U.K. listed law firm DWF is to cut its global office space by a third, as the firm targets more hybrid working amid a significant slowdown in its top line growth.
For the year ended April 2022, the firm recorded net revenue growth of 3.6% up to £350.2 million—a more modest increase than the 13% growth posted in 2021.
As part of the results, the firm said its property strategy was under review, with an estimated one-third of global office space considered as “potentially surplus to requirements post-COVID”.
According to the firm, reducing office space could represent around a “£7 million recurring annualised saving opportunity in the medium term”.
Speaking to Law.com International, the firm’s CFO Chris Stefani said this would not translate to office closures or exiting current locations. Instead, the firm wants to move towards a more hybrid way of working, and therefore both save money and occupy less space.
Stefani said: “It’s something we are looking at with the appropriate sympathy for cultural differences”, acknowledging that open plan offices and agile working were not the accepted norm in every market.
Adjusted profit before tax was up 21% to £41.4m, while net debt grew to £71.8m—an increase of £11.6 million. In its full results, the firm attributed this to “repayment of COVID-19 VAT deferrals and acquisition related payments”.
The year’s results are the first since the firm overhauled its structure into three global divisions: legal advisory, Mindcrest (managed services), and connected services.
The firm’s CEO Sir Nigel Knowles said the firm had seen more opportunities across the business since the overhaul, and added that the changed structure “was the logical and sensible thing to do”.
According to a person with knowledge of the firm, more than 80 of DWF’s clients are now using more than one of these three divisions, and that this client base represents 45% of fee income.
In February this year, DWF’s share price returned to its float price of 125p for the first time during Sir Nigel Knowles’ tenure as the company’s CEO—a role he took up in May 2020. The share price had been below that level since March 2020 and as of Thursday morning sits at 98p.
