International firm DWF has revealed that it spent £12.6m on costs related to its listing on the London Stock Exchange earlier this year. Annual accounts for 2018/19, covering the year to 30 April, confirm the cost of going public reduced profit before tax by 42% to £12.3m.
DWF said much of the cost incurred was driven by the complexity of the project, including detailed regulatory work required in each jurisdiction in which it operates.
Restructuring work was undertaken immediately prior to the initial public offering to ensure the group structure was ‘robust’ and further work was needed to transition the company’s financial reporting, systems and controls from an LLP model to a corporate one.
DWF became the first existing law firm to float on the main market of the London Stock Exchange in March this year.
Overall during the year, net revenue has increased 15% to £272.4m, with gross profit up 16% to £145.5m, today’s results show.
Andrew Leaitherland said the results mark the end of a milestone year for DWF and reflect an uplift across all four divisions of the business. ‘We have made significant progress against strategy, taking meaningful strides towards our medium-term targets, and expect our diversified and differentiated business model to continue driving long-term sustainable growth.’
DWF has said it will, from 2020, target a dividend payout ratio of up to 70% of profit after tax. For 2019, the group was listed for only six weeks of the financial year, so the final dividend will be 1p per share, around £3m in total.
Group net assets have increased from £5.3m in 2018 to £41.8m this year. This is due to a 16.5% increase in gross lock-up to £21.5m, an £18.8m reduction in net debt and £18.4 net repayments to members.
DWF now has 2,715 employees, up from 2,656 in 2018.
Shares rose marginally today to 122.5p. On listing in March the price was 127p.