Bar flies in the face of the recession with turnover hikes across the board
20 July 2009 | By Katy Dowell
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The bar appears to be on the brink of a boom period, despite leading litigators warning that the anticipated litigation tsunami has failed to materialise.
As the recession squeezes firms’ financials, the first chambers to post their results are showing a trend for strong growth.
Quadrant Chambers has reported the largest jump in turnover, with a 44.9 per cent rise, from £15.8m in 2007-08 to £22.9m. Revenue per barrister (RPB) jumped by 38.9 per cent over the same period, from £367,000 to £509,700.
With its focus on shipping litigation, the set is ideally placed to take advantage of the downturn.
As The Lawyer reported last month (29 June), City firms with an insurance bias have reported an upturn in revenues. At Clyde & Co, for example, turnover grew by 17.8 per cent to £185m, while Ince & Co, which has a strong marine practice, reported a 23.5 per cent rise, from £64.3m to £79.4m.
“The shipping market is very buoyant,” said Quadrant chief executive Tim Gerard. “We’ve been helped in part by the recession, but there’s also a wider strategy behind that.”
Quadrant appointed Gerard as chief executive last month (The Lawyer, 1 June). He told The Lawyer that the creation of the chief executive position signalled the completion of the first phase of the set’s expansion strategy.
“The strategy’s been to change market perceptions of us,” he said. “We’re seen as a wet [shipping] set. That pigeonholes us in an unreasonable way - we’re also pre-eminent in aviation and have significant capabilities in insurance and reinsurance.”
Senior clerk Gary Ventura said Quadrant’s members had seen a significant increase in instructions from outside the set’s core area. Now it aims to boost its profile without losing its marine credentials.
“We’re very keen to expand and are discussing the strategic targets of where we want to be,” said Gerard, adding that this could include bringing in new practice areas through the addition of new tenants.
At 39 Essex Street revenue has risen by 13 per cent, from £26.9m to £30.4m. As was the case in 2007-08, RPB at the set has risen by 10 per cent, up to £410,810.
Hailing 2008-09 as a bumper year, the set’s director of clerking David Barnes said he expected the current year to be exceptionally strong as well.
“The next half year will be very exciting. Some will try to consolidate and others will seek to invest and move forward,” he said.
Barnes stressed that 39 Essex Street was sensitive to the wider economic climate.
“We have a diverse spread of work coming in,” he explained. “Public law is booming, but rates are sensitive.”
The firm is keen to expand and in April unveiled plans to open in Manchester to take advantage of work being generated by the city’s new Administrative Court, which opened in January.
Manchester-headquartered Kings Chambers has also benefited from the opening of the Admin Court, reporting a turnover rise of 9.14 per cent, from £17.5m in 2007-08 to £19.1m. RPB, however, dipped by 4.1 per cent, from £273,000 to £261,700. Chambers contributions stood at 10.7 per cent.
Kings chief clerk Bill Brown said £1m of the set’s turnover came from its common law group, with a further £250,000 generated by the planning group.
“The balance was made up by the chancery commercial work we do,” he said.
The set won a place on the Attorney General’s Treasury panel during the financial year, which guarantees it an income stream. According to Brown, the Government is keen to make use of the local courts and Kings’ members make regular appearances in the Admin Court.
The bar is experiencing a gentle revolution, with many sets looking to overhaul their structures to become more businesslike prior to the implementation of the Legal Services Act in 2011.
On the back of such strong results, these sets should find they have the capital to make the investments necessary to see them through the challenges of the next two years.