London law firm Howard Kennedy has surpassed £60m in revenue for the first time on record, but a 6% rise in turnover wasn't enough to keep profit per equity partner (PEP) in an upward trajectory.

The firm’s latest revenue figure represents a 6.3% increase on the previous financial year, when it brought in £56.9m. Profits increased by a modest 2% to hit £16.7m from £16.4m in FY2020/21. PEP, meanwhile, fell 9% to £315k from £348k, a change the firm chalked up to investment in its new partners. 

Particularly strong performances came from the corporate and real estate transactional practices, which both delivered 18% year-on-year growth. Other standouts for the firm came from its specialist business crime unit, which grew by 24%, and its construction team, which posted a similarly impressive 20% in growth for the financial year ending April 30. 

A portion of the firm’s financial growth this year was fuelled by work on a string of big-ticket transactions, including its work on the £160m joint venture between Galliard Homes and Apsley House Capital on the forward funding of a regeneration scheme in Birmingham by Swedish private equity firm Heimstaden Bostad.

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In terms of headcount growth, the firm secured eight lateral partners over the past 12 months, including disputes partner Monika Byrska, who joined Howard Kennedy from Thomson Snell & Passmore in February. Another notable hire was Kyle Philips, who joined the firm’s business crime practice from Fieldfisher last summer. The private client-focused firm currently boasts around 50 partners, 150 lawyers and 350 people in total in its London headquarters. 

Howard Kennedy’s managing partner Craig Emden was upbeat about this year's results, identifying the revenue increase as a pillar of the firm’s practical growth plan to invest back in its lawyers, technology and working practices as part of the three-year growth plan introduced alongside his re-appointment in 2021. 

He said: “In order to achieve our goals, including reaching annual revenue of £80m, we acknowledge that we need to be bold. Recognising the need to enable individual growth for those already at the firm, and for those from outside the firm wishing to join our partnership, we have introduced a new career level as an enhancement to our all-equity partnership.” 

Under this new two-tier structure, a newly created level has been introduced for those wishing to join the partnership as partners on a fixed share basis with an equity stake in the firm, he added.