Group Preliminary Results

4 December 2013

Brewin Dolphin Holdings PLC (the "Group"/"Company")

Group Preliminary Results

for the 52 weeks ended 29 September 2013

Highlights

Declaration of Final Dividend

The Board is proposing a final dividend of 5.05p, to be approved at the 2014 AGM and payable on 28 March 2014 to shareholders on the register at close of business on 28 February 2014, with an ex-dividend date of 26 February 2014.

David Nicol Chief Executive said:

"Our priorities are clear. They are to reinforce our high standard of service to clients and ensure an improved return to shareholders. Discretionary Investment Management is currently the core of our business model and our mission is to provide a compelling and consistent offering, relevant to all our clients. Over the past decade we have evolved from a stockbroker into a private client investment manager. Our evolution must continue as we strive to become the leading provider of personal Discretionary Wealth Management in the UK."

For further information, please contact:

Business Highlights

We are now two and a half years into the transformation and growth strategy announced in 2011. This strategy has two main priorities: continued strong growth and increased efficiency. These priorities are underpinned by a series of initiatives to transform the business, ensuring it is best placed to enhance client service, meet regulatory demands and generate shareholder returns.

This year we announced a new operating margin target of 25%, which we aim to achieve by the end of the financial year 2016.

Capital

We successfully raised £38.6m through an equity placing in May 2013 to improve our capital strength and investment capacity. This will allow us to accelerate the strategy, capitalise on our competitive position and drive future growth in earnings and shareholder returns.

Board changes

The Board of the Company has been restructured with the appointment of three new Executive Directors, David Nicol, Chief Executive, Andrew Westenberger, Finance Director and Stephen Ford, Head of Investment Management who have joined fellow Executive Director, Michael Williams. In accordance with the UK Corporate Governance Code, the roles of Chairman and CEO have been split. Simon Miller was appointed Non-Executive Chairman. The new management team has been in place since March. These appointments have been accompanied by other management changes designed to create greater accountability and clearer lines of responsibility.

The UK Corporate Governance Code also requires that the boards of listed businesses should have at least an equal number of independent Non-Executive Directors excluding the Chairman. There are four Non-Executive Directors on the Board, excluding the Chairman. Jock Worsley retires from the Board at the AGM in February 2014 after 10 years of service. He has been Chairman of the Audit Committee and was appointed Senior Independent Director at the end of March 2013. His wise counsel will be greatly missed. Ian Dewar, who was appointed to the Board on the 15 November 2013, will succeed Jock as Chairman of the Audit Committee. Angela Knight will become Senior Independent Director. We will seek to recruit one more Non-Executive Director during the current year. Brewin Dolphin will then be fully compliant with the UK Corporate Governance Code.

Market Environment

Personal financial services remains a growth market with good long term prospects. There is increasing demand as society becomes more self-reliant in specific areas such as retirement provision and long term care as well as savings in general. In addition, the policy responses to the 2008 downturn have benefited those invested in risk assets such as equities and property and this has helped to create a higher number of investors.

Our industry offers many opportunities

The market environment has changed considerably in recent years, presenting challenges and opportunities. Increased transparency combined with growth has encouraged both new entrants and new business models to challenge the status quo in the industry.

Increased regulatory focus

There have been welcome and important changes to regulation - the most notable of which is the new regulator, the Financial Conduct Authority ('FCA'), and the development of its wealth management division which provides both increased scrutiny and guidance to our sector. In addition, many new rules including the Retail Distribution Review ('RDR') are now in place, giving us a stable period in which to consolidate and benefit from their introduction.

RDR's full implementation in 2013 has intensified the competitive environment. The move away from financial advice for the mass market and increased pricing transparency has prompted a change in client behaviour.

Changing client behaviours

Clients are increasingly sophisticated and using more complex technology which is leading to the development of new propositions and fuelling a real trend towards self-directed solutions. Investors are becoming more sceptical of in-house funds and products and also expect more education and guidance from their advisers. Scale has become a more important consideration as investors require reassurance regarding the security of their assets as well as the robustness of the organisation dealing with their money.

Competition is intensifying

One of the consequences of RDR has been the creation of the so called 'advice gap', which has led to a large potential market for investors seeking some guidance but who are unable to justify paying for full advice or have no such requirement. New propositions are being created to address this new market which could present a threat to established providers as they fully leverage the capabilities of today's technology. In addition, there is increased competition for high net worth clients and these are two of the key challenges facing the sector.

