Linklaters PEP rises 6.5 per cent, turnover up 1 per cent to £1.195bn
5 July 2013 | By Joshua Freedman
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Linklaters has claimed a 1 per cent like-for-like increase in global revenue to £1.195bn against a 6.5 per cent rise in average profit per equity partner (PEP).
The magic circle firm said the minimal turnover hike for the 2012/13 financial year was based on its 2011/12 revenue figure being £1.184bn once revenue from its co-operation agreements with Brazil’s Lefosse Advogados and Singapore’s Allen & Gledhill, both of which ended last year (7 December 2012).
However, the latest unaudited revenue result represents a 1 per cent drop in the raw figure of £1.207bn in 2011/12, which itself was a rise of under 1 per cent on 2010/11 (6 July 2012).
Meanwhile, Linklaters’ PEP rose to £1.261m based on a pre-tax profit figure of £521.9m, up 2 per cent from £513.5, and a 4 per cent decrease in the average number of full-time equivalent equity partners from 433 to 414. Last year’s PEP as £1.184, down 3 per cent on 2010/11.
The PEP result provided by the firm, calculated in a different way taking into account partners in jurisdictions that do not support full equity status, is a higher figure of £1.313m, up 6 per cent on the equivalent result of £1.243m in 2011/12.
The firm has seen a particularly strong year for its corporate practice, with key client Glencore spending legal fees of £18.3m on its mega-merger with miner Xstrata, mostly to Linklaters (14 May 2013). Other key mandates have included the Direct Line IPO (14 September 2012), on which it advised the banks, Vodafone on its €7.7bn takeover of Kabel Deutschland (24 June 2013), Biffa on its debt restructuring (6 August 2012) and the lenders on the administration of HMV (15 January 2012).
Global managing partner Simon Davies said: “The key growth area will be on the restructuring, the regulatory and the contentious work. If you look at M&A, we the quality of the business has improved, but there’s just not been the volume there was.
”London’s had a strong year. That refelcts the development of the UK client base. But also our international strength based in London - we cover a lot of the new trade flows out of London.”
Despite the drop in average equity partner numbers across the year by 19, the firm made up 24 new partners this year in an increased promotions round (29 April 2013).
He added in a statement: “Restructuring, regulatory and contentious work continue to be very active as we support our clients on the complex issues faced in these areas. Our financial resilience allows us to invest in these and other areas where we see growing client demand. M&A activity remains subdued, especially in Europe, however our international strength for cross-border matters, encompassing all developed and emerging markets, has given us the opportunity to advise on some of the most significant and complex matters of the year.”
The firm went live with exclusive alliances with Australia’s Allens in May 2012 (23 April 2012) and South Africa’s Webber Wentzel (3 December 2012) in February this year, with Davies saying it had gained 340 referrals and 120 joint mandates since the Allens deal launched.
The firm is now looking to focus on other Africa jurisdictions such as Nigeria and Kenya.
The firm no longer announces revenue breakdowns by practice area or region, but the latter is usually disclosed in its annual LLP accounts.