The decision by Barclays' (BARC) management to halve the dividend for 2016 and 2017 to 3p cast a long shadow over the banking group's 2015 results. The group's new chief executive, Jes Staley, believes the dividend cut necessary to beef up the group's capital base and to compensate for impending losses on the group's non-core assets. To the same end, the group also intends to sell its 62.3 per cent stake in its African banking business.
Management will accelerate the sale of non-core assets this year and simplify the group into two divisions - splitting the retail-focused Barclays UK from Barclays Corporate and International. During the period, Barclays reduced non-core risk-weighted assets by £29bn to £47bn, which helped bump up the group's tier one capital ratio by 110 basis points to 11.4 per cent. The sale of its Italian, Spanish and Portuguese businesses resulted in total losses on disposal of £580m.
Like many of its counterparts, the banking group racked up hefty provisions against past mis-selling of payment protection insurance, totalling £2.2bn. Barclays also set £1.2bn aside for ongoing investigations and litigation in the US.
Analysts at Investec Securities are forecasting net tangible assets per share of 288p by 31 December 2016.
BARCLAYS (BARC) | ||||
|---|---|---|---|---|
| ORD PRICE: | 156.05p | MARKET VALUE: | £26.2bn | |
| TOUCH: | 156.05-156.15p | 12-MONTH HIGH: | 290p | LOW: 148p |
| DIVIDEND YIELD: | 4.2% | PE RATIO: | na | |
| NET ASSET VALUE: | 356p | LEVERAGE RATIO: | 19.3 | |
| Year to 31 Dec | Total operating income (£bn) | Pre-tax profit (£bn) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 33.0 | 5.88 | 23.6 | 6.00 |
| 2012 | 25.2 | 0.80 | -4.8 | 6.50 |
| 2013 | 28.4 | 2.87 | 3.8 | 6.50 |
| 2014 | 25.8 | 2.26 | -0.7 | 6.50 |
| 2015 | 26.0 | 2.07 | -1.9 | 6.50 |
| % change | +1 | -8 | - | - |
Ex-div: 10 Mar Payment: 5 Apr | ||||
