Freshfields Bruckhaus Deringer, one of the City's oldest law firms, today revealed a 9 per cent increase in full-year revenue to £1.29 billion despite the turmoil in the legal services market.

Profit per equity partner, the key measure of law firm profitability, held steady at £1,440,000.

It is the best performance yet reported by a leading City firm for the 12 months to April 30 and is in contrast to Clifford Chance, its "magic circle" rival, which yesterday revealed a 37 per cent slump in profits.

It is also vindicates a controversial £40 million overhaul of the firm's partnership and pension arrangements two years ago that led to its former head of restructuring, Peter Bloxham, bringing an unsuccessful but publicly damaging £5 million age discrmination claim against the firm.

Although painful at the time, the restructuring left the firm leaner and better managed than comparable firms when the financial crisis struck. Unlike it competitors, it has not made significant job cuts this year although it has frozen salaries and reduced starting rates for newly-qualified lawyers.

Ted Burke, the firm's chief executive, said: "We are fortunate to have come through a challenging year in relatively good shape, thanks to a large number of restructuring and other complex mandates."

Mr Burke said that the firm's revenue was boosted by 2 per cent by exchange rate fluctuations. Freshfields has a large practice in Europe which benefited from the strength of the euro.

"We expect that this financial year will be more difficult for us, at least from a financial perspective," Mr Burke said. "Our focus will continue to be on helping our clients through this difficult period."

Yesterday Clifford Chance said that revenue had fallen 5 per cent, from £1.33 billion to £1.26 billion, which cost it its spot as the world's highest-grossing law firm. Profit per equity partner fell from £1,156,000 in 2007-08 to £733,000.

Among Britain's other "magic circle" law firms, Linklaters is expected to report its latest full-year results tomorrow. Allen & Overy's are expected next week.

Explore Law

• Columnists

• Law Panel

• Law Reports

• Student Law

Times Recommends

• The best legal yarns this Christmas
• Legal school 'earned £1m by exploiting bar course'
• Axe may fall on 5,000 more City lawyers