Fund manager Walter Scott & Partners sees profits soar

The equity portfolio manager for institutional investors reported a three per cent rise in turnover from £202 million to £208 million while post-tax profits rose from £61.8 million to £114.8 million.

The firm, owned by Bank of New York Mellon which itself saw its dividend up five per cent, from £95 million to £100 million, said the huge rise in profits was mostly due to its expenses bill no longer making provision for potential tax liabilities on overseas funds.

Over the same period the company’s administrative expenses fell from £124.4 million to £66 million.

Salaries were up across the board, with its six directors receiving an average pay package of £3.5 million, up from £2.3 million the previous year.

The total pay pot for the firm’s 112 staff was £40 million, up from £25 million for 99 staff a year earlier.

Executive chairman Rodger Nisbet said: “Administrative expenses decreased by £58.4 million – 47 per cent – during the year.

“Prior year administrative expenses included £75.8 million in respect of potential overseas fund tax liabilities. This does not represent acceptance of any liability but ensures no further interest can accrue whilst the matter is being considered.”

Discussions with the UK tax authorities relating to a bill for overseas tax on six limited liability funds, are still ongoing but Mr Nisbet said “the expected outcome and timing are not known”.

Meanwhile, the firm’s charitable donations were up from just under £300,000 to just over £450,000.