Objectives and Strategy

Our primary goal and corporate objectives summarise the long term targets for the Group. These have been refreshed to build on its heritage and the principles on which it has prospered for 250 years. Management has formulated a strategy in order to achieve these objectives, taking into account our business model and the market environment.

Improving revenue and efficiency have been the principal strategic priorities for the last two years.

A series of initiatives are underway to deliver these strategic priorities, including the move to a transparent national charging structure for our services, the design and implementation of new technology to help lower support costs and the restructuring of our organisational model to reduce the cost of central overheads.

The new management team completed an initial appraisal of the strategy, reported on at the time of our interim results. This re-affirmed the two strategic priorities, namely growth and efficiency, but also added two new strategic priorities:

Additional equity capital of £38.6m was raised via a placing to underpin and accelerate the strategy and help deliver on the two additional priorities of capital sufficiency and dividend growth.

The refocused strategy is underpinned by several initiatives:

The new focus reflects our view that to meet our objectives successfully in this environment our business model needs to evolve, in particular:

The business will grow and prosper if it simplifies and focuses the business model. A strategy of growth purely reliant on team acquisitions is, in our view, unsustainable in the current market environment. We believe that by building a simplified scalable business, focused on delivering our primary services we can achieve a leadership position in the industry.

Our strategy does allow for expansion through whole business acquisition and hiring of individuals but only when we can successfully integrate them into our culture and business model. In the past our acquisitions strategy has involved insufficient integration which has led to inefficiencies and lack of standardisation in key business processes. This has resulted in higher operational costs, which have impaired the ability of the business to reinvest in new technology to continue improving client service. It has also had a negative impact on shareholder returns and the management of risk.

The strategy has sought to address these issues over the last two years and we have been successful at standardising elements of the business such as pricing, client valuations and client communication. There is significant scope to further improve the business processes without changing the personalised nature of the service we offer. This challenge will be addressed by many of our current strategic initiatives in order to de-risk and improve the efficiency of the business.

A series of actions, some of which are underway and others completed are helping to deliver our strategic priorities. These are being pursued by management to grow the number of clients we service and therefore the revenue we generate and to improve our efficiency so that we achieve our 25% margin target.

Progress Report

Many projects have been undertaken over the past year to support our strategic priorities.

Growth

We have completed moving our Discretionary and a large portion of the Managed Advisory and Execution Only services onto standard national pricing. We now have circa £20bn on national pricing but there is still approximately 40% of our Managed Advisory business to complete during 2014. This has allowed us to continue to remove Unit Trust trail from the business and standardise the yield we receive for the services we offer at a more sustainable level:

Over the last year many clients have moved away from our dealing based offerings into our primary managed services and this is evident in our client fund flows.

Funds under management ('FUM') - rounded to 1 decimal place

Total managed and advised funds were £28.2bn, up by 8.9% from a year ago. The strategy of focusing on our Discretionary service and our move to fair and consistent national pricing across all client services has resulted in a continued move away from Advisory to Discretionary services.

Discretionary funds grew by £3.1bn in the year, a 17% increase (2012: 16.7% increase) as a result of continuing good net inflows of £1.1bn (2012: £1.0bn) and higher market levels £2.0bn (2012: £1.6bn).

Advisory funds fell by £0.8bn in the year, a 10.4% decline (2012: 8.3% decrease), as a result of net outflows of £1.5bn (2012:£1.1bn) partially offset by higher market levels £0.7bn (2012: £0.4bn). The figures also show the lack of demand from new clients for our Advisory Managed and Advisory Dealing services which continue to see outflows. The reduction in demand for these services combined with the absence of any yield premium (to cover the risk of providing investment advice) and the flow to Execution Only has shaped Management's view that we should withdraw our Advisory Dealing service.

Client funds held on an Execution Only basis grew by £1.3bn, a 24% increase of which £0.9bn represented new inflows and £0.7bn was transferred from Advisory to Execution Only as a result of our service review and move to standard pricing. During the year, the FTSE100 index increased by 13.4% and the FTSE APCIMS Balanced Index increased by 10.0%.

Discretionary funds now make up 76% (2012: 70%) of total managed and advised funds, continuing the long term trend and representing good progress towards our target of 80% by 2016.

