More than half of the UK’s 100 largest law firms posted double-digit revenue increases for the last financial year, with the group bouncing back from a jittery 2022-23 to drive total turnover to a new high of £37bn.
Data collected for the latest LB100 – which spans firms from the now-£3bn DLA Piper to £40m City boutiques and regional practices – underlines what a strong year 2023-24 was for many UK law firms, despite lingering uncertainty after the previous financial year.
Following healthy 2023 results from the LB Global 100, which saw total revenues rise by more than 6%, the UK’s leading firms went even further, with an average revenue increase of 10% across the group, up from 8% last year.
Fifty-three of the 100 firms boosted turnover by a double-digit percentage – up from 34 last year – with more than 90% growing their top line, pushing combined revenues for the group from £33.8bn in 2022-23 to £37bn for the most recent financial year.
Slaughter and May corporate and M&A co-head Simon Nicholls attributed this bounceback to a recovery in transactional markets. ‘Deals were back after a lowkey 2023, and we were happy to see more than our fair share of activity. Alongside that, our disputes and antitrust practices motored on and had great years once again. We saw momentum build through the year in all key practice areas.’
Herbert Smith Freehills CEO Justin D’Agostino described 2023-24 as ‘an incredibly strong year’, while also acknowledging a point made in PwC’s recent law firm survey that the top 10 UK firms have been able to increase fees by 40% over the last five years.
‘Demand was up in every region and every practice group,’ he said. ‘There was a surge in class actions, competition disputes and transactional work. And for all firms there has also been a focus on pricing – a lot of markets have had inflationary pressures and firms have had to respond to that, which clients accept.’
The transatlantic DLA tops the table by revenue after breaking through the £3bn mark for the first time, a performance outgoing CEO Simon Levine attributed in large part to ‘standout practices focused on litigation and regulation’, as well as a more recent pickup in transactional activity.
‘You might expect some areas to have struggled, but while the transactional side was quieter, there was still plenty of activity in corporate, M&A, private equity and financing,’ said Levine, who is handing on the baton as international managing partner and global co-CEO to Charles Severs next year after a decade leading the firm.
The £3bn landmark for DLA was achieved through a 6% revenue increase, placing it slightly behind the average of 10% achieved by the group as a whole.
While double-digit growth was achieved by firms of all shapes and sizes, from the magic circle to regional players, the group that lagged slightly behind the 10% benchmark was firms with a large US footprint gained from transatlantic mergers – Eversheds Sutherland, Norton Rose Fulbright, Bryan Cave Leighton Paisner, DLA, Hogan Lovells and Womble Bond Dickinson.
Average revenue growth by firm category
- International firms: 11%
- London-only firms: 11%
- Magic circle: 11%
- National firms : 10%
- Regional firms: 12%
- Transatlantic mergers: 6%
The magic circle put in a more than respectable showing this year, with Freshfields leading the way with a 16% hike to £2.14bn. While Allen & Overy’s pre-merger revenue rise of 6% to £2.2bn was the slowest growth among that elite group, the firm will add around 30% to its top line next year with the addition of Shearman & Sterling.
There were also notably strong showings from London firms such as Kingsley Napley (17%), pensions boutique Sacker & Partners (25%) and Mishcon de Reya, which posted an 18% hike – the firm’s third consecutive year of double-digit growth – on the back of its January 2023 merger with Taylor Vinters.
‘It was a good year,’ managing partner James Libson told LB. ‘The things we wanted to achieve we achieved – the merger with Taylor Vinters was the first time we’ve ever done anything on that scale.
While many firms within the upper echelons of the LB100 are decisively looking to the US for growth, Mishcon achieved its recent successes without a presence in the States, where it closed a small New York base in 2020.
‘Obviously America is very important – we have a big client base there, and lots of people that do business there. But it’s an unbelievably well serviced market,’ Libson explained. ‘The US law firms are among our biggest allies and referrers – we do a lot of work in conjunction with them. It’s very difficult in America to establish a presence that’s meaningful in even any one area, let alone across areas.’
