Orrick and McDermott see UK revenues dip
The UK arms of Orrick Herrington & Sutcliffe and McDermott Will & Emery have posted decreasing revenues and profits for the 2011 calendar year, according to public accounts filed today (16 July). Orrick's London office posted fee income of £21.1m for the 2011 calendar year, having brought in nearly double that amount during the 18-month period leading up to 31 December 2010.
July 16, 2012 at 09:47 AM
3 minute read
The UK arms of Orrick Herrington & Sutcliffe and McDermott Will & Emery have posted decreasing revenues and profits for the 2011 calendar year, according to public accounts filed today (16 July).
Orrick's London office posted fee income of £21.1m for the 2011 calendar year, having brought in nearly double that amount during the 18-month period leading up to 31 December 2010.
Profits distributed to the highest-paid partner totalled £767,000 for the 2011 calendar, with £1.9m handed out to Orrick's highest-paid London partner during the 18 months leading up to 31 December 2010. Average profits per equity partner (PEP) stood at £386,000 for the 2011 period.
During the year, there were 14 partners in London (compared to 17 the previous year), nine partners in Italy (compared to 17 the previous year) and 33 in France (compared to 31 during the previous year) – an overall equity partner decrease of 14%.
The UK accounts show that the European LLP guarantees the US entity's $180m (£116m) credit facility, as well as letters of credit worth $8.7m (£5.6m). The accounts also show that Orrick's European offices were owed a total of £194,000 in unpaid receivables by clients at the end of the 2011 calendar year.
Fellow top 30 US law firm McDermott, meanwhile, has posted a 17% decline in UK revenues for the period, with fee income dropping from £23.2m in 2010 to £19.2m in 2011. Operating profit – before the deduction of partner remuneration – dropped by just over 7% from £9.8m in 2010 to £9.2 in 2011.
PEP for the 2011 calendar year stood at approximately £369,000, a 12% drop from the previous year's figure of £421,000. The highest-paid partner took home £1.1m in comparison to £1.2m during 2010. There were 25 partners in the UK LLP, against 23 the previous year.
There were an average of 71 staff members in the firm's London office during 2011 in comparison to 86 the previous year, with staff costs dropping by just below 20% as a result.
The accounts also show that at the end of 2011, McDermott owed £3.4m to the US LLP for work that had been completed for the US entity's clients during the year. In turn, the UK LLP was owed money by its German, French and Belgian arms respectively. McDermott in Germany owed the UK LLP £1.5m, while the Italian and Belgian offices owed £70,236 and £238,779 respectively.
The financial results indicate that the two US firms' London arms are less profitable than their firm-wide average. Orrick generated PEP of $1.48m (£948,000) in 2011, while McDermott generated $1.5m (£962,000).
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