Investec predicts higher H1 pretax profit driven by UK, South African performance

Investec, the financial services firm, has projected a rise in its adjusted operating pretax profit for the first half of its fiscal year ending September 30, 2023. The firm attributes this anticipated increase to strong performance in its UK and South African divisions. These positive results are expected to help the company meet its return on equity guidance for the period.

The firm’s forecasted adjusted pretax operating profit, which excludes any unique or exceptional items, is set between £428.7 million and £449.6 million ($527.1 million-$552.8 million). This estimation marks a notable increase from £405 million reported in the same period last year.

Investec’s bullish outlook is underpinned by several contributing factors including continual client acquisition, the favorable impact of rising global interest rates, and year-on-year growth in average lending books.

In terms of regional performance, Investec expects substantial growth in its UK division. The adjusted operating profit for this division is predicted to be at least 25% higher than last year’s £174.4 million. Similarly, the South African division is also projected to follow a positive trend with the same metric expected to grow by at least 5% from last year’s £230.6 million.

Regarding return on equity, Investec anticipates it will land around the midpoint of its target range of 12% to 16%. Concurrently, headline earnings per share are projected to be between 33.8 and 35.8 pence, signaling an increase from 32.0 pence during the same period a year earlier.

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