Partner Profits Plummet 37% at Clifford Chance; Skadden Now #1 Firm By Revenue
What was until recently the world’s top-grossing law partnership has announced its preliminary results for the fiscal year that ended April 30, and the picture isn’t a pretty one.
Profits per equity partner at London-based Clifford Chance dropped 37 percent compared to the previous fiscal year, and the firm’s overall revenue fell by 5 percent, reports Legal Week.
The revenue drop means that the London-based megafirm Chance is now no longer the world’s top-billing law partnership; New York-based Skadden Arps Slate Meagher & Flom had the highest gross last year, reports the London Times.
Skadden earned $2.2 billion (or about 1.33 billion pounds) in 2008. Although Clifford Chance hit the 1.33-billion-pound mark in 2007-2008, the firm earned only 1.26 billion pounds (or $2.067 billion in U.S. dollars at the current exchange rate) in 2008-2009.
Even after the plunge in profits, however, partners at Clifford Chance are still doing OK, it would appear. The average PEP is was 733,000 pounds last year (about $1.2 million in U.S. dollars, at the current exchange rate), down from 1,156,000 pounds ($1.9 million) the year before.
The firm’s corporate finance and litigation groups were its strongest practice areas, Legal Week reports.
However, banking, private equity, mergers and acquisitions and real estate practices all suffered from the global downturn in the economy, the London Times recounts.
“Given the scale of the financial crisis and the severity of the economic downturn, last year was very challenging for our clients and therefore for us,” says David Childs, the firm’s global managing partner.
Additional coverage:
ABAJournal.com: “Clifford Chance May Lose #1 Spot, as Revenue Drops 5% to $2.04B”
ABAJournal.com: “How Clifford Chance Intends to Rebuild Decimated NYC Litigation Team”
ABAJournal.com: “Clifford Chance Expands in Singapore, But Plans to Close Hungarian Office”
Bloomberg: “Clifford Chance Partner Profits Decline 37 Percent”
