14th Sep 2006 10:50
Investec PLC14 September 2006 Investec plc and Investec Limited ("Investec" or "the group") Pre-close statement and investor briefing 14 September 2006 Strong performance in the first half of the financial year As previously announced, Investec is today hosting an investor pre-closebriefing at 11:00 (GMT) (12:00 South African time) which will focus ondevelopments within the group's core business areas in the first half of thecurrent financial year ending 31st March 2007. Overall group performance commentary The group has continued to see strong operating performances from the majorityof its businesses in the first half of the financial year. As we have outlined previously, our strategy of maintaining a balanced businessmodel remains an important focus, particularly in the context of a more volatileoperating environment. In this regard, our average advances and average thirdparty assets under management have grown over the reporting period, the resultof which is we have experienced strong growth in net interest income, fees andcommissions. Contributions are well spread across our core activities andgeographies with noteworthy performances from our Private Banking, Treasury andSpecialised Finance and Asset Management businesses. Stephen Koseff, Group Chief Executive, commented: "Although the first half of the financial year ends on 30 September 2006 we arepleased to report at this point that we are on track to deliver a strongperformance for the six-month period. Whilst financial market conditions haveweakened since our year-ended 31 March 2006 we are continuing to benefit fromincreased brand recognition and penetration in our core activities andgeographies. We remain committed to maintaining a distinctive growth strategy and we are wellplaced to once again deliver on our financial targets and objectives." Bernard Kantor, Group Managing Director, commented: "Our strategy to increase the scale in our UK and Australian operations isstarting to reap benefits and should be reflected in the operational performanceof the group during the first half of the financial year." Business commentary Salient features of the operating performance of our core business areas arelisted below and further details will be provided in the briefing presentationwhich can be viewed on our website. Private Banking - Very strong performance. - Benefiting from our growth strategy with continued penetration in all areas of specialisation. - Good momentum in lending turnover and transactional activity with strong growth in margin and very strong growth in fees. - Average advances increased by 30.0%. Private Client Portfolio Management and Stockbroking - Increased volatility but benefiting from higher average asset levels and volumes over the period. - Average assets under management increased by 46.2%. Treasury and Specialised Finance - Initiatives undertaken in the past few years are starting to generate significant revenue. - Pipeline and levels of activity have been good across the advisory, lending, debt capital markets and structured derivative areas. - Very strong performance in the UK and Australia supported by a good performance in South Africa. - The acquisition of N.M. Rothschild Australia Holdings Pty Ltd provides a base from which to grow our operations in Australia. - Average advances increased by 31.4%. Investment Banking - Agency and Advisory - Strong corporate finance pipeline in South Africa and a stable corporate finance pipeline in UK and Australia. - Strong performance from the stockbroking businesses as a result of increased volumes over the period. - Direct Investments and Private Equity - Good performance from the direct investments and private equity portfolios in South Africa. - The UK business has not benefited from realisations as was the case in the prior year. Asset Management - Earnings growth enhanced by momentum of UK and international business. - Solid long-term investment performance. - Average assets under management increased by 17.2%. Property Activities - Property Activities in South Africa remain buoyant as the market fundamentals remain strong, despite increases in interest rates, however this may not be reflected in the current trading performance. - Average assets under management increased by 23.0%. Group Services and Other Activities - Central Funding weaker performance: - Negative market impact on underlying assets in the South African shareholders portfolio. - UK impacted by hedging loss on the translation of the Euro denominated preferred securities (there is an equal and opposite effect reflected in the minority interest line, and hence this impact is neutral on the group's overall profitability). - Central Costs are marginally up on the previous year. Notes: 1. Key trends set out above, unless stated otherwise, relate to the five months ended 31 August 2006, and are compared to the six months ended 30 September 2005. 2. Please note that matters discussed in the briefing and highlighted above may contain forward looking statements which are subject to various risks and uncertainties and other factors, including, but not limited to: - the further development of standards and interpretations under International Financial Reporting Standards (IFRS) applicable to past, current and future periods, evolving practices with regard to the interpretation and application of standards under IFRS. - domestic and global economic and business conditions. - market related risks. - A number of these factors are beyond the Company's control. - These factors may cause the Company's actual future results, performance or achievements in the markets in which it operates to differ from those expressed or implied. - Any forward looking statements made are based on the knowledge of the Company at today's date. Presentation details The briefing starts at 11:00 (GMT) (12:00 South African time) and will bebroadcast live via video conference from the group's offices in Johannesburg toLondon. The briefing will also be available via a live and recorded telephoneconference call, a live and delayed video webcast, a delayed podcast and adelayed Mp3. Further details in this regard can be found on the website at:www.investec.com Timetable: Six-month period end: 30 September 2006 Release of interim results: 16 November 2006 Financial year-end: 31 March 2007 For further information please contact: Investec Investor Relations UK: +44 (0) 207 597 5546 South Africa: +27 (0) 11 286 7070 [email protected] About Investec Investec is an international specialist banking group that provides a diverserange of financial products and services to a niche client base in threeprincipal markets, the United Kingdom, South Africa and Australia as wellas certain other countries. The group was established in 1974 and currently hasapproximately 4 800 employees. Investec focuses on delivering distinctive profitable solutions for its clientsin five core areas of activity namely, Private Client Activities, Treasury andSpecialised Finance, Investment Banking, Asset Management and PropertyActivities. In July 2002 the Investec group implemented a dual listed company structure withlistings on the London and Johannesburg Stock Exchanges. Management and staffown approximately 15% of the equity share capital of the group. The combinedgroup's current market capitalisation is approximately £3.1bn. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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