Mishcon de Reya
UK 200 RESULTS 2010
Movement since 2009
Turnover (£M):
Profit per equity partner (£K):
Earnings per partner (£K):
Equity spread (£K):
Net profit (£M):
Profit margin (%):
Revenue per fee-earner (£K):
Revenue per lawyer (£K):
Revenue per partner (£K):
Revenue per equity partner (£K):
Total number of fee-earners:
Total number of qualified lawyers:
Total number of partners:
Total number of equity partners:
Total number of female partners:
Total number of female equity partners:
Total number of staff:
Leverage ratio (fee-earners per equity partner):
UP
47.5
450
269.49
275-750
9.9
21
247.4
316.7
805.1
2,159.1
192
150
59
22
14
2
359
5.82
Litigation-led Mishcon De Reya may have stunned its rivals by launching in New York in January, but do not expect the London firm to embark on any global expansion push.
New York was opportunistic rather than strategic, according to the firm’s managing partner Kevin Gold.
In other words, Mishcon unearthed a team of litigators from Sheppard Mullin Richter & Hampton capable of generating $8m (£5.12m) in its first year and who meshed well with the UK firm’s longstanding international fraud practice.
Couple that with an attractively priced real estate deal – Mishcon secured offices in the iconic MetLife building for less than $30 per sq ft – and the Holborn firm had a deal that is likely to be profitable in its first year.
In contrast, the London end of the business (the two are separate LLPs) posted another sharp decline in average profit per equity partner (PEP), down from £575,000 to £450,000 in 2009-10.
PEP at Mishcon, which operates an entirely merit-based remuneration system, has dropped by 39 per cent from £740,000 two years ago.
Gold says the firm’s financial performance was largely due to the investments it had made in hiring senior lawyers during the year, plus the continuing weakness of core areas such as property.
Despite the struggles of real estate, the group that generated 20 per cent of the firm’s total revenue was one of the key areas into which Mishcon recruited last year. Partner hires included property partners Steve Hughes and Nick Minkoff from SJ Berwin, former Matthew Arnold & Baldwin construction head Richard Gerstein and corporate partner Dean Poster from Orrick Herrington & Sutcliffe.
Litigation was Mishcon’s biggest revenue contributor last year at around 45 per cent.
UK 200 RESULTS 2009
Movement since 2008
Turnover (£M):
Profit per equity partner (£K):
Earnings per partner (£K):
Equity spread (£K):
Net profit (£M):
Profit margin (%):
Revenue per fee-earner (£K):
Revenue per lawyer (£K):
Revenue per partner (£K):
Revenue per equity partner (£K):
Total number of fee-earners:
Total number of qualified lawyers:
Total number of partners:
Total number of equity partners:
Total number of female partners:
Total number of female equity partners:
Total number of staff:
Leverage ratio (fee-earners per equity partner):
UP
47.3
575
347.2
275 - 950
12.65
27
249
322
892
2,150
190
147
53
22
11
2
349
5.68
Like most firms that rely on property as a way of bringing in the cash, Mishcon de Reya has seen its profit take a tumble during the downturn.
The firm saw net profit slide by 17.9 per cent to £12.65m at the 2008-09 financial year-end, from £15.4m a year earlier. The firm’s property practice, which accounts for 19 per cent of revenue, played its part in carving away at Mishcon’s profits.
According to managing partner Kevin Gold, the property practice was hit hard by uncompleted deals as a result of clients being cautious in light of the downturn.
Turnover was up marginally from £47.1m to £47.3m. Average profit per equity partner (PEP) stood at £575,000, 22 per cent below 2007-08’s £740,000.
The firm’s equity spread also narrowed, with the top earners taking home £950,000 and those on the bottom rung receiving £275,000. This was down on the previous year, when the equity spread ran from £350,000 to £1.2m.
In contrast with property, Mishcon's litigation practice experienced a surge in instructions, contributing to 49 per cent of total turnover.
During the 2007-08 year, Gold said that investment was a priority for 2008-09 financial, with a particular emphasis on litigation. The partnership deliberately prevented PEP levels from rising above £710,000 as it looked for new premises in which to grow.
As a result of the downturn the plan to move was put on hold while the firm reorganised key practices, including the creation of a professional negligence team in the litigation group.
It also cut 17 staff, including two partners (one each from real estate and corporate), following a redundancy consultation launched in December 2008.
But it has not been all bad news. During the year Mishcon announced plans to revamp its private client practice and bring its flagship family practice into the fold.
Gold said the new practice area would bring contentious trust lawyers together with those in probate, residential conveyancing and immigration.
The firm also created two new positions in the pathway to partnership following an 18-month review of its career structure. The role of legal director was created as a precursor to partnership and the firm also introduced a formal associate role – until then lawyers at the firm progressed from trainee to assistant to partner, with the firm making just one or two promotions each year.
Mishcon operates an entirely merit-based remuneration system.
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