UK 200: Firm by firm

Uniquely, the UK 200 includes independent editorial on every firm in the table. Here is a selection of this year’s analyses

To purchase access to the full report visit or contact Daniela Badcock on +44 (0) 207 970 4582

Allen & Overy

Allen & Overy (A&O) had a muted 2012/13, with turnover inching up by 0.6 per cent and average profit per equity partner (PEP) standing still, giving respective figures of £1.189bn and £1.1m.

The standstill repositions A&O as the magic circle’s smallest member by revenue – a position which, until the firm overtook Freshfields Bruckhaus Deringer’s £1.13bn turnover in 2011/12, had not shifted for more than a decade.

However, this year Freshfields experienced its first substantial rise in revenue since 2008/09, increasing turnover by 7.4 per cent, to £1.39bn. Freshfields also remained the more profitable of the two, with net profit at £548m and PEP at £1.39m compared with A&O’s £464m net profit and £1.1m average PEP. A&O’s profit margin for 2012/13 was 39.02 per cent, up from 38 per cent the year before. Average lockup last year was 126 days, not far off the firm’s target of 120 days and an improvement on the previous year’s 129-day average.

Although A&O’s growth for the year proved unspectacular, the stasis does mark an improvement on the 3 per cent revenue drop recorded at half-year. In November 2012 the firm turned over £566m compared with £582m the year before, although it said its half-year turnover grew by 1 per cent on a constant currency basis – presented in euros, the revenue figure rose by 6 per cent from €664m to €703m. Managing partner Wim Dejonghe admitted that the first nine months of the 2012/13 financial year had been slow, a pattern he claimed reversed in the months towards the end of the financial year thanks to the strong recovery of capital markets.

That said, top of equity at the firm fell from £1.6m to £1.567m during the year, while bottom of equity dropped from £640,000 to £627,000. The firm is home to 442 ‘full partners’ who receive 20 profit-sharing points on promotion, rising by two points every year to a maximum of 50 points. With one of the longest equity ladders in the City at 15 years, internally promoted partners at A&O are required to spend two years on a fixed share before stepping onto the ladder.

Dejonghe said the firm monitors performance on a five-year cycle, meaning management will compare this year’s figures with those of 2008/09 when turnover stood at £1.09bn and PEP for the 372 equity partners stood at £1.04m. This way of monitoring growth is a result of the firm’s targeted investment abroad in recent years, Dejonghe added. Over the past five or six years the firm has been closing the gap on its elite stablemates by investing heavily in new offices in emerging markets. Now boasting 42 offices in 29 countries, A&O followed office launches in Istanbul, Morocco and Washington DC with two new bases in Vietnam, opening in Hanoi in the third quarter following the hire of JSM’s Vietnam managing partner Dao Nguyen.

The firm divides these international offices into three categories – fast-growth emerging market jurisdictions such as Vietnam; countries where the firm has established itself as among the market leaders, such as the UK and Benelux; and jurisdictions where the firm is underweight, such as the US (or, more specifically, New York). These three tranches illustrate the way A&O thinks about strategy and have no impact on the firm’s management structure.

While growth in 2012/13 came from A&O’s Central and Eastern European offices, the South East Asian markets and Morocco, there were also good performances in traditional offices such as London and the Middle East, where the firm continues to expect a good chunk of its most high-profile mandates. 

During 2012/13, for example, A&O’s London banking team advised on the $23.3bn (£14.9bn) takeover of Virgin Media by US group Liberty Global, representing the consortium of arranging banks led by Credit Suisse and including BNP Paribas, Deutsche Bank, Barclays and Bank of America Merrill Lynch.

But the firm did not excel in every jurisdiction. A&O still struggles to compete with Wall Street’s finest. Insiders have suggested that US managing partner David Krischer, the firm’s longstanding capital markets partner who took on the role in February, will focus on building up the US as a whole rather than zoning in on New York.

Overall, 2012/13 was business as usual. A&O continued to take a cautious approach to its clients, with none accounting for more than 3 per cent of total revenue. However, while A&O says it monitors credit exposure, there is no hard and fast rule over how much each client can bring in.

