Research by Legal Week has found that the majority of leading firms will see a drop in partner profits for the year to April with managing partners now proclaiming static profits a victory.
Freshfields Bruckhaus Deringer is estimating 2002-03 partner profits down by at least 5% — to around £700,000 — although fee income is up 8% at £800m.
A host of ‘chasing pack’ firms are also preparing to unveil falls in profitability of between 2% and 3%, with average partner profits of £580,000 at Ashurst Morris Crisp and £330,000 at Denton Wilde Sapte. Norton Rose and CMS Cameron McKenna are both expected to see a 5% decline in partner profits to hit £437,000 and £416,000 respectively.
The results also confirm that revenue growth has slowed significantly for the first time in recent years with Ashursts expected to post a near-10% decline in fee income to £166m, Camerons seeing a drop of 1% to £174m and Dentons broadly static at £172.4m.
Allen & Overy (A&O) and Herbert Smith are both expecting profits in line with their 2002 totals of £680,000 and £740,000 respectively. Herbert Smith will unveil an 8% increase in fees to £242m, while A&O’s income is up 10% to £640m.