Maclays turns to Deloitte as it eyes City growth

The news comes as the firm revealed a drop in turnover and rise in average profit per equity (PEP) partner for the 2011-12 financial year. Turnover fell by 3.5 per cent to £46.9m while PEP rose by 4 per cent to £270,000. Net profit, meanwhile, nudged up from £12m in 2010-11 to £12.7m.

While the turnover figure represents a fall of 23 per cent on the firm’s 2007-08 high of £61.1m, chief executive Chris Smylie said he believes that the £46.9m figure “marks the bottom of the curve” for Maclays. He added that, while the headline figures show a drop in turnover from 2010-11 to 2011-12, the previous year’s figure included turnover from compliance advisory subsidiary Regulatory Solutions Limited, which the firm sold at the end of the 2010-11 financial year.

Smylie, who succeeded Magnus Swanson as chief executive at the beginning of 2011-12 (21 January 2011), said that with the firm back on a stable footing financially now was the time to carry out a strategic review.

“When I took over as chief executive I said to the board that I was very conscious about self-definition – what we were, could be and wanted to be for the future – and that we needed to go through a process of proper strategic review,” he said. “We had to put all that thinking to one side when the Bond Pearce talks came along.”

Maclays entered tie-up talks with Bristol-headquartered Bond Pearce in the summer of 2011, with the aim of creating a firm with turnover of almost £100m. The talks were ultimately abandoned at the beginning of this year (14 March 2012).

“Since those discussions stopped I’ve been in the process of a detailed strategic review of the firm’s operations,” said Smylie. “That will help define what we do from here.”

With the review due to conclude at the end of this summer, Smylie said that merger remains an option for the firm, adding: “The focus for our growth is south of the border, and particularly in London. I think that the long-term future of MMS is tied into the success of our operations beyond Scotland as well as in Scotland.”

In the last financial year London contributed 26 per cent of firmwide revenues, with Glasgow and Edinburgh making up just over a third each and the remainder coming from the firm’s five-partner Aberdeen office.