Some things did change last year, however. In January 2013 the firm announced that support staff across its US and European offices would have their jobs moved to Belfast as the firm beefed up the role played by its support services centre. A&O also announced a 24-person hiring spree in the office, which opened in 2011, in response to attrition. As a result it received £348,000 in incentives from Invest Northern Ireland.


DWF has bolted on four firms in the past 12 months, growing its turnover by 84 per cent from £102m to £188.2m at the end of the 2012/13 financial year.

Average profit per equity partner also increased from £412,000 to just over £429,000, with the equity spread increasing from £224,000 to £833,000 in 2011/12 to between £233,000 and £1.09m at the end of this year. Net profit grew by 41 per cent from £14.5m to £20.5m.

Although DWF saw 8 per cent organic growth, most of the hike in revenue came via 12 months of mergers and acquisitions. In May 2012 it bolstered its Midlands presence with Buller Jeffries and in June merged with Scottish firm Biggart Baillie, creating a combined turnover of about £118.2m. That was followed in February by a merger with 22-partner niche insurance practice Fishburns, which added £21.3m, and the pre-pack acquisition of Cobbetts in the same month.

The rapid growth led to some rationalisation, with DWF scrapping 38 roles across the firm following redundancy consultations in May. The main areas affected were where there were overlaps in central services staff. The secretarial capacity in London was replaced by staff in the northern offices, eight people were lost in Scotland due to fee-earner overlaps and some paralegals lost their positions due to conflicts of interest after the mergers.

DWF’s partnership has doubled since last year as a result of the merger activity, with the total number of partners standing at 285 at the end of the financial year, compared with 157 the year before. Despite this, the already tight equity partnership grew disproportionately from 37 at the end of 2011/12 to 59. Eighteen of those partners joined through mergers, six through lateral hires and three through internal promotions.

None of the equity partners from Cobbetts joined DWF’s equity, instead becoming fixed-share partners, slightly skewing the ratio of equity to non-equity members.

DWF has a meritocratic partnership, with the firm assessing remuneration levels annually via six performance criteria. Partners must demonstrate a minimum level of competence to be considered to join the equity and there is a 12-month training programme on which suitable candidates are enrolled to get them to that point.

The highest proportion of the firm’s income still derives from litigation. Last year it was 67 per cent, compared with 72.2 per cent the year before. Property generated 13 per cent, 9 per cent came from corporate, 7 per cent from finance and the remaining 4 per cent from other revenue streams.

Geographically, the firm is seeking to move away from its historical association with the North of England. Managing partner Andrew Leaitherland said he spent most of his time in London and was budgeting for growth of up to 300 people there this year, which would more than double last year’s headcount in the capital.

The focus is on bolstering the insurance practice in London but corporate, regulatory, employment and real estate are also on the agenda. DWF’s lower cost bases in regional locations means the firm can deliver services at a more competitive rate than some London-based firms.

Having appointed ex-Pinsent Masons partner Jay Birch as head of corporate in the second half of 2012, the corporate team in London has already grown from three to nine people, but Leaitherland sees scope for more growth.

The firm is planning to expand its insurance offering in Scotland via the right merger and is understood to be eyeing two or three firms, although it may also build up through lateral hires. The focus remains on the UK although opening international offices has not been ruled out. DWF’s insurance and IT clients are  most likely to generate the business argument for opening overseas.

DWF had borrowings of £14.5m last year, which enabled investment in IT and the infrastructure to consolidate the firm’s growing network, as well as pay the administrators for Cobbetts. The firm budgets £1.5m for excess costs each year and there are no plans to raise additional capital from partners.

Across the UK the firm holds 271,450sq ft of office space at a combined rent of £9m per year. In London it has 21,524sq ft, costing £1.6m.

Clients include Liverpool John Moores University, London Borough of Sutton, First Milk, Persimmon Homes, Volkswagen Financial Services and Halfords.