During 2014 we will introduce an enhanced investment process. We aim to improve the client experience around a consistent structure which will be supported by new technology to underpin the change. This will mean we can consolidate our operating model within a national framework and ensure we offer a more consistent client experience.

To benefit from our enhanced investment process and more focused service offering, we intend to develop five growth channels to achieve our target of 5% pa growth from net inflows in Discretionary business.

a) Direct - A new website due in Spring 2014 will focus on our primary services combined with a number of marketing initiatives.

b) Agent - Financial Advisers are big supporters of our business and we believe our enhanced investment process will facilitate new, national partnerships.

c) Customer Advocacy - Our existing clients are our best advocates and we intend to build upon our high "Net Promoter Score".

d) Professional Services - Our proposition to accountants and solicitors will be updated during 2014.

e) Direct to Client Proposition - There is a significant demand for a simplified, lower cost service. We have an award winning model portfolio service and we are working on delivering this service directly to consumers.

We believe that the best way to grow is organically and our energies are devoted to building the brand value and meeting the needs of the market.

Improving efficiency

We have made progress in simplifying the business model in parallel to the development of our new IT systems. We successfully implemented the first stage of our new core operating system into Stocktrade, our Execution Only service, in September 2013 and we are already seeing the benefits. We will now roll the system out across the rest of the Group during 2014 and implement new software to support our Investment Management and Financial Planning services. Technology and process improvement is critical to our success and we will continue to invest in these areas over the foreseeable future.

In conjunction with the development of our new operating system we are also simplifying our service offerings. We have reviewed the risk, profitability and demand for our ancillary services many of which are either in the process of being closed or are no longer available to new business. This will lead to a greater concentration of resource around our primary discretionary wealth service.

The rationalisation of our services, combined with our enhanced investment process and supported by new technology, should facilitate a more efficient balance of Advisers to Funds under Management.

We have reviewed the number of offices which resulted in six offices being merged or closed (Inverness, Teesside, Bradford, Hereford, Stoke and Swansea). At the same time we have experienced the departure of a small number of teams including the majority of our Leicester office. Despite these reorganisations and departures, some of which were to competitor firms, early indications of clients remaining are positive. This has been achieved without having to hire any new staff.

We also reviewed the Appointed Representatives of the Group in the context of our refocused strategy and concluded that the risks of self-employed agents providing advice under our brand, in return for half the commission they generated was an out of date approach and not in the best interests of our clients. Over the year several Appointed Representative have transferred their business elsewhere and one has become an employee.

Maintaining capital sufficiency

We have added a new strategic priority to ensure that sufficient capital solvency is maintained in order to:

The Group successfully raised £38.6m equity capital via a placing, in order to increase capital levels. Together with profits retained during the year, this helped our capital solvency levels increase from 123% in September 2012 to 226% in September 2013.

We intend to operate at a minimum solvency level of 150% in future.

Growing the dividend to shareholders

The Board is implementing a dividend policy from 2014 based on a target dividend payout ratio of between 60% to 80% of annual reported adjusted diluted earnings per share to deliver the new strategic priority of ensuring that dividends grow in line with underlying adjusted earnings. The objective of this priority is to ensure that shareholders fully benefit in a timely way from any improvement to earnings.

Historically, the Board has adopted a policy of paying broadly equal interim and final dividends on the ordinary shares. In the future, the Board intends to establish an interim dividend and grow it in real terms. The variable final dividend will be based upon the full year target dividend payout ratio of 60% to 80% of adjusted earnings per share.

Key performance indicators

The table below summarises the key performance indicators for each strategic priority, with a measure of our performance to date.

1Controlled Function 30 (CF30) is an FCA approved customer function of dealing in, advising on or managing

investments on behalf of clients.

Results for the year

Financial highlights

The strong underlying results for the year ended 29 September 2013 reflect the combination of improving market conditions and progress we have made on delivering our strategic objectives. Adjusted profit before tax grew by 22% to £52.3m from £42.9m last year and adjusted diluted EPS grew by 19% to 14.9p per share from 12.5p last year.

The underlying adjusted profit growth was driven by increased income, 9% higher than prior year, together with improving efficiency as reflected by fixed operating cost growth being limited to 3% and the increase in adjusted profit before tax margin to 18.5% from 16.5% in the prior year.

Profit before tax for the year was £28.6m (2012: £29.9m), a 4% decline on the prior year. This was a result of significant restructuring costs incurred in the year and material provisions for onerous contracts which are explained below.

