Top 20 firm Simmons & Simmons has increased its cash reserves by 20% in a sign of the market taking a cautious approach to economic challenges ahead.

In its annual report and financial statements for the year ended 30 April, published this week, the firm reported healthy growth across the board: turnover increased 6% to £452m while profit before taxation was up 9% to £173m.

The firm made £157m available for discretionary division among members, up from £152m last year, but also increased its cash at the bank and in hand from £80m to £96m. Amounts due to creditors within a year fell 10% to £115m and the firm’s net current assets were up 23% to £212m.

Jeremy Hoyland, managing partner, said the members felt that the increase in profits was a positive result ‘driven by robust growth and reflects an ambitious investment and hiring strategy. In the next year the business will continue to grow, he said, through investment in lateral hires and the opening of an office in Silicon Valley to expand the relationship with US tech companies.

Simmons

Simmons & Simmons accounts show healthy profit rises but also a note of caution in current climate

Hoyland added: ‘We are mindful of the economic headwinds that the firm is facing including the impact of the war in Ukraine, the inflationary pressures we are experiencing in many of the countries the firm operate in as well as the fact that Covid-19 related restrictions remain in place in certain jurisdictions.

‘We remain alert and agile to these challenges.’

Meanwhile, the firm has awarded £1,500 to all UK staff earning less than £50,000. Recipients include contractors and part-time staff. The firm said the one-off costs of living payment was made ‘in recognition of the challenging economic climate’.

The annual accounts show that the total number of staff in the Simmons group rose from 1,458 to 1,562 during the year, with increases in both fee earner and business support staff. The average number of members during the year was 230, up from 208.

The entitlement of the highest paid member for the 2021/22 year increased from £2.2m to £2.4m.