Financial services group Old Mutual Plc, which has shed several hundred jobs in Britain over the last two years, said it would still consider further cutbacks to boost profits at its UK division.

Old Mutual held a presentation for analysts, published on its website, in which it detailed ambitious targets for its UK businesses, and said it would examine headcount reductions to save costs. Old Mutual employs over 40,000 staff worldwide.

Old Mutual, whose businesses include banking, stockbroking and fund management, makes around 70 per cent of its group profits in South Africa but has gradually built up a presence in Britain after buying wealth management firm Gerrard in 2000.

A presentation by Mike Bolsover, human resources director at Gerrard, said the group would "rigorously control costs" in areas including headcount, as well as property and software. He added Old Mutual would be "cutting fat not muscle".

Old Mutual's London-listed shares were up 0.3 per cent at 75-1/4 pence in afternoon trade.

Its UK businesses, including results fron Old Mutual's banking arm Nedcor, had an operating profit of £31 million at the interim stage. The division also includes stockbroking arm Old Mutual Securities, which the company has put under review, and the GNI derivatives broking firm.

Old Mutual reported a 16 per cent fall in first-half operating profits of 381 million pounds in August, after earnings were hit by a weak South African rand and tumbling stock markets, and Old Mutual said markets remained difficult.

A slide presentation by Gerrard Chief Executive Stephen Clark highlighted the "collapse of investor confidence" as one of the challenges facing the group.

Old Mutual said it hoped its UK division would win around one billion pounds of annual net client business by 2004.

"The UK is an important leg of Old Mutual's internationalisation strategy," said Finance Director Julian Roberts.

Clark was also optimistic over Gerrard's prospects. "Gerrard will be the leading UK private client wealth creator and wealth manager," he said at the presentation.

Roberts said Old Mutual should achieve a return on investment on its UK businesses of 10 per cent by 2004. He also stuck to a goal for the UK unit to have a post-tax operating profit of £40 million by 2004.

Old Mutual's London shares have outperformed the broader FTSE Eurotop 300 index by about 23 per cent since the start of 2002.