Firm reveals FY17 results
Baker McKenzie, the leading global law firm, has announced revenues for the fiscal year ended 30 June 2017 (FY17) of $2.67 billion. In terms of constant currency, the most accurate measurement of the financial performance of any global professional services firm, Baker McKenzie's revenues were up 5% compared to previous year. In $US, the Firm's reporting currency, this translates into growth of 2.1%, highlighting the appreciation of the US dollar against most other currencies in the period.
Baker McKenzie is the most diverse global law firm with revenues spread by regions as follows: Asia Pacific 26%, EMEA 37%, Americas 37%. All of our regions' revenues grew in FY17 by 4% or more.
Profits per Partner were up by 1.2% or 0.2% in dollar terms at $1.3 million. Since 2007, our PPP has increased by over 20%.
"A 5% revenue growth and 1% increase in profit is a strong performance in difficult circumstances. It means that over the last decade, our Firm has grown revenues by 50% without a significant merger. Very few global law firms can match that.
"We have plenty else to be proud of this year - record client demand for our services, a great crop of new lateral hires, the successful launch of our market-leading innovation initiative, and our long-term strategic investments in New York, London and China paying off. The market is increasingly seeing Baker McKenzie not only as the No. 1 legal brand in the world but also as a truly innovative and integrated organization with a clear vision and purpose, as well as its own unique culture," Paul adds.
FY17 saw the formal launch of our innovation initiative, which has already made some major announcements. Baker McKenzie is the only law firm to partner with the World Economic Forum on their Fourth Industrial Revolution project, which aims to accelerate the deployment of technology and science for positive impact on individuals and the societies, while minimizing their downside risks.
Baker McKenzie recently announced the opening of our Toronto-based Whitespace Collab as a major hub for driving collaboration between the Firm and clients, and in May we highlighted how we became the first law firm to roll out machine learning technology on a global scale.
Not only are these initiatives benefitting all of our clients and people, but they are also already beginning to make a direct financial impact on our financial performance. We estimate that our use of alternative legal services in Belfast, our e-discovery platforms and our use of legal project management are already bringing in more than $20 million in annual revenue.
Our practices and our sectors
Notable growing practices in FY17 included Tax, Dispute Resolution, Banking & Finance, M&A and Capital Markets.
Our TMT (Technology, Media & Telecoms) group was our highest growth industry sector. In continuing to offer our clients a robust industry focus, we launched our fifth and sixth industry groups this year: Consumer Goods & Retail, and Industrials, Manufacturing and Transportation.
They join: Energy, Mining & Infrastructure; Financial Institutions; Healthcare and TMT. Expanding our industry offerings is part of our strategy as a Firm to help anticipate our clients' needs by getting even closer to them and their industries, by understanding trends within the sector.
The Firm advised on some of the world’s most important deals and cases during the year, including:
- We supported BHP Billiton on the development of a Forests Bond co-developed in conjunction with the International Finance Corporation, part of the World Bank. The Bond aims to achieve emission reductions through a combination of forest protection and community development activities in East Kenya.
- Victory for Dyson before the European Court of Justice in a case where the court ruled true-to-life testing, where technically possible, must be used to measure the energy performance of vacuum cleaners.
- We advised Yum! Brands, Inc. on the corporate implementation of the $9.7 billion global restructuring relating to the spin-off of its Chinese restaurant operations.
- An international team of Baker McKenzie lawyers advised digital technology company Konica Minolta on its acquisition of Ambry Genetics Corporation, a leading diagnostic solutions provider for hereditary conditions, for up to $1 billion.
- Baker McKenzie tax practitioners secured a full concession from the IRS on behalf of Nike Inc., ending a significant dispute over the treatment of foreign tax credits.
- We advised Siemens on a multi million dollar loan to Stoneway Capital Corporation, as part of a $500 million financing for a thermal power project in Buenos Aires – which included the first use of project bonds in Argentina in 25 years
- We worked with Emerson Electric on its $4 billion carve-out and sale of its Network Power business to Platinum Equity, a complex carve-out involving over 60 countries and legal issues including corporate, tax, real estate, IT, employment, pensions and cash repatriation.
Our brand and client recognition
Many leading organizations recognized Baker McKenzie's innovation and leadership in FY17, including:
- Thomson Reuters ranked the Firm No. 1 in the world by number of cross-border deals for the eighth year in a row. More than 65% of our deals are cross-border.
- For the 12th consecutive year, the Firm was ranked first for deals with emerging market involvement, by both number of announced and completed deals.
- Acritas recognized the Firm as the world’s strongest legal brand for the seventh year in a row.
- Identified as one of the best law firms for women by Working Mother magazine, Law360 and Euromoney.
- Chambers Global recognized Baker McKenzie more than any other law firm in its 2017 global guide.
- During FY17, we hired 59 lateral partners, including senior government officials, talented lawyers from other top firms and experienced in-house counsel from leading multinationals. The Firm continued to focus on bolstering its transactional capabilities, in particular in London, New York and China, which accounted for a quarter of all new hires worldwide.
- In June we announced the election of 80 new partners. This latest investment in talent takes the number of partners worldwide to nearly 1,600 as of 1 July 2017. 40% of the new promotions are women.
- During FY17 we grew our overall full time equivalent (FTE) fee-earner population to 6,076.
- 42% of our lawyers and 26% of our partners are women.
- Total staff FTE headcount as of 30 June 2017 was 12,346 and actual headcount was 13,413.
- We have increased total billable hours by 3% year-on-year to 8.4 million.
Paul concludes, "Baker McKenzie has more than six decades of experience in advising and supporting our clients wherever they are in the world and whatever the volatility of the macroeconomic environment. We look ahead to the next 12 months with quiet confidence that despite a tough market, our people and our Firm will continue to go from strength to strength."