Combined revenue of European 100 keeps rising but 2020 outlook is bleak

The combined revenue of the 100 largest independent firms in Europe continued to rise in 2019, The Lawyer can reveal – but firms are bracing for a reversal of fortunes in 2020.

Total turnover for the 100 firms rose 5.2 per cent last year, from €10.4bn in 2018 to €10.94bn (£9.6bn), continued an upwards trend.

The 100 firms employed a total of more than 48,000 staff, including 25,556 lawyers of whom 7,554 were partners. Headcount was also up on 2018, although recruitment was slower than turnover growth.

Of the 100 firms, 82 had seen some turnover growth in 2019, including 20 reporting double-digit growth. Germany was again the strongest performer, with seven firms reporting growth of at least 10 per cent including Luther, up 28.2 per cent, and Graf von Westphalen, up 26.2 per cent.

Luther has also reported the highest five-year growth with an 80.2 per cent boost in revenue since 2015.

The impact of the Covid-19 pandemic is expected to hit hard in 2020, with the vast majority of European firms operating a calendar financial year. Although our survey went out before the full scale of coronavirus was clear, the majority of firms responding to our question about their outlook for the future of the legal market in their jurisdiction of their prospects for growth said they were unable to give a prediction.

Some firms suggested that their small size, relative to their larger international competitors, would help them adapt to the crisis and attract work from their jurisdiction’s major corporates.

“We believe that, as compared to our international competitors, we will be better placed to capture opportunities with domestic players given the general lockdown in which the world is currently finding itself,” asserted Sweden’s Vinge.

However, a majority of European 100 firms said they were not planning any geographical expansion in 2020, and consolidation is expected to be the main theme over the coming 12 months.