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London Firms Post Solid Financials as Rest of U.K. Starts to Feel the Pinch
Legal Week
November 07, 2008
A band of London law firms look set to tough out the gloomy market with Lovells, Norton Rose, Trowers & Hamlins and CMS Cameron McKenna all expecting double-digit revenue growth for the first six months of the year.
Norton Rose has said that it expects to see 11 percent growth over the first half of 2008-09, increasing revenue from 127.5 million pounds ($199.2 million) to 141.5 million pounds ($221.1 million).
Cameron McKenna has also had a solid first-half with a 10 percent increase in revenue from 103 million pounds ($160.9 million) to around 113 million pounds ($176.6 million).
Lovells is predicting to see 10 percent-plus revenue growth with the firm highlighting insolvency and restructuring, capital markets, intellectual property and corporate as strong performers.
Trowers, which has a well-established practice in the much-courted Middle East market, has emerged as a leading performer, posting a 16 percent increase in income moving from 36.1 million pounds ($56.4 million) to 42 million pounds ($65.6 million).
Ashurst and Simmons & Simmons have both also managed to grow their first-half revenues by more than 5 percent against the same period in 2007, in what will be seen as credible performances.
Norton Rose chief executive Peter Martyr told Legal Week: "We are looking good at the moment -- our main practice areas are robust and we are well placed. But it is extremely hard to judge the future. There has never been such a degree of uncertainty as to what the immediate future will bring."
Despite indications that many law firms have managed to maintain growth in the face of the slump, the 2008-09 year promises to display widely diverging results, with a substantial proportion of firms seeing falls in revenue.
Addleshaw Goddard, Eversheds, Halliwells and Wragge & Co have all this week confirmed dips in H1 revenue.
Eversheds is down 4 percent to 188 million pounds ($293.8 million) from 196 million pounds ($306.3 million), while Halliwells sees its income drop by 3.1 percent to 44 million pounds ($68.8 million) from 45.4 million pounds ($71 million).
Eversheds chief executive David Gray said: "Given the economic turmoil of the last six months, it is not surprising that law firms are facing reduced revenues.
"Eversheds has posted a small decline in revenues of just 4 percent, which is further evidence that the business is holding up well, with some areas seeing over 30 percent growth, such as competition and international."
Addleshaws' income between April and October dropped to 94.7 million pounds ($147.9 million) from 97.5 million pounds ($152.4 million) on the same period last year. It is thought that Cobbetts' first half will be down around 5 to 10 percent
A spokesperson from Halliwells added: "There is no disputing that the market is extremely difficult at present and the remainder of the financial year is sure to prove just as challenging, but our core business remains strong and a number of our practice areas continue to perform very well."
In addition, Magic Circle firms have this year been intensely secretive about their H1 results, despite expectations that the group has benefited from relatively busy foreign offices and a flight to quality with transactional mandates.
H1 Performance: Preliminary results
Fairly Bullish
Hunkering Down
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