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INL INP INPR INPP
INL INP
INL/INP - Investec - Unaudited combined consolidated financial results in Pounds
Sterling for the year ended 31 March 2009
Investec Limited
Incorporated in the Republic of South Africa
Registration number 1925/002833/06
JSE share code: INL
ISIN: ZAE000081949
Investec plc
Incorporated in England and Wales
Registration number 3633621
JSE share code: INP
ISIN: GB00B17BBQ50
Investec plc and Investec Limited
(combined results)Unaudited combined consolidated financial results in Pounds
Sterling for the year ended 31 March 2009
Salient Features
31 March 31 March %
2009 2008 Change
Operating profit before impairment of 652 939 622 902 4.8
loans and advances, goodwill, non-
operating items, taxation and after
minorities
Operating profit before goodwill, non-400,088 537,671 (25.6)
operating items and taxation
(GBP`000)
Adjusted earnings before goodwill and 269,215 344,695 (21.9)
non-operating items (GBP`000)
Adjusted earnings per share (before 42.4 56.9 (25.5)
goodwill and non-operating items)
(pence)
Earnings attributable to shareholders 292,022 391,558 (25.4)
(GBP`000)
Earnings per share (pence) 38.5 57.7 (33.3)
Headline earnings per share (pence) 41.2 49.7 (17.1)
Dividends per share (pence) 13.0 25.0 (48.0)
Dividends per share (cents) 194.0 361.5 (46.3)
Tangible net asset value per share 266.3 215.0 23.9
(pence)
Combined consolidated income statement
Year to 31 March
GBP`000 2009 2008
Interest income 2,596,913 2,083,380
Interest expense (1,902,882) (1,499,960)
Net interest income 694,031 583,420
Fee and commission income 592,814 614,357
Fee and commission expense (61,292) (63,061)
Principal transactions 276,521 276,705
Operating income from associates 12,438 12,138
Investment income on assurance 74,584 89,593
activities
Premiums and reinsurance recoveries on 18,773 40,849
insurance contracts
Other operating (loss)/income (30,240) 50,043
Other income 883,598 1,020,624
Claims and reinsurance premiums on (88,108) (120,358)
insurance business
Total operating income net of insurance 1,489,521 1,483,686
claims
Impairment losses on loans and advances (256,173) (114,185)
Operating income 1,233,348 1,369,501
Administrative expenses (803,158) (807,500)
Depreciation, amortisation and (30,102) (24,330)
impairment of property, equipment and
intangibles
Operating profit before goodwill 400,088 537,671
Goodwill (32,467) (62,765)
Operating profit 367,621 474,906
Profit on disposal of group operations 721 72,855
Profit before taxation 368,342 547,761
Taxation (81,675) (127,249)
Profit after taxation 286,667 420,512
(Losses)/earnings attributable to (5,355) 28,954
minority interests
Earnings attributable to shareholders 292,022 391,558
Earnings attributable to shareholders 292,022 391,558
Goodwill 32,467 62,765
Goodwill attributable to minorities (8,677) -
Profit on disposal of group operations, (721) (64,345)
net of taxation
Preference dividends (47,503) (41,779)
Additional earnings attributable to 1,627 (3,504)
other equity holders
Adjusted earnings before goodwill and 269,215 344,695
non-operating items
Further adjustments to derive headline (7,588) (43,196)
earnings (headline adjustments)
Headline earnings 261,627 301,499
Earnings per share (pence)
- basic 38.5 57.7
- diluted 36.1 54.0
Adjusted earnings per share (pence)
- basic 42.4 56.9
- diluted 39.7 53.2
Headline earnings per share (pence)
- basic 41.2 49.7
- diluted 38.6 46.6
Dividends per share (pence)
- interim 8.0 11.5
- final 5.0 13.5
Number of weighted average shares
- basic (millions) 634.6 606.2
Combined summarised consolidated cash flow statement
Year to 31 March
GBP`000 2009 2008
Cash inflows from operations 631,378 610,450
Decrease/(increase) in operating assets 46,724 (655,805)
(Decrease)/increase in operating (323,255) 1,080,433
liabilities
Net cash inflow from operating activities 354,847 1,035,078
Net cash outflow from investing activities (63,670) (65,642)
Net cash outflow from financing activities (184,981) (54,893)
Effects of exchange rate changes on cash 226,277 (97,791)
and cash equivalents
Net increase in cash and cash equivalents 332,473 816,752
Cash and cash equivalents at the beginning 1,951,876 1,135,124
of the year
Cash and cash equivalents at the end of the 2,284,349 1,951,876
year
Cash and cash equivalents are defined as including: cash and balances at central
banks, on demand loans and advances to banks and cash equivalent advances to
customers (all of which have a maturity profile of less than three months).
