RPC’s consulting arm posts £2.6m loss as pay for firm's top earner drops 16%

rpc-london-office_432776-Vert-201701261125RPC’s consulting business posted a £2.6m loss for the 2015-16 financial year, while the amount paid to the firm’s highest paid partner fell 15%, according to its 2015-16 limited liability partnership filings.

The profit attributed to the highest paid member for the year was £840,802, down 16% from last year’s figure £995,409.

The accounts also show that RPC Consulting – which launched in February 2015 – paid £1m in cash for UK software business Marriott Sinclair, plus “deferred consideration of £2.56m”.

Marriott Sinclair has developed a financial modelling tool that helps insurance companies address regulatory requirements such as those presented by Solvency II, the new EU framework for the insurance industry.

During 2015-16, the consulting business generated total turnover of £1.05m but made a loss for the year of £2.6m.

RPC Consulting includes four partners: Rory O’Brien, formerly global head of risk consulting and software at Towers Watson, who headed up the launch of the business, and former Marriott Sinclair principals Alun Marriott, Mark Sinclair-McGarvie and Jonathan Broughton.

O’Brien told Legal Week: “We acquired the business and assets of Marriott Sinclair part-way through the 2016 financial year as part of our long-term strategy to develop our insurance management consultancy business, RPC Consulting. Of course, there was an upfront cost to that acquisition, which is reflected in the accounts.

“As with any startup there has been significant early-stage investment, which naturally takes time to flow through to revenue. It’s entirely as expected and the growth of the business as we see it now is on track for where we anticipated it would be by this point.”

The total number of fee earners at RPC rose to 317 during the year, up from 300, while the total number of support staff increased from 216 to 233, with staff costs increasing by 12% to £47.4m as a result.

The total number of partners rose to 71 from 67, while the total paid to key management personnel fell 4% from £6.35m to £6.09m.

Overall, the firm posted revenue of £99.5m, up 5% from £94.5m, while operating profit fell 12% from £27.5m to £24.3m.

RPC is currently in the process of electing a new managing partner after longstanding leader Jonathan Watmough left the firm in December. The new managing partner is expected to be announced later this month and take up the role at the beginning of February.