Scottish law firm Burness Paull has unveiled underlying advances in turnover and profits, declaring all parts of its business are performing well with none “creaking” and that its headcount has surpassed 700.
Burness Paull said turnover for its shortened, eight-month accounting period to March 31 was £60.1 million and profit was £24.3m. The firm noted it had decided to change its year-end to “align with market norms”. It calculated that, on the most “straightforward” method of adjusting the results for the abbreviated accounting period to compare them with the prior year, profit was up 3% and turnover was 8% higher.
The law firm highlighted a bonus being paid to all staff on the back of the results.
It said: “These figures triggered an all-staff bonus that - in addition to individual performance-related bonuses - will see every employee receive an additional payment worth 7.5% of their annual salary, pro-rated to account for the shortened financial year.”
Peter Lawson, who chairs Burness Paull, flagged the possibility of a boost to transactional activity and the housebuilding sector from an anticipated fall in interest rates, in an interview with The Herald yesterday. He also highlighted a potential fillip for the housebuilding sector if Labour wins the July 4 General Election.
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Mr Lawson said: “Overall, we are really pleased with the results. The business has been trading well, and all parts of the business have been trading well. No bit of the business has been creaking. It has been quite a nice period of good trading across the firm.”
He noted that transactional activity had picked up once it had become clear, around this time last year, that interest rates were not going to keep rising. Referring to Liz Truss’s brief spell as prime minister in autumn 2022 and the fall-out from that, he said there had been a “drastic negative impact on investor appetite” from “Trussonomics”.
Mr Lawson declared: “Since the transactional [activity] market picked up once interest rates stabilised and the investor appetite picked up again, we have been trading well and our clients have been active and we have been supporting our clients as they look to do more investment.”
He added that this growing investor confidence and the increased levels of transactional activity played “to the firm’s strengths in corporate finance, real estate, banking and funds, [and] energy and technology in particular”.
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Burness Paull, while noting challenges in comparing the eight-month figures with the prior year given seasonality of trading and the timing of certain costs, said the “simplest” calculation for reaching “annualised” figures was to multiply the numbers for the abbreviated accounting period by 12 and then divide by eight.
A spokesman said: “On that basis, turnover would be £90.2m and profit would be £36.5m – up 8% and 3% respectively on last year.”
He added: “There are a number of methodologies we could have applied, and each one produces different figures. Ultimately, these are projections that are subjective.
“The 12/8 method is a bit simplistic, and actually least favourable from our perspective, as it doesn’t take into account the seasonality of trading or timings of certain costs, but it’s the most straightforward and least open to challenge.”
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Mr Lawson highlighted a lack of impact from the looming General Election on the business and client behaviour.
Asked if there had been any nerves around this week’s election, or if the outcome was likely to result in much change, he replied: “We did expect there to be more of an impact. Actually, there is not. I think a lot of investors have priced in a Labour win, so trading activity and appetite has remained constant.”
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Mr Lawson added: “It is not gangbusters-style. It is steady confidence, and it is that cautious optimism in the future.”
He highlighted the potential fillip to activity from the expected fall in UK interest rates.
Mr Lawson said: “The opportunity is the expectation that interest rates will go down if inflation stays where it is. The expectation is August, September, interest rates will go down. That will be another boost in terms of confidence for investors.
“If that does happen, we do expect there to be an increase in transactional activity. That would be a real boost. We are very active in the housebuilding sector. With the messages that are coming through from Labour, it is expected there will be a boost to housebuilding combined with interest rates going down.”
Asked if he had noticed weakness in the housebuilding sector, Mr Lawson replied: “With albeit-stabilised, still-high interest rates and the cost of living crisis, that combination has meant the housing market has been quite tight. The hope is that will loosen up later on in the year.”
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