Ince disposes of first post-listing acquisition amid positive results

Singapore: Ince turnover doubled

Ince Group has unveiled a strong international performance this year to make up for a dip in UK revenues, while also disposing of the first law firm it acquired after listing.

In the six months to 30 September, turnover across the group was up 6% to £48m, with profits before tax, which were minimal in the same period last year, of £2.5m.

Organic growth was about 3%. While UK turnover dropped 4% to £27m, all of Ince’s overseas offices grew their income, most notably Greater China (£11m, up 15%) and Singapore (£2.2m, up 99%). Gross margin for the half year went up from 41.6% last year to 44.5% this.

Net debt at the period end was £8.3m, compared to £9m six months earlier. This reduction was “on schedule”, the firm said, and came after it had also paid deferred consideration of £4.9m on acquisitions.

Investors were told that most of the UK decline came in the earlier part of the period, when coronavirus restrictions were more severe.

“Covid-19 has hit the UK harder than our international offices for a number of reasons including… the ability and willingness of colleagues to travel into central London by public transport and restrictions on access to our main office imposed by the landlord. This has restricted the ability of partners and colleagues to meet clients.

“The UK business is also more transactional than the international business and sectors such as real estate and corporate… have been quieter. Other sectors which have been quieter include aviation, employment and private clients which are mostly undertaken in the UK practice.”

In January 2018, what was then Gordon Dadds made technology and corporate solicitors White & Black its first post-listing law firm acquisition, spending £1.7m on completion, and up to £3.4m in total, with some of it performance related.

Yesterday’s announcement said: “Our aspirations for White & Black to be integrated into the wider group as its FinTech offering were not met due to the fall off of its transactional business during the first half and, subsequent to the first half, we therefore have disposed of the whole of the share capital to part of its management team for £0.5m.”

The six months saw Ince Group increase both its legal and non-legal services abroad, starting a Middle East consultancy business as a specialist asset finance provider, as well as an office in Cyprus offering both legal services, focusing on maritime work, and consultancy providing a full range of corporate support services.

In Singapore, the group’s office was consolidated with the Singapore law practice of former alliance partner Incisive Law.

The announcement said Ince typically saw an increase in revenues and profit in the second half of the year over the first, and so far this half is ahead of 2019. But “market uncertainties persist across our territories”, particular in the UK, and the group has decided not to declare a dividend as a result.

The board also said changing working practices were likely to render the group’s current office space “too large or unsuitable”, and it could break all of its main long-term property commitments within the next three years.

Group chief executive Adrian Biles said: “Lateral recruitment has taken time to expand the service lines offered in the overseas offices, but the results are beginning to be felt and I am particularly pleased with the performance of the international offices in this period…

“These results demonstrate that we are in a position to deliver future growth and, if that continues over coming months, we should be able to declare a dividend with the final results.”

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