Law firms had ‘very strong performance’ financially at 9-month point, new report says

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Legislation companies had ‘very robust efficiency’ financially…

Legislation Companies

Legislation companies had ‘very robust efficiency’ financially at 9-month level, new report says

By Debra Cassens Weiss

November 20, 2024, 12:22 pm CST

Legislation agency income within the first 9 months of 2024 elevated 12.8% from the identical interval final 12 months, thanks largely to will increase in commonplace billing charges, in accordance with a brand new report by Wells Fargo’s Authorized Specialty Group.

At this identical level final 12 months, income had elevated 4.6%, in accordance with the report. The year-over-year income progress of 12.8% within the first three quarters was eclipsed solely by progress charges of 14.4% in 2021.

“For the primary 9 months of 2024,” the report says, “the regulation agency business skilled very robust efficiency, enhancing upon the momentum seen on the six-month mark.”

Income progress was highest for Am Legislation 50 companies, that are ranked based mostly on gross income. They’d year-over-year income progress of 14.6% on the nine-month level, in comparison with progress of 9.3% for companies within the Am Legislation Second Fifty and 10.1% for companies within the Am Legislation Second Hundred.

The “main contributor” to income progress is the rise in billing charges, in accordance with the report. Customary billing charges elevated 9% from the identical interval final 12 months. The year-over-year enhance was 10% for Am Legislation 50 companies and seven% for Am Legislation Second Fifty and Am Legislation Second Hundred companies.

Web revenue can be up, Wells Fargo says, though the financial institution cautions that proportion will increase may be “unusually massive” in interim reporting due to the seasonality of collections and money foundation reporting. Web revenue elevated 22.2% within the first 9 months of the 12 months, in comparison with the identical interval final 12 months, whereas earnings per fairness associate elevated 21.5%.

Legislation.com spoke with Owen Burman, a senior advisor for the Wells Fargo’s Authorized Specialty Group, concerning the findings.

Monetary progress goes so nicely that companies are “pinching themselves,” Burman stated.

The report relies on data from greater than 130 companies, together with 70 Am Legislation 100 companies and 35 Am Legislation Second Hundred companies.