1 excluding redundancy costs, additional FSCS levy, onerous contracts provision, amortisation of client

relationships and disposal of available-for-sale investment.

Reconciliation of adjusted income and operating expenses to financial statements

Prior to the introduction of RDR (1 January 2013), Brewin Dolphin collected income from client portfolios on behalf of intermediaries, which it recorded as income with an offsetting expense. Post RDR, intermediaries are required to collect and record their income directly from clients and consequently this income is no longer recorded in Brewin Dolphin's results.

This has no impact on reported profit, however we have chosen to adjust the comparative figures for 2012 to be on a post RDR basis as we believe this offers a more fair and appropriate analysis of underlying income and cost trends.

Income

Total income grew by 9% to £283.7m (2012: £260.4m) in the year and is analysed as follows:

1 Core income is defined as income derived from fees and commissions charged on management and/or advice and execution activities relating to client portfolios.

Core income from our Discretionary, Advisory and Execution Only services, grew strongly by 19% to £245.5m (2012: £205.5m). This was driven by a combination of increased average client fund balances due to higher market levels and continued inflows, and improved returns as a result of the move to new pricing structures.

Income and yield by service type

The strong growth in FUM and improved yield resulted in a 23% increase in income to £192.7m (2012: £156.3m) from our Discretionary service. Despite lower levels of Advisory Managed FUM, overall income from Managed/Advised services increased by 18% due to the improved yield from re-pricing. The decline in income from advisory dealing resulted from the steep decline in funds under this category as a result of the service review and re-pricing initiative.

Overall fees and commissions grew, with fees growing particularly strongly, up 25% to £152.0m (2012: £121.4m) as a result of the growth in Discretionary services and the on-going introduction of fees to all Advisory Managed accounts in line with new pricing structures.

Aggregate other income declined by 30% to £38.2m from £54.9m in 2012, primarily due to the planned significant reduction in trail income which decreased to £14.8m (2012: £29.2m) as a result of our initiative to switch to trail free 'clean units'. Since the beginning of this year all new funds have been purchased on a 'clean' basis post the implementation of RDR.

Income from financial planning activities grew by 26% during the year to £11.7m (2012: £9.3m) as a result of our strategy to offer an integrated wealth management service.

Net interest earned from the management of client cash deposits reduced by 29% in the year to £11.7m (2012: £16.4m) as a result of reduced interest rates on deposits available from our banks, whilst maintaining interest rates payable on client cash balances.

Costs

Reconciliation of adjusted operating expenses to financial statements

1see reconciliation of adjusted income and operating expenses to financial statements

Significant progress has been made in bringing costs under control during the year.

Fixed staff costs

Fixed staff cost growth was limited to 7% year on year, below the rate of income growth, a reversal of previous years' trends and contributing to the improved operating margin. This was achieved through a combination of hiring discipline together with reduced run rate central function costs following the restructuring exercise undertaken during the year. The exceptional costs associated with this are described below.

Variable staff costs

Variable staff costs increased by 26% to £43.7m (2012: £34.6m). The increase was driven primarily by the rise in adjusted profit before variable staff costs (+24%) to which the majority of variable staff cost is linked, and management's decision to increase the overall level of variable staff compensation to assist in staff retention.

The overall ratio of total (fixed and variable) staff costs to adjusted income increased accordingly during the year to 53% from 51% in 2012.

Non-staff costs

A significant reduction in underlying non-staff costs of 6% year on year was achieved, falling to £84.2m from £89.7m in 2012.

This was due to tighter controls around discretionary spend, in particular in areas such as marketing, advertising and legal/consulting fees, and the reduction contributed significantly to the improvement in operating margin during the year.

Insurance recovery

During the year the Group reached final settlement with its insurers with respect to certain material past claims relating to insured losses incurred in prior years. This resulted in an additional £0.8m (2012: £4.7m) recovery being recognised in the year.

Exceptional costs

Redundancy costs

Redundancy costs of £4.8m (2012: £0.6m) incurred in the year primarily resulted from two organisational restructurings:

Onerous contracts provisions

Provisions in respect of onerous contracts totalling £6.2m, £5.7m relating to surplus property space which may not be able to be continually sub-let, were made in the year.

