The record global revenue and profit figures revealed by The Lawyer earlier this month (6 March) are echoed by the leading firms’ performances in London.
All of the top US firms had solid years at worst, but in certain cases the past 12 months have been little short of phenomenal.
The most notable growth comes from Debevoise & Plimpton, which reported a staggering 67.5 per cent increase in London revenue to reach $56m (£32m). The 14 partners chipped in to achieve the record jump in revenue, which equates to 10 per cent of total revenue for the firm of $536m (£306m).
Debevoise London head Jim Scoville said 2005 had been a “terrific year” across the board, with particular successes in funds formation, international arbitration (an area boosted recently by the hire of Norton Rose partner Peter Rees) and M&A.
LeBoeuf Lamb Greene & MacRae reported a similarly astounding 43 per cent increase in UK turnover, from $34m (£19.5m) in 2004 to $48.8m (£27.9m) in 2005, and an even more astonishing 67 per cent increase in UK profit per equity partner (PEP), from $680,750 (£389,000) in 2004 to $1.1m (£650,000) in 2005.
LeBoeuf London managing partner Peter Sharp managed to keep the excitement out of his voice when he attributed the increases to “steady growth” across the firm’s key practice areas of insurance, reinsurance and energy.
“There was no jumbo deal or specific trigger that sparked the growth for us. It’s been a broad advance across the range of what we do,” he said.
As with several global firms, Latham & Watkins does not account for revenue on an office basis, but sources suggest its London performance was broadly in line with its global results. Firmwide revenue was up 17 per cent, taking London to $142m (£81.1m), while average PEP rose 19.6 per cent to $1.6m (£915,000).
White & Case also saw a 28 per cent increase in UK revenue, from $97.5m (£55.7m) in 2004 to $124.7 (£71.3m) in 2005, almost double the 15 per cent increase seen in global revenue.
But the firm was unable to compound on this to increase UK PEP. Instead, London partners suffered a £128,000 decrease in their average pay packet, to reach $731,000 (£418,000) in 2005.
Sources within the firm attributed the disappointing results to “investment in new partners and 2005 being the first full year in the [firm’s] new offices”.
White & Case’s PEP was one of the worst of the top 20 international firms in 2005, only outdone by Kirkpatrick & Lockhart Nicholson Graham, which reported an average PEP of $525,000 (£300,000), although even this was up 36 per cent from 2004’s $385,000 (£220,000).
Meanwhile, the London office of Shearman & Sterling remains the leading light within the firm in terms of profit, although its shine has dimmed somewhat. UK partners took home an average PEP of $1.7m (£950,000), which, while stable on 2004’s figures, was 20 per cent higher than the global average PEP of $1.4m (£789,000). However, this is down on the 51 per cent difference in 2004.
Shearman managing partner Kenneth MacRitchie explained that, while London had enjoyed three years of rapid growth, 2005 had been “a consolidation year”.
Skadden Arps Slate Meagher & Flom’s lateral hiring spree in 2005 is reflected in its revenue growth of 8.8 per cent to $81.9m (£46.8m). Major hires included private equity star Adrian Knight from Shearman, leveraged finance specialist Clive Wells from Allen & Overy and tax partner James Anderson from Clifford Chance.
Dechert saw a 29 per cent increase in UK PEP to $1.5m (£846,500), compounding the 54 per cent increase in PEP reported the year before. Revenue increased by 15 per cent.
Dechert London managing partner Stephen Fogel said growth had occurred across the board, but most notably within financial services, which has grown from zero turnover in 1997 to £10m last year.
Simpson Thacher & Bartlett London managing partner Walt Looney was more direct in his explanation of the office’s 30 per cent increase in revenue. “Private equity saw the most growth off the back of clients such as KKR and Blackstone,” he explained.