Summary: The first publicly traded law firm will not be celebrating good news as they announce the largest financial loss in the legal industry’s history.
Slater & Gordon first made history by becoming the first publicly traded law firm. Now they are making history by announcing the largest financial loss in legal sector history. The Aussie firm posted the largest financial loss recorded in the legal industry.
The Australian Securities Exchange and the firm’s shareholders received the warning on the profit loss just a few days ago. The damage is set at A$1bn or £580 million for the 2015/2016 financial year. They entered the Australian exchange in 2007.
Read Slater & Gordon Stock Drops after Inquiry Announced.
Slater & Gordon managing director Andrew Grech said, “Slater & Gordon’s FY16 performance is a story of two different halves. The results for the first half were extremely disappointing and well below expectations. In the second half we have taken significant steps towards turning around the performance of the UK business. Whilst the UK performance improvement programme is still in its early stages, the second half results indicate that our efforts are beginning to bear fruit.”
See Slater & Gordon Sees Double-Digit Net Profit Increase.
Much of the loss came from the news that Chancellor of the Exchequer George Osborne wanted to ban general damages for minor injuries. The firm’s share price plummeted from A$6 to A$1. The law firm also acquired Quindell’s legal services division for £680m as well as a number of other firms in the UK.
The firm provides 15 training contracts and legal apprenticeships each year but they have not commented on how this loss will affect that, if at all.
Slater & Gordon now sits on A$682.3m in debt.
Do you think there will be any other repercussions for the firm or will they go on like nothing happened? Tell us your thoughts in the comment below.
To learn more about publicly traded law firms, read London’s Stock Market to Welcome Its First Law Firm.
Photo: legalbusiness.co.uk