The survey of 131 firms shows limited growth in fee income across most sizes of firm except larger practices. Net profits fell overall, with even those firms recording improvements in fees billed showing little growth in profitability.

Most firms with fewer than 10 partners reported no fee income growth in the past three years and profitability has plummeted.

Mid- sized (11-25 partner) and large firms reported revenue growth of 6% and 3% during the past 12 months, as a result of greater M&A activity and larger property transactions.

Improving revenue at mid-sized firms has been accompanied by rising profit per equity partner (PEP), up by 21%, while PEP for large firms dropped by 2%.

In terms of profitability, 11-25 partner firms did better than 25+ firms and there are some signs that 2-4 partner firms are starting to reap the benefits of managing expenditure, although their profitability is down.

Control of lockup remains high on the agenda. Sole practitioners, 2-4 partner firms and 11-25 partner firms reduced their lockup days. In contrast, for the 5-10 partner and 25+ partner practices, lockup increased by 5% and 8% respectively.