Accessibility Links

Half-yearlies out for London's Magic Circle, Linklaters and Freshfields look sad

Posted by: Laurence Simons 12/07/12

Party pooped for legal giants.

Like the surprise party you get for coming in second place, Linklaters and Freshfields have today been setting off damp party poppers and drinking flat champagne to celebrate relatively dismal full-year results.

You like looking at numbers? Well, time for a treat: Linklaters posted an annual income of £1.207 billion, a rise of just under one per cent on 2010-11's £1.2 billion figure. Freshfields Bruckhaus Deringer, meanwhile, despite having more words in its name, posted slimmer revenues: the firm bought in just £1.139 billion in turnover, roughly static (otherwise known as 'slightly less') compared to last year's £1.14 billion.

"Over the last year, like many of our clients, we've continued to face volatile and challenging conditions amid wider economic strains," said Linklaters' Simon Davies, sadly eating Twiglets while no music plays. "In spite of those conditions, and in supporting our clients, our revenues and profits have remained stable and we've maintained our financial strength and ability to invest."

And Freshfields' Ted Burke was in fine 'life of the party' mood too, telling The Lawyer: "It was a challenging market. We have a significant presence in the eurozone, which saw a fair amount of turmoil. I'd say we were pretty consistent. We saw a strong performance across the network."

Europe. Flipping Europe. But that is the danger that comes with being an international firm: if the territories aren't performing, then your overall turnover figures come July aren't going to be so hot. Just look at the Linklaters' breakdown: of the £1.207 billion taken this year, £513.5 million was through the London offices: the rest was from the Americas (£88.2 million), £450.3 million from continental Europe, while Asia and the Middle East pulled down just £154.7 million. Pull your socks up, Asia and the Middle East.

More importantly, could today's figures signal a sea change in the UK capital's Magic Circle scene? Clifford Chance set the bar pretty high earlier this week, with revenue rising seven per cent to £1.303 billion, making the firm the UK's largest in terms of pure turnover. Allen & Overy also did well, with Freshfields dropping into fourth place in revenue terms for the first time. All at once a bunch of Freshfields partners glance sideways at Allen & Overy chiefs doing the Conga, and look suddenly sad.