Allen & Overy reports 17% jump in PEP as turnover climbs 5% to £1.77bn

UK Magic Circle firm is latest practice to improve its financial performance through the pandemic
Photograph of Gareth Price

Gareth Price

Allen & Overy’s (A&O’s) revenue has climbed 5% to £1.77bn against a 17% jump in profit per equity partner, making it the latest major law firm to improve its financial performance during the Covid-19 pandemic.

While revenue growth has edged up from last year’s 4% increase, PEP has rebounded strongly after a 1.7% fall last year to hit £1.90m. Profit before tax jumped by 19% to reach £822m. 

The jump in PEP, aided by the enforced efficiencies generated by lockdown, is in line with a host of comparable US firms – average PEP for the Am Law 100 increased by 13% in 2020, compared to just 5% the year before.

Early results from UK firms, whose year-ends are typically on 30 April, are painting a similar picture, with Herbert Smith Freehills leading the pack with a 28% PEP jump against the same increase in revenue as A&O.

The results were fueled by a strong performance by its transactional and disputes practices, all of which recorded increased revenue, according to the firm. It said it had advised on 12% more deals than any other practice in 2020, benefiting strongly from the booming special purpose acquisition company (SPAC) market in the US and Europe.

International capital markets, banking and corporate all performed well, while income for its real estate and tax practices remained broadly flat. Regionally, revenue growth was driven by its operations in the US, the UK and mainland Europe. 

The firm made a number of expansion plays in the US market this year, which included opening a West Coast office in Los Angeles back in March and the hiring of Jake Mincemoyer from White & Case in New York to head up its US leveraged finance practice.


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Global managing partner Gareth Price said he was proud of how the firm’s employees had responded to the challenges imposed by the Covid-19 pandemic and underlined the firm’s efforts to support them.

“We focused on the wellbeing of colleagues as they worked remotely and often very long hours,” he said. “And we looked after the people in our supply chain in a responsible way. 

He added: “Our services are more in demand now than ever in our history and we have started the new financial year strongly, driven in particular by exceptionally high levels of M&A activity.”

Other highlights flagged by the firm include its work in the technology and innovation space, particularly through its tech incubator programme, Fuse, which took in 15 legaltech and fintech firms this year to launch the incubator’s fifth cohort.

The firm also recorded progress in the realms of environmental sustainability and diversity and inclusion, reporting a 46% cut in global emissions in large part thanks to a drop in business travel during the pandemic. Last summer, it launched an initiative aiming to have 15% of its partnership from an ethnic minority in its London office by 2025, reflecting its wider commitment to increasing diversity within its global teams. 

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