Total net profit at the same firms tells a different story, however. The profit generated by the big four in 2008-09, £1.82bn, rose by 3 per cent to £1.88bn last year. Of this, it was Clifford Chance’s performance that stands out. It was the only one of the quartet to post a rise in net profit, adding £80m to the bottom line.
Figures for The Lawyer UK 200 Annual Report 2010 are still being finalised, but in light of recent events it will come as no surprise that one of the biggest fallers by revenue among this year’s top 200 so far was Halliwells, which posted a 14 per cent decline in turnover, from £77.8m to £67m.
Among the 30 largest firms some of the most significant drops in revenue were posted by the largest, transactionally dominated practices. Simmons & Simmons and Slaughter and May saw revenue drops of 14 and 13 per cent respectively. Hard on their heels comes Freshfields and CMS Cameron McKenna, both of which registered 11 per cent decreases. Camerons was also jointly the biggest faller on average profit per equity partner (PEP) among the top 30, posting an 18 per cent drop in PEP, from £554,000 to £453,000.
Slaughters, one of the few in the table for which figures have been estimated (Lovells and DLA Piper, which report this week, are two others), is thought to have seen a drop in PEP from £2.25m to £1.84m.
Further down the table, as this year’s reporting season nears its peak, an intriguing picture of mixed fortunes emerges for the UK’s leading firms.
While total fee income was down, in contrast PEP grew at well over half of the UK’s 30 largest firms last year. The result underlines the return to form of much of the domestic legal market.
This year’s financial reporting season has been characterised partly by a succession of firms, several coming from a relatively low base in 2008-09, reporting hefty and largely unexpected increases in PEP.
So despite the 4.5 per cent drop in total revenue, these figures confirm that the widespread cost-cutting undertaken by most of the leading firms has paid dividends.
Firms outside the top 30 currently top the list, with Shoosmiths, LG and Travers Smith posting rises of 70, 64 and 53 per cent respectively. Among the top 30, however, the PEP rises have been slightly less dramatic.
Travers’ performance contrasts with its silver circle rival SJ Berwin, which has endured a torrid time in recent years. Last year it posted a 7 per cent fall in revenue and a 9 per cent rise in PEP, somewhat less spectacular than Travers’ figure.
Elsewhere, Pinsent Masons and Hammonds top the high PEP risers table with increases of 32 per cent.