Considering the challenges of 2008, the 25 highest-grossing Texas-based firms showed financial spark in 2008, with their combined gross revenue increasing a little compared to 2007. However, combined net income was flat.
Those not-too-shabby financial results came despite the nation’s dramatic economic downturn, which worsened as the year went on, and the impact of Hurricane Ike, which slammed into the Gulf Coast in September 2008, darkening homes, offices and the economic outlook for Texas.
Combined gross revenue at the 25 firms increased by 3.8 percent in 2008 compared to 2007, while combined net income was flat. Those percentage increases are smaller than in 2007, when combined gross revenue at the 25 firms improved by 6.1 percent compared to 2006, and net income rose by 5 percent.
Dire economic conditions impacted the 2008 results for the 25 Texas-based firms included on Texas Lawyer ‘s Annual Report on Firm Finance. In interviews, managing partners at most of the firms say transactional work, especially real estate work, dropped in 2008 as the banking crisis put a crimp on borrowing and as consumers cut spending. However, the managing partners say some practice areas, including litigation and bankruptcy-restructuring, were strong players during 2008 and helped firms ride out the deal downturn.
Last year, the 25 highest-grossing firms produced a total of $5.4 billion in gross revenue, 3.8 percent more than the $5.2 billion the 25 firms posted in 2007. Fifteen of the firms brought in more revenue in 2008, and 10 brought in less.
Most of the 25 firms included this year on the Annual Report on Firm Finance are returning to the list from last year. The newcomers for 2008 are Thompson Coe Cousins & Irons of Dallas and McGinnis, Lochridge & Kilgore of Austin. They replace Dallas firm Hughes & Luce, which merged on Jan. 1, 2008 with K&L Gates, and Godwin Ronquillo of Dallas, which was smaller in 2008 than in 2007.
The five highest-grossing Texas operations of out-of-state firms are ranked separately.