Management has continued to review operations and performance levels to ensure all locations align with the Group strategy. The decision has been taken to rationalise the Group's Legal Advisory operations in Australia, with an orderly closure of those operations in Melbourne, Sydney and Newcastle. The Brisbane office and the Group's Connected Services operations in Sydney, Melbourne and Brisbane will be retained.
These changes will enable a leaner Australian business to focus on institutional clients and core sectors, such as insurance, which have a stronger strategic fit for the Group and offer the best opportunity for sustainable and profitable growth, by integrating other products and services provided by Mindcrest and Connected Services.
Subject to the formal consultation process which will be undertaken, the Group anticipates that the office closures will regrettably result in approximately 85 employees and 14 principal lawyers (partners) leaving the business. Damien van Brunschot will continue to lead the Australian business and will join the Group's Executive Board from 1 May as previously announced.
While we expect an FY21 loss for the Australian operations of between £3m and £4m and some one-off non-underlying associated closure costs in FY21, these changes are anticipated to be earnings enhancing for the Group.
Irrespective of the action being taken in Australia, the Group continues to see an improving financial performance for FY21 with Q3 trading building upon the positive revenue and profit trajectory reflected in the FY21 interim results. The Group expects FY21 performance to be at least in line with expectations.
Sir Nigel Knowles, Chief Executive Officer, commented: "It is never easy making decisions like this, but rationalising our Australian operations is about focusing our investment resources on areas aligned to Group strategy and priority sectors and clients, something that we have done very successfully in Dubai and elsewhere. I am confident that we will continue to grow our global operations in the future.
"Whilst we will part company with valued friends and colleagues in some locations, we retain a strong and respected team in Brisbane, with a renewed emphasis on our Insurance practice. We also retain Connected Services in Brisbane, Sydney and Melbourne and will continue to bring our Mindcrest offering to this market. We remain committed to the Australian market, and wish our departing colleagues well as they transition their practices
"As we approach our FY21 year end in April, we remain confident in our performance and have seen strong activity levels in our third quarter ending in January, and are enjoying a busy start to our fourth quarter. We therefore continue to view the future with confidence."
This announcement contains inside information for the purposes of Article 7 of EU Regulation 596/2014. The person responsible for release of this announcement on behalf of the Company is Chris Stefani (Chief Financial Officer).
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