Keystone Law exceeds expectations as UK growth strategy excels

Legal firm Keystone Law saw its shares jump on Tuesday after strong first-half revenue and profit growth saw trading exceed expectations.

Profit before tax grew by 74% to £2.2m over the six-month period ended 31 July, driven by a 29.9% increase in revenue to £19.9m as the firm worked to deliver on its UK organic growth strategy and was nominated for ‘Law firm of the year’ in the Lawyer Magazine awards.

Under the growth strategy the firm increased the number of lawyers under its employ by 31, bringing the total up to 297 after a 6% increase in new applicants.

James Knight, chief executive of Keystone, said: "The recruitment activity in the period further demonstrates that our increasing reputation as a leading, quality-centric mid-market law firm makes Keystone an attractive proposition for good quality lawyers; thus, driving our expansion and enabling us to exploit the market opportunity which exists in the UK legal services sector."

The AIM traded company declared an interim dividend of 2.5p, up from zero last year, while cash and cash equivalents were at £5.3m at 31 July, up from £1.9m at the same point last year.

"The performance of the existing lawyers, together with the recruitment activity during the first half and the strength of the recruitment pipeline at the half year all serve to underpin management's confidence in the second half," said Knight.

Keystone’s shares were up 11.70% at 367.50p at 1059 BST.