Knights reports profit surge as recruitment and acquisitions drive growth

Knights chief executive David Beech

Professional services group Knights has reported a significant increase in profitability, driven by recruitment and major acquisitions.

Knights’ first-half profit before tax (PBT) has risen by 30.4% to £9m in the six months ended 31 October 2024 (H1 FY24: £6.9m).

It says the ‘pioneering’ transition to a more corporate model over a decade ago has attracted professionals to help it become “the most compelling acquirer, of scale, in the sector”.

As a result, the firm’s underlying profit before tax is now three times higher than its full-year PBT at the time of its IPO in April 2018. Over the same period, Knights has grown its workforce from 430 to 1,335 staff.

Knights CEO David Beech said: “It is particularly interesting to see this approach being validated by the considerable levels of investment from private equity in a parallel professional service, accountancy.”

Revenue climbed by 5.4% to £79.4m, supported by the hiring of 23 senior fee earners during the period.

During the half, Knights acquired Thursfields Legal in a £12.5m deal. The independent, full-service legal services business has strengthened Knights’ presence in the West Midlands, adding offices in Worcester, Kidderminster, Solihull and Birmingham.

It also adds to the group’s private wealth service lines, with Thursfields’ reputation in private client, family and residential property, alongside corporate, real estate and dispute resolution services. The team has contributed £3m of revenue in the half year, which is in line with expectations.

This latest deal with Thursfields takes the number of acquisitions since Knights’ IPO in 2018 to 21.

Total revenue from acquisitions of Carlisle law firm Baines Wilson and Newcastle-based St James Law in May 2023 is ahead of expectations.

David Beech, CEO of Knights said: “Knights has delivered a strong performance in the first half, with a significant increase in profitability, supported by strong recruitment, significant client wins, contributions from prior year acquisitions and excellent cost discipline.

“The second half of the year has started in line with our expectations, with important recent client wins, and continued recruitment momentum, underpinning our confidence in delivering further organic growth in the second half.

“Knights’ growing reputation as a quality UK legal services provider with national scale continues to support our recruitment and acquisition pipeline and we have a good pipeline of further hires for the second half.

“This positive momentum, together with our continued focus on operational excellence positions us well for delivering full-year profits in line with our expectations.”

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