Law firm Michelmores is seeking to grow its turnover by 12 per cent for the next financial year on the back of increased work streams from London and beyond.

The Exeter-based business has a turnover target of £20.4 million with managing partner Malcolm Dickinson saying that he was "cautiously optimistic" for the year ahead.

The firm has recruited 25 members of staff in the last year and has reported an upturn in work levels out of its London office with contracts with large corporates like Capita as a result.

Contacts in the capital have also been responsible for increased international work for the company.

In particular, Michelmores has advised on several large schemes in Africa, including taking a lead role in US$20 million investment in a palm oil plantation and milling company in Sierra Leone.

"It's been a good year and we're confident that we will hit our targets for the year. Set against the context of the global economy it's been difficult to make investment decisions – it's been about having the confidence to push forward," said Mr Dickinson.

"It's difficult to reconcile our growth against what's happening in the world economic market. More work is coming from outside the region into the firm and I think that's probably a consequence of the economic situation. There's a shift with large companies looking for the quality legal services that are not prepared to pay the level of fees that you see in London.

"That's benefiting not just Michelmores but some of the other, larger law firms – it's a positive effect of difficult economic times."

While other professional firms have been focused on consolidation or expansion into new geographical areas, Michelmores has opted to focus solely on its Exeter office, at Pynes Hill, although it has a small office in Sidmouth and a growing base in the capital.

Cost cutting in the public and corporate sectors has seen the firm pick up increasing volumes of work from London.

"We're a Westcountry firm. Although we have a London office, our aim is to be pre eminent in the Westcountry. We have adopted the strategy of having a single, very strong, Exeter office with the synergies that brings, with a London office that supports it," said Mr Dickinson.

"With our cost base I think we can attract public sector and institutional work. We're very competitive when we're tendering for that sort of work."

While work in the construction sector remains flat, Mr Dickinson said that corporate and commercial work was starting to pick up and that, because of its involvement in the Skypark development, Michelmores was also bucking the trend in the local property market.

Despite the challenging economic outlook, Mr Dickinson believes that Exeter is well-placed to recover when the market picks up.

"Exeter is always busy. The growth of the economy is always ahead. It's difficult to predict, I think Exeter does rely on the public sector employment – we have probably not seen that feed through," he said.

"We don't feel that we're going into recession, but we have to be cautious about what we're doing. I think things are going to be driven by events outside our control."

Mr Dickinson predicted that, in the wider economy, times would remain tough with the prospect of more insolvencies.

"What's been unusual about the last few years is that not that many companies have been placed into some sort of procedure – I think that's starting to happen now."