The North has been as vulnerable as anywhere else to the recession, but the largest firms are increasing their gap at the top. By Tom Phillips
It has been a mixed bag for firms in the North of England over 2008-09. In a fiercely competitive market, the past year has shown which firms, to paraphrase Warren Buffet, have been swimming naked.
Climbing the hill
In turnover terms special mention must go to Hill Dickinson after it posted a 12 per cent increase in fees to hit £82m from £73.1m the year before. The double-digit growth, achieved over the most turbulent financial year for decades, is testament to the firm’s diverse practice mix.
Strong growth in its employment (up 39 per cent), insurance (16 per cent ) and professional risk (13 per cent) practices countered a dip in revenue from the firm’s property estate group.
Liverpool’s largest firm also spent the 12 months expanding and investing, with the launch of a Singapore office specialising in shipping work in March and signing up London-based commodities boutique Middleton Potts, a merger that is expected to create £22m in turnover for the firm, but which came too late for the UK 200 figures.
A drop in average profit per equity partner (PEP) of 6 per cent, from £312,000 in 2007-08 to £294,000 in 2008-09, shows where some of profit may have gone.
The big 3-0
Hill Dickinson managing partner Peter Jackson could be forgiven for looking over his shoulder at highly ambitious rival DWF. A growth of 9 per cent in DWF’s fees, up to £60m, is only half the story.
Never one to hold back from declaring his intentions, DWF managing partner Andrew Leaitherland is busying himself around the firm’s Leeds, Liverpool,
London, Manchester and Preston offices implementing a strategy to make DWF a top 30 firm by 2010.
The plan, first revealed in 2007, has taken a knock over the second half of the year and the firm has 22 places to climb over the next 12 months before Leaitherland can claim his mission accomplished.
Leaitherland admitted last year that the bar might have to be set lower for the firm, but he hints at making more waves over 2009-10.
“This year will be better, but I think regional players are beginning to wake up to the fact that a finite amount of legal work exists within the regions,” Leaitherland says. “To pull work from London you have to show excellence. I think there’ll be consolidation in the regions over the next 12 months, and we may play a role in that.”
Highlights for DWF include poaching a six-partner insurance team from regional rival Weightmans for the niche London practice launched last year and a three-person pensions team from Dickinson Dees. The firm the latter group left behind is an example of the difference in fortunes in the North.
Newcastle-based Dickinson Dees saw a double-digit drop in turnover, with fees falling by 11 per cent to £53.8m from £60m the year before.
The result is not a surprise. Dickinson Dees went through some major restructuring over 2008-09, laying off 90 from its workforce, including around 15 qualified lawyers.
Down up North
The turnover drop brought the firm closer on revenue to Manchester-based Pannone, which saw a slight increase in fees. The firm recorded fees of £52.5m, up 3 per cent from £50.8m in 2007-08.
With Liverpool-based Weightmans seeing a near flat result of £50.2m, the £50m-£60m firms in the North have clustered together.
Walker Morris, which last year caught up to its regional peers on turnover with a figure of £48m, saw revenue fall by nearly 8 per cent 12 months later to £44.2m.
The firm also stands out for seeing its PEP tumble by 27 per cent, from £670,000 in 2007-08 to £486,000 this financial year.
Liverpool’s Brabners Chaffe Street, which cut 15 jobs and restructured its management earlier this year, saw fees fall by 6.5 per cent to £29m.
Leeds-based Ward Hadaway, which experienced a fairly good year compared with its peers, with turnover up by 6 per cent to £26.6m, put a plan to open in Manchester on hold while it rides through the downturn.
Meanwhile, Watson Burton also saw its turnover drop, reporting fees of £20.5m, down by 7 per cent on the year before.
The Newcastle-based firm undertook redundancy talks in March, bringing the number of staff under consultation up to 85.