Irwin Mitchell’s profit drops 8.5 per cent to £17.1m as revenue inches up

Irwin Mitchell grew revenue by 1.2 per cent from £200.3m to £202.7m and saw profit before tax drop by 8.5 per cent from £18.7m to £17.1m last year, according to audited figures.

The firm broke through the £200m mark for the first time in 2012/13, with revenues climbing 5.3 per cent from £190.1m to £200.2m, while profit rose by 3.1 per cent from £18.5m to £19.1m (29 July 2013).

The £17.1m profit figure reported for the last financial year is net of member remuneration. It is paid to the firm’s holding company, Irwin Mitchell Holdings, and then set aside to pay tax contributions and reinvest into the firm.

Irwin Mitchell attributed the growth to increased activity in multi-track personal injury (PI) and its subsidiaries including Irwin Mitchell Asset Management Ltd and Ascent, its debt services firm.

The firm’s business legal services (BLS) arm, which has received considerable investment since the firm restructured in 2012, also saw low double-digit growth last year (20 August 2012).

Recently appointed chief executive Andrew Tucker said BLS turned over just in excess of £40m, amounting to roughly 20 per cent of total revenue.

Tucker said the growth had offset the inevitable downturn in its motor team and some PI areas as a result of the Legal Aid, Sentencing and Punishment of Offenders Act 2012.

He said the firm’s profit before tax reduced as result of continued investment, including new locations, advertising and 26 partner-level lateral hires during 2013/14.

The firm added 13 to its personal legal services arm, eight to business legal services, three to Ascent and two to business services, as well as making up 10 new partners (29 April 2014).

Irwin Mitchell secured a £60m rolling banking facility, with an additional £30m buffer, in a joint deal with HSBC, Lloyds and Royal Bank of Scotland (RBS) earlier this year (27 March 2014).

Chief financial officer Andrew Merrick said: “We’re in an investment for growth cycle at the moment, our forward projection is for growth so both turnover and profit should be up this year.”

He said the firm operates on a two-to-three year investment period but ad hoc investments are made as opportunities arise.

Irwin Mitchell opened new offices in Southampton (10 February 2014) and Cambridge (16 April 2014) this year but Tucker said forthcoming investment was likely to come in the form of acquisitions.