Stock exchange: New shares for Gateley partners
The UK’s first listed law firm, Gateley, unveiled strong annual results yesterday, as the partners from when it went public have seen a “healthy return” on their shares.
The national law firm recorded revenue up 11% to £86m and profit up 11.7% to £14.6m for the year to 30 April 2018.
Gateley also strengthened its balance sheet, with net assets increasing by £5.6m to £23m.
It has proposed a 4.8p dividend, making a total dividend of 7p for the year, a 6.1% increase on 2016/17.
Staff numbers grew 9% to 757, largely due to more fee-earners, and have subsequently been boosted by the acquisition of housebuilder specialist law firm GCL Solicitors in May, which added 80 new staff.
Earlier this month, Gateley also bought human capital consultancy Kiddy & Partners.
Nigel Payne, the firm’s non-executive chairman, told the stock exchange that “our ability to attract quality staff, who are interested in benefiting from the opportunities provided by our PLC structure, continues to strengthen”.
Similarly, he said that “without our PLC status, I do not believe that we would have appealed to either [new acquisitions] in the same way”.
Gateley has three staff share schemes in place – an all-staff save-as-you-earn share scheme; a company share option plan for associates, senior associates, legal directors and their equivalent levels within the support services team; and a stock appreciation rights (SAR) scheme for partner-level employees.
It said yesterday that 2.4m share vested last month following the third anniversary of the company’s admission to AIM, pursuant to the terms of the SAR scheme.
Seven million shares were put in the scheme when the firm floated in June 2015, and a further 10.85m shares were added in October 2016. A third year’s award was issued in October 2017.
The 2015 shares were 95p, with an exercise price of 110p. As the price is now higher than that, the partners in the scheme at the time of the float have seen what chief executive Michael Ward called a “healthy return”.
The new shares are being admitted to trading today At the level of yesterday’s share price – up 4% at 172.5p – they are worth nearly £4.2m.
Mr Payne noted that “the majority of group employees now have some form of equity in the business”. Last October, a group of internal shareholders at Gateley sold £10m worth of shares.
Chief executive Michael Ward said the awards under the SAR scheme would ensure that senior staff “remain aligned with the long-term success of the group”.
At the time of listing, 30% of Gateley’s shares were held outside of internal shareholders; that figure is now 40%.
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