Addleshaw Goddard

Fee income fell marginally at Addleshaw Goddard, with the firm posting a revenue drop of 2 per cent, from £170m to £166.5m. Average profit per equity partner (PEP) rose by 2.5 per cent, from £446,000 to £457,000, while the profit margin was 27 per cent compared with 26.5 per cent a year ago.

It has been a tough five years for Addleshaws. Revenue fell by 7 per cent, from £173.1m to £161.9m, between 2008/09 and 2010/11 and, despite finances looking up in 2011/12 when it reported a 30 per cent increase in net profit, it has shown no notable compound growth in turnover since 2007/08.

However, the need to adapt to survive has not escaped the notice of senior partner Monica Burch and managing partner Paul Devitt. Addleshaws has process-mapped all its services and in 2010 introduced its Transactional Services Team, with around half a dozen paralegals. There are now 80 staff in the Manchester-based team, which turned over £3m last year. The firm hopes to be delivering at least 10 per cent of its work through this team by 2015.

Litigation brought in the bulk of 2012/13’s revenue at £40m, followed by finance and projects at £37m, real estate at £33m, corporate at £29m and commercial services at £23m. 

Although the figures seem to tell much the same story as in recent financial years, the firm underwent a drive to expand internationally in 2012/13. It opened five international offices: Singapore in May 2012; Dubai in September 2012; Oman (in association with Nasser al Habsi Law Firm) in March 2013; Hong Kong (via an alliance with Hashidate Law) in May 2013; and Qatar in May 2013.

The firm has a modified lockstep that begins with a three-year period of pure lockstep followed by an entirely meritocratic process assessed each year. The equity spread among the 103 equity partners ranged from £229,000 to £596,000, with nine partners at plateau.

Lockup rose from 88 days in 2011/12 to 96 at the end of 2012/13. Both figures are below its stated target of 110 days. The business continues to be funded by the partner capital base and bank borrowing, which rose from £12.1m at the end of 2011/12 to £14.3m last year.

Field Fisher Waterhouse

The 2012/13 financial year was a challenge for Field Fisher Waterhouse (FFW), where global turnover was unable to match the previous year’s record high of £97.6m, dropping by 2.8 per cent to £94.8m. Net profit inched up slightly from £18m to £18.3m, while average profit per equity partner (PEP) slumped to its lowest point since 2006/07, from £410,000 to £402,000.

London did not fare much better. Housing more than three-quarters of its staff and generating almost 80 per cent of global revenue, UK turnover dropped by 2.5 per cent from £77.2m to £75.3m.

Managing partner Michael Chissick, who took the helm in February 2013, said the bumpy year was due to three major obstacles, including FFW’s failed merger talks with two firms. Discussions with Lawrence Graham were abandoned in June 2012 and talks of a £200m tie-up with Osborne Clarke were called off in November.

Second, the firm lost three partners from its franchising practice to Bird & Bird in early 2013, including high-profile IP and IT head Mark Abell. Finally, FFW was busy plugging the leaks in its new German
offices. FFW took over two offices from the now-defunct Howrey in Munich and Düsseldorf, housing a four-partner team before gradually losing all four to different firms over the course of the year.

Since then, FFW has focused on its international strategy with renewed vigour, with a new office building in Munich, an uptick in lateral hires in Paris and an office launch in Palo Alto, plus a combination with Shanghai firm Ryser &
Associates in July 2013.

Over the course of 2012/13, FFW transferred about four additional fixed equity partners on to its full equity scale, taking its total to 45.5 equity partners worldwide, 40 of whom are based in London. As net profit crept up, those at the bottom of equity pocketed £182,000, £3,000 more than in the previous year, while plateau partners took home an additional £100,000, bringing their total to £615,000.

The firm missed out on its lockup target of 100 days, thanks largely to its debtor days increasing from 78.5 to 88.7. In May 2013 it hired Mike Giles, formerly financial director at SJ Berwin, to tighten this up.

The firm is set to move its London contingent to a new single-site river-side base in summer 2014, comprising 81,270sq ft in total. Rent is roughly £50 per sq ft, making the premises significantly cheaper than the £4.7m the firm paid out in rent and rates previously.