Combined consolidated balance sheet
At 31 March
GBP`000 2009 2008*
Assets
Cash and balances at central banks 1,105,089 788,472
Loans and advances to banks 2,018,089 2,153,773
Cash equivalent advances to customers 396,173 504,382
Reverse repurchase agreements and cash 569,770 794,153
collateral on securities borrowed
Trading securities 2,313,845 1,984,580
Derivative financial instruments 1,582,908 1,305,264
Investment securities 1,063,569 1,130,872
Loans and advances to customers 15,390,519 12,011,261
Loans and advances to customers - 1,897,878 2,034,874
Kensington warehouse assets
Securitised assets 5,628,347 6,082,975
Interest in associated undertakings 93,494 82,576
Deferred taxation assets 136,757 84,493
Other assets 894,062 882,209
Property and equipment 174,532 141,352
Investment properties 189,156 134,975
Goodwill 255,972 271,932
Intangible assets 34,402 31,506
33,744,562 30,419,649
Other financial instruments at fair value
through income in respect of
- liabilities to customers 3,358,338 2,878,894
- assets related to reinsurance 1,768 805,009
contracts
37,104,668 34,103,552
Liabilities
Deposits by banks 3,781,153 3,489,032
Deposits by banks - Kensington warehouse 1,412,961 1,778,438
funding
Derivative financial instruments 1,196,326 881,577
Other trading liabilities 344,561 450,580
Repurchase agreements and cash collateral 915,850 382,384
on securities lent
Customer accounts 14,572,568 12,133,120
Debt securities in issue 1,014,871 777,769
Liabilities arising on securitisation 5,203,473 5,760,208
Current taxation liabilities 155,395 132,656
Deferred taxation liabilities 120,135 79,172
Other liabilities 1,264,144 1,279,373
Pension fund liabilities 1,212 -
29,982,649 27,144,309
Liabilities to customers under investment 3,352,863 2,862,916
contracts
Insurance liabilities, including unit- 5,475 15,978
linked liabilities
Reinsured liabilities 1,768 805,009
33,342,755 30,828,212
Subordinated liabilities (including 1,141,376 1,065,321
convertible debt)
34,484,131 31,893,533
Equity
Called up share capital 190 177
Perpetual preference share capital 151 151
Share premium 1,769,040 1,632,634
Treasury shares (173,068) (114,904)
Equity portion of convertible instruments - 2,191
Other reserves 42,509 (42,057)
Profit and loss account 658,129 433,012
Shareholders` equity excluding minority 2,296,951 1,911,204
interests
Minority interests 323,586 298,815
- Perpetual preferred securities issued 295,084 251,637
by subsidiaries
- Minority interests in partially held 28,502 47,178
subsidiaries
Total shareholders` equity 2,620,537 2,210,019
Total liabilities and equity 37,104,668 34,103,552
*As restated for reclassifications detailed in the commentary section of this
report.
Segmental geographic and business analysis of operating profit before goodwill,
non-operating items and taxation for the year ended 31 March 2009
United
Kingdom
and Southern Total
GBP`000 Europe Africa Australia group
Private Banking 42,034 35,954 2,475 80,463
Private Client Portfolio 12,044 12,058 - 24,102
Management and
Stockbroking
Capital Markets 78,015 61,150 2,209 141,374
Investment Banking (30,810) 66,065 (7,089) 28,166
Asset Management 17,149 49,037 - 66,186
Property Activities 774 21,769 2,138 24,681
Group Services and Other (18,316) 47,395 2,715 31,794
Activities
Total group 100,890 293,428 2,448 396,766
Minority interest-equity 3,322
Operating profit before 400,088
goodwill
Segmental geographic and business analysis of operating profit before goodwill,
non-operating items and taxation for the year ended 31 March 2008
United
Kingdom
and Southern Total
GBP`000 Europe Africa Australia group
Private Banking 91,619 56,760 18,015 166,394
Private Client Portfolio 11,929 15,413 - 27,342
Management and
Stockbroking
Capital Markets 39,187 68,118 8,326 115,631
Investment Banking 3,995 64,775 3,756 72,526
Asset Management 24,940 51,471 - 76,411
Property Activities 144 36,078 99 36,321
Group Services and Other (34,205) 46,612 1,685 14,092
Activities
Total group 137,609 339,227 31,881 508,717
Minority interest-equity 28,954
Operating profit before 537,671
goodwill
Combined summarised consolidated statement of total recognised income and
expenses
Year to 31 March
GBP`000 2009 2008
Profit after taxation 286,667 420,512
Fair value movements on cash flow hedges (16,293) -
