South East firm Matthew Arnold & Baldwin (MAB) has reported a 57 per cent jump in average profit per equity partner (PEP) for the 2012/13 financial year, rising from £390,000 to £616,000.
According to early results from data in this year’s The Lawyer UK 200 (12 August 2013), the increase puts the firm above a number of those in the UK top 20 when it comes down to PEP – including Simmons & Simmons, Bird & Bird and Taylor Wessing.
Net profit at MAB was up from £5.2m in 2011/12 to £7.7m in 2012/13, an increase of 48 per cent, while turnover rose 22 per cent from £15.8m to £19.3m. The firm recorded nine equity partners in 2012/13, the same as the previous year, while the total number of partners shrank by two to 31.
The significant boost in PEP is not thought to be down to any changes in the firm’s equity structure but an ongoing cost-reduction strategy, an increase in banking and finance work and the closure of its Milton Keynes office in 2011.
”We have won an increasing amount of litigation work from new and existing banking and finance sector clients and have seen the return of transactional work, especially in the last six to eight months,” said senior partner Steven Mills. “In addition, we have continued to benefit from the trend of clients giving work to regional firms that historically would have gone to larger London or magic circle firms.”
The arrival of asset-based lending partners Charny Sanghera and Andrew Bowden-Brown from Squire Sanders (where Bowden-Brown was a senior associate) in 2011 added to the firm’s client base, bringing in Close Brothers, Centric Commercial Finance, ABN Amro, Leumi ABL, IGF Invoice Finance and Lloyds TSB.
The increase of banking and finance work to the firm resulted in the employment of 35 temporary and permanent staff, mostly paralegals, in the summer of 2011. The recruitment drive continued into 2012 and lawyer numbers at the firm have since increased from 80 to 86.
However the firm’s borrowings went up from nil in 2011/12 to £1.1m at the end of the last financial year, money which went entirely into a new practice management system. The amount of space controlled by the firm also changed slightly as the firm took on additional office space in Watford, spending £851,000 on 26,402 sq ft compared to £837,000 on 21,525 of sq ft the year before.
For further analysis of UK legal market finances see The Lawyer UK 200 Preview: Come on, united