Updated on 3/14/13
Following a year of stagnant gross revenues, Hogan Lovells finances didn't improve in 2012, the second full year of the firm's existence.
The firm, which formed in May 2010 after Washington-based Hogan & Hartson and London-based Lovells merged to create a giant, for 2012 reported gross revenues of $1.633 billion, a 1.9 percent drop from 2011. Hogan Co-CEO J. Warren Gorrell Jr. said the closing of the firm's Abu Dhabi, United Arab Emirates, office and exchange rate fluctuation contributed to the decline. The firm's substantial international presence makes it more susceptible to changes in currency values than most U.S. law firms, he said.
Hogan in 2012 had a "pretty solid performance" in 2012, helping close several major deals for clients, Gorrell said. The firm's highlights include advising News Corp. on the acquisition of a 49 percent stake of YES Network, which broadcasts New York Yankees games, and assisting Equity Residential Inc. in Lehman Brothers Holdings Inc.'s $16 billion sale of Archstone Enterprise LP to the company and AvalonBay Communities Inc. Hogan also was busy with international regulatory and anti-corruption work, he added.
As a result of the decline in Hogan's gross revenues, most of the firm's key financial indicators had drops, too. The firm biggest percentage decrease was the 7.1 percent decline in net income, bringing the total compensation for equity partners to $563 million. As for profits per partner, the drop was 6 percent, falling to $1.1 million.
Hogan also took hits of 5.5 percent for the average compensation for all partners and 3.4 percent for revenue per lawyer.
The only financial indicator that increased for Hogan was nonequity partner compensation. The firm reported nonequity partner compensation of $131 million, a 6.1 percent bump.
Despite several drops in Hogan's financial report, the firm's number of full-time equivalent attorneys grew to 2,280 lawyers, a 1.2 percent jump. And Hogan's full-time equivalent partner count increased by five even with a seven lawyer drop in the firm's full-time equivalent equity partner figures.
David Harris, Hogan's other CEO, said the firm is optimistic about 2013.
"We've already seen some encouraging developments," he said.