Fair value movements on available for sale (4,223) (38,907)
assets
Foreign currency movements 215,653 (79,591)
Pension fund actuarial (losses)/gains (9,722) 7,619
Total recognised income and expenses 472,082 309,633
Total recognised income and expenses 21,285 17,365
attributable to minority shareholders
Total recognised income and expenses 376,020 270,327
attributable to ordinary shareholders
Total recognised income and expenses 74,777 21,941
attributable to perpetual preferred
securities
Total recognised income and expenses 472,082 309,633
Combined summarised consolidated statement of changes in equity
Year to 31 March
GBP`000 2009 2008
Balance at the beginning of the year 2,210,019 1,820,416
Foreign currency movements 215,653 (79,591)
Earnings attributable to ordinary 292,022 391,558
shareholders
Earnings attributable to minority interests (5,355) 28,954
Fair value movements on cash flow hedges (16,293) -
Fair value movements on available for sale (4,223) (38,907)
assets
Transfer to pension fund (deficit)/surplus (9,722) 7,619
Total recognised income and expenses 472,082 309,633
Share based payments adjustments 92,848 39,182
Dividends paid to ordinary shareholders (143,995) (145,926)
Dividends paid to perpetual preference (47,503) (41,779)
shareholders
Issue of ordinary shares 91,764 230,664
Share issue expenses - (65)
Movement of treasury shares (58,164) (5,625)
Issue of equity instruments by subsidiaries 3,486 6,777
Dividends and capital reductions paid to - (3,923)
minorities
Movement of minorities on disposals and - 665
acquisitions
Balance at the end of the year 2,620,537 2,210,019
Commentary
Investec plc and Investec Limited (combined results)
Unaudited consolidated financial results in Pounds Sterling for the year ended
31 March 2009.
Overall performance
The group`s strategy of maintaining a solid recurring revenue base; geographical
and operational diversity; strong capital ratios; low leverage ratios; and
strict management of liquidity and risk has enabled Investec to navigate through
the present challenging operating environment. Market conditions have, however,
negatively impacted activity levels, asset valuations and credit loss ratios,
resulting in a 25.5% decline in adjusted earnings per share (EPS) before
goodwill and non-operating items to 42.4 pence (2008: 56.9 pence).
The main features of the period under review are:
- Operating profit before goodwill, non-operating items and taxation and
after minorities ("operating profit") decreased 22.0% to GBP396.8 million
(2008: GBP508.7 million).
- Operating profit before impairment losses on loans and advances increased
4.8% to GBP652.9 million (2008: GBP622.9 million).
- Adjusted earnings attributable to shareholders before goodwill and non-
operating items decreased 21.9% to GBP269.2 million (2008: GBP344.7
million).
- Recurring income as a percentage of total operating income increased to
70.0% (2008: 65.1%).
- Net asset value per share increased to 308.8 pence (2008: 260.6 pence) and
net tangible asset value per share (which excludes goodwill and intangible
assets) increased to 266.3 pence (2008: 215.0 pence).
- Core loans and advances to customers increased 26.2% to GBP16.2 billion
(2008: GBP12.9 billion) - an increase of 11.7% on a currency neutral basis.
- Third party assets under management decreased by 4.7% to GBP50.3 billion
(2008: GBP52.7 billion) - a decrease of 12.0% on a currency neutral basis.
- Customer accounts (deposits) increased 20.1% to GBP14.6 billion (2008:
GBP12.1 billion) - an increase of 6.3% on a currency neutral basis.
- Cash and near cash balances amounted to GBP4.9 billion (2008: GBP5.0
billion).
- Tier 1 and total capital adequacy ratios have strengthened in both Investec
plc and Investec Limited (refer to "Operational review" section below).
- Low gearing ratios represented by core loans and advances to equity at 6.2
times (2008: 5.8 times) and total assets (excluding assurance assets) to
equity at 12.9 times (2008: 13.8 times).
- The board proposes a final dividend of 5.0 pence per ordinary share
equating to a full year dividend of 13.0 pence (2008: 25.0 pence) resulting
in a dividend cover based on the group`s adjusted EPS before goodwill and
non-operating items of 3.3 times (2008: 2.3 times), consistent with the
group`s dividend policy, as revised in November 2008.
