Mark Kelly of Vinson & Elkins.
Mark Kelly of Vinson & Elkins. (Gittings Photography)

Vinson & Elkins posted record gross revenue, net income, revenue per lawyer and profits per partner in 2016—financial results that chairman Mark Kelly attributed to strength in complex commercial litigation, a range of transactional practices and rising oil prices.

“We hit it on all four marks,” said Kelly, a partner in Houston.

V&E’s gross revenue hit $654 million in 2016, up 4.2 percent when compared with $627.5 million in 2015, and net income came in at $288.5 million, up 5.5 percent compared with $273.5 million the prior year. Revenue per lawyer was $1.085 million in 2016, up 5.3 percent compared with $1.030 million in 2016. Profits per partner were $2.025 million in 2016, 7.4 percent more than in 2015, when PPP was $1.885 million. The Houston-based firm had its best year ever, exceeding the previous record year of 2014.

“I was pleased. We had strong business activity in a number of our practice areas and we also finished the year very strong in our inventory levels,” Kelly said.

Complex commercial litigation was very strong in 2016, and transactional areas, including finance, M&A, capital markets, real estate, restructuring and tax, contributed significantly to the firm’s financial success, Kelly said. The first three months of 2016 started off slow in a number of areas, but it picked up during the last three quarters. Energy work, which recovered during the year as the price of oil increased, improved in 2016, he said. The firm worked on all eight of the initial public offerings for upstream companies that were filed in 2016. (Kelly said that three of the companies ultimately did not go public, but instead were sold on the private equity market.)

The firm’s size changed little in 2016. It had 604 lawyers on a full-time-equivalent basis, compared to 608 in 2015. The firm added 18 lateral partners during the year, which Kelly said is a “big number.” Those hires include Paul Tobias, a corporate lawyer in Austin who does work for technology companies, and five intellectual property lawyers who left Akin Gump Strauss Hauer & Feld to join Vinson & Elkins in Austin and Dallas.

Kelly said the firm concentrated on bulding up its IP and government investigations practice areas in 2016.It also added lawyers in London who do private equity and finance work, he said.

In addition, the firm opened an office in Richmond, Virginia, after hiring a group of real estate investment trust partners, including two who practice in Richmond. It also opened an office in Taipei that is overseen by lawyers based in Palo Alto and San Francisco. Kelly noted that the firm closed its office in Abu Dhabi in 2016 and consolidated it with its office in Dubai.

Kelly, a partner in Houston, said the fact that profit per partner exceeded the $2 million mark in 2016 should help the firm recruit lateral partners because it enhances how lawyers look at the firm. But the firm also raised associate salaries in 2016 in response to the new scale set by Cravath, Swaine & Moore. “To attract talent we need to be in that sandbox. We are going to pay the national scale in each market,” he said.

Kelly said energy work remains very important to the firm, despite efforts to diversify. “By and large we are still known as the leading energy firm. I don’t want to forget that,” he said.

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Vinson & Elkins posted record gross revenue, net income, revenue per lawyer and profits per partner in 2016—financial results that chairman Mark Kelly attributed to strength in complex commercial litigation, a range of transactional practices and rising oil prices.

“We hit it on all four marks,” said Kelly, a partner in Houston.

V&E’s gross revenue hit $654 million in 2016, up 4.2 percent when compared with $627.5 million in 2015, and net income came in at $288.5 million, up 5.5 percent compared with $273.5 million the prior year. Revenue per lawyer was $1.085 million in 2016, up 5.3 percent compared with $1.030 million in 2016. Profits per partner were $2.025 million in 2016, 7.4 percent more than in 2015, when PPP was $1.885 million. The Houston-based firm had its best year ever, exceeding the previous record year of 2014.

“I was pleased. We had strong business activity in a number of our practice areas and we also finished the year very strong in our inventory levels,” Kelly said.

Complex commercial litigation was very strong in 2016, and transactional areas, including finance, M&A, capital markets, real estate, restructuring and tax, contributed significantly to the firm’s financial success, Kelly said. The first three months of 2016 started off slow in a number of areas, but it picked up during the last three quarters. Energy work, which recovered during the year as the price of oil increased, improved in 2016, he said. The firm worked on all eight of the initial public offerings for upstream companies that were filed in 2016. (Kelly said that three of the companies ultimately did not go public, but instead were sold on the private equity market.)

The firm’s size changed little in 2016. It had 604 lawyers on a full-time-equivalent basis, compared to 608 in 2015. The firm added 18 lateral partners during the year, which Kelly said is a “big number.” Those hires include Paul Tobias, a corporate lawyer in Austin who does work for technology companies, and five intellectual property lawyers who left Akin Gump Strauss Hauer & Feld to join Vinson & Elkins in Austin and Dallas.

Kelly said the firm concentrated on bulding up its IP and government investigations practice areas in 2016.It also added lawyers in London who do private equity and finance work, he said.

In addition, the firm opened an office in Richmond, Virginia , after hiring a group of real estate investment trust partners, including two who practice in Richmond. It also opened an office in Taipei that is overseen by lawyers based in Palo Alto and San Francisco. Kelly noted that the firm closed its office in Abu Dhabi in 2016 and consolidated it with its office in Dubai.

Kelly, a partner in Houston, said the fact that profit per partner exceeded the $2 million mark in 2016 should help the firm recruit lateral partners because it enhances how lawyers look at the firm. But the firm also raised associate salaries in 2016 in response to the new scale set by Cravath, Swaine & Moore . “To attract talent we need to be in that sandbox. We are going to pay the national scale in each market,” he said.

Kelly said energy work remains very important to the firm, despite efforts to diversify. “By and large we are still known as the leading energy firm. I don’t want to forget that,” he said.

Copyright Texas Lawyer. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.