Slater & Gordon’s acquisition of Keddies has lost some of its sparkle following the firm’s poor revenue result in the first half of the financial year. Keddies’ revenue was down approximately A$4 million in the six months to December 31, but managing director Andrew Grech is confident the practice can rebound. “While its revenue performance in the first half was disappointing, the Keddies acquisition represents the best opportunity available to underpin our future growth in personal injuries litigation in NSW,” he said.

The ASX-listed Slater & Gordon purchased Keddies in January last year for A$35 million. As a result of the lackluster performance, that price has now dropped to A$32 million, as agreed in the acquisition.
Slater & Gordon’s half year financial results show that the legal company made a net profit (after tax) of A$11.8 million, down 11.3 percent compared to the same period last year, despite a revenue increase of 17.3 percent. However, Grech is confident the firm will achieve a revenue of more than A$200 million in the full financial year before taking into account revenue from its latest acquisition in the UK. The acquisition of UK firm Russell Jones & Walker is subject to regulatory approval, but is likely to be finalised by April this year. The firm has spent approximately A$700,000 on associated acquisition costs such as legal fees in the past six months and expects to spend a further A$300,000 in the second half as a result of the UK expansion.

Slater & Gordon’s other acquisitions in recent years have all met revenue targets. Trilby Misso Lawyers is on target to achieve yearly revenue of A$36 million according to the half year financial results. Personal injuries across the group performed well, with the exception of Keddies, achieving growth of six percent compared to the corresponding period last financial year.

There are no other material acquisitions in Australia or the UK planed according to the statement.

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