July 6 (Reuters) - Two of the largest law firms in the United Kingdom are reporting flat-to-lower annual revenue growth, reflecting the reach of Europe's economic woes.

Linklaters and Freshfields Bruckhaus Deringer released financial results Friday showing stagnant revenue gains and declines in profits per partner for the fiscal year ending in April.

"The more mature European markets have been pretty terrible this year," said Tony Williams, a former managing partner of Clifford Chance who is now with Jomati Consulting.

The annual results are some of the weakest to emerge this week from the UK's Magic Circle, a label applied to a small but influential group of London-based law firms. But on Tuesday two other Magic Circle firms, Clifford Chance and Allen & Overy, reported stronger financial results.

All four rank among the 10 largest law firms by revenue in the world, according to an annual list compiled by The American Lawyer.

Freshfields is the product of a 2000 merger between a London firm and two German firms, Deringer Tessin Herrmann & Sedemund and Bruckhaus Westrick Heller Lober. The firm said it grossed nearly £1.14 billion ($1.77 billion), down 0.7 percent. Profits per partner declined 1 percent, to £1.31 million ($2.03 million).

In a statement, Freshfields managing partner Ted Burke described 2011 as "a good year" for the firm, "especially when you consider the impact of the sovereign debt crises on transactional activity."

Linklaters, meanwhile, said that its revenue grew just 0.6 percent, to £1.21 billion ($1.87 billion). Profits per partner fell 3 percent, to £1.18 million ($1.83 million). In a statement, Linklaters managing partner Simon Davies nodded to the challenging economic climate.

Law firm consultants predicted a tough road ahead. The crisis in the euro zone coupled with the double-dip recession in the UK have cast a cloud over how British law firms will be able to do better next year, Williams said.

Though the 100 largest firms in the UK are expected to report a 6.6 percent annual increase in revenue, according to a survey by Deloitte released in June, at least some of that growth is attributable to mergers, said Jeremy Black, a partner in Deloitte's professional services group. He also said that law firm revenue growth has been slowing since July 2011.

"The firms are finding that the corporate work is quiet," Black said. "There just aren't the number of corporate transactions one would typically see or want to see."

The two Magic Circle firms that have posted significant revenue growth for last year, Allen & Overy and Clifford Chance, were aggressively expanding into new markets in 2011. They launched new offices in cities like Casablanca and Istanbul, while also making major lawyer acquisitions to open outposts in Australia.

"Typically, the European firms have a more global footprint than the American firms," Wim Dejonghe, Allen & Overy's managing partner, said in an interview. "The domestic markets are smaller than the American market is, so European firms that want to see revenue growth need to go abroad."

Allen & Overy's revenue climbed 6 percent, to £1.18 billion ($1.92 million). Of that, 22 percent came from emerging markets, up from 15 percent three years ago, Dejonghe said. The firm is continuing to expand overseas, announcing in May it planned to open two offices in Vietnam.

Overall profits at Allen & Overy grew 7 percent. Profits per partner were flat, at £1.1 million ($1.8 million), thanks in part to the firm adding another 29 partners.

Clifford Chance posted the biggest gains, with revenues up 7 percent, to £1.3 billion ($2.05 billion), and profits per partner up 7 percent, to £1.1 million ($1.7 million).

Clifford Chance executives attributed some of the firm's growth to its presence in markets other than Europe, particularly Asia, where revenues climbed 28 percent and contributed to 14 percent of the firm's overall revenues.

But with more than a third of its revenues coming from Continental Europe, Clifford Chance management said it is mindful of issues in the euro zone.

David Childs, the managing partner of Clifford Chance, said during a conference call with reporters Tuesday that he expects a challenging year ahead, but was hopeful a European Union summit agreement reached June 29 would help bring down borrowing costs for Spain and Italy.

"It looks like market conditions will be tough this year, or at best uneven," Childs said.

(Reporting By Nate Raymond)

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