SVM Asset Management, the Edinburgh fund group, more than doubled pre-tax profits last year from £1.2m to £2.6m, as a successful push into the retail market restored its momentum.

Turnover rose from £5.8m to £7.3m and operating profit on continuing operations jumped from £730,000 to £2m, after suffering a £500,000 hit last year on a write-off of an investment in Ireland.

A dividend of £600,000 was paid, against only £100,000 the previous year. SVM is 95% owned by chairman Colin McLean and partner Margaret Lawson.

Two years ago, SVM said it was moving to improve fund manager retention with a range of loyalty schemes, and the accounts show the issue of 585,200 C' shares to staff, which will convert into ordinary shares at the end of 2010 - or sooner if the company is sold or floated. Those shares will be worth 20% of the increase in value of the company from when the shares were issued.

McLean commented that the current year had started well for SVM. "We are reasonably confident we will be up again this year, we have made a strong start notwithstanding the market background. Some business wins have been coming through and contributing, as have performance fees."

He added: "It is helpful that over the last couple of years we have read the financial sector and banking probably quite well - that has meant our funds have been positioned quite well, and it should mean that our performance records are looking quite good."

McLean and Hugh Cuthbert have also been appointed by multi-manager Skandia to join its select band of managers.

SVM has added £100m of funds from its push into retail, out of £800m under management, helped by strong performance notably from its UK Opportunities fund, and some £30m more than the minimum target the company set itself at the beginning of 2007.

McLean commented: "There is a lot more corporate and proprietary value in having the retail business building up. It tends to be more stable and more valuable."

Next week SVM is adding two funds, cautious managed and balanced managed, to its fund of funds range.