Clifford Chance (CC) has posted a 3% increase in turnover for the 2015-16 financial year to reach a new high of £1.39bn.

The rise in revenue contributed to a 10% jump in profits per equity partner (PEP) to an average of £1.23m. Total partnership profit also rose 10%, taking it to £494m.

Despite the challenging market conditions ahead of the UK's referendum on leaving the EU the results mark an improvement on the 2014-15 financial year, when PEP fell 2% to £1.12m and revenue remained flat at £1.35bn.

CC managing partner Matthew Layton (pictured) said he was "confident" that the firm is standing in good stead for the coming years despite the current UK market conditions. He added: "In the medium term I'm optimistic about the position of global firms but I'm slightly cautious now because of [Brexit]."

Overall, PEP has grown by 23% over the past three years. Alongside the revenue increase, other factors driving this rise include the firm's focus on "breadth and practice expertise", and its focus on costs and increasing efficiency, which led to a 1% reduction in costs over the 2015-16 year, said Layton.

In London, he highlighted subletting 400,000 sq ft of office space at its headquarters in Canary Wharf to Deutsche Bank as "a major factor" in cost reductions. He also highlighted the firm's 'Continuous Improvement' programme, first launched in London in 2013 to help lawyers identify inefficiencies in the way they work. It saved the firm £7m during the last financial year in operational costs. The programme has now expanded to Europe and Asia.

Regional performance

Looking at last year's financial performance by region, in the UK revenue grew 2% to £489m, making up 35% of total turnover.

Standout regions included the Americas, which brought in 13% of the firm's revenues this year after a 13% rise in Sterling and a 6% hike in local currency to £175m.

The firm has now grown to 300 lawyers including 73 partners spread across its offices in New York and Washington. It added a new real estate partner this week, with Eddie Frastai joining from Dentons in New York.

Asia Pacific revenue grew by 9% (7% in local currency) to £224m, representing 16% of the firm's revenues.

"We see Asia Pacific and the US becoming more significant parts of our revenue; the pace of growth in these two markets will pick up," commented Layton.

Meanwhile continental Europe saw a 4% decline (1% increase in local currency) to £452m but still represents around a third of the firm's total revenues. "Continental Europe performed well, particularly Paris and Germany," said Layton.

In the Middle East, revenue rose 7% (flat in local currency) to £46m, making up 3% of total turnover.

Layton said the financial growth was driven by the new strategy introduced in January 2015, as well as the firm's more streamlined leadership team, which was stripped back just after he assumed office in May 2014.

"We've changed the governance structure, the business units, the lockstep and come up with a new strategy."

When Layton took on the role of managing partner, he swiftly set about restructuring the firm's governance. The changes, effective from September 2014, involved reducing executive group members from 16 to 12, cutting out the regional and practice head elections in favour of an appointment by the managing partner and introducing three global business units (GBUs) to cover financial markets; M&A and corporate transactions; and risk management and disputes.

He also won support in spring 2015 to overhaul CC's lockstep remuneration to create a more flexible model. While the changes are not clear, it is understood that top earning partners are earning between 115 or 130 points, while other partners at the previous core lockstep plateau of 100 points have been moved down as far as 70.

Declining to comment on the specifics, Layton said: "People understand the reasons for doing it."

The firm also heavily restructured its Germany operations since Layton took over. Overall, around nine partners departed CC's offices there following the firm's largest region-specific review, which kicked off in December 2014.

However, Layton said that he didn't see "any need" to make more changes now to the firm's strategy, adding: "It's about implementing it. People get it now."

Going forward, he expects the firm to win a significant slice of Brexit related work. "There are some potential upsides such as regulatory and advisory work. The challenging market conditions mean clients need advice. I have seen some transactions put on hold but some have already started to come back. "

Standout deals for the firm in 2015-16 include advising the Anheuser-Busch InBev shareholders on the financing of their bid for SAB Miller, the biggest brewing takeover in history; acting for Poste Italiene on its IPO, the biggest in Europe in 2015 and representing Sainsbury's on its successful bid for Home Retail Group.