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Turnover at Ashurst was pretty much in line with expectations last year, although as senior partner Charlie Geffen admitted, the firm had been budgeting very cautiously. Clearly the City firm is not alone there.
While most if not all firms have ’asked’ partners to leave, few have changed their cultures as much as Ashurst. Ex-partners claim it has now become ruthless, where “you’re either in Charlie’s gang or you’re not”. The man himself puts it differently. Geffen claimed Ashurst’s equity partner remuneration system has become “more sophisticated”. What this means is that, following a consultation with the partnership last year, the architecture of the lockstep has not changed, although there is more transparency with regards to what is needed to get through the key gateway at 45 points. Ashurst’s lockstep starts at 25 points. Virtually all partners move onto the lockstep at 29-33, where there is a gate. A small number of partners stop there, the rest move onto 37, 41 and the next gate at 45 points. Ashurst’s upper echelons are on 50, 57 and ultimately 65 points. Geffen added that profit distributions have accelerated as revenue and profit have increased and that cashflow has improved. The cull will dent morale, but if Geffen and co secure a merger with Australia’s Blake Dawson it is unlikely he will be too concerned. Indeed, diversifying outside the UK when the domestic market is flat is Geffen’s main priority. Of the total revenue last year, 59 per cent was derived from the UK. Three years ago it was 67 per cent. Last year turnover rose by 3.4 per cent, from £293m to £303m; net profit was up to £107m; while average profit per equity partner rose by 5 per cent to £723,000. There were no major exceptional costs, with the Rome opening not having a big impact on the bottom line. Neither does Ashurst carry any debt as such. There is an unused overdraft facility and no debt on the balance sheet.