City firms are expecting to exceed their current bullish budgets, according to new research, which shows three out of four lawyers predict their firms will beat 2006-07 targets.
The latest Legal Week/ EJ Legal Big Question survey found that not a single respondent expected to miss their 2006-07 targets.
In addition, the survey of more than 100 partners found that more than half (54%) expect to beat their target and a further 19% expect to be "well above budget". The remaining 27% expect to hit their target.
The results follow a strong showing for the first six months of this financial year which put most of the UK’s top firms on track for a record year.
Firms including Linklaters, Fresh-fields Bruckhaus Deringer, Ashurst and SJ Berwin all announced turnover increases of more than 20%, with the entire magic circle looking likely to break the £1m average equity partner profits mark in 2006-07.
Berwin Leighton Paisner managing partner Neville Eisenberg told Legal Week: "We were up 17% on the same period last year, which we are happy with, and we are expecting to have a pretty busy second half. The markets are busy, but while lots of firms are benefiting, not all are. Even if the markets are buoyant, firms have to work hard to build market share."
Nilufer von Bismarck, a corporate partner at Slaughter and May, said: "Activity levels are on a par with last year, if not even stronger. There is still a lot of public M&A activity going on, particularly in infrastructure, and that corporate activity gives rise to associated financing work. There must come a time when things slow down but we are not seeing any sign of it yet."
One senior partner at a top 20 UK firm commented: "It has been a great year for transactions and I would think we will be well above our target in London. I am pretty optimistic that activity levels will continue to be strong, although the types of work may change."
He added: "All UK firms ought to have done well as the market does not get much better [from this], but some of the ‘wannabes’ have suffered."
Nearly four out of 10 respondents to the survey (39%) said their firm had beaten its first-half targets for the current financial year, with a further 21% saying they had come in ‘well above’ budget. Only 13% admitted that their firm had failed to hit its H1 budgetary targets, with the remaining 27% of respondents saying they were on budget.
With M&A continuing to boom, half of all of Big Question respondents said their firm’s corporate practice had been the best performing department. Litigation was voted the next best performer with 22% of the votes, followed by finance on 20% and property with 8%.
Guy Stobart, managing partner with Burges Salmon, said: "There is an awful lot of work around in every field. It is a good time to be in a professional services firm. In 10 years people will still look back and recognise that this has been a great time for firms."
TALKBACK
IS YOUR FIRM IN A BULLISH MOOD REGARDING 2006-07 TARGETS?
POST YOUR COMMENTS ONLINE AT: legalweek. com/talkback
Law Firms
Burges Salmon
Firms bullish over budget targets as turnover continues to rise
Published: 07/12/2006 00:00
Email article | Comment on this article | Sign up to News Alerts
Saturday 05/07/2008
Job of the Week
Current Issue
The pay review led to furious senior associates Recent updates include DLA Piper, Linklaters, BLP, Dewey and Herbert Smith