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Investec sees steady earnings growth as it prepares for new CEO

The rise in operating profit indicates stability as Investec change its leadership this year.

 Anglo-South African investment bank and asset manager Investec reported an increase in operating profit on Thursday, with funds managed by its asset management business topping 100 billion British pounds ($135 billion)/(R1 trillion) for the first time.

The 5.6% rise in operating profit for the year ended in March indicates stability as Investec heads for a changing of the guard this year with co-founder Stephen Koseff set to step down as CEO in October and two other founding members of the business – Bernard Kantor and Glynn Burger – also due to retire.

Analysts do not expect any big strategy shift for the group, which reported ongoing operating profit of 701 million pounds ($949 million)/ (R11 billion)  for the full-year ended March 31, up from 663.7 million pounds a year earlier.

“Operating performance during the year was underpinned by sound growth in loans and funds under management and a solid recurring income base, despite a challenging backdrop in South Africa and the UK,” Koseff said in a statement.

Adjusted earnings per share before goodwill, acquired intangibles and non-operating items jumped 13.3% to 61.3 pence, the company said in a statement.

The board proposed a final dividend of 13.5 pence per ordinary share, equating to a full year dividend of 24 pence, up from 23 pence last year.

Uncertainty about the terms of Britain’s departure from the European Union and political uncertainty in South Africa continued to affect corporate and consumer confidence in those two markets during the period under review, Investec said.

The group’s wealth & investment and asset management businesses generated substantial net inflows taking fund management’s assets under management above 100 billion pounds, Koseff said.

Shares in Johannesburg-listed Investec were up 1% at R95.99 by 07:04 GMT, while in London the group’s shares were flat.

Chairman Fani Titi and Hendrik du Toit – head of Investec’s asset management business – have been picked as the group’s new joint chief executives and will formally take charge in October.

($1 = 0.7401 pounds)

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‘’Friends, Romans, countrymen, lend me your ears;
I come to bury Caesar, not to praise him.
The evil that men do lives after them;
The good is oft interred with their bones;
So let it be with Caesar’’

(From Julius Caesar, spoken by Marc Antony)

…so let it be with Stephen Koseff – the main driver of the billions of rands lost by Randgold shareholders – due to Investec’s shenanigans (Kebble) and roles, when JCI (the thief) stole Randgold’s (the victim) shares, and Western Areas (main beneficiary) together with Investec, walked away with billions of rands (my views and extensively reported by the mainstream media for many moons)….methinks KPMG should be investigated/probed – as a ‘’can of worms’’ would be opened in the process…which should/could be handed to the NPA for in depth investigation – KPMG failed to adhere to the Companies Act, for years, by not releasing compliant (signed) financials statement on their audit client, JCI !

Given the state of the economy and country we need 100s more Stephen Koseffs. The asset management division has gone from a small operation in the early 90s to a major player in SA and a player in the UK market. A great South African success story.

End of comments.

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