Operational review
Liquidity and funding
A core strategy for many years has been the maintenance of cash reserves and a
stock of readily available, high quality liquid assets well in excess of minimum
regulatory requirements. During the financial year the group has on average held
approximately GBP4.9 billion of cash and near cash to support its activities.
These balances have ranged between GBP3.7 billion and GBP6.2 billion over the
period, representing 20% to 30% of the group`s liability base. The group
continues to focus on diversifying its funding sources and maintaining a low
reliance on interbank wholesale funding to fund core lending. Customer deposits
have held up well over the period and the group has been successful in securing
medium term syndicated loans due to its long standing counterparty
relationships. The Private Bank and Capital Markets divisions have implemented a
number of initiatives to increase private client and retail deposits. Active
campaigns to build the group`s retail deposit franchise were launched in the UK,
Ireland and Australia towards the end of 2008, and more recently in South
Africa. The group has been successful in increasing retail deposits with total
net inflows since December 2008 amounting to approximately GBP1 billion.
In addition, Investec Bank plc in the UK has received an Institution Certificate
under the UK Government`s Credit Guarantee Scheme 2008 and is accordingly
eligible to apply under the Scheme Rules for Eligibility Certificates in respect
of debt instruments issued by it. Investec Bank (Australia) Limited is also
eligible to issue government backed debt.
Capital adequacy
The group holds capital well in excess of regulatory requirements and intends to
perpetuate this philosophy and ensure that it remains well capitalised in a
vastly changed banking world. Accordingly, as announced in November 2008, the
group has adjusted its capital adequacy targets and is focusing on increasing
its capital base, targeting a minimum tier one capital ratio of 11% and a total
capital adequacy ratio of 14% to 17% on a consolidated basis for Investec plc
and Investec Limited, respectively. Investec has made good progress in this
regard and intends on meeting these targets by the end of calendar year 2010.
Basel II ratios 31 March 2009 31 March 2008
Investec plc
Capital adequacy ratio 16.2% 15.3%
Tier 1 ratio 10.1% 9.2%
Capital adequacy- pre 18.6% 17.4%
operational risk
Tier 1 ratio - pre 11.6% 10.5%
operational risk
Investec Limited
Capital adequacy ratio 14.2% 13.9%
Tier 1 ratio 10.8% 10.0%
Capital adequacy- pre 16.0% 15.5%
operational risk
Tier 1 ratio - pre 12.2% 11.2%
operational risk
Asset quality
The bulk of Investec`s credit and counterparty risk arises through its Private
Banking and Capital Markets activities. The Private Bank lends mainly to high
net worth and high income individuals, whilst the Capital Markets division
primarily transacts with mid to large sized corporates, public sector bodies and
institutions. Investec continues to focus on asset quality and credit risk in
all geographies. Impairments and defaults on core loans and advances have
increased as a result of weak economic conditions in all geographies as detailed
in the "Financial statement analysis" below.
Business unit review
Private Client Activities
Private Client Activities, comprising Private Bank and Private Client Portfolio
Management and Stockbroking divisions, reported a decline in operating profit of
46.0% to GBP104.6 million (2008: GBP193.7 million).
- Private Banking
Operating profit from the Private Banking division decreased by 51.6% to
GBP80.5 million (2008: GBP166.4 million). Higher average advances and a
diversified set of revenues continued to drive operating income. However,
activity levels have declined and impairment losses on loans and advances
have increased in all geographies as a result of the weaker credit
environment. The private client core lending book grew by 24.3% to GBP11.1
billion (2008: GBP8.9 billion) and the division increased its deposit book
by 17.0% to GBP7.7 billion (2008: GBP6.6 billion). Funds under advice
decreased 11.2% to GBP3.3 billion (2008: GBP3.7 billion).
- Private Client Portfolio Management and Stockbroking
Private Client Portfolio Management and Stockbroking reported a decrease in
operating profit of 11.8% to GBP24.1 million (2008: GBP27.3 million). The
Private Client business in South Africa was negatively impacted by lower
turnover and valuations and the absence of performance fees on alternative
investments. Funds under management, expressed in Rands, decreased by 24.6%
to R85.0 billion (2008: R112.7 billion). The results of the UK operations
include Investec`s 47.3% share of the directors` estimate of the post-tax
profit of Rensburg Sheppards plc.
Capital Markets
Capital Markets reported an increase in operating profit of 22.3% to GBP141.4
million (2008: GBP115.6 million). The division`s advisory, structuring and
trading activities performed well. The results of the Principal Finance division
improved substantially as current year write downs on US structured credit
investments of GBP13 million were significantly less than the prior period of
GBP49 million. Core loans and advances increased 26.5% to GBP4.8 billion from
GBP3.8 billion at 31 March 2008. Kensington Group plc ("Kensington") produced a
stable performance and reported operating profit of GBP37.1 million (2008:
GBP24.3 million; the business was acquired on 8 August 2007).
