Hogan Lovells breaks $2bn mark for first time as London revenues also rise
Firm boosts top line to new high after year described by CEO Stephen Immelt as "a bit all over the place"
Hogan Lovells has joined the $2bn club for the first time after a 5.8% rise in global revenues during 2017, with the transatlantic firm’s London base also boosting its top line.
Firmwide revenues grew to $2.036bn, a new record for the firm, while London saw a 4.2% increase to reach £292.6m, up from £280.7m last year.
Profits per equity partner (PEP) increased 2.4% to $1.28m, while revenue per lawyer ticked up almost 3% to just under $760,000, according to preliminary ALM reporting.
The firm did not provide a UK PEP figure, but last year’s limited liability partnership accounts for Hogan Lovells International, which encompasses all of the firm’s operations outside of the US, showed that PEP had jumped 25% from £698,000 to £879,000.
Hogan Lovells ranked eighth by revenue among the Am Law 100 last year, based on its performance in 2016. This year’s rankings will be released in the May issue of The American Lawyer.
CEO Stephen Immelt said the market was “a bit all over the place” for the firm in 2017, with the second half of the year producing much stronger results than the first six months.
The firm saw its work in the Americas bring in more than half of its billings in 2017. Americas represented approximately 52% of total billings, with London and continental Europe together contributing 41%, and Asia and the Middle East 7%.
Globally, the firm said its corporate practice represented about 32% of total billings, while litigation, arbitration and employment accounted for 28%. Government and regulatory matters generated 16%, finance 14%, and intellectual property, media and technology 10%, the firm said.
There was a nearly 5% uptick in billable hours growth over 2016, the firm said.
Immelt touted his firm’s work advising Oracle on its purchase of cloud-based solutions company Aconex, a transaction valued at more than $1bn, while he also pointed to the tech sector and Chinese market as areas for robust growth in 2018.
“I view 2018 as a year where we’re going to work on what we’ve got, and focus on execution,” Immelt said. “It is more critical than ever that law firms are very clear about what they’re trying to do for clients.”
Highlights for the firm’s London office in 2017 have included winning a lead role for Uber on its appeal against Transport for London’s decision to reject its application for a new licence in the capital. The firm also advised Deloitte on a cyberattack that compromised the accounting firm’s confidential emails, and was added to British Land’s roster of legal advisers in an out-of-season appointment.
Immelt highlighted the firm’s work advising China-based telecoms company ZTE on its efforts to comply with the terms of a settlement agreement with the US Government.
ZTE agreed last year to plead guilty and pay $1.19bn in fines as part of a settlement for shipping electronics to Iran and North Korea. The company also came under fire last week from US senators, who expressed concern during an Intelligence Committee hearing that the Chinese government would use ZTE to gain access to sensitive American technology.
Immelt said the firm’s cross-border strength is a key draw for clients, and the firm noted its work on behalf of pharmaceutical company Eli Lilly in a UK Supreme Court patent ruling and its lead role for UK online payment company Paysafe on its £2.9bn sale to a private equity consortium.
In the US, Hogan Lovells combined with Collora, a Boston firm, last year, and it bolstered its M&A technology practice by hiring three partners led by Richard Climan in Silicon Valley. The firm said it added 37 total lateral partner hires globally last year and promoted 31 partners internally.
Immelt also touted his firm’s appellate practice, which has led the charge against the president’s travel ban in the federal courts, and the work of the firm’s most recognisable partner, Neal Katyal, at the US Supreme Court. Katyal argued nearly 10% of all cases during the high court’s 2016 term, and in January was named an American Lawyer litigator of the year.
As the firm approaches the eighth anniversary of the merger of Hogan & Hartson and Lovells, Immelt said the success of that union is more than evident. The deal that produced Hogan Lovells in 2010 remains a model for transatlantic law firm mergers, even if some have questioned whether the combined firm was aggressive enough out of the gate.
Immelt will remain atop the firm’s leadership as CEO, alongside London-based deputy CEO David Hudd, through 30 June 2020. The two men have led the firm since July 2014.
While political instability could pose unforeseen challenges in the coming year, Immelt said he thinks “plenty of money” remains out there waiting to be invested 10 years after the onset of the financial crisis.
“I feel very optimistic in terms of the broader indicators,” Immelt said. “The macroeconomic picture is more positive today than it’s been for some time.”
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