A leading personal injury firm lost almost £8m in the year preceding an overhaul of the business, newly published accounts have revealed.
The financial statements of Simpson Millar, covering calendar 2021, show that the business posted a loss of £7.76m after continuing to suffer during the pandemic. The firm also lost £8m in 2020.
Turnover was stable, falling only slightly to £29.8m, while cash reserves fell from £1.5m to £1m. Amounts owed to creditors within one year increased from £27m to £29m.
Following the results, the firm undertook several changes to its business, including cutting around 100 jobs and closing departments including conveyancing, dispute resolution, employment, wills, trusts and probate.
Simpson Millar stressed to the Gazette this week that the results, published over Christmas, pre-dated this company-wide restructure and had led to ‘decisive and in some cases difficult’ action in response. The closure of the conveyancing department in particular caused problems with completing property transactions and the firm apologised last year for ongoing issues.
The remaining business largely focuses on consumer services in personal injury and family, and the firm has ‘invested heavily’ in a transformation programme to capitalise on opportunities in these sectors.
Chief executive Greg Cox said: ‘Simpson Millar is a great business, and with the continued support of our investors we firmly believe that we can really challenge the legal market and the way that legal services are offered to clients.
‘Consumer needs and expectations have changed, particularly in personal injury cases, and our investment in our transformation programme means we now have the right structure and the right teams in place to respond to that,' he added. 'We remain committed to the future development of teams across the firm.’
The problems experienced by Simpson Miller in 2021 mirror many of those suffered by other firms in the personal injury and conveyancing markets.
In his accompanying notes on the financial statements, Cox said fewer claims had been pursued due to reduced movement of the population and temporary court closures during lockdown. The conveyancing department had also suffered but was ‘recovering well’ at the turn of the year.
The business said it continued to have financial backing from its funder Doorway Capital Limited, which entered into a five-year loan agreement worth £25m in December 2018.
