Investec sees jump in FY profits, boosted by rising interest rates

In a pre-close trading update for the year to the end of March 2023, the company said adjusted operating profit before tax is expected to be between £782.8m and £833.6m, up from £687.4m a year earlier.

Adjusted earnings per share were seen at between 66p and 70p, up 20% to 27% on the previous year. Meanwhile, Investec said basic earnings per share were set to rise between 60% and 67% on the year to 83p to 87p. This reflects a positive impact from the gain on the implementation of the Ninety One distribution in May 2022.

Headline earnings per share will be between 65p and 69p, up from 53.3p a year earlier.

For the UK business, it expects adjusted operating profit to be at least 15% higher than the prior year’s £302.8m. Adjusted operating profit for the Southern African business will be at least 10% ahead in rands, it said.

Investec’s return on equity will be within the group's FY2024 target range of 12% to 16%, in line with the guidance given in November 2022.

"The group experienced strong performance, notwithstanding the complex macroeconomic backdrop that prevailed in the period," Investec said. "Our diversified business model and strong balance sheet allowed us to support our clients amidst this evolving environment. Continued execution of our stated strategy has enabled the group to achieve its FY2024 targets."

At 0835 GMT, the shares were up 4.4% at 458.70p.