Legal Business

Gateley turnover soars 15% to £77m as group plans further growth

Gateley turnover soars 15% to £77m as group plans further growth

AIM-listed Gateley has seen turnover soar 15% for the financial year ending 30 April 2017, from £67m in 2016 to £77m. In addition, adjusted EBITDA also saw double digit growth, increasing 14% from £12.9m to £14.7m.

In a trading update, the firm said that the integration of acquired complementary businesses, including tax adviser Capitus, the continued investment in new staff and the development of the firm’s newly opened Reading office, were positive focus points for the firm during the year.

The statement added: ‘The Board remains extremely pleased with the level of share incentive scheme participation across the Group, as reported in our half year statement.’

‘We continue to look to strengthen our offering to clients and have experienced another significant year of staff recruitment across the Group including new skills and service lines from our complementary businesses of Gateley Capitus Limited and Gateley Hamer Limited,’ it continued.

‘The Board expects to recommend a final dividend in line with its stated dividend policy of distributing up to 70% of the Group’s after tax profits,’ according to the statement.

Michael Ward, chief executive of Gateley said he was delighted with the continued progress made by the Group in the year. ‘This represents another year of expansion for us. This has been possible due to the strength of our service offering, the depth of our client relationships and the growth in our teams of skilled professionals.’

This month, Legal Business revealed that Gateley was looking at options for a new Scottish tie-up and had approached a number of firms in the market including Anderson Strathern, MacRoberts, Morton Fraser and Harper Macleod.

The merger between Gateley’s former Scottish arm HBJ Gateley and Addleshaw Goddard is due to go live on 1 June.

kathryn.mccann@legalease.co.uk

Legal Business

Gateley makes approaches to secure new Scottish tie-up

Gateley makes approaches to secure new Scottish tie-up

With the merger between its former Scottish arm and Addleshaw Goddard due to go live on 1 June, Gateley is looking at options for a new Scottish tie-up and has approached a number of firms in the market.

According to one Scottish partner, Anderson Strathern, which has offices in Edinburgh, Glasgow and East Lothian, would be the most likely option for a tie-up.

‘Anderson Strathern has some good clients, some good lawyers. It just hasn’t been on track for a long time and it has been looking to do something for a while as well.’

MacRoberts and Morton Fraser, who were previously in merger discussions together, are also understood to have been approached by Gateley, as was Harper Macleod.

‘MacRoberts would be a good move for Gateley, but it has pension issues and I don’t know how serious that would be,’ added the partner. ‘Morton Fraser wouldn’t be a fit either. It doesn’t want to tie up with anyone.’

Legal Business revealed in January that Morton Fraser and MacRoberts had called off their merger talks as a deal was ‘financially unworkable’. Chris Harte, chief executive of Morton Fraser, said the firm will not be merging in the near future, ruling out any imminent combination. ‘We have been clear about how we see our future. We will continue that way until someone causes us to rethink that direction. We aren’t there at the moment.’

Speaking to Legal Business, Gateley chief executive Michael Ward would neither confirm nor deny that the firm had approached Anderson Strathern, MacRoberts, Morton Fraser or Harper Macleod, but added that Gateley is looking for a firm that it can work with on client assignments on a preferred arrangement.

‘It is our stated preference to have a new collaboration agreement in place when the other one expires on 31 May, but we are certainly not close to that at the moment. You would describe our relationship with HBJ as more than a best-friend relationship. We are not negative about the arrangement we had with HBJ. It made a decision. That’s business and that’s life. We are looking for a similar arrangement with another party.’

kathryn.mccann@legalease.co.uk

Read more: ‘Better together? – Those Anglo-Scots unions in focus’

 

Legal Business

Gateley makes approaches to secure new Scottish tie-up

Gateley makes approaches to secure new Scottish tie-up

With the merger between its former Scottish arm and Addleshaw Goddard due to go live on 1 June, Gateley is looking at options for a new Scottish tie-up and has approached a number of firms in the market.

