Irwin Mitchell profit tumbles following bumper FY21 as revenue dips to £275.7m
UK firm’s profit halves to £21.2m as cost-saving measures from pandemic come to an end
National UK law firm Irwin Mitchell saw its pre-tax group profits tumble in the year to 30 April against a fall in group turnover of just under 3% to £275.7m, though the firm saw revenue for its ‘core’ business grow slightly.
Profits fell from £43.1m last year to £21.2m, which the firm said was ‘up on pre-covid levels’ and that the figure for FY21 was fuelled by a range of one-off cost saving measures implemented during the pandemic. The firm’s reported profit before tax is calculated after all partners have been paid.
The firm said the slight revenue drop was ‘expected’ following its decision last September to withdraw from the volume personal injury market to focus on more complex PI cases as well as its other legal and financial services.
Turnover for the firm’s core segments, which refers to its complex personal injury, life cycle legal services and financial asset services businesses, rose 1% to £266.2m. Profits for the core group were £25.2m, a marked drop from last year’s £39.9m but still well ahead of the £8.9m the firm posted for FY20.
Andrew Tucker, group chief executive, said: “This was a transformational year for Irwin Mitchell as we implemented several changes designed to increase our operational resilience and agility, enhance our clients’ experiences and promote greater collaboration amongst our colleagues.”
“Our results this year, while robust and significantly ahead of pre-pandemic levels, are set against last year’s exceptional performance which benefited from the wide range of one-off cost-saving measures that helped to protect group profitability and preserve cash during the pandemic.”
The past financial year saw the firm form a number of tech partnerships to roll out a new client relationship management platform, add Kate Fergusson from Pinsent Masons as its first head of responsible business and offer all of its staff below partner level a one-off cost of living payment of £900.
Tucker said that the firm had gotten the current financial year off to ‘a strong start’, opening offices in Cardiff and Liverpool and adding financial planning company TWP Wealth to boost its wealth management services.
He added: “We’re mindful of the current macroeconomic and geo-political environment; however, we’re confident that our trusted reputation, leading approach to responsible business, differentiated business model and healthy balance sheet position us well for continued long-term, sustainable growth.”
Irwin Mitchell’s latest results have been calculated differently to those reported last year because the firm has switched to International Financial Reporting Standards (IFRS). The figures from previous financial years referred to in this article are presented under IFRS.