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Herbert Smith Freehills: Partner profits slip by nearly 10% to £857,000

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Taylor Wessing also records drop

Herbert Smith Freehills has published its latest set of financial results, recording a 10% drop in partner profits.

The global player posted revenues of £989.9 million, up 2.5% on the previous financial year. Profit per equity partner (PEP), however, is down 9.7% to £857,000 from £949,000, as is profit — £283.2 million from £306.7 million, a cut of 7.7%.

“It is encouraging that we achieved another year of revenue growth, underlying the core strength of our business,” commented Justin D’Agostino, who took over as chief executive officer in May. “While profitability fell from last year, it reflects our second highest year of profitability performance.”

D’Agostino said revenue growth would have been stronger but for the onset of COVID-19, which saw the firm reduce partner profit distributions, suspend salary reviews and delay the start dates of its future trainee solicitors.

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D’Agostino continued:

“While the Covid crisis has required significant adjustments across the firm to how we work, I am delighted to say that our performance through the challenges it has brought has so far exceeded all our expectations.”

Elsewhere, international law firm Taylor Wessing revealed a 7.6% uplift in global revenues to £365.6 million. But PEP dropped 6.5% to £612,640, while UK profits fell by almost 8% to £57.6 million.

Shane Gleghorn, UK managing partner, said: “This year, we’ve invested significantly in our business. While the final quarter was made difficult by the crisis, we have seen the benefit of our investment in tech and people, even more so in recent months. Our tech investment has supported agile working for our people, and has deepened our client relationships.”

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30 Comments

Pied Piper

My heart bleeds.

(13)(0)

Ed W

100k NQ salary but lower PEP just shoes that HSF care about their junior lawyers lower down in the ranks. Good on them

(27)(5)

Hsf insider

1. It’s not 100k – it’s 90k
2. They had an awful retention rate this cycle – around 60%. I think the vast majority of trainees would prefer a few grand less in exchange for significantly higher retention

Sad firm!

(31)(18)

John

That is seriously worrying news. I’m almost speechless.

(2)(2)

Fhjkf

I don’t know why HSF is so highly rated by people here – it’s firmly in league with the likes of ashurst (which actually posted higher pep 2 years in a row now) not just off the MC

(16)(9)

FF is King/Queen

It’s a second tier-firm. Without litigation it has nothing going for it

(9)(3)

Lmaobantah

Lmao what are you smoking bro, a shop like Assbursts don’t come anywhere near a powerhouse like HSF

(5)(14)

Anon

Then why is “assbursts” more profitable???

(6)(2)

tolchok

Loooooooooooooool it aint you moron

(0)(0)

FF is King/Queen

HSF are trash

(15)(16)

Where's my new Lambo?

How will those poor souls survive?

(0)(1)

Anon

Where would you rank HSF in the silver circle?

(0)(0)

Anon 2

I would argue that the silver circle doesn’t really exists but it’s in the tier below the MC alongside HL, ashurst etc

(5)(1)

FF is King/Queen

It’s a second tier-firm. Without litigation it has nothing going for it.
CMS > HSF

(15)(13)

Magic Square

Silver circle is really:

Macs/TS Equal footing

Slaughters

HSF

BCLP

(1)(6)

Jamie

I know people are complaining but I’m sure most lawyers would prefer working for a firm like HSF where they can earn 90k and over as an NQ and associate where the PEP is slightly lower compared to say DLA who have consistently very high PEP but their NQs are only on 78k.

Like the comment said above, what’s the point working for a firm with a high PEP when the lawyers lower down the ranks aren’t getting paid the salaries matched across the city

(18)(0)

Zoe

DLA is always an interesting one to discuss because their equity partners must take it in but the NQs are only on 78k…

(4)(0)

Allaboutthehours

Because as an NQ at HSF you’re going to be working SIGNIFICANTLY more hours than a mid tier firm like DLA. The extra dollar is just not worth it.

(4)(3)

PEP Monitor

Miles off the US shops.

(2)(1)

HSF is life

But but they pay £105k nq salary… 🤣🤣🚬 🌈

(2)(1)

Joe

You make that as an NQ but the salary progression is pretty stagnant after that point. Also if you see the firm and law as a long term career it’s pretty crappy to work your way up to make the lowest salary across the city firms as a senior associate/partner.

Imagine starting on the highest NQ salary amongst your legal peers only for them to surpass you a few years down the line

(5)(1)

HSF is life

I agree, I was being sarcastic

(1)(0)

Comments are closed.

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