Field Fisher Waterhouse

UK 200 RESULTS 2010

While many of its UK rivals were all too eager to cut their workforces in bids to slash costs and boost profits, Field Fisher Waterhouse (FFW) bucked the trend.

While FFW certainly has not been immune to redundancies, making 42 in the 2008-09 financial year, managing partner Moira Gilmour says the firm has embarked upon a growth-related three-year master plan it calls the ‘virtuous triangle’ (a term the firm has trademarked).

The triangle refers to the three areas FFW has chosen to expand: corporate, IP/IT and regulatory. The firm says it has pursued the strategy regardless of the economic climate in the belief that in the long term it will pay dividends.

In the short term this has meant the firm posted declining turnover, net profit and average profit per equity partner (PEP) for the 2009-10 financial year. Turnover at the firm dropped by 3 per cent to £92m, net profit fell by £3.3m to £16.7m and PEP tumbled by 7.6 per cent to £476,000.

Despite this year’s fall, the past four years has seen turnover rise by 36 per cent from £67.7m, although during the same period net profit fell by £4.8m.

FFW has tightened up its billing and collection practices recently, including internal sanctions, and within the past two years has managed to drive year-end work-in-progress down from 42 to 18 days, while its lockup target has been reduced from 136 to just 60 days. Total lockup at the 2009-10 year-end was 88 days.

Gilmour believes this improvement in its financial management has been essential in allowing the firm to pursue its investments. Looking ahead, FFW is hoping to win more work in Asia and India – and it will, of course, continue to pursue its virtuous triangle strategy.

UK 200 RESULTS 2009

Field Fisher Waterhouse, one of few firms to increase its turnover in 2008-09, might still have to revise its ambitious growth targets.

The firm wants revenue to hit £200m by 2012, the year London hosts the Olympic Games. If the current market conditions continue then this is about as likely as somebody other than Usain Bolt winning the 100 metres.

But do not assume that means Field Fisher’s relentless race up the UK 200 table has run its course. Five years ago the firm was ranked 40th by revenue. Since then turnover has more than doubled to £95m and Field Fisher is now knocking on the door of the top 30.

The firm, already known for its strength in IP/IT, spent much of the year building up in litigation, which accounted for most of the 17 lateral partners of 2008-09.

The litigation practice only contributed around 21 per cent of revenue last year but the real figure was higher when contentious parts of the IP/IT and medical negligence departments are included.

The rise in turnover was also boosted by a large public sector group – the General Medical Council is one of the firm’ largest clients.

A more than 30 per cent drop in profit per equity partner will be source for concern though, as will the fact that profit margin fell from 30 to 21 per cent. The firm responded with three redundancy consultations resulting in the loss of 49 jobs.

Managing partner Moira Gilmour has pinpointed Europe as a key area for the coming months. At the end of the 2008-09, the firm restructured its Paris office leading to the loss of four of the 10 partners. It will be hoping to rebuild the practice quickly to make the most of the recovering Eurozone economy.

Field Fisher has three classes of partner. Non-equity members are divided into B partners, who are given a salary and a slice of a shared pool based on the firm’s profitability that year, and C partners, who receive a salary and a discretionary bonus.

The equity partners receive most of their remuneration from a merit-based system, varying from one to 10 points. The remainder of their income, some 20 per cent for middle ranking partners, comes from a lockstep running from 12 to 20 points.