The restructure is over for Barclays (BARC), even if the recovery is still in train. A loss on sale and £1.1bn impairment of its holding in Barclays Africa Group was buried in discontinued operations, while the sale of its Egypt operations, along with lower operating expenses, meant pre-tax losses for the non-core business reduced by two-thirds. The non-core business was closed in July and residual assets and liabilities reintegrated.
As for the core, charges for payment protection insurance rose to £700m, helping push pre-tax profits down by a quarter to £3.0bn. It also meant returns on tangible equity were 7.3 per cent, from 12.5 per cent in last year's first half. However, the retail bank's net interest margin increased from 3.59 per cent to 3.69 per cent, as the bank passed on last year's interest rate cut to borrowers. Lending was also flat.
Pre-tax profits for the international business declined 5 per cent due to a weak performance in the consumer and cards segment. Credit impairment charges were up more than half to £575m, attributed to a change in the mix and growth in delinquency rates in US credit cards. Investment banking income was up 3 per cent to $5.3bn as underwriting growth offset a trading decline.
Analysts at Investec expect adjusted net tangible assets of 289.3p per share at 31 December 2017 (end-2016: 289.9p).
| BARCLAYS (BARC) | ||||
| ORD PRICE: | 207p | MARKET VALUE: | £ 35.3bn | |
| TOUCH: | 206.9-207p | 12-MONTH HIGH: | 244p | LOW: 145p |
| DIVIDEND YIELD: | 1.4% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 330p | LEVERAGE: | 23.3 | |
| Half-year to 30 Jun | Total operating income (£bn) | Pre-tax profit (£bn) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 11.0 | 2.06 | 6.0 | 1 |
| 2017 | 10.9 | 2.34 | 7.1 | 1 |
| % change | -1 | +13 | +18 | |
| Ex-div: | 10 Aug | |||
| Payment: | 18 Sep |
