DWF, Manchester law giant, reports strong trading

Shares of Manchester-headquartered international law firm DWF Group plc rose about 13% on Thursday after it published a trading update showing “strong trading in the first two months of the financial year with revenues and EBITDA ahead of budget and prior year.”

DWF said: “While M&A opportunities are on pause in the short term, this remains an important part of the company’s strategy through the medium to longer term, where targeted acquisitions add synergistic value to the group.  

“The new management team has been reviewing options to take further cost efficiencies across the group and now anticipates total cost savings of £15m in FY21.

“This comprises of £10m of savings previously announced in March 2020 and an additional £5m of cost savings identified through a further review of the group’s cost base. 

“This will result in £18.5m of savings in FY22 at a full annualised run rate.

“Given the investment in FY20 was back end weighted and there are selected investment plans in growth areas in FY21, approximately half of this £15m may be reinvested into the group.

“In addition, the group is closing its Brussels and Singapore offices and reducing its presence in Dubai and Cologne as part of a review of underperforming business units.

“DWF Resource in the Connected Services division is also being discontinued.”

DWF Group CEO Nigel Knowles said: “Despite the headwinds facing the global economy, I am pleased with the positive momentum that DWF has generated during the first two months of the year, with revenue and EBITDA ahead of prior year, and activity levels increasing. 

“We have taken decisive action focused on consolidating our existing operations to increase profitability, deliver cost efficiencies and improve lock-up and cash generation.

“Measures to scale-up Managed Services and optimise the International division will position DWF well for FY21 and beyond.

“Having had the opportunity to talk personally with many stakeholders, including both internal and external shareholders, I am very pleased that our new direction has such strong support.”