According to one Scottish partner, Anderson Strathern, which has offices in Edinburgh, Glasgow and East Lothian, would be the most likely option for a tie-up.

Legal Business

‘Deals are being done’: AIM-listed Gateley’s half-year revenues soar 19% to £35.2m

‘Deals are being done’: AIM-listed Gateley’s half-year revenues soar 19% to £35.2m

AIM-listed Gateley has seen revenues jump significantly for the six months to 31 October 2016, up 19% from £29.6m to £35.2m. Gateley saw turnover improve 11% in the same period last year.

Meanwhile adjusted EBITDA in the last six months increased 11% to £5m, and profit before tax increased 45% to £4.2m from £2.9m.

The firm highlighted two successful acquisitions: Gateley Capitus in April 2016 and Gateley Hamer in September 2016 as operational highlights as well as the expansion of legal services through investment in the firm’s new Reading office.

In addition, staff numbers have increased 12.7% since October 2015 to 701.

Speaking to Legal Business, Michael Ward, chief executive of Gateley said the market was experiencing some headwinds as a result of Brexit, but that there was less effect felt outside London-centric businesses.

Ward (pictured) said: ‘We’ve seen a little bit of drop off in top-end property deals where people are relooking at them etc. But across the rest of the country we have experienced it very much as business as usual.’

‘We have had a good six months, property and corporate are doing well. Deals are being done. Commercial property development is ongoing and there has been strong performance in our residential development team.’

The results today (6 December) follow on from the firm’s impressive full year performance for 2015/16, when revenues rose by 10.2% from £60.9m to £67.1m. The balance sheet of the firm has been strengthened with gross assets of £41.6m compared to £40.7m.

At that time, adjusted EBITDA increased 13.3% to £12.8m from the pro-forma 2015 figure of £11.3m and profit before tax increased 12.2% to £11m from the pro-forma 2015 figure of £9.8m.

In October partners at the firm made almost £6.4m from selling shares in Gateley, according to a filing with the London Stock Exchange.

Partners sold 5,761,971 shares at a sale price of £1.11 to new and existing shareholders.

kathryn.mccann@legalease.co.uk

Read more: ‘Selling the family silver: Will Gateley’s listing on London’s stock exchange pay off?’

Legal Business

AIM listing good for Gateley with revenues up 10.2% to £67.1m

AIM listing good for Gateley with revenues up 10.2% to £67.1m

AIM-listed law firm Gateley has posted a double digit increase in revenues for this financial year, with turnover up 10.2% from £60.9m to £67.1m.

In addition, adjusted EBITDA increased 13.3% to £12.8m from the pro-forma 2015 figure of £11.3m and profit before tax increased 12.2% to £11m from the pro-forma 2015 figure of £9.8m.

Cash held at the period end increased from £2.7m to £9.8m, whilst net cash flow from operating activities stood at 122% of profit after tax before one off transitional changes.

Gateley chief executive Michael Ward said the board had remained focused on the execution of long term organic and acquisitive growth.

Ward added: ‘Trading in the second half of the financial year ended 30 April 2016 was robust and we are pleased to report that trading in the first two months of the current financial year has been encouraging. We are confident that our business is well balanced and resilient and we remain focused on delivering another year of growth in our core services, whilst continuing to look for complementary acquisitions.’

In April this year, Gateley made its first acquisition since its listing in June 2015, buying tax adviser Capitus in a deal worth £2.72m – £1.59m in cash and 1.1m ordinary shares. The firm raised £30m from the listing.

According to Gateley, the acquisition of Capitus is part of a wider growth strategy for the firm which aims to selectively acquire businesses offering complementary professional and other specialist services to clients in Gateley’s target markets, providing it with an opportunity for cross selling to existing clients as well as broadening its appeal.

The business, renamed Gateley Capitus, operates as a wholly owned subsidiary and has offices in London, the Midlands, Northern Ireland and the Republic of Ireland, allowing it to serve the entire UK market, as well as providing its services to overseas projects.

Gateley also opened a new office in Reading, and made 12 new lateral partner hires since 1 May 2015.

