Freshfields Revenue Growth Lags, PEP Dips As Firm Adds Further US Heft
Freshfields' revenue continues to lag behind its Magic Circle rivals as the firm continues to commit to growing its U.S. practice with the addition of a Washington D.C. partner.
July 22, 2020 at 07:59 AM
4 minute read
Freshfields Bruckhaus Deringer's revenue growth slowed during the 2019/20 financial year, the firm has announced, while it has continued its recent U.S. growth push with a new partner in its Washington D.C. base.
It increased its revenues by a muted 3% to hit £1.52 billion, compared to last year's increase of 5%. The firm's revenue remains the smallest of its Magic Circle rivals Allen & Overy, Linklaters and Clifford Chance.
Freshfields PEP dipped from £1.84 million to £1.82 million during the year, as did its profits, which dropped slightly from £688 million to £685 million.
Managing partner Stephan Eilers said that in line with various infrastructure investments for the future of the firm, the financial results were "stable and quite satisfying".
On Wednesday the firm also announced the hire of Julie Elmer from the DOJ antitrust division's technology and financial services section, to its Washington D.C. base.
Elmer had been at the DOJ since 2015, according to her LinkedIn. She was previously a counsel at Maynard Cooper & Gale and a partner at Bradley Arant Boult Cummings.
Elmer handled DOJ merger and conduct investigations under two presidential administrations, according to an announcement by Freshfields.
Elmer's hire is the latest in a spree of U.S. hiring undertaken by the top U.K. firm. At the start of July, the firm opened a debut office in Silicon Valley, grabbing five lawyers from U.S. firms for the launch.
In October 2019 the firm hired four partners from Cleary Gottlieb Steen & Hamilton to its New York office in October 2019. Eilers and global client partner Alan Mason both agreed this particular team hire was a "turning point" for the firm in the U.S and contributed to its recent success.
"People are now knocking at our door for the first time wanting to be global partners", Eilers added, noting that U.S. lateral hires will likely continue. Given the firm's success in the recent landmark Apple €13 billion tax case may see further growth in the firm's tax practice, he said, alongside pharmaceuticals and antitrust.
Mason said the aim was to "grow boardroom level relationships with key U.S. clients" and expects this to continue. In particular, the "tech client DNA" will continue to be reinforced.
However, another U.S. office is not on the horizon for the firm in the near future. Next steps will be consolidating its current offering and growing the firm's American brand.
In January, Law.com International research found that Kirkland & Ellis has ended Freshfields' five-year run at the top of Europe's M&A advisor league table rankings. However, the firm has had a strong showing in the first half of 2020, jumping to the top of global M&A rankings behind Latham & Watkins.
The firm is currently gearing up to complete its office move to 100 Bishopsgate by the end of December, after the formal move in August 2020 was delayed due to the pandemic disruption. It also took various global measures to weather the effects of the pandemic, including delaying partner profit distributions, and holding its NQ salary rate at 2019 levels of £100,000.
Freshfields is the last of the Magic Circle firms which announce their results to do so. CC hit a record revenue of £1.8 billion, it announced on Tuesday, while Allen & Overy and Linklaters both revealed drops in PEP and profits earlier in July.
Looking forward, Eiliers said he is optimistic: "The firm is on an incredible roll".
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