Ashurst PEP Falls Amid Muted Revenue Growth
The firm's profit per equity partner fell by 7% but is still the firm's second highest figure since 2008.
July 21, 2020 at 07:01 PM
3 minute read
Ashurst's financial growth during the 2019/20 financial year was significantly muted compared to its standout growth in recent years, with revenue marginally nudging up by 0.5% and its profits per equity partner (PEP) falling.
PEP dropped by 7% to £903,000, compared to its 31% leap the previous year, the firm announced on Wednesday. Despite the fall, the firm said the figure is the second highest since the global financial crisis in 2008.
Meanwhile, the firm's global revenue slightly increased by 0.5% to £644 million.
Global managing partner Paul Jenkins attributed the firm's notably capped revenue growth to the COVID-19 pandemic's initial outbreak in Asia, which meant the firm's revenue for the final quarter of the year in Asia Pacific was 10% behind budget. Before this, Ashurst was heading toward "another strong year of growth, above budget", according to Jenkins.
He added: "Notwithstanding that, I'm very pleased with the way we reacted to the pandemic. We're now seeing a bounceback in Asia and a resurgence in activity, particularly in greater China as well as more widely in the U.K. and Continental Europe."
Ashurst rolled out several measures in response to the pandemic, including its reduced hours scheme, which it is set to wrap up by the end of July. In London, the firm is maintaining its newly qualified salaries at its current rate rather than increasing.
The firm had a flurry of notable London exits during the financial year, but boosted several of its other international offices, including Melbourne and Hong Kong.
Jenkins said the firm plans continued international growth, with the U.S. region as a priority.
Ashurst launched a Los Angeles office in January which is now fully operational, according to Jenkins. He described the firm's U.S presence as a "particular success" during the year and that its U.S. based projects, project finance and infrastructure teams had double-digit growth during the year.
He added that the firm is also aiming to grow in "banks & funds, digital economy, real estate and energy" in particular in the U.S.
The firm also announced that its global innovation arm, which includes its in-house tech development and investment business Ashurst Digital Ventures (ADV), grew its revenue by 34%.
Ashurst advanced its diversity & inclusion action plan during the year, and has already exceeded its 2021 target of 30% of legal management or leadership roles to be held by women, and has also met its 50% gender target for senior business services staff.
However, Jenkins recognised the ongoing challenges going forward: "Most firms are reviewing their business on a quarter by quarter basis as conditions can change quickly, while also adapting to clients' evolving needs in this challenging market.
"Work levels may of course increase or decrease if there is a second wave, or development of a vaccine – the next 12 months is very difficult to predict."
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