Macfarlanes defied the depressed UK and European markets this year to record its second set of strong financial results in a row, with revenue up by 11.6% and profits per equity partner (PEP) increasing by 9.5% for 2012-13.

Revenue at the top 30 firm climbed from £102.3m to £114.2m with PEP rising from £903,000 to £989,000 – within touching distance of the £1m landmark the firm achieved during the credit boom. The figures follow another successful performance in 2011-12, when revenue grew 7.9% and PEP was up 20.1%. 

However, Legal Week's five-year comparison shows that the firm is still rebuilding its profitability following the downturn, with PEP remaining 10% below the £1.1m achieved in 2007-08 and revenue up just 4%.

Despite being one of the few remaining independent City firms, Macfarlanes senior partner Charles Martin (pictured) insists the firm is not a domestic practice. "Leading independent firms around the world have a strong commercial imperative to work together for the benefit of clients as never before, and to partner with an English firm like ours is essential for many of them," he says. "The emergence of corporate counsel who are geared up to manage multiple relationships on any one matter – and who regularly do so even on domestic work where, for example, they are outsourcing – makes our way of working a more attractive proposition to many sophisticated clients than ever before."

Macfarlanes has been noticeably more active on the lateral hiring front as it seeks to reposition itself to cope more effectively with current market conditions. Last month it announced the hire of real estate partner Clare Breeze from Shearman & Sterling, reuniting her with former Shearman partner Ian Nisse, who joined Macfarlanes in 2011 to head the firm's commercial real estate group. 

Other recent partner hires include those of investment funds specialist Simon Thomas from Akin Gump, and private client partner Charles Gothard, who rejoined the firm after an eight-year spell at Speechly Bircham.

Martin says: "We like to keep things simple. We have great people and we listen carefully to our clients. We are able to adapt to client demand for quality and value. Good examples are the way in which we have developed our hedge fund practice and how we have grown in financial regulation, private equity secondaries, financial services investigations and litigation and in the repositioning of our real estate group. The focus used to be largely on transactional activity but there is no point waiting for it to come back – once it is back we will be on it like a shot."

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