Cobbetts increased its bank loans and overdrafts by £4.3m from 2007 to 2008 – the equivalent of almost 10 per cent of total firm turnover – according to LLP accounts filed by the firm for the 2007-08 financial year.
Bank loans and overdrafts totalled £2.1m in 2006-07, but they rose to £6.5m in 2007-08. Turnover grew slightly from £58.5m to £59.8m over the same period.
Although staff costs dropped by £1.6m, fit out and office and IT costs increased as the firm took on new headquarters at Mosley Street in central Manchester and a London office at Gray’s Inn Road.
At the same time cash at bank and in hand fell from £2.2m on 1 May 2007 to £587,000 on 30 April 2008.
Average total headcount at the firm, including partners, dropped by almost 10 per cent from 783 in 2007 to 722 in 2008, with the biggest fall seen among fee earners.
The ratio of support staff to fee earners is almost 1:1. The average number of support staff in 2008 was 315, compared with 326 fee earners.
Cobbetts did not return calls for comment.