Australian-listed Slater & Gordon has announced it will split from its UK arm after a 46.3 per cent fall in profits in 2016/17.
Turnover dropped 32.7 per cent for the firm as a whole from A$908.1m (£556.5m) to A$611.5m (£374.7m) while firmwide profits fell 46.3 per cent from A$1bn (£612.8m) to A$546.8m (£335m).
The firm’s UK arm recorded turnover of A$157.8m (£96.7m) for the last financial year, a 31.4 per cent decrease on the previous year’s A$230m (£140.9m) turnover.
This was attributed to a reduction in size of the business in conjunction with its parent firm’s ‘business rationalisation programme’.
Net loss before tax and interest in the UK stood at A$98.5m (£60.4m), an increase of 52.7 per cent on the previous year’s A$64.4m (£39.5m) loss.
Slater & Gordon entered the UK market in 2012 when it acquired legacy Russell Jones & Walker in a structured deal which valued the UK firm at A$80m (£53.8m).
An announcement on the Australian Stock Exchange said: “The company believes the separation of the UK operations provides the best option to enable both the Australian and UK operations to succeed in their own right and will enable the company to focus its management’s time and resources on the Australian business.”
The firm’s UK group will be transferred to a new holding company, UK HoldCo, which will be owned entirely by senior lenders.
Slater and Gordon group chief financial officer Bryce Houghton has also stepped down from his position. Chairman John Skippen said: “On behalf of the board, I thank Bryce for all he achieved and for his valuable support to the board and the company. I wish him all the best in his future endeavours.”