Edinburgh Fund Managers (EFM) suffered a 57% drop in pre-tax profits for the 12 months to the end of January, despite reducing operating costs by a massive £11m (€16.1m).

Charles Nunneley, the recently installed chairman of the Scottish investment house, revealed that pre-tax profits were down to £2.78m in 2002, from £6.51m the year before. After taxation, EFM made a loss of £1.73m - the first time the company has dipped in to the red in 18 years. Profits after tax were £1.61m in 2001.