Investec Group (INVP) H2 2025 earnings summary

Executive summary

• Delivered strong results for the year ending March 2025, overcoming challenging environments in South Africa and the U.K., with muted first-half activity followed by a significant second-half pickup.

• Pre-provision operating profit increased by 8% to over GBP 1 billion, a historic milestone, reflecting the strength of focused client franchises.

• Strategic focus since 2019 on simplification and disciplined growth has improved underlying performance by 200 basis points in ROE and ROTE.

• Results were in line with prior guidance, with group ROE at 13.9% and strong capital and liquidity positions.

• Adjusted EPS grew from 55.1p to 79.1p over three years, with increasing loan books, funds under management, and deposit books.

Financial highlights

• Pre-provision adjusted operating profit rose 7.8% to £1,039.2mn; adjusted operating profit up 4% to £920mn year-over-year.

• Net interest income rose 1.5%, non-interest revenue up 11.5%, offset by lower trading income.

• Cost-to-income ratio improved to 52.6% (from 53.8%); credit loss ratio increased to 38bps (from 28bps).

• Return on tangible equity at 16.2%, group ROE at 13.9%, South Africa at 18.3%, U.K. at 14.5%.

• Final dividend of 20p, full-year dividend 36.5p, and GBP 100 million buyback planned.

Outlook and guidance

• Revenue momentum expected to be supported by book growth and increased client activity post-elections.

• FY2026 guidance: ROE around 14%, ROTE around 16%, cost-to-income ratio 52%-54%, credit loss ratio within 25-45bps.

• Medium-term (to 2030) targets: ROE above 16%, ROTE around 18%, driven by scale, leverage, and new initiatives.

• Cautious guidance on U.K. Specialist Bank ECL at 60bps due to ongoing volatility and book mix.

• SA business ROE expected at 18.5%, UK & Other ROTE at 14.0% for FY2026.