Keystone Law Group plc reported a 31.3% increase in adjusted profit before tax to £9.6 million in the first half of fiscal 2027, ending July 31, 2026. Revenue climbed 22.5% to £66.3 million, surpassing the £54.2 million recorded in the prior-year period. Adjusted earnings per share rose 29.8% to 23.1 pence, while profit margins improved to 14.5% from 13.6% a year earlier. The firm’s revenue per principal grew 14.5% to £133,800, and net cash remained positive at £10.5 million with no debt outstanding. Management highlighted a strong operational cash conversion rate of 95.6%, though trade debtor days remained steady at 33 days.
The company’s share buyback program, completed in May 2026, totaled £1.5 million, acquiring 267,815 shares, with 223,822 shares allocated to Long-Term Incentive Plan vestments. Interim dividends increased by 28% to 9.6 pence per share, with a special dividend of 15 pence announced. Historically, dividends have accounted for about 91% of adjusted EPS since the IPO.
Keystone’s expansion into corporate practice represented 20% of total revenue, up from 16% in the prior fiscal year. The firm added 23 new principals in the first half, though recruitment efforts saw 148 qualified applicants, with 23 acceptances and starters. Headcount grew to 501 principals and 682 fee earners, with a retention rate of approximately 90% for new principals. AI adoption accelerated, with 50% of lawyers using enterprise-grade generative AI tools like ChatGPT and Claude, while 33% utilized NetDocuments’ generative AI. CoCounsel, a proprietary Thomson Reuters AI tool, was deployed to enhance access to U.K. legal databases.
Management expressed optimism for full-year 2027 results, projecting revenue to exceed prior-year levels and adjusted profit to surpass market expectations. The firm operates in the £14 billion U.K. mid-market commercial legal sector, ranking as the 57th largest law firm by revenue. Keystone’s pay-when-paid model and diversified client base—with no single client exceeding 5% of recurring revenue—support its growth trajectory, which has averaged 15% annual revenue growth and 20% annual adjusted profit growth since January 2021.
