Law company's move into UK pays off
SLATER & Gordon's recent expansion into the UK is returning dividends for the listed law company, which delivered a 61 per cent increase in first-half profit.
Slater & Gordon on Wednesday reported a December-half net profit of $19.1 million. Total revenue jumped 46.5 per cent to $145.7 million. Nearly a quarter of that, or $34.3 million, came from its recently acquired British arm.
Revenue from Australian legal fees were $111.3 million and the new UK operations contributed $34.3 million.
The company, which listed on the Australian Securities Exchange six years ago, declared a fully franked interim dividend of 2.75¢, up from 2.5¢ in the same period last year.
Last year Slater & Gordon took over British firm Russell Jones & Walker and rebranded the firm. Managing director Andrew Grech said he was optimistic about the growth opportunities. "It's a market which is undergoing quite a lot of regulatory change at present and we see that change as auguring in some real opportunities," Mr Grech said.
The changes relate to legislation introduced in October 2012 allowing law firms to be owned by non-legal practitioners.
Australia and the UK are the only two jurisdictions in the world that have such laws, which is how Slater & Gordon became the globe's first publicly listed law firm.
It also purchased Tasmanian firm Hilliard for $1.3 million in late 2012.
Slater & Gordon confirmed guidance for the full financial year of $290 million, and expects to reap $70 million from Britain. Revenue could be higher if the Australian dollar weakens against the British pound before July, or lower if the dollar keeps rising. Advertising and marketing expenses doubled to $12.6 million, or 9 per cent of revenue. Bad and doubtful debt also increased from $1.6 million to $2 million.