A model of consistency in the Legal Business 100, 2018/19 was Clyde & Co’s 21st consecutive year of growth – albeit with a merger or two thrown in. This time around it grew 11%, adding £59.7m to its top line to reach £611m.
In just three years, the firm has grown by 36%, or £160m in total. ‘If you went back eight years, we were around £250m turnover. We are now a £600m+ business,’ says senior partner Simon Konsta. Continue reading “Case study: Clyde & Co”
Back in 2014, not many – if any – would have predicted Addleshaw Goddard would boast one of the highest percentage growth rates in profit per equity partner (PEP) across the Legal Business 100 over the next five years. But with PEP increasing 13% to £730,000 in the 2018/19 financial year, PEP has risen an impressive 87% over that time.
Top-line growth between 2014 and 2019 is similarly impressive, up 61% to £275.4m, topped by a 14% increase year-on-year. In the five years leading up to 2013/14, turnover for Addleshaws had dipped 1% as the global financial crisis weighed heavily. PEP also fell 11% in 2013/14 due to exceptional expenses including partner restructuring and a written off conditional fee agreement – hence the low starting base for the dramatic growth in partner profits over the last five years. Continue reading “Case study: Addleshaw Goddard”
Smaller regional and national firms have gained ground on their London rivals in this year’s Legal Business 100 (LB100) after years of the productivity gap widening in favour of the City. And, as some of the strongest performers from the 32 regional firms in the 51-100 bracket have shown, a big part of the shift has come from a growing trend of partnering up with law’s global elite to effectively provide northshoring outposts for blue-chip clients.
Following a muted period and just 1% growth last year, the group’s collective revenue rose a solid 7% to £1.36bn in 2018/19, for an average revenue of £42.4m. The productivity per capita at regional firms, traditionally weaker than London counterparts, also grew where City firms lagged this year, closing a gap that had been steadily widening. Revenue per lawyer climbed 9% to £197,000, compared to an almost flat £267,000 in London. Profit per lawyer stayed flat at £38,000, against £78,000 in the City, which was down 6%. Profit per equity partner (PEP), however, slid 5% to £339,000. Continue reading “LB100 Second 50 – Regional focus: Crawling on a razor”
With just over 200 lawyers and only 48 partners, Foot Anstey has been among the ten fastest-growing firms in the Legal Business 100 over the last five years. Stretch that track back to six years, and the firm has nearly doubled its turnover to £47.2m. Profit per equity partner has also grown 52% since 2014, up a healthy 8% to £400,000 in 2018/19.
That growth, including a 9% revenue uptick this year, has come from a smaller base than many but is also organic. The firm’s corporate practice grew by about 30%, property litigation was up 23%, and the finance team boomed on the back of 75% growth in Islamic banking and private equity work lifting 85%. New client wins included motorway service operator Welcome Break, private equity firm Livingbridge, and a reappointment to FTSE 100 retailer Kingfisher’s legal panel. It also advised on the £1.6bn Pivot Power electric vehicle recharging network – the world’s biggest. Continue reading “Case study: Foot Anstey”
‘We’ve disrupted the market – everybody knows about us now,’ says Quinn Emanuel Urquhart & Sullivan London co-managing partner Ted Greeno of the US firm’s inexorable rise in the City.
The ex-Herbert Smith Freehills (HSF) partner, himself one of a string of high-profile recruits Quinn Emanuel made since its London launch in 2008, has a point. The disputes-only powerhouse now counts some 85 full-time partners and associates in London – a larger team than Slaughter and May’s litigation offering and not far off the size of Clifford Chance (CC)’s muscular City practice (see below). Continue reading “New players and funding prompt evolution of disputes but City leaders adapt well”
This year’s Legal Business 100 (LB100) presents a clear picture of the firms continuing to dominate the UK legal market by turnover and profitability – but who comes out top in terms of The Legal 500 rankings? Continue reading “Legal 500 Data: Behind the story”
We go to press with Parliament locked in battle with the Government over threats to take the UK into a ‘no-deal’ exit from the European Union (EU). I’m not going to offer political predictions but we are clearly at the point where a disorderly exit from the EU is a very real prospect for the country and the profession.