Of this, approximately £0.5m relates to the remaining lease commitments of up to 4 years on recently closed offices, £4.3m relates to lease commitments of up to 20 years on excess space resulting from the consolidation of operations into one office in Edinburgh, and £0.9m from excess space resulting from the consolidation into one office in London. The £0.4m non-property related provision relates to software applications no longer being used as a result of the central functions restructuring. The maximum total future undiscounted exposure resulting from the aggregate of the onerous property leases is approximately £23.0m.

Exceptional gain

During the year the Group sold its remaining stake in NPLUS1 Singer Ltd realising an exceptional gain on disposal of £0.9m.

Cash flow and capital expenditure

Our strategy aims to deliver not only growing earnings, but also rising free cash flow, being the cash generated from operations less what we invest in the business. This will ensure that dividend growth can be aligned with earnings growth without material short term reductions to tangible equity.

The table below shows how underlying profitability translated into cash generation:

Reconciliation to reported cash from operations:

The Group's cash balances increased materially by £65.8m to £113.5m at 29 September 2013, from £47.8m at 30 September 2012.

In addition to underlying cash generated from operations of £46.4m (2012: £44.5m), the large increase was the result primarily of the equity capital raising in May 2013, generating net proceeds of £38.6m, in addition to positive working capital movement of £17.6m in the year.

Underlying free cash flow increased to £24.6m from £14.1m in 2012, due to lower total capital investment in the year (£21.8m, versus 2012: £30.4m).

Upfront cash spent on acquiring teams of investment managers and their client relationships declined to £3.4m from £6.9m in 2012 due to the significant absence of further team hires in the year beyond what was already in progress at 30 September 2012.

Investment in fixed assets declined to £4.5m in the year (2012: £7.4m), primarily due to lower spend on computer hardware in support of the implementation of the new core software operating system.

Development of the new core settlement system which has been underway for 18 months, reflected in total £16.8m further capital investment in computer hardware and software development costs to bring the new software into use. In addition to £17m spent in 2012, total cumulative investment in the project is approximately £34m. It is anticipated an additional £20m will be spent over the course of the next 18 months to bring the implementation to a successful completion.

Dividends paid in the period came to £18.1m (2012: £16.9m).

There has been a cash outflow from the purchase of shares for the Share Incentive Plan (SIP) of £0.2m and £nil for the Deferred Profit Share Scheme (DPSP) during the year, (2012: £1.9m SIP and DPSP). The Group instructed the trustees of the DPSP to purchase £4m of shares after the end of the financial year.

Investment in new technology to improve the quality of our client service, as well as lowering the cost of delivering that service, is a key initiative to achieve the strategic priority of improving operational efficiency. We will continue to develop ways of investing and successfully integrating new software solutions into our business model. This will result in future capital investment, though at a lower level than the current run rate, once the core system is fully in place. Free cash flow as a proportion of underlying earnings should therefore increase over time.

Resources available to the Group

Our primary assets, in addition to our employees, are the value of:

We invest across all three categories to develop the assets of the business, securing growth and preserving and improving our operational efficiency.

As our strategy has changed in recent years from focusing solely on growth by acquiring additional client relationships to seeking also to improve operational efficiency, we have been investing more in the development of new software and less on acquiring teams of investment managers.

Pension Fund

The actuarial loss on the pension fund this year was £2.2m (2012: £5.1m). Under IAS19, large annual fluctuations can occur. The Group has agreed to make additional pension contributions of £3m per annum with the aim of paying the deficit off, over the next 7 years.

The net pension deficit reduced by £0.6m during the year to £9.2m (2012: £9.8m). This primarily resulted from better than expected investment returns on assets exceeding the increase in the actuarial value of liabilities.

Capital Structure, Treasury Policy, Liquidity and Capital Requirement

At 29 September 2013 the Group had net assets of £221.6m (2012: £162.7m). Net assets excluding intangible assets and shares to be issued of £109.1m (2012: £61.1m) broadly represent the Group's capital for regulatory purposes. These net assets were largely represented by net cash and cash equivalents of £137m (2012: £72m), including £20.3m (2012: £23.8m) of client settlement money. The Group has an agreed unsecured overdraft facility of £15m (2012: £15m). At the period end the Group had a surplus of net assets for regulatory capital adequacy purposes of £60.5m (2012: £11.4m), the increase is mainly attributable to the capital raised during the placing in May.

The Group aims to hold at least 90% of both clients' and Groups' money only at major UK clearers. Client money is segregated under rules set out in the FCA Client Asset Source Book.

