Walker Morris failed last year to sustain the dramatic recovery in average profit per equity partner (PEP) it achieved in 2009-10, which was the result of aggressive cost-cutting measures and a cull in staff numbers.
Turnover dropped by 4.8 per cent in 2010-11, from £42.6m to £40.6m, while PEP dropped by almost the same percentage points, from £535,000 to £509,000. Partners at the top and bottom of equity took home £650,000 and £180,000 respectively.
Indeed, in contrast with the previous financial year, Walker Morris has invested in staff, resulting in the number of qualified lawyers growing from 161 to 166. However, in the absence of a stronger recovery, managing partner Ian Gilbert, who is halfway through his current three-year tenure, is keeping a close eye on both utilisation rates and headcount.
Corporate, which accounts for 21.6 per cent of overall revenue, continued to feel the effects of the downturn and saw fees drop by around 10 per cent, almost double that of the firm as a whole. Litigation, meanwhile, was one of the strongest performers and continued to be the biggest fee-generating practice, contributing 44.6 per cent to total billings.
However, those in the licensing team will leave in October to set up their own practice.
Walker Morris operates a modified lockstep. Partners enter on 30 points, while those at the top of the ladder have 100 points. Movement up the equity is determined by the remuneration committee, which is comprised of the firm’s plateau partners.