The good news is that the largest UK law firms feel confident they can largely mitigate the immediate impact of no-deal, even with the abrupt end of EU rights to practise that have been such a boon. This is because potentially obstructive Bars in key markets in France and Germany have been kept onside and UK lawyers feel that other decent workaround options are available (see pages 12-13). With leading UK firms also having substantial foreign operations, including the Legal Business 100 having 19% of their lawyers in mainland Europe, and rapidly increasing their ranks of Irish-registered solicitors, the large outfits at least are braced. The Law Society recently issued research arguing a no-deal would knock 10% off the value of the UK legal market, equivalent to more than £3bn, and costing 10,000 jobs. Most law firm leaders see such predictions as excessive – a scepticism I share – though the industry does believe such an exit would be damaging. Continue reading “A no-deal outlook and the law – time for pragmatic pessimism”
It is a measure of how fast-moving the Brexit-dominated landscape now is that imagery in this year’s Legal Business 100 (LB100) is dominated by Conrad, Castro and Coppola as the summer months have moved to rapidly challenge notions of how Britain works. One of the most stable and predictable major economies in the world has been locked into a mounting political conflict more akin to a banana republic than the Mother of Parliaments. Sooner or later Westminster drama on this scale will spill into a real economy that already contracted in the second quarter.
And yet, the UK’s largest law firms have endured another 12 months of uncertainty and ominous haze with impressive resilience, pushing revenues up 9% to £26.35bn, one of the better years of all-round performance since the banking crisis. And though a handful of mergers flatter that headline figure, 28 firms managed double-digit revenue growth, showing that plenty of UK firms are thriving in these challenging conditions. Continue reading “LB100: Legal elite shows resilience amid ominous haze”
This article sits in the news leader slot of our latest issue, but when considering Allen & Overy (A&O) and its epic courtship of O’Melveny & Myers, the defining factor has been the absence of news. Since it emerged last spring that A&O was in merger talks with the Los Angeles-bred firm, there have been bare scraps of information, alongside alternating whispers the deal was/was not on. Finally the resolution came on 2 September, with the pair announcing the end of the talks with the traditional noises about mutual respect.
The reason for the long delay was as much the scale and ambition of the merger as the inevitable complications of bringing 700 partners on side. The looming spectre of a messy ‘no-deal’ Brexit and fresh falls in sterling further strained a delicate situation, probably tipping it over the edge. Not only were the firms aiming for full financial integration upfront – a move never attempted on the scale of a £2.4bn transatlantic union – the aim was to do an immediate merging of governance, leadership and remuneration. Forget vereins and grace periods kicking tricky issues down the road. That all-in approach raised the stakes and logistic issues enormously. Not least it would have involved substantive reform of A&O’s remuneration structure to make it more compatible with a US firm. Continue reading “The end of A&O’s marathon O’Melveny merger bid reveals the stark choices facing the Magic Circle”
With daily headlines reminding the City of the Brexit-induced crisis engulfing the UK, the Legal Business 100 (LB100) has shrugged off the pervasive uncertainty to post another year of robust growth.
Amid the increasing probability of the UK facing a wrenching ‘no-deal’ exit from the EU on the looming 31 October deadline, the LB100 results show the UK’s leading law firms driving collective revenues up 9% to £26.35bn. Continue reading “LB100 drives income up 9% to £26.35bn but fears mount of a chaotic no-deal as Brexit fallout spreads”
‘Throw enough mud at a wall, and some of it will stick,’ the proverb says. But since US investor Muddy Waters published a scathing attack on third-party litigation funder Burford Capital on 7 August, the muck-slinging has not stopped.
The charges in the 25-page report were devastating. Having labelled Burford a ‘poor business masquerading as a good one’, and suggesting the company was ‘already insolvent’, more than £1bn was wiped off the listed funder’s value. Five days later, Burford enlisted Freshfields Bruckhaus Deringer, Quinn Emanuel Urquhart & Sullivan and Morrison & Foerster to pursue claims of illegal market manipulation. Continue reading “Mud sticks to Burford amid intense row but dispute funders’ rise looks assured”
Simon Davis has had quite a start to his one-year term as the 175th president of the Law Society of England and Wales. Taking office just a few weeks before Boris Johnson was appointed Prime Minister in July, the Clifford Chance (CC) litigation partner faced the reality of a nation that was heading for a cliff-edge exit from the EU, with major potential disruption for its legal industry.