Client stock is segregated and held in our nominee companies. Stock is settled via the Crest System which is owned by Euroclear, a highly rated bank, and, in the case of foreign stock, the Bank of New York Mellon.

Market risk, foreign currency risk, liquidity risk, interest rate risk, and credit risk are small and set out in detail in note 14 to the financial statements.

Post Balance Sheet Events

There have been no material post balance sheet events.

Accounting Policies

There were no changes in accounting policies during the year.

Significant Relationships

No client provides more than 2% of the Group's revenue. The Group has two main suppliers of computer software.

Going Concern

The Group has substantial operational gearing arising from its fixed cost base; this is mitigated by variable staff costs which if income falls would reduce variable costs. Cash balances ranged between £28m and £124m over the year.

The Group's business activities, performance and position, together with the factors likely to affect its future development, are set out in the Strategic Report which also describes the financial position of the Group including its liquidity position and borrowing facilities.

The Group's objectives, policies and processes for managing its capital, its financial risk management objectives, details of its financial instruments and its exposure to credit risk and liquidity risk are described in note 14 to the financial statements.

The Directors believe that the Group is well placed to manage its business risks successfully. The Group's forecasts and projections, taking account of possible adverse changes in trading performance, show that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the Directors continue to adopt the going concern basis for the preparation of the financial statements.

Principal risks and uncertainties

Risks

The Group's principal risks and uncertainties together with the key mitigants and controls are set out below.

Details of the risk framework and governance are set out in the Risk Committee Report in the 2013 Annual Report.

The origins and nature of the Group's principal risks change over time and are the result of, among other factors, the market environment and the Group's strategy.

As discussed above when explaining the Group's current strategy, management takes careful consideration of the risk implications of different strategic initiatives. The strategic refocus instigated by the new management team has in part been driven by the appreciation that the Group's risk profile was increasing over time as a result of external factors such as increased regulatory scrutiny and competitive pressures as well as from the Group's former strategy of inorganic growth.

The current strategy is aimed at managing and where possible reducing the operational, business and strategic risks over time. For example, initiatives already underway, such as the standardisation of the business model and withdrawal from certain activities and services, should result in reduced risks.

Equally, the increased focus on organic growth will limit the addition of further risk relating to acquisitions. Risks resulting from the past strategy, however, may remain.

In the long term, successful implementation of the strategy and realisation of strategic priorities will reduce the Group's strategic risk by making it more competitive and better able to continue to prosper in a challenging market environment.

In the short term, however, strategic risks may well increase due to the challenges of delivering the business transformation itself. In particular, the inability to implement change due to cultural inertia, vested interests or poor project management is an emergent risk as the refocused strategy is implemented.

Future Developments

The risks of not adapting our business model to a changing environment are significant and would erode shareholder value. Therefore we have developed an ambitious strategy to evolve the business and become the leading provider of Discretionary Wealth Management and the firm of choice for our clients, employees and shareholders.

We will continue to invest in our people, processes and technology to improve the client offering and if we achieve these goals, we will deliver significant value for shareholders, clients and employees.

Directors' Responsibilities

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors are required to prepare the Group financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union ("EU") and Article 4 of the IAS Regulation and have also chosen to prepare the parent Company financial statements under IFRSs as adopted by the EU. Under company law the directors must not approve the accounts unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period. In preparing these financial statements, International Accounting Standards 1 requires that directors:

· properly select and apply accounting policies;

· present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;

· provide additional disclosures when compliance with the specific requirements in IFRSs are insufficient to enable users to understand the impact of particular transactions, other events and conditions on the entity's financial position and financial performance; and

· make an assessment of the Company's ability to continue as a going concern. 

The directors are responsible for keeping proper accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Directors' Responsibility Statement

We confirm that to the best of our knowledge:

1. the financial statements, prepared in accordance with International Financial Reporting Standards as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole. In addition, each of the directors considers that the Annual Report, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company's performance, business model and strategy; and

2. the management report, which is incorporated into the Directors' Report together with the information provided in the Strategic Report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

By order of the Board

David Nicol Andrew Westenberger

Chief Executive Finance Director

3 December 2013

Independent Auditor's Report

to the members of Brewin Dolphin Holdings PLC

Opinion on financial statements

In our opinion:

· the financial statements give a true and fair view of the state of the Group's and of the Parent Company's affairs as at 29 September 2013 and of the Group's profit for the period then ended;

· the Group financial statements have been properly prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union;

· the Parent Company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and

· the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and as regards the Group's Financial Statements, Article 4 of the IAS Regulation.