Top 10 LB100 firms by revenue growth
- Fletchers Solicitors – 35%
- Bond Turner – 33%
- Burges Salmon – 27%
- Veale Wasbrough Vizards – 26%
- Sacker & Partners – 25%
- Kennedys – 23%
- Osborne Clarke – 21%
- Birketts – 20%
- Mishcon de Reya – 18%
- Stevens & Bolton – 18%
While growth was more muted among historically national firms which now have a much more international perspective, such as DLA (6%), Eversheds Sutherland (0%), Pinsent Masons (7%) and CMS (7%), opportunities are opening up for a group of well-managed UK-focused players sweeping up work from clients seeking a lower price point as bigger firms raise rates.
Of the 53 firms posting double-digit growth last year, around half were national and regional firms. East Anglia’s Birketts sits in the top 10 fastest-growing firms after its fourth consecutive year of double-digit growth on the back of recent expansion into the South East, while Browne Jacobsen (12%) and Freeths (13%), both of which have significantly expanded from their Midlands roots in recent years but are still entirely based in the British Isles, are other notably strong performers once more, on the back of double-digit hikes last year.
Freeths national managing partner Karl Jansen underlined this point. ‘Opportunities for truly national firms are as good as ever. If you’re a partner largely servicing UK clients and work, you’re increasingly going to feel tensions in a firm that has more of an international focus. Our business model is far better suited to a national or regional client base, and that’s helping us to win more clients and attract more recruits from the larger international firms, who are less focused on the national market and are increasingly pricing themselves out of those opportunities.’
‘We are certainly seeing the benefits of our strategic focus and ambitions as a leading national firm, and our continuing year-on-year growth is testament to that.’
*LB100 firms by category
Transatlantic mergers: Hogan Lovells, Womble Bond Dickinson, Norton Rose Fulbright, DLA Piper, Eversheds Sutherland, Bryan Cave Leighton Paisner
Regional firms: Thorntons, Burness Paull, Brodies, Shepherd and Wedderburn, Fletchers Solicitors, Bond Turner, Veale Wasbrough Vizards, Birketts, Stevens & Bolton, Brabners, Capsticks, Michelmores, Foot Anstey, Walker Morris, JMW, Ashfords, DMH Stallard, Ward Hadaway, Cripps, RWK Goodman, Blake Morgan, Harrison Clark Rickerbys, Moore Barlow, BDB Pitmans, Hugh James
National firms: Burges Salmon, Devonshires, Keystone Law, Bevan Brittan, Mills & Reeve, gunnercooke, Ampa, Freeths, Browne Jacobson, Hill Dickinson, Weightmans, Keoghs, TLT, Taylor Rose, Irwin Mitchell, Thompsons, Shoosmiths, Gateley, Knights, Penningtons Manches Cooper, Trowers & Hamlins, Leigh Day, Clarke Willmott, Slater and Gordon
Magic circle: Freshfields, Clifford Chance, Linklaters, Slaughter and May, Allen & Overy
London firms: Sacker & Partners, Mishcon de Reya, Kingsley Napley, Lewis Silkin, Fox Williams, Wedlake Bell, Howard Kennedy, Bristows, Macfarlanes, Charles Russell Speechlys, Stewarts, Farrer & Co, RPC, Harbottle & Lewis, Travers Smith, Russell-Cooke, Forsters, Winckworth Sherwood, Fladgate, Wiggin, RBG
International firms: Kennedys, Osborne Clarke, Stephenson Harwood, DWF, Addleshaw Goddard, HFW, Watson Farley & Williams, Simmons & Simmons, Herbert Smith Freehills, Bird & Bird, Taylor Wessing, Ashurst, DAC Beachcroft, Gowling WLG, Pinsent Masons, CMS, Clyde & Co, Fieldfisher, Withers