Waldie: Additional headroom
Pioneering listed law firm Gateley has announced a new £80m revolving credit facility as it eyes further acquisitions alongside organic growth.
The firm has made 14 acquisitions since becoming the first law firm to list in London, back in 2015, of which 11 have been non-legal businesses.
Its most recent half-year results showed that non-legal professional services now account for 30% of its revenues.
Replacing an existing £30m facility, the new arrangement provides total committed funding of £80m until April 2028 with options to extend this to April 2030, split equally between Bank of Scotland, HSBC UK, Barclays and NatWest.
The facility also features an uncommitted accordion option for a further £20m and was coordinated by Bank of Scotland.
Gateley told investors that it had also secured improved terms and conditions when compared to the existing facility.
Chief executive Rod Waldie said: “The facility will provide us with additional headroom and flexibility to continue with our stated strategy to grow organically and through acquisitions, further diversifying the group’s business.
“We continue to position ourselves to invest in and grow our platforms to provide an increasing breadth of services to our clients.
“The aggregation of complementary legal and consultancy services on our four market-facing platforms of corporate, business services, people and property continues to differentiate Gateley, strengthen our appeal to clients and enhance our resilience.”
Group income was up 5.3% to £86m for the six months to 31 October 2024 – with organic revenue from consultancy services growing three times as fast as from legal services.
Underlying operating profit rose nearly 6% to £9.1m and underlying profit before tax to £10.6m.
In the 2024 financial year, revenue rose 6% to £173m, with underlying profit before tax of £23m – down £2m on the previous year after reinstating the payment of employee bonuses, some £4.5m.
Our annual review of listed legal businesses’ performance showed that Gateley’s shares have been slipping over the past three years, down another 10% in 2024 to 139p, but there’s been no obvious reason for this as it has continued to perform well.
The shares closed yesterday at 127p.
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