Knight: Strong performance
AIM-listed firm Keystone Law is “moving up the food chain” in terms of the quality of lawyers it is recruiting, which is helping to drive turnover and profit, it said yesterday.
The fee-share practice announced that revenue for the six months to 31 July was up 8.3% to £47m when compared to the same period last year, with adjusted profit before tax rising 7.2% to £6m.
The adjusted profit margin dipped slightly from 13.3% to 13.1% but the board is paying a dividend of 6.2p per share, 0.4p more than in 2023.
Recruitment metrics were up across the board compared to the previous two years: Keystone had 153 applicants and made 56 offers, of which 31 were accepted. Thirty principals joined during the six-month period, although there were 20 departures as well. Historically, principal numbers increase about 6% a year.
There were 442 principals as at 31 July, plus a further 115 other fee-earners, who work for the principals in so-called pods.
Speaking to Legal Futures, chief finance officer Ashley Miller said the high quality of joiners and the clients they brought in – Keystone has “moved up the food chain” in terms of recruitment, he said – was a key driver of growth at the firm.
Recent examples include the hire of Mario Jacovides, previously global head of the structured and asset finance group at Allen & Overy, and Linos Choo, former head of marine in London at DLA Piper.
Chief executive James Knight added: “We turn away those who may be considered good lawyers with good client followings but don’t quite meet the criteria of where Keystone are now. We’re extremely selective of who we take on now.”
Growth would come from helping lawyers to build their practices, rather than through acquiring other firms, he said.
Mr Knight added: “We have delivered a strong performance across all KPIs of the business, continuing to build sustainable growth and increased profits whilst re-enforcing Keystone’s position as a market leader.
“Although the UK economy continues to have its challenges and the recent change in government has introduced a new element of uncertainty to the future, we remain confident that Keystone will continue to build on this performance to deliver ongoing sustainable growth.
“Therefore the board is confident that Keystone will deliver both revenue and adjusted profit before tax slightly ahead of current market expectations.”
Keystone’s shares closed on 670p yesterday, a 1.5% increase, as they maintain a strong upward momentum over the past year. They were 389p last July, having reached an all-time high of 830p in January 2022.
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