The financial statements comprise the consolidated income statement, the consolidated and Parent Company statement of financial position, the consolidated statement of comprehensive income, the consolidated and Parent Company statement of changes in equity, the consolidated statement of cash flows, and the related notes 1 to 19. The financial reporting framework that has been applied in their preparation is applicable law and IFRSs as adopted by the European Union and, as regards the parent company financial statements, as applied in accordance with the provisions of the Companies Act 2006.

Going concern

As required by the Listing Rules we have reviewed the directors' statement that the Group is a going concern. We confirm that:

· we have not identified material uncertainties related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern which we believe would need to be disclosed in accordance with IFRSs as adopted by the European Union; and

· we have concluded that management's use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Group's ability to continue as a going concern.

Our assessment of risks of material misstatement

The assessed risks of material misstatement described below are those that had the greatest effect on our audit strategy, the allocation of resources in the audit, and directing the efforts of the engagement team:

· the assessment of the Group's calculation of intangible assets, comprising goodwill, client relationships and software development. This is a complex and judgemental process, concerning estimates of future cash flows and growth rates based on management's assessment of future profitability;

· the assessment of the Group's calculation of provisions for onerous leases, is a complex and judgemental process due to the uncertainty of future rental receipts;

· the calculation of the pension scheme deficit is susceptible to small changes in the underlying assumptions and requires significant management judgement in relation to mortality, price inflation, discount rates, pension increases and earnings growth;

· no active market exists for the Group's investment in Euroclear, making the valuation of this investment a judgemental process;

· the assessment of provisions in relation to outstanding legal cases and claims, and the associated estimates of insurance recoveries require significant judgement due to the need to estimate the expenditure required to settle the obligations; and

· the assessment of shares to be issued and deferred purchase consideration payable in respect of acquisitions of businesses or client relationships. This requires significant judgements from management due to the estimates of future earnings from acquisitions and discount rates used.

Our application of materiality

We determined planning materiality for the Group to be £2.86m, which is approximately 10% of pre-tax profit, and below 2% of equity.

We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of £57,000, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We also report to the Audit Committee on any disclosure matters that we identified when assessing the overall presentation of the financial statements.

An overview of the scope of our audit

The majority of the operations of the Group are based in the United Kingdom and are audited by Deloitte LLP. The only exception to this is Brewin Dolphin Tilman Limited, an Irish Company, which represents 4% of pre-tax profit and which is audited by another firm. We have supervised their work on the figures included in the Group's financial statements for this entity through the issuance of instructions, receipt of summaries of work performed and ongoing dialogue throughout the audit process.

The way in which we scoped our response to the risks identified above was as follows:

· we challenged the appropriateness of the various inputs used by management in their impairment calculations, and validated these to external information where available.

· we assessed in detail management's assumptions in respect of the amount of space identified as surplus to requirements; the potential income which could be earned from sub-letting this space; and the potential time to identify tenants.

· we evaluated the appropriateness of the principal actuarial assumptions used in the calculation of the retirement benefit obligation, using our own actuarial experts to make enquiries of the Group's actuary as to the key assumptions made, and compared these to our knowledge of market practice.

· we evaluated the appropriateness and consistency of the methodologies used for the valuation of the Group's investment in Euroclear.

· we challenged management's identification of outstanding legal cases and claims received, reviewed associated legal correspondence and obtained direct confirmation from the Group's legal advisors as to the adequacy of the level of provisions. We also tested the acknowledgement of any associated insurance recoverable.

· we evaluated management's calculation of shares to be issued and deferred purchase consideration, and challenged estimates of future earnings from acquisitions and discount rates used.

The Audit Committee's consideration of these risks is set out in the 2013 Annual Report

Opinions on other matters prescribed by the Companies Act 2006

In our opinion:

· the information given in the Strategic Report and the Directors' Report for the financial period for which the financial statements are prepared is consistent with the financial statements; and

· the part of the Directors' Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006.

Other matters on which we are required to report by exception

Adequacy of explanations received and accounting records

Under the Companies Act 2006 we are required to report to you if, in our opinion:

· we have not received all the information and explanations we require for our audit; or

· adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

· the parent company financial statements are not in agreement with the accounting records and returns.

We have nothing to report in respect of these matters.

