Legal Business Blogs

Withers’ profit drops as revenue approaches £200m amid Asia and America expansion

UK top 30 firm Withers has seen partner profits fall 12% while its top line passed the £190m mark amid a sharp increase in headcount on the back of international expansion.

Revenue at the private wealth specialist rose 9% to £193.2m in 2018/19 following a modest 1% increase to £176.6m the previous year. But profit per equity partner (PEP) fell back below the £400,000 mark to £354,000.

While the firm saw a 2% decrease in net income to £31.5m, the fall in PEP was largely the result of the expansion in its headcount as Withers grew its ranks in the UK, Asia and the US over the year.

The firm’s equity partnership grew by nine to 89 while lawyer headcount shot up 12% to 612. Total partner numbers were up by 21 to 180.

A spokesperson for the firm told Legal Business: ‘The gearing has increased over the course of the year due to demand. A lot of the increase has been outside of the UK in terms of associate numbers. It’s about bulking up in Asia and the US.’

The drop in PEP also affected the firm’s equity spread. The five highest earning equity partners brought home £552,000 in 2018/19, 12% down on the £629,000 available for those at the top of the equity the previous year. The bottom of the equity saw a more moderate 5% fall from £183,000 to £173,000.

Despite the firm’s focus on international expansion, the UK business outpaced its global growth with an 11% in turnover to £79.7m. The firm did, however, continue to bring in the majority of its revenue from abroad, with its international offices accounting for 59% of turnover.

While in the UK Withers bought out six-partner UK tech law boutique JAG Shaw Baker in August last year, seeing 26 lawyers join its ranks in London and Cambridge, in the following months its expansion targeted mainly its 15 international offices.

In January this year it merged with Singapore firm KhattarWong, while in October it hired a six-partner real estate and funds team in Tokyo and Hong Kong.

In September 2018 it recruited Bryan Cave Leighton Paisner international arbitration team head Emma Lindsay in New York, and in February this year it added a three-lawyer California team from Los Angeles firm Mitchell Silberberg & Knupp.

The firm also saw changes in its senior leadership over the last few months. Geneva-based private client and tax partner Justine Markovitz replaced Ivan Sacks as chair of the firm this month, while chief executive Margaret Robertson (pictured) was appointed for her fourth term in July last year, meaning she will be at the helm of the firm until 2021.