February 1, 2012 12:25 PM
The Am Law 100, the Early Numbers: Mayer Brown Bounces Back with Gains in Revenue, Profits
Posted by Chris Johnson
After seeing revenue drop for two straight years, Mayer Brown made a return to topline growth in 2011, according to The American Lawyer's reporting. Gross revenue climbed 2.4 percent to $1.13 billion, while revenue per lawyer and profits per partner both rose 10 percent, to $745,000 and $1.18 million, respectively. (The profits-per-partner figure is the second-highest in firm history.)
Overall, Mayer Brown enjoyed a nearly 13 percent uptick in net income last year, leaving the firm with a 29 percent profit margin—a slight improvement over its 26 percent profit margin of the previous two years.
Last year's financial performance marks a significant turnaround for the firm, which saw its revenue slump to a four-year low of $1.11 billion in 2010. Global chair Bert Krueger says the improved showing was largely the result of a sustained increase in activity firmwide during the first half of the year. "We had a really strong first half, but like a lot of firms had a more modest second half," Krueger says. "Overall we're pretty pleased with our performance."
Krueger says that all the firm's core practice areas saw their revenue increase in 2011: Capital markets finished the year up 30 percent, litigation—particularly those matters connected to financial institutions—was "booming" and real estate work "had a big bounce."
The profit figures could have been higher, Krueger adds, but for a number of major IT investments—including a new global business intake and conflict-management tool—that the firm had deferred amid the recession.
"We kept a close eye on cost-management and squeezed where we could, but with technology you pay today or you pay tomorrow," he says. "We want 2012 to be really strong, so decided we should bite the bullet and go forwards with it."
Having previously made a series of what Krueger refers to as recession-driven "rightsizings," Mayer Brown's attorney head count fell again in 2011, dropping 7 percent to 1,523 lawyers—the fewest the firm has employed at any time since 2007. The firm's partnership also contracted slightly, with total partner numbers down 4 percent to 585—a reduction of 22.
Krueger insists that Mayer Brown did not initiate any new layoffs in 2011, however, and that the reductions were merely the product of lawyers finally leaving after serving out their notice periods, and natural attrition in the face of decreased hiring activity. The firm "kept a very tight rein on bringing in new people," he says, and also significantly cut back on intakes for its annual summer classes.
Mayer Brown actually made more than 30 lateral partner hires last year, and picked up 21 intellectual property, antitrust, and litigation lawyers from Howrey upon that firm's dissolution in March, including former Howrey IP cochair Alan Grimaldi and former New York office managing partner Theresa Gillis.
Mayer Brown is budgeting for further topline growth in 2012, Krueger says, but he expects the market to remain challenging. "We just don’t see a broad uptick in the next 12 months," he says. "We're going pretty strong in some areas, such as litigation, but I would expect the transactional market to continue to be very tough."
This report is part of The Am Law Daily's ongoing Web coverage of 2011 financial results of The Am Law 100/200. Results are preliminary. Final rankings and full results for The Am Law 100 will be published in The American Lawyer's May 2012 issue and on AmericanLawyer.com. The Am Law Second Hundred will be published in the June issue.Make a comment