However, the group's performance elsewhere was much more impressive. Operating profits from asset management jumped 52.6 per cent to £127m, thanks to net inflows of £7.4bn that contributed to a 26.7 per cent rise in assets under management to £58.8bn. On the wealth and investment side, last year's acquisition of Rensburg Sheppards helped to lift operating profits by 56.2 per cent to £40.4m, while investment banking recorded a 62.1 per cent increase in profits to £67.4m. Finances remained in pretty good shape too, with Investec's Tier 1 ratio a healthy 11.6 per cent.
Numis Securities is forecasting 2012 adjusted pre-tax profits of £672m and EPS of 61.1p (2011: £434m and 43.2p).
| INVESTEC (INVP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 486p | MARKET VALUE: | £2.6bn | |
| TOUCH: | 486-487p | 12-MONTH HIGH: | 539p | LOW: 425p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 10 | |
| NET ASSET VALUE: | 737p | |||
More analysis of company results
IC VIEW:
Investec has realigned its business model towards less capital intensive activities by building up the asset and wealth management side, resulting in a strong increase in fee income. Impairments remain a concern but are expected to decline, assuming a pick up in economic activity. Rated on 8 times forecast earnings the shares remain good value.
Last IC view:Good Value, 508p, 18 November 2010.
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