Wealth manager Brewin Dolphin’s profit took a hit in the first half of the year, despite an increase in demand for financial advice during the market turbulence.
In a market update for the six months to March, Brewin Dolphin reported that statutory profit before tax had dropped 5.1 per cent to £28.2m, down from £29.7m in the same period the previous year. Total funds fell to £41.4bn, down from £45bn in 2019.
Total income for the period increased 8.3 per cent to £175.8m. Excluding income from acquisitions of £9.3m, income increased 2.6 per cent.
Despite the market volatility, the wealth manager reported an increased demand for its advice services. Income in its financial planning division jumped to £16.4m, from £12.6m in the first half of 2019.
Advisory income grew £900,000 to £2.2m, which Brewin Dolphin was driven predominantly by the acquisition of Investec’s wealth management business in Ireland, BDCIIL, last October. The group said the migration of clients and assets had been completed remotely in April.
Looking ahead, the wealth manager anticipates a high level of uncertainty for the rest of the financial year. It has identified non-staff related cost savings of between £6m and £8m, which it will leverage during the second half of the financial year.
Chief executive David Nicol, who is due to step down next month said: “We will have further clarity on the impact of Covid-19 over the summer, at which point we would expect to consider further actions to support us beyond full-year 2020.”
“In periods of uncertainty we believe our advice-led services are required more than ever. We have a strong balance sheet with good cash generation, and a robust regulatory capital position, which will support us during these challenging market and social economic cycles.”