Results at most purely regional North East firms for the 2007-08 financial year have been underwhelming, with some having to scale back their ambitions.
Newcastle’s largest firm Dickinson Dees has proved surprisingly resilient in its core operations, but the collapse of work in remortgage, conveyancing and home information packs (HIPs) is likely to result in 70 redundancies in its struggling £6.6m volume business, as reported on TheLawyer.com (14 July).
As a result turnover has increased by only 7.1 per cent to £60m, with net profit dropping by 5.9 per cent to £12.8m. Average profit per equity partner (PEP) decreased by 7.9 per cent to £336,000.
Ward Hadaway, by contrast, has seen a busy year in terms of work, but the firm opened a new office in Leeds late this financial year with the hire of six lateral partners, hitting its bottom line.
While turnover increased by 13 per cent to £28.4m, net ;profit ;and ;PEP remained practically static at £5.3m and £408,000 respectively. Around a third of the firm’s revenue is generated by property work, although a large part also comes from litigation.
Watson Burton has yet to publish its figures, but the outlook is not good. The firm relies heavily on construction, the miners’ revenue stream that buoyed the firm for years is over, it is running expensive London and Leeds presences and it has lost several partners this year.
On a brighter note, the firm has made several hires and concluded an opportunistic merger with a technology boutique in London.
Of the smaller Newcastle players, Muckle has grown only slightly from a turnover of £9.4m last year to around £9.7m. ;The ;economic climate may put a dampener on the firm’s stated ambition to double its turnover within five years.
Rising star Sintons has bucked the trend. With a financial year ending on 31 January, it has seen turnover rise by 23 per cent to £8.2m, with PEP up by a similar amount. This half-year’s results are also expected to be strong, buoyed by work generated from the change to capital gains tax in April.
The ;turnover ;at Newcastle firm Crutes, by contrast, has dropped to £5.67m from £5.92m last year, although profit has increased as a result of the firm’s restructuring.