In a challenging but ‘good year’ for the firm, Macfarlanes has continued growing with revenues up 4% to £167.6m.
With profits per equity partner rising 7.6% to £1.38m, senior partner Charles Martin said the results were impressive, despite the market turbulence which followed the June 2016 EU referendum vote and some partner losses over the year.
‘It had its challenges, but some of the more gloomy predictions made following the Brexit vote didn’t turn out to be true,’ Martin said. ‘Business held pretty firm: the results speak for themselves.’
Profits also rose 4% to £85.85m. Given the firm’s billings are mainly in sterling with negligible foreign currency effect, Martin said this reflected ‘client loyalty’ and the firm’s ‘willingness to adapt’ to market conditions. He also attributed the results to ‘hard work’ by its team and its ‘strategic focus’.
He added that Macfarlanes did not benefit from billing in euro and dollars, ‘unlike many of our competitors – that makes these results doubly pleasing’, Martin added.
For a firm with revenue growth figures of 64% over the previous five years, the figures remain fairly stable, despite a number of challenges. Macfarlanes lost three partners in three months between September and November 2016. Financial services head David Berman left for Quinn Emanuel Urquhart & Sullivan, Scott Brodsky quit the Johannesburg practice to join a client, spelling the closure of the South African office, and competition and EU head Marc Israel left for White & Case after 15 years with MacFarlanes.
The firm, however, hired King & Wood Mallesons’ (KWM) competition team in December, bringing in partners Cristophe Humpe, Tom Usher and Cameron Firth, who started operating from the firm’s new Brussels office in January 2017.
‘We have a much larger competition law practice group now than we had last year, and we are encouraged by the start that the former KWM team has had.’ While Brussels is now Macfarlanes’ only non-UK office, it operates closely alongside London.
Advisory roles in multi-billion deals helped maintain growth. Macfarlanes acted for Argus Media’s chairman in its £1bn takeover by General Atlantic and advised US internet giant Verizon during the $2.4bn purchase of vehicle communications company Fleematics group.
‘In corporate, private equity and the large strategic M&A are the main areas of focus for us, and they held up pretty strongly,’ added Martin.
Last year, revenue was £161m with profits of £74.5m, following several strong years of significant growth.