A solid first-half performance from Investec saw five of the group's six core business areas enjoying a solid increase in earnings - the exception being private banking, where impairment charges turned last year's £16.7m profit into a loss of £3.9m.
Asset and wealth management were the principle drivers for the rise in profits from the specialist bank and asset manager, with the asset management side notching up a £1.9bn net inflow of funds which boosted assets under management by 6.7 per cent to £49.5bn. Together with a solid investment performance, this saw operating profits rise by 69.1 per cent to £48.9m. And the wealth management arm was strengthened by the acquisition of Rensburg Sheppards in March which helped to boost operating profits by 36.1 per cent to £16.3m.
The group's investment banking business also turned in a strong performance - operating profits rose 58.7 per cent at £42.5m - reflecting improvements in some of the investments held in the UK and South African portfolios. And good levels of activity in structured finance and equity derivatives helped the capital markets division to record an 81.3 per cent rise in profits to £133.5m.
Finances were in pretty good shape too, with a Tier 1 ratio a healthy 12.1 per cent. Numis Securities is forecasting full-year pre-tax profits of £481m and EPS of 43.9p (2010: £410m/44.8p).
| INVESTEC (INVP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 508p | MARKET VALUE: | £2.7bn | |
| TOUCH: | 507-509p | 12-MONTH HIGH: | 565p | LOW: 411p |
| DIVIDEND YIELD: | 3.1% | PE RATIO: | 10 | |
| NET ASSET VALUE: | 707p | |||
| Half-year to 30 Sep | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|
| 2009 | 204 | 22.2 | 8.0 |
| 2010 | 278 | 29.7 | 8.0 |
| % change | +36 | +34 | - |
Ex-div: 8 Dec Payment: 21 Dec | |||
