'Resilient' DWF unveils UK and Canada acquisitions amid double-digit revenue growth
Listed firm pays £4m for business services bolt-ons in UK and Canada; profits soar by 120%
DWF is back on the M&A trail after a turbulent pandemic-impacted year, announcing two acquisitions against the backdrop of a 13% revenue increase with profits up by 120%.
Turnover at the UK’s largest listed law firm hit £338m for its financial year to 30 April, according to a trading update released today, with adjusted profit before tax of £34m exceeding market expectation by 15%, according to the firm. Organic growth increased by 8%.
DWF unveiled the results on the same day it announced two bolt-ons to its specialist business solutions division. It is paying £1.8m for UK-based compliance training business Zing 365 Holdings and £2.2m for Canadian claims and loss adjusting business Barnescraig & Associates.
The news marks the anniversary of the resignation of longstanding chief executive Andrew Leaitherland and his replacement by the then-chairman Sir Nigel Knowles as the firm sought 'strong and experienced leadership' after the firm revised down its expected revenue growth for a second time in as many months.
A series of cost-cutting measures followed – including the closure of its Singapore and Brussels offices and the scaling back of its Australia legal operations – helping the firm to report a reduction of its net debt at year-end to £61m from £65m in 2020.
“We have grown the business, transformed our profitability, improved our operational efficiency and strengthened our balance sheet notwithstanding the impact of Covid-19 during the year,” said Knowles. “These results are testament to the resilience, dedication and excellence shown by our colleagues right across the business.”
The firm, which launched Connected Services in 2017 in a bid to diversify its offering, said it expects the two bolt-ons to add a combined £3m in revenue and £0.5m of adjusted profit before tax in 2022.
Established more than three decades ago, Vancouver-based Barnescraig & Associates boasts a team of 25 claims and loss adjusting specialists who will join DWF’s existing business solutions network and ‘complement’ the firm’s claims and loss adjusting business in Toronto.
Jason Ford, head of Connected Services, said: “We already have a well-established claims management and adjusting business in Toronto and wanted to increase our geographical coverage across Canada to the West Coast.”
Meanwhile, Devon-based Zing 365, which provides online and in-person compliance training to the insurance and financial services sectors, will add six professionals to DWF’s specialist business division. The firm said it expects to scale the platform’s e-learning and consultancy services across its global network.
"Providing compliance services to regulated clients is a key part of the growth strategy for Connected Services,” Ford said. “Zing 365 is a perfect fit for us and it will help us to grow our training and learning services rapidly alongside our Advantage digital platform."
Earlier this month, listed regional firm Knights said its revenue would grow by at least 36%, breaking through the £100m mark.