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.