First-mover firms report average turnover growth of 7 per cent for 2011-12
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Firms have been slow off the mark when it comes to unveiling their financial results for the 2011-12 year, but the first to post revenue figures have on average beaten market expectations by posting growth of almost 7 per cent.
The largest of the firms to have already revealed their end of year figures for 2011-12 are Herbert Smith, Ashurst, Eversheds and Berwin Leighton Paisner (BLP), which increased turnover by 3, 6, 3, and 8 per cent, respectively.
One firm consultant had told The Lawyer that, given what a poor year 2011-12 was for deals, particularly the second half, they expected law firm revenue figures to be up or down by between 1 and 3 per cent only. Another senior corporate partner at a City firm said that he expected the magic circle to be flat in terms of fee income with firms just outside of that select group posting slight increases.
The average increase in revenue among the small group of firms to have so far given turnover was buoyed, however, by outlier performances by Manchester firm DWF, which completed several mergers in 2011-12 and increased turnover by 23 per cent, and Kemp Little, which grew by 15.6 per cent.
None of the magic circle have provided figures yet for the 2011-12 financial year, though these firms usually start publishing results in early July. Allen & Overy managing partner Wim Dejonghe told The Lawyer last month that he believed his firm would be “looking at single digit growth” (7 May 2012).
But while the firms that have announced results so far this year have posted higher-than-expected increases in turnover, revenue numbers for 2007-08 and 2008-09 show how firm income has suffered since the financial crash.
Eversheds, for instance, returned to growth for the first time in three years with turnover of £366m in 2011-12, but that figure is still 6 per cent lower than the £390m it posted in 2007-08. Meanwhile, Nabarro’s latest turnover figure of £113.4m is down 20 per cent on its 2007-08 high of £142m and Dickinson Dees is down 23.2 per cent over the same period.
CMS Cameron McKenna and Wragge & Co, too, are both yet to return to their previous highs of £240m in 2008-09 and £125.6m in 2007-08, respectively.
UK firms’ 2011-12 finncial results:
| Firm | Turnover 2011-12 £m | Turnover 2010-11 £m | Change % |
| Addleshaw Goddard | 170 | 161.9 | 5 |
| Ashurst | 322 | 303 | 6 |
| Berwin Leighton Paisner | 246 | 228.4 | 8 |
| Bird & Bird | 235 | 214.6 | 10 |
| CMS Cameron McKenna | 227.6 | 227.6 | 1 |
| DAC Beachcroft | 163.2 | NA | N/A |
| Dickinson Dees | 46.1 | 45.5 | 1.3 |
| DWF | 102 | 83 | 23 |
| Eversheds | 366 | 355 | 3 |
| Harbottle & Lewis | 18.9 | 17.5 | 8 |
| Herbert Smith | 480 | 465.1 | 3 |
| Kemp Little | 8.9m | 7.7 | 15.6 |
| Nabarro | 113.4 | 112.6 | 0.7 |
| Taylor Wessing | 206 | 192.3 | 7 |
| Wragge & Co | 118.2 | 113.1 | 5 |
Readers' comments (9)
Anonymous | 2-Jul-2012 9:48 am
Isn't the Finance Director of Cameron McKenna leaving soon as well? With their attempt at a US merger, it all sounds like a bit of desperation. Might as well hoist a 'For Sale' sign and be done with it. Total missmangement of the Firm over the last 5 years.
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Anonymous | 2-Jul-2012 10:47 am
Well done DWF
Wooden spoon Dickie Dees, CMS Cameron McKenna and Nabarro.
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Anon | 2-Jul-2012 11:16 am
Inflation in the UK is, in reality, around the 5% mark so any thing below that is a real terms fall.
It would also be interesting to see a geographical break down. I suspect that many of the results above are flattered by overseas expansion.
Finally, a big drop in GDP is on the way in Europe and North America. The can can't be kicked down the road much longer and firms should be getting ready for a collapse in turnover in those regions.
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oops | 2-Jul-2012 12:38 pm
As Sterling strengthens agains the Euro, Cameron Mckenna's fee income (much of which is denominated in Euros) will fall. No wonder they are looking to the US.
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2+2=5 | 3-Jul-2012 9:42 am
Surely post-merger results not shown on either a like for like basis or taking into account combined pre-merger revenues are simply misleading - especially when taking such figures into account in an overall market average where in the market as a whole there isn't growth - no growth has been created the revenue has just been moved to a new balance sheet.
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Anonymous | 3-Jul-2012 11:22 am
That's a very good point.
What would be really valuable, is for the Lawyer to publish results taking into account inflation. Then we can genuinely judge a firm's progress within the UK Top 200.
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oops | 3-Jul-2012 12:22 pm
Inflation would make Cameron Mckenna's income rise of 1% become a decrease of 4% then.
And goodness knows what the decrease would actually be since 2008!
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Anonymous | 3-Jul-2012 2:16 pm
Ooops,
As a measure, inflation would mean that Dickinson Dees's finances have dropped a whopping 32% in 5 years.
It's a bit of a rough and ready calculation, but in 2007-2008 DD posted turnover of £60m. An online inflation calculator shows that would be £67.8m today. This year they've posted £45.8m, so over 32% less than 5 years ago.
It would be interesting to know if that is better / worse than other firms.
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Fur coat...... | 3-Jul-2012 10:32 pm
but what cost the lateral hires who have assisted with the growth in turnover?
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