A WEALTH management firm employing hundreds of North-East workers has revealed IT troubles hit profits.

Brewin Dolphin said pre-tax profits sank from £28.4m to £8.6m in the year to September 28, with the cancellation of a software system delivering heavy exceptional costs.

Bosses said the IT system, which was expected to be used in its discretionary wealth management business, meant Brewin paid £38m exceptional costs.

The company employs about 360 North-East workers in Newcastle, which is the group’s third largest office.

In a full-year report, the firm also revealed it paid £2.3m redundancy costs after closing offices in York, Chester, Dorchester, Guernsey, Stoke, Truro and Lymington, Hampshire.

Its York closure was followed by an expansion of its team in Leeds.

However, despite the pre-tax profits fall, the company said it had made good progress, with discretionary funds increasing 13 per cent to £24bn and total income two per cent higher at £290.5m.

Fee income lifted from £152m to £177.3m.

William Baker Baker, head of Brewin Dolphin, in Newcastle, said: “2014 has been an exceptionally busy year in Newcastle.

“We are proud of our contribution to these creditable results and we have done much to improve our efficiency and our services for clients.

“We are mindful of the many changes to the landscape for investors, with new freedoms for pensions and a veritable savings revolution, following a succession of announcements from the Chancellor during the year.

“We are determined to be in a position to help fill the growing advice gap, of which we see continuing evidence in the North-East.”

David Nicol, chief executive, added: “We reassessed a significant software project, which resulted in a material impairment charge.

“Nevertheless, we are well positioned for success and I remain confident we have the right people to deliver our plans for growth.”