Directors' remuneration

Under the Companies Act 2006 we are also required to report if, in our opinion, certain disclosures of directors' remuneration have not been made or the part of the Directors' Remuneration Report to be audited is not in agreement with the accounting records and returns. Under the Listing Rules we are required to review certain elements of the Directors' Remuneration Report. We have nothing to report arising from these matters or our review.

Corporate Governance Statement

Under the Listing Rules we are also required to review the part of the Corporate Governance Statement relating to the company's compliance with nine provisions of the UK Corporate Governance Code. We have nothing to report arising from our review.

Our duty to read other information in the Annual Report

Under the International Standards on Auditing (UK and Ireland), we are required to report to you if, in our opinion, information in the annual report is:

· materially inconsistent with the information in the audited financial statements; or

· apparently materially incorrect based on, or materially inconsistent with, our knowledge of the group acquired in the course of performing our audit; or

· is otherwise misleading.

In particular, we are required to consider whether we have identified any inconsistencies between our knowledge acquired during the audit and the directors' statement that they consider the annual report is fair, balanced and understandable and whether the annual report appropriately discloses those matters that we communicated to the audit committee which we consider should have been disclosed. We confirm that we have not identified any such inconsistencies or misleading statements.

Respective Responsibilities of Directors and Auditor

As explained more fully in the Directors' Responsibilities Statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the Group's circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the directors; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the Annual Report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

Simon Hardy FCA (Senior Statutory Auditor)

for and on behalf of Deloitte LLP

Chartered Accountants and Statutory Auditor

London, United Kingdom

3 December 2013

Consolidated Income Statement

52 week period ended 29 September 2013

Consolidated Statement of Comprehensive Income

52 week period ended 29 September 2013

Consolidated Balance Sheet

As at 29 September 2013

Consolidated Statement of Changes in Equity

52 week period ended 29 September 2013

Company Balance Sheet

As at 29 September 2013

 Company Statement of Changes in Equity

52 week period ended 29 September 2013

Consolidated Cash Flow Statement

52 week period ended 29 September 2013

For the purposes of the cash flow statement, net cash and cash equivalents include bank overdrafts.

Company Cash Flow Statement

52 week period ended 29 September 2013

 Notes to the Financial Statements

Brewin Dolphin Holdings PLC is a company incorporated in the United Kingdom under the Companies Act. The address of the registered office is 12 Smithfield Street, London EC1A 9BD. The nature of the Group's operations and its principal activities are set out in the Narrative Reports. The Company is registered in England and Wales.

These financial statements are presented in pounds sterling because that is the currency of the primary economic environment in which the Group operates. Foreign operations are included in accordance with the policies set out in note 3.

In the current year, the following new and revised Standards and Interpretations have been adopted and have affected the amounts reported in these financial statements.

Standards affecting the financial statements

New standards, amendments and interpretations issued but not effective and yet to be endorsed by the EU are as follows:

New standards, amendments and interpretations issued but not effective and have been endorsed by the EU are as follows:

The Group is currently reviewing the impact of these new standards, amendments and interpretations but does not intend to adopt the standards early.

IFRS 13 will apply to all transactions and balances (whether financial or non-financial) from which IFRSs require or permit joint value measurement, with the exception of:

· share-based payment transactions within the scope of IFRS 2 Share-based Payment

· leasing transactions within the scope of IAS 17 Leases.

· measurements that have similarities to fair value but are not fair value, such as net realisable in IAS 2 Inventories or value in use in IAS 36 Impairment of Assets.

IAS 19 (revised 2011) will impact the measurement of the various components representing movements in the defined benefit pension obligation and associated disclosures, but not the Group's total obligation. The amendments to IAS 19 (revised 2011), if applied for the year ended 29 September 2013, would reduce profit after tax by approximately £130,000 and increase actuarial losses in other comprehensive income by the same amount. There would be no effect on total equity.

The financial statements of both the Group and the Company have been prepared in accordance with International Financial Reporting Standards (IFRSs) adopted by the European Union and therefore the Group financial statements comply with Article 4 of the EU IAS Regulation.

The financial statements have been prepared on the historical cost basis, except for the revaluation of certain financial instruments. Historical cost is generally based on the fair value of the consideration given in exchange for the assets. The principal accounting policies adopted are set out below.

The consolidated financial statements incorporate the financial statements of Brewin Dolphin Holdings PLC and all its subsidiary undertakings.