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A £36m write-down on US structured investments at Investec's capital markets division meant profits at that unit slipped 24.3 per cent in the period to £43.2m. But the advisory, structuring and asset creation side of the division performed well. While the group's other operations - private client activities, investment banking and property - reported impressive results.
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Indeed, profits from private banking rose 16.4 per cent in the period to £85.7m, while the private client portfolio management and stockbroking unit pushed operating profit ahead by 47.5 per cent to £14.4m. Meanwhile, a solid performance in South Africa and strong momentum in the UK pushed profits from asset management up 13.5 per cent to £36.2m, boosted by a 5.9 per cent rise in assets under management - which rose to £30.8bn. And there was a welcome bounce in the property division, where operating profits jumped 81.8 per cent to £11.5m, underpinned by a solid contribution from its investment property portfolio and higher funds under management.
Click here for a guide to the terms used in IC results tables
| INVESTEC (INVP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 542p | MARKET VALUE: | £2,268m | |
| TOUCH: | 542-543p | 12-MONTH HIGH: | 765p | LOW: 479p |
| DIVIDEND YIELD: | 4.5% | PE RATIO: | 9 | |
| NET ASSET VALUE: | 444p | |||
| Half-year to 30 Sep | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|
| 2006 | 213 | 24.1 | 10.0 |
| 2007 | 254 | 26.9 | 11.5 |
| % change | +19 | +12 | +15 |
Ex-div:12 Dec Payment:21 Dec |
|||
Inevitably in the current climate, the shares have slipped on our buy tip (605p, 24 November 2006). But Investec boasts a diverse earnings base, with South Africa and Australia both strong performers. More capital market-related losses can't be ruled out, but exposure there is limited, which leaves the shares looking too cheaply rated. Buy.
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-IC-1.5.4a-prod - 31/10/2008 13:11:34 - carlos.princz