Meanwhile last December the firm announced that it had hit its revenue targets with an 11% increase in its audited half year figures during the six month period to 31 October 2015. Turnover rose to £29.6m from £26.7m at the West-Midlands based firm which also lifted profit before tax by 11.5% to £2.9m from £2.6m.

In addition adjusted EBITDA was up 40.6% to £4.5m, from £3.2m and basic earnings per share was up 5% to 2p, from a pro-forma 1.9p in 2014, while Gateley also declared its first interim dividend of 1.895p.

kathryn.mccann@legalease.co.uk

Read more in: ‘Selling the family silver: Will Gateley’s listing on London’s stock exchange pay off?’

Legal Business

Gateley acquires tax adviser Capitus in first deal since AIM listing

Gateley acquires tax adviser Capitus in first deal since AIM listing

AIM listed law firm Gateley has bought tax adviser Capitus in a deal worth £2.72m, the firm’s first acquisition since its listing in June 2015.

The business will be renamed Gateley Capitus following the deal, which includes £1.59m in cash and 1.1m ordinary shares in the company.

According to Gateley, the acquisition of Capitus is part of a wider growth strategy for the firm which aims to selectively acquire businesses offering complementary professional and other specialist services to clients in Gateley’s target markets, providing it with an opportunity for cross selling to existing clients as well as broadening its appeal.

Gateley Capitus will operate as a wholly owned subsidiary and has offices in London, the Midlands, Northern Ireland and the Republic of Ireland, allowing it to serve the entire UK market, as well as providing its services to overseas projects.

Gateley chief executive Michael Ward said: ‘Capitus is a recognised and highly respected tax incentives advisory business and I am particularly excited by the additional expertise and cross referral opportunities the business will bring to the group.’

The co-founders of Capitus, Kevin Meyer and Aubrey Calderwood, said in a statement: ‘Our tie-up with Gateley, which we believe to be the first between an RICS regulated firm and a full service national law firm, gives us access to this expertise and provides us with many additional commercial opportunities.’

In February Gateley revealed its audited first-half results, posting a revenue increase of 11% from £26.7m to £29.6m. At the time, Ward said that the group had faced an improving but challenging period, but its flexible plc status had enabled it to grow and make strategic acquisitions.

The national firm made history last year, becoming the first UK law firm to carry out an initial public offering on 8 June. In its initial filling on 12 May 2015, Gateley said that moving from an LLP to a PLC would allow for faster expansion and diversification and give it a ‘first mover advantage’.

kathryn.mccann@legalease.co.uk

Legal Business

Hitting the target: Gateley posts 11% rise in revenue in first post-IPO results

Hitting the target: Gateley posts 11% rise in revenue in first post-IPO results

The UK’s first listed law firm Gateley has hit its revenue target by achieving a 10.9% rise to £29.6m, up from £26.7m in 2014, in audited half year results released today (15 December).

The West-Midlands based firm also lifted profit before tax by 11.5% to £2.9m, higher than the pro-forma figure of £2.6m last year, while adjusted EBITDA was up 40.6% to £4.5m, from £3.2m over the same period, which was also a pro-forma figure.

During the six month period to 31 October 2015, basic earnings per share was up 5% to 2p, from a pro-forma 1.9p in 2014, while Gateley also declared its first interim dividend of 1.895p.

Gateley said in November it was on track to lift revenues by 10% to take the firm’s revenue increase over the last six months to just short of the £30m mark.

It has been an interesting year for Gateley, which became the first UK-listed law firm on the Alternative Investment Market in June raising £30m on its first initial public offering.

Since the beginning of May, Gateley had taken on eight new lateral partner hires with overall staff numbers increasing from 604 to 622 over the six month reporting period.

Gateley chief executive officer Michael Ward said: ‘The group’s ability to deliver a strong first half performance, in an improving but challenging market, whilst at the same time transitioning the business from an LLP to a Plc not only highlights the capabilities of the senior management team but also reconfirms our strategy of using our more flexible Plc status to enhance shareholder value through organic growth and strategic acquisitions.’