With the new Conservative government promising to deliver Brexit on 31 October – ‘do or die’ – and the path to a withdrawal agreement with the bloc getting narrower by the day, the prospect of a disorderly exit has rapidly become a realistic possibility. Continue reading “Dealing with no deal – Can top law firms cope with a chaotic Brexit?”
In this table we blend together the three key profitability metrics – profit per equity partner, profit per lawyer and profit margin – to discover which of the top 100 firms are the most profitable. The firms have been ranked according to their aggregate score across all three measurements. Firms marked * are either listed firms or alternative business structures and do not have equity partnerships, meaning their profit distribution does not bear any resemblance to traditional law firm models and why most feature towards the bottom of this table. See methodology for further explanation. Continue reading “LB100: Behind the numbers – profitability revealed”
On paper, an 11% jump in average revenue to £135.5m for the second 25 looks like a great leap forward from last year’s 5% increase to £122.6m, and this rate of growth compares favourably to the top quartile’s 9% hike to £830.7m. But as usual the figure must be taken with a pinch of salt.
Tempering excitement that the group is outstripping the top 25, Womble Bond Dickinson (WBD)’s transatlantic merger has inflated revenue and catapulted it into the top tier, squeezing out last year’s top-25 entrant Fieldfisher. Swapping WBD for Fieldfisher means that around £140m is artificially added to the £3.39bn total revenue of the group. Without it, average turnover would be around £130m – a more muted 6% increase. Continue reading “LB100 Second 25: A brooding gloom in sunshine”
Kennedys senior partner Nick Thomas describes 2018/19 as a year of consolidation: ‘The acquisitions are up and running and, despite those investments, we had growth all over the place throughout the year.’
In 2017/18, this insurance and shipping specialist was hands down the star performer of the 26-50 bracket in revenue terms, recording a 31% rise in global turnover and 14% for UK income on the back of sustained geographic expansion. But, while it failed to emulate that racy performance in 2018/19, with 10% revenue growth to £216m, what is far from average is Kennedys’ five-year track. The firm has grown revenue 68% since 2014 when it turned over £128.5m and has increased headcount by 51% in the last five years on the back of a dynamic international investment drive. Continue reading “Case study: Kennedys”
With the expansion of UK and international firms north of the border, as well as the stepping down of former managing partner Bill Drummond, Scottish leader Brodies has for the past two years endured what was by its own high standards pedestrian growth. 2018/19, however, has seen a return to form and place in the top 50 for the first time. Revenue increased 12% to £76.9m while profit per equity partner jumped 16% to £708,000.
These year-on-year growth rates are much faster than last year’s 3% and 4% respectively for revenue and profit, while the firm’s five-year growth track sees the top line up 48%. For managing partner Nick Scott, the performance comes after his first full financial year in charge – some validation for the man who had the difficult task of replacing the highly-regarded Drummond. Continue reading “Case study: Brodies”
Serle Court’s chief executive argues that the blending of chancery and commercial is about seeing legal issues from the client’s point of view
Eighteen months on from the launch of the Business and Property Courts in England and Wales, it is interesting to reflect on what this change means. Not only in terms of maintaining the UK’s lead as the best place in the world for resolving commercial disputes but also for the increasingly artificial distinction between chancery and commercial disputes – now seeing business and legal issues the way our clients do. The new structure, bringing together all the various specialist commercial courts under one judicial roof, was intended to make it easier for international and domestic clients to understand the structure of the High Court in England and Wales. Our commercial courts have belatedly caught up with the realities of commercial life in the 21st century; we know from speaking to our business clients that they do not categorise their issues distinctly as either chancery or commercial. Instead they see ‘problems’ for which they require ‘solutions’. Lawyers may benefit from seeing things from this perspective too. Continue reading “Sponsored chambers briefing: Hybrid counsel – powered by commercial and chancery expertise”
Parklane Plowden Chambers is seeing the long-term benefits after its 2014 restructuring
In an increasingly competitive and financially challenging legal marketplace, the demand on law firms and barristers’ chambers alike has been to innovate and explore new ways of working in order to succeed. It is easy to accept that this could be trickier for barristers’ chambers to achieve, given the highly traditional and arguably outdated structure they take. Continue reading “Sponsored chambers briefing: Innovate to succeed”
