Patently obvious that Murgitroyd is weathering the downturn well

Scotland's only listed firm of patent attorneys has begun hiring again after a "challenging" 12 months which saw employee numbers dip but profits and sales increase for the ninth year on the trot.

• Keith Young: Pleased with results 'in teeth of a recession'

Murgitroyd, which is based in Glasgow and floated on the Alternative Investment Market in 2001, also said it would continue to sound out acquisition opportunities to bolster its 14 satellite operations around the world.

The group yesterday posted a 23 per cent hike in annual profits to 3.8 million. Turnover in the year to 31 May nudged up 2 per cent to 29.4m.

A final dividend of 2p per share was proposed, giving a total shareholder pay-out for the year of 10p, up 0.5p on a year earlier.

Chief executive Keith Young said he was pleased at the outcome "in the teeth of a recession" - the firm winning new contracts and improving market share.

Gross profit, however, was flat while margins dipped from 63.7 per cent to 62.3 per cent.

Staff numbers fell slightly to just over 220, "due to those leaving the group not necessarily being replaced immediately".

The firm, founded in 1975 as a one-man business by current chairman Ian Murgitroyd, said that since the year end it had taken on three qualified attorneys for its offices in London and Newcastle and a newly-opened Helsinki operation.

Part-qualified and trainee lawyers have also been recruited for a number of sites, including Edinburgh and Glasgow.

Young described the move as a "reflection of our optimism", adding: "We got through the last part of the recession with fee-earner capacity intact. Ultimately no business is entirely recession proof but we're probably pretty close to it.

"Intellectual property is a long-term asset. People don't invest in IP then abandon it. We also benefit as our client base is widely spread geographically."

In March, Murgitroyd formally opened its Finnish office while, since the start of the new financial year, a sales-only operation has been launched in Tokyo.

House broker Brewin Dolphin, which has a "buy" rating on the shares, said the pre-tax result was 5 per cent ahead of its forecast.

Analysts noted that the solid full-year performance came against a 7.6 per cent reduction in European patent applications during 2009. The broker said: "We expect Murgitroyd to continue to outperform and believe that the group is capable of steady near-term growth."

The chairman, who holds a 29 per cent stake in the business, said: "We have delivered record turnover and profits whilst continuing our long-term strategy of investing in organic growth.

"The board believes that Murgitroyd remains positioned to take advantage of current and future opportunities in the market and is well placed to continue to deliver value to shareholders."