remains that many key US outfits continue to outperform the London elite on headline financial metrics while making threatening inroads into Europe.
As such, much attention will remain on whether A&O can make good on long-cherished plans to secure a credible US merger, with the Los Angeles-bred O’Melveny & Myers currently the focus of a merger bid.