‘These results represent a very solid start to our life as a Plc and I believe will serve to further raise our profile, differentiate us from our direct competitors and attract quality staff.’

Gateley joins DAC Beachcroft, Nabarro, Allen & Overy, Osborne Clarke and Clyde & Co in announcing half year results this quarter.

jaishree.kalia@legalease.co.uk

For further analysis of Gateley and its listing see the feature: ‘Selling the family silver: Will Gateley’s listing on London’s stock exchange pay off?’

Legal Business

‘Highly strategic’: Gateley opens in Reading with Pitmans managing partner Avery

‘Highly strategic’: Gateley opens in Reading with Pitmans managing partner Avery

On the back of its stock market listing earlier this year, national firm Gateley will open an office in Reading, a venture to be led by well-established local lawyer Christopher Avery, who joins from Pitmans where he served as managing partner for 25 years.

In its first office opening since it launched a presence in Leeds in 2012 and its seventh in England, Gateley said this morning (1 December) the new office ‘fits with the strategy of becoming a leading national firm while still retaining a strong regional emphasis.’

Commercial property lawyer Avery has spent 36 years at Pitmans, overseeing major firm growth from 25 to over 200 staff with revenues totalling over £20m. In June, corporate partner John Hutchinson was elected to succeed Avery as managing partner. 

Gateley chief executive Michael Ward said: ‘Christopher has been appointed to help us develop a full-service commercial practice in the highly strategic Thames Valley/M4 corridor which is a large and growing centre for legal services. He is well known in the Thames Valley and has the right combination of experience and entrepreneurial spirit to help us deliver our objectives.

‘We indicated at the time of IPO that while we had a fully invested UK network of offices we would consider opportunities in one or two other geographical locations if the right opportunity presented itself and Reading is such an opportunity.’

The opening follows Birmingham-headquartered Gateley’s AIM listing in June, having set aside £5m for investment from the float which placed 31.6m ordinary shares with institutional and other investors at 95p per share. The plc had a market capitalisation of £100m on admission – down from the initially targeted range of between £130m to £140m. Last month the firm said it was on track to lift revenues by 10% to take the firm’s revenue over the last six months to almost £30m.

sarah.downey@legalease.co.uk

For more on Gateley’s landmark IPO see: ‘Selling the family silver: Will Gateley’s listing on London’s stock exchange pay off?’

Legal Business

Trading update: Gateley expects 10% increase in half year revenue

Trading update: Gateley expects 10% increase in half year revenue

The UK’s first listed law firm, West-Midlands based Gateley said it is on track to lift revenues by 10% to take the firm’s revenue increase over the last six months to just short of the £30m mark.

In its second trading update issued today (November 16) the firm said it has ‘made a solid start to the financial year and is trading in-line with management expectations. Revenues for the first six months are expected to be not less than £29.5m, being not less than 10% ahead of the corresponding pro-forma period last year’

Gateley plans to announce the group’s audited half year results in December.

The firm said in July that revenue had increased by 10% to ‘not less than £60m’ for the 2014/15 financial year.

The results are a marked increase on last year when the firm posted turnover of £53.8m, up 6% from £50.7m, while profit rose from £17.1m in 2013 to £20.4m. LLP accounts filed at Companies House for 2013/14 showed that cash at bank and in hand totalled over £1.9m, while net debt amounted to £1.5m. It also cleared an overdraft totalling £464,667.

The 380 fee-earner outfit became the first UK-listed law firm in June with an Gateley on the Alternative Investment Market (AIM). It set aside £5m for investment from the float which placed 31.6m ordinary shares with institutional and other investors at 95 pence per share.

The firm had a market capitalisation of £100m on admission – down from the initially targeted range of between £130m to £140m.

kathryn.mccann@legalease.co.uk

For more on Gateley’s decision to float see: ‘Selling the family silver: Will Gateley’s listing on London’s stock exchange pay off?’

