The biggest 200 law firms in the UK broke through the £20 billion revenue barrier for the first time, as firms that have US headquarters and London outposts begin to usurp their British counterparts.

The largest 200 firms posted total revenue of £20.2bn in the 2013-14 financial year, a six per cent increase on the previous 12 months, according to statistics from The Lawyer magazine.

Of the total, £11bn was generated by the largest 10 firms, which also managed to boost their net profit by 11 per cent to £4 billion.

The results underscore the improving market for law firms, which were disproportionately hit by the financial crisis and made unprecedented job cuts as the flow of lucrative mergers and banking work on which they had relied dried up.

The biggest firms are now once again advising on cross-border mergers and acquisitions, while banks need legal advice to deal with greater regulatory scrutiny and a wave of investigations and litigation.

PricewaterhouseCoopers said that while the number of UK firms managing to boost their revenue and profit above inflation was increasing, most financial metrics at law firms were still lagging behind their 2008 inflation-adjusted levels; particularly the keenly watched average profit-per-equity-partner figure.

US firms – which can rely on a litigation-obsessed domestic market and tight client relationships with large banks – have been particularly well placed to benefit from the growth in work. The London offices of the largest US firms are now bigger in their own right than some UK firms, according to The Lawyer’s research.

Legal practices looking at ways to develop their firms and maximise competitiveness may find it helpful to discuss their options and the financial issues involved with professional advisers that specialise in this area. For more information about how Milsted Langdon can help you, please contact us.