Canaccord Financial Inc. (TSX:CF) says risk-averse investors and tough market conditions posed challenges for its Canadian wealth management business in the most recent quarter.

“The markets have been much better in the U.S. and the U.K. than they have been in Canada, but we’re expecting to see a slight uptick in the latter part of this year in Canada,” Canaccord president and CEO Paul Reynolds told analysts on Wednesday in a conference call.

“We’re working very hard on the cost side of our Canadian wealth management business, and we’ve worked very hard on the new products and services where we see the industry going.”

Despite the headwinds, the investment firm said the funds managed by its Canadian wealth division grew by 24 per cent compared with last year.

Overall, the Canadian division accounted for 49 of revenue from the company’s wealth management operations in the latest quarter.

The investment firm rose to a first-quarter profit as revenue grew by 15 per cent.

Canaccord Financial, which will be renamed to Canaccord Genuity Group Inc. in October, said reported Tuesday after markets closed that it had $7.9 million of earnings, or six cents per diluted share, during its fiscal first quarter.

That’s up from a loss of $20.6 million or 24 cents per diluted share a year ago, while revenue grew to $187.2 million from $162.5 million.

The company said it benefited from cost cutting and from diversifying its operations geographically.

“Our first quarter results showcase the early benefits of our expanded and increasingly diversified global platform,” Reynolds said Wednesday.

“The added scale and scope of our franchise is enhancing our competitive position in each of our core markets, and the cost containment culture we’ve cultivated is showing signs of success.”

Excluding significant items, Canaccord said it earned $11.8 million or nine cents per diluted share compared with loss of $16.3 million or 20 cents per share a year ago.

Its capital markets division, Canaccord Genuity, led or co-led 36 deals raising a total of $1.7 billion and participated in 82 deals, raising a total of $5.9 billion in the quarter.

Canaccord Financial is an independent financial services firm with wealth management and investment banking operations.