Baker & McKenzie posts 13% jump in PEP as revenue grows 8%

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Baker & McKenzie has posted an 8% revenue rise against a 13% jump in profit per equity partner (PEP) for 2015-16, after a strong year for the firm in the face of much economic uncertainty around the world.

The firm’s turnover rose to $2.62bn (£2bn) during the year ending 30 June 2016, up from $2.43bn (£1.86bn) the previous year. Meanwhile, PEP grew to $1.3m (£1m).

Bakers said that on a constant currency basis, these increases equated to 16% for revenue and 21% for PEP, due to the strength of the dollar against most currencies during this period.

Net profit, meanwhile, grew by 14% to $904m (£692m) – 22% growth on a constant currency basis.

The positive results come after a weaker 2014-15, during which the firm saw revenue dip 4% while PEP fell 12%.

Bakers chairman Eduardo Leite (pictured above) said there were “a number of factors” for the recovery in PEP and revenue this year. He highlighted growth in specific sectors such as technology, which he said has generated more work. In terms of practice areas, Leite highlighted the firm’s M&A, tax, financial services, trade and commerce practices as outstanding performers.

The firm won 67 major panel appointments during the year and took roles on significant deals including the $5bn acquisition of US insurance firm StanCorp Financial Group by Japan’s Meiji Yasuda Life Insurance Company.

Leite added that the firm’s financial performance was boosted by an improvement in client service delivery.

In July 2015, the firm opened a legal and business support centre in Belfast, its second global services base, following the launch of its support centre in Manila in 2000.

In addition, Leite also said the firm was paying closer attention to project management and pricing. “We are training our clients in these areas, which has made a difference. For top clients we have one set of rates and we keep our margins competitive. We are wiser in the way we work.”

The firm first appointed a global pricing director four years ago and is now looking to expand its pricing team.

By region, Leite said that UK turnover growth slightly outpaced the global figure of 8%. Overall, the Europe, Middle East and Africa region contributed 37% of total turnover, alongside 37% for the Americas and 26% for the Asia-Pacific region.

Going forward, Leite said that the firm was focused on investing in teams in New York, China and London. In addition, he said Bakers is aiming to ramp up its Africa presence, particularly in Kenya and Nigeria, but said further office openings in the region would not be imminent. The firm already has Africa bases in Johannesburg, Casablanca and Cairo.