European Wealth has been forced to issue a profit alert after failing to attract the funds it initially forecast.

In a statement to the stock market the AIM-listed firm said: ‘Whilst the cross selling between the divisions of the group are showing a material improvement, many of the new revenue generators are taking longer to build an established client base than we had originally anticipated, which together with the subdued trading volumes in global stock markets has resulted in our wealth management division being behind budget.’

Due to a fall in turnover the group, led by chief executive Rod Gentry (pictured), warned there could have a detrimental impact on earnings for the group.

European Wealth, which has discretionary and advice divisions, has made a number of acquisitions over the last 12 months, including European Wealth (Switzerland) SA in November 2014, which was the first step in building an international presence. 

This was followed by an announcement in November that Montpelier, an independent financial adviser in the Far East, had hired European Wealth as its preferred discretionary fund manager. 

More recently the firm bought Manchester-based Xcap Nominees, although this deal is taking the firm longer than anticipated to complete. It expects problems to be resolved soon, with Xcap bringing in around £30 million in assets under management.

Despite these struggles, the group remained confident about its prospects.

‘The foundations that have been put in place during the course of 2015 are expected to deliver growth in the next 12 months as the group continues to build on its original strategy of organic growth, acquisition and the attraction of revenue-generating staff,’ it said.

‘These foundations have already facilitated growth in assets under management, supported by a back office function that has only increased head count by one in the last 12 months.’