Boodle Hatfield

Boodle Hatfield made its entry into The Lawyer’s UK 200 this year with a 2 per cent rise in turnover to £20.7m, a net profit of just over £4m and an average profit per equity partner of £401,000.

The London-based firm specialises in acting for wealthy individuals, families, property owners and businesses in the UK and worldwide. There are 28 partners, 10.4
of whom were full equity on a full-time-equivalent basis in 2012/13. Last year 40 per cent of total fee income was generated by the property department, which is headed by partner Caroline King.

The litigation group, headed by partner Simon Fitzpatrick, enjoyed a particularly strong year, chipping in 19.2 per cent of revenue, having boosted its contribution by 40 per cent during the year thanks to the team having acted in major cases for Isis Investments and former Aeroflot head Nikolay Glushkov. 

Other key clients included Grosvenor, Bedford Estates and IBM Pension Trust.

Boodle Hatfield has a lockup target of 110 days, which it bettered last year, with year-end work-in-progress of 48.2 days and 60 debtor days. 

The firm had £660,000 total borrowings last year, the tail-end of a fitout loan of about £3m it took out nearly 10 years ago for its then new offices at 89 New Bond Street. The firm has been paying this off at about £300,000 a year and has now cleared that debt. It has a total of 34,693sq ft of office space in the UK for which it pays £3m, 29,693sq ft of which is in London, costing £2.7m. It also has an Oxford office.

Withy King

Withy King’s turnover rose by 10 per cent in 2012/13 from £15.9m to £17.4m, as the Bath-headquartered firm continued its push to reduce its reliance on one department.

While the high-performing clinical negligence practice continued to do well, contributing 21 per cent to turnover, investments tended to focus on commercial and private client, which contributed 15.5 per cent and 14.5 per cent respectively.

The firm boosted its 28-strong private client team with three partners from Thrings and invested in internal training programmes for its 264 staff. At the end of the financial year Withy King moved 100 Bath-based staff to a refurbished
office in the city centre.

Average profit per equity partner at the firm dropped by 11 per cent, from £225,969 to £200,841, while net profit fell 5 per cent, from £5.8m to £5.5m, as a result of various investments.

Withy King has a 47-strong partnership, two fewer than in 2011/12, with 19 being full-equity. The equity spread starts at £103,000 and peaks at £297,000. Partners are remunerated on a merit basis.

The firm did not increase its borrowings over the year, adding there were no redundancies. Total lockup last year stood at 277 days, far exceeding the 225-day target. This consisted of 52 debtor days and work-in-progress of 175 days.

The firm is 18 months into its three-year growth programme. At the time of writing potential M&A targets had not been ruled out.

Boyes Turner

Thames Valley firm Boyes Turner had a year of consolidation and growth in 2012/13, with turnover rising by 4.3 per cent, from £14.1m to £14.7m. The growth in the top line came with no material change in headcount – the firm’s partnership dropped from 23 to 22 and there was one less lawyer, at 67.

Net profit rose by 3.4 per cent, from just under £3m to £3.1m. Average profit per equity partner rose by 16.5 per cent, from £176,000 to £205,000. Boyes Turner operates a two-tier partnership structure, with 15.3 full-time equivalent equity partners and seven fixed-share equity partners. The number of equity partners fell slightly last year, from 17.

Investment in the claims-handling unit several years ago has paid off, said CEO Andrew Chalkley. The firm does not advise on mass personal injury claims, with most work associated with industrial disease. As a result of the Jackson reforms, Boyes Turner is ensuring it is not buying in any claims, and finalised the acquisition of the business that formerly referred industrial disease work at the start of the current
financial year.

The firm increased its space during 2012/13, adding around 9,000sq ft, to bring the total space controlled by Boyes Turner to 31,000sq ft. Rent increased by around 7 per cent, bringing the total cost to just over £1m, or £35.58 per sq ft. The new premises can accommodate up to 240 people. There are 165 staff presently employed at the firm.

To purchase access to the full report visit or contact Daniela Badcock on +44 (0) 207 970 4582