Grech: acquisitions programme “compressed”
Slater & Gordon (S&G) is to concentrate on improving the performance of its UK operations, after an acquisitions spree that it claims has given it a 5% share of the claimant PI market.
The Australian firm’s managing director said that by “compressing” its acquisition phase, the firm could “for now” focus on “integration” and consolidation.
It remains unclear what progress is being made with the previously announced deal to buy Simpson Millar.
S&G’s first half figures reported yesterday to the Australian stock exchange, the firm said its total revenue was up 22.3% to £97m for the six months to the end of December 2013.
The total share of S&G’s revenue coming from the UK in the half year was 35%, compared to 23% the previous year, representing what the company called a successful revenue diversification strategy.
Its UK revenues grew by almost 80% to £35m for the six months, up from £19.5m in the same period in 2012. UK net profit after tax doubled to just over £4m from just under £2m in the previous year; the Australian side of the business is markedly more profitable at the moment.
S&G’s £33m acquisition of Pannone will be completed this month. The five UK-based firms acquired during the second half of 2013 were Goodmans Law, the PI practice of Taylor Vinters LLP, Fentons Solicitors LLP, John Pickering & Partners LLP and the PI practice of Chadwick Lawrence.
S&G expects annual revenue for the financial year 2014 from Taylor Vinters, Goodmans and Pickerings together to be just over £10m, whereas Fentons should bring in £27.7m and Pannone £72.5m.
A deal to acquire Simpson Millar was announced last May. In August, S&G said that “in light of the current transactions, discussions with Simpson Millar… have been deferred until early 2014”. No further statements have since been made, and an S&G spokeswoman said there were no updates.
The firm said early signs showed its direct-to-consumer advertising programme in the UK, launched in September, were resulting in “increased new client enquiries in key areas of personal injury (PI) work.”
Managing director Andrew Grech said the results were “very pleasing”, adding: “The performance of the UK business demonstrates that our strategic rationale for entering the UK market is sound and that whilst still early days is being executed effectively. With the completion of the Pannone transaction later this month we will have secured approximately 5% market share in the UK claimant PI market and have built a strong base for future growth and development.
“By compressing our acquisition programme in the UK into a shorter time frame we have given ourselves the opportunity to move more quickly to improving operational performance as we have been doing in Australia in the past 12 months
“For now we are very focused on integration. We have a strong management team in place tasked with consolidating our operations over the next 12 months. The businesses acquired to date are running smoothly and we are delighted with the quality of the firms and people we’ve been able to bring together.”
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