Profit Drops 30 Percent at U.K.’s Largest Law Firms

Legal World

Profit at the 100 highest-grossing U.K. law firms fell 30 percent on average during the past year as deal work declined with the recession, according to a PricewaterhouseCoopers LLP survey.

Profits per partner at the top 10 U.K. firms averaged 872,000 pounds ($1.44 million), a 21 percent decrease, according to PwC. Partners at the second tier of law firms, ranked 11 to 25, brought in around 444,000 pounds and saw “the greatest average fall in U.K. income,” the accounting firm said.

“This year has seen the greatest turmoil in the law firm sector since our survey began in 1991,” Alistair Rose, a PwC partner, said in a statement. The effect of the economic crisis “has been even greater than we anticipated across the sector.”

Large law firms in the U.S. and U.K. have been forced to cut costs by firing lawyers, reducing pay and deferring the hiring of first-year attorneys as they weather a decline in legal work.

Allen & Overy LLP, the fourth-highest-grossing U.K. law firm, said revenue fell 7 percent to 511 million pounds for the first six months of the financial year that began May 1. Revenue at Simmons & Simmons LLP, also based in London, fell 16 percent to 120.3 million in the half-year period, spokesman Ibrahim Kamara said.

A spokesman for Linklaters LLP, the highest-grossing U.K. law firm, said half-year revenue results weren’t yet available.

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