Knight: Strong momentum
AIM-listed Keystone Law has reported revenue growth of almost 18% to over £115m in its latest annual financial results, highlighting its implementation of both generative and agentic AI.
The law firm said it was using agentic AI in new tools to help lawyers tackle anti-money laundering (AML) compliance relating to source of funds and provide “an enhanced approach to conflict checking”.
Keystone said the 18% growth in revenue, with adjusted profit before tax up by over 20% to £15.3m, were both “marginally ahead of market expectations”. Revenue per principal was up 10.5% to £243,000.
There was an increase in the number of principals recruited in the year to 31 January 2026, from 50 to 61, bringing the total to 491. The increase in other fee-earners, recruited to work in ‘pods’ with the principals, jumped 35%, bringing that total to 163.
The firm could not provide figures on how much of the income growth was simply down to the greater number of lawyers.
Its board proposed a final ordinary dividend of 17.2p per share, bringing the total dividend for the year to 24.7p. Shares closed yesterday at 514p, well down from October’s peak of 700p, but similar to this time last year.
In his chief executive’s review, James Knight said the firm had “deployed a secure, locked down version” of both ChatGPT and Claude.
The firm recognised that “for these solutions to make a difference they need to be widely adopted across the business”, so the firm had invested “significant time and energy” in promoting the benefits of AI and in training.
“This approach has ensured the successful adoption of these tools, with over half our lawyers already using them regularly.”
Working with external consultants, Keystone had identified “several possible applications” for agentic AI.
“We have applied a combination of generative and agentic AI to enable our lawyers to interrogate our substantial operating manual in seconds, saving them time and improving their experience.
“With regards to agentic AI we have harnessed this technology in new tools which we have rolled out to support our lawyers in complying with AML legislation regarding identification of source of funds as well as providing an enhanced approach to conflict checking.”
Mr Knight added: “We delivered another excellent year for Keystone, with strong operational and financial momentum driven by sustained client demand and continued growth in lawyer numbers.
“Our brand refresh, which more accurately reflects the evolution of Keystone, underscores our ambition and further reinforces our position as the premier tech-enabled platform law firm.
“In addition, the ongoing investment in IT infrastructure and AI capabilities continues to differentiate our highly scalable model, underpinning both our strong balance sheet and progressive dividend policy.”
Separately, AIIC Holdings, the legal group behind law firms Taylor Rose, FDR Law and Kingsley Wood, reported revenue up 27% to £124m and adjusted EBITDA rising nearly two-thirds to £12m. Adjusted profit before tax more than doubled to £9.6m.
The growth was driven by the group’s consultant-led model, with the number of consultant fee-earners increasing to 981 during the financial year and, we reported last month, it has since risen beyond 1,000, alongside around 600 employed lawyers.
Observers have noted that a significant proportion of the group’s profit in recent years has come from client account interest, but the board said in a statement: “While interest earned on client funds continues to represent a component of reported EBITDA, the group noted that its underlying profitability and cash generation have strengthened materially regardless of client interest, and despite significant ongoing investment in its IT transformation programme designed to help it prosper long into the future.
“In FY2025, adjusted EBITDA excluding net client interest increased to £5.5m, reflecting improved operating performance and scale benefits from the consultant model.”
Chief executive Adrian Jaggard said: “FY2025 was a year of strong operational progress for the Group. The performance of our core business has strengthened materially, even as we deliberately reinvested significant sums into our IT transformation.
“We have chosen to absorb those costs now in order to build a more efficient, scalable and resilient business for the long-term, and the benefits of that approach are becoming increasingly evident.”
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