Profit growth at magic circle firm Clifford Chance slipped into reverse in 2014/15 as exchange rates made an impact on margins.
The firm today revealed profits per equity partner of £1.12m in the year ending 30 April, 2% down on the previous year. Firm-wide profit was also down by 2%, to £450m.
This contrasts with strong profit rises posted by city and international firms.
Clifford Chance cited the weak euro and ‘tough’ conditions in three German offices as factors behind flat revenue growth. Global revenue dipped slightly (0.7%) from £1.36bn to £1.35bn, although this still represented the second best year for revenue in the firm's history.
Matthew Layton (pictured), managing partner, said he was ‘cautiously optimistic’ about the immediate outlook but ‘extremely positive’ for the longer-term future.
‘Glancing at the events of the last few days indicates how much uncertainty there is,’ he said. ‘But we are seeing confidence in other markets and in cross-border transactions. Many corporates have strong balance sheets.’
The firm today confirmed it has sub-let a ‘substantial’ proportion of unused floor space at its London base in Canary Wharf to Deutsche Bank, although the move has not led to any job losses.
Clifford Chance also intends to expand its centres in India after seeing costs savings since moving operations to the country eight years ago.
Its shared services centre now employs almost 350 people, while the Delhi-based knowledge centre received around 4,000 instructions and supported on around 1,500 client projects in 2014/15.
The firm has also announced that from December 2015 its office in Kiev, Ukraine, will be established as an independent law firm operating as Redcliffe Partners. Under the agreement, Clifford Chance and Redcliffe will enter what they call a ‘best friends’ arrangement to transfer staff and clients.
Leyton added: ‘The firm has an ambitious new global strategy which is dependent on us strictly concentrating our investment and resources on our priorities.’
* London firm Howard Kennedy today announced a 29% rise in profit per equity partner to £360,000. Revenue climbed 6.8% to £43.8m.
Howard Kennedy, with 76 partners and 288 staff, moved into new offices at No 1 London Bridge in November 2014. The firm merged with Finers Stephens Innocent in early 2013, changing its name to HowardKennedyFSI, but reverted to its original name last September.