A busy year across practices helped Thompson & Knight improve its gross revenue by 6.8 percent in 2018, and boost profits per equity partner by a hefty 15.9 percent.
The Dallas-based firm’s gross revenue came in at $226.49 million, up from $212.02 million in 2017, and revenue per lawyer hit $802,000, up 5.8 percent from $758,000 in 2017.
Net income was $95.28 million, up 2.7 percent from $92.75 million the year before, and PEP topped the million-dollar mark at $1.11 million, up from $956,000 in 2017.
“It was a busy year all the way around,” managing partner Mark Sloan said, highlighting the energy, private equity and corporate practices as very busy throughout the year.
“We closed about $16 billion in M&A and $10.6 billion in private equity and capital markets deals,” Sloan added.
He said the strong deal flow drove work into other practices, including tax, finance, and oil and gas. Real estate posted another strong year, Sloan said, and intellectual property litigation was the busiest it has been in several years. The trial practice also stayed busy, Sloan said.
The countercyclical bankruptcy practice was the only major down area, Sloan said.
Anticipating a heavy workload, Sloan said the firm made a concerted effort to build up its associate bench strength in 2018, and ended the year with 10 more associates than it had on Jan. 1. As for the expense of higher associate pay during the second half of the year—the firm bumped it’s starting salary for first-years to the $190,000 market rate—Sloan said Thompson & Knight had budgeted some money for associate raises just in case.
The firm’s total lawyer count was flat, and its equity tier shrank, with a full-time-equivalent of 86 equity partners, down from 97 the year before. Sloan noted that some lawyers defected to other firms early in the year, but a few lawyers also retired or scaled back their practices, leaving the partnership.
Thompson & Knight worked on a new strategic plan in 2018, and very recently rolled it out to the partners, Sloan said.
“It was high time we did one and I think people are excited about it,” he said. “We keyed in on things we are prioritizing as a firm for growth and areas we want to pay attention to, like growth in talent, and business development and marketing.”
The firm’s goals include recruitment and retention of “quality” talent, a focus on profitability and providing value for clients, and marketing and business development, he said. As for growth, Sloan said, the top priorities are the Houston and New York offices.
“When you consider all the competition coming into the marketplace, I’m really excited about the future,” Sloan said, adding that the firm’s new chief operating officer, Keith Whitman, will focus on the strategic plan.
“He came in at the right time,” Sloan said.
Whitman, who spent five years at Kobre & Kim in New York, said Thompson & Knight is “ready to write the next chapter in the firm’s history.” In addition to advancing the firm’s strategic initiatives, he said, he plans to focus on branding, as well as developing more customized pricing models for various clients.
Sloan said it’s too early in the year to predict how 2019 will turn out, but he said activity has picked up dramatically the last two or three weeks.