Legal Business

Revolving doors: Pinsents and Irwin Mitchell both hire from CRS as Gateley brings in two new partners

Revolving doors: Pinsents and Irwin Mitchell both hire from CRS as Gateley brings in two new partners

With the summer break fast approaching, there was a flurry in the lateral market among law firms last week as they looked to sign off key appointments. Pinsent Masons and Irwin Mitchell both turned to Charles Russell Speechlys (CRS) partners for strategic appointments while Gateley made two laterals.

Pinsents hired CRS’ financial services practice head Elizabeth Budd to bolster its financial regulatory group as the firm targeted banking, insurance and asset management work in the City.

Budd specialises in advising asset and fund managers on the evolving regulatory landscape in both the UK and the EU. On the funds side she has established funds structured as unit trusts, open ended investment companies and limited partnerships both onshore and offshore. She has also advised asset managers regarding the Financial Conduct Authority’s increased supervision and enforcement action as well as regulatory changes.

The hire follows the firm’s recruitment of David Heffron from Addleshaw Goddard to lead its financial regulation group earlier this year. John Salmon, head of financial services at Pinsents, said: ‘We continue to see a high level of demand for regulatory advice from our clients in the banking, insurance and asset management sectors and are investing in our City-based team accordingly. The appointment of David and Elizabeth in quick succession is a real signal of intent – our clients value our innovative approach allied to significant sector knowledge. Pinsent Masons’ vision is to become an international market-leader in the sectors in which we operate, and this appointment moves us forward a significant step in the financial services arena.’

Irwin Mitchell also found CRS a productive hunting ground – hiring partner Penny Cogher. Joining the pensions team, which has grown to four partners with the addition of Martin Jenkins in the City to head the team in December 2014 and Andrew Ashley Taylor in Manchester in May this year, Cogher comes with 23-years’ experience in the field.

Having primarily advised charities and not-for-profit bodies, she advises on regulation, compliance, risk management, funding disputes, public sector outsourcing, and use of contingent asset arrangements. On defined contribution schemes, she advises on governance, the newly introduced 2015/2016 flexibilities, life assurance and on tax for high net worth individuals.

Niall Baker, partner and chief executive at Irwin Mitchell, said: ‘Penny is the tenth partner to join our Business Legal Services side of the firm since the start of 2015, showing our commitment to building our business expertise and attracting high-calibre lawyers. Our pensions department is going from strength to strength. Pensions are a key concern for our clients in an ever changing legislative environment. We are delighted to have someone of Penny’s experience and reputation joining the firm. We remain committed to investing in the growth of our business team further.’

Meanwhile, Gateley has made two appointments. The national firm hired two partners to boost its litigation and employment. Benedict Gorner joins the firm from DLA Piper, where he made partner having joined the global firm from Eversheds in 2002. Gorner covers a broad range of employment law covering all aspects of contentious and non-contentious work with a particular specialism in TUPE and change management programmes. Three-office Watson Burton also lost the head of its commercial litigation practice, Andrew Johnson, to the publicly-listed law firm. Johnson has previously acted for a range of companies including Bellway, Microsoft, Colas and the University of Leicester. Gateley also appointed a new director of Client and Market Development, Fiona Holland, from PwC.

Meanwhile, also on the national scene was Bevan Brittan’s move on Andrew Shaw at TLT. The property partner joined the firm with a specialism in social housing, though the exit from TLT’s social housing team was partially offset by the firm’s hire of Lewis Silkin’s real estate specialist Linda Convery and social housing partner Gillian Bastow.

Jonathan Turner, head of housing at Bevan Brittan, commented: ‘The housing sector is facing a number of challenges with changes to Right to Buy and Welfare Reform looming. The impact of these policy changes on Registered Provider development programmes could be significant at a time when there is growing pressure on housing stock numbers. Organisations need to ensure that they are structuring their portfolios effectively and, where appropriate, maximising development delivery through exploring new cross-sector partnership models between Registered Providers, Local Authorities and Health Trusts. Andrew will be an important addition to our team.’

michael.west@legalease.co.uk