DWF returns to profit with record annual results

DWF Manchester

Manchester-based law firm, DWF, returned to profit, it revealed, publishing record annual results for the year to April 30, 2022, today.

Revenues rose 3.8% to £416.1m, while a pre-tax loss of £30.6m last year , was turned around into a pre-tax profit of £22.3m.

The dividend was raised from 4.5p per share to 4.75p per share.

Net debt increased from £60.2m to £71.8m, due to repayment of COVID-19 VAT deferrals and acquisition-related payments.

The group said the first two months of trading for fiscal year 2023 have been strong, showing continued momentum in line with the fourth quarter of 2022.

While the board is mindful of inflationary pressures and the wider economic backdrop, DWF said it has resilient revenues, a countercyclical litigation focus, and recurring revenues in insurance providing a natural hedge against economic headwinds.

It said it remains well placed to continue delivering on its growth strategy and confident in its medium term guidance.

Chief executive, Sir Nigel Knowles, said: “We have achieved a record set of results with net revenue growth taking us to £350m in scale, adjusted profit before tax up by 21% to £41m and lock-up days continuing to fall, down to 179.

“Our adjusted diluted earnings per share are up by 45% to 10.7p with our diluted earnings per share increasing to 6.5p, our strongest results since IPO.

“These results have been made possible through the continued transformation of our business, not least the successful implementation of our new global operating model which was introduced on 1 May last year.”

He added: “As anticipated, this has resulted in the greater integration and alignment of our colleagues and services, for the benefit of our clients. It has also supported our integrated legal management approach, our key differentiator which is helping us to gain share of wallet against both traditional and new competitors.

“Despite the prospect of challenging macro-economic conditions, we remain confident in our medium term guidance. This confidence is supported by the defensive nature of the group’s revenue being weighted towards litigation and the recurring revenue base in insurance, which has always protected the group both from artificial peaks in growth and hedges against a slowdown in transactional activity.

“Similarly, we are confident that our balanced approach of competitive reward, including our unique ability to offer share awards, combined with a more progressive working environment will position us favourably in the ‘war for talent’.”

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