Investment Banking
The Investment Banking division reported a decrease of 61.1% in operating profit
to GBP28.2 million (2008: GBP72.5 million) reflecting a mixed performance across
geographies and business activity. The agency divisions closed fewer deals in
comparison to the prior year but reported higher trading revenues. The UK
operations were impacted by a much weaker performance from certain of the
investments held within the Private Equity and Direct Investments division,
whilst the South African Private Equity operations recorded another steady
performance.
Asset Management
Asset Management reported a decrease in operating profit of 13.4% to GBP66.2
million (2008: GBP76.4 million) largely as a result of a tougher mutual fund
environment and weak equity markets. The division continued to benefit from a
shift in the mix of funds managed, good investment performance and solid net
inflows, notably within its institutional portfolio. Assets under management
increased by 0.3% to GBP28.8 billion (2008: GBP28.7 billion).
Property Activities
Property Activities generated operating profit of GBP24.7 million (2008: GBP36.3
million). The results of the division, based mainly in South Africa, were
supported by fees earned on projects completed in the current year and a
satisfactory performance from the investment property portfolio.
Group Services and Other Activities
Group Services and Other Activities contributed GBP31.7 million to operating
profit (2008: GBP14.1 million). The Central Funding division performed well
benefiting from increased cash holdings and higher average interest rates in
South Africa. Central Services costs declined by 11.9%.
Further information on key developments within each of the business units is
provided in a detailed report published on the group`s website
http://www.investec.com/en_za/#home/investor_relations.html
Financial statement analysis
Total operating income
Total operating income net of insurance claims of GBP1.485 billion is in line
with the prior year. Material movements in total operating income are analysed
below.
Net interest income increased by 19.0% to GBP694.0 million (2008: GBP583.4
million) as a result of growth in average advances, the acquisitions of
Kensington and Experien (Pty) Ltd ("Experien") which were made in the prior
year, and a solid performance from the Central Funding division.
Net fee and commission income decreased by 3.6% to GBP531.5 million (2008:
GBP551.3 million). Transactional activity and asset levels have been
significantly impacted by the economic environment. However, the group benefited
from a solid performance from the Capital Markets advisory and structuring
businesses.
Income from principal transactions remained in line with the prior year at
GBP276.5 million (2008: GBP276.7 million) reflecting a strong contribution from
our Capital Markets trading businesses and an improved performance from our
Principal Finance businesses. This was offset by a reduced profit from
revaluations and realisations in the current year.
Operating income from associates increased by 2.5% to GBP12.4 million (2008:
GBP12.1 million). The figure includes Investec`s 47.3% share of the directors`
estimate of the post-tax profit of Rensburg Sheppards plc for the year ended 31
March 2009.
The consolidation of the operating results of certain investments held within
the group`s Private Equity portfolio resulted in an operating loss of GBP30.2
million (2008: income of GBP50.0 million).
Impairment losses on loans and advances
As a result of the weaker credit cycle we have seen a decline in the performance
of the loan portfolio resulting in an increase in impairment losses on loans and
advances from GBP58.8 million to GBP162.9 million (excluding Kensington). The
credit loss charge as a percentage of average gross core loans and advances has
increased from 0.5% to 1.1% since 31 March 2008. The percentage of default loans
(net of impairments but before taking collateral into account) to core loans and
advances has increased from 1.3% to 3.3% since 31 March 2008. The ratio of
collateral to default loans (net of impairments) remains satisfactory at 1.20
times (2008: 1.21 times).
Impairment losses on loans and advances relating to the Kensington business
amount to GBP93.2 million (2008: GBP55.4 million; the business was acquired on 8
August 2007). The total Kensington book has been managed down to GBP5.2 billion
from GBP6.1 billion at 31 March 2008. Arrears have increased as the book seasons
in a weak economic environment.
Administrative expenses and depreciation
The ratio of total operating expenses to total operating income improved to
55.9% from 56.1%.
Total expenses increased by 0.2% to GBP833.2 million (2008: GBP831.8 million).
Variable remuneration decreased by 29.9% to GBP144.8 million. Other operating
expenses increased by 10.1% to GBP688.4 million largely as a result of the
acquisitions of Kensington and Experien and an increase in average headcount and
associated costs in certain of the businesses. Total headcount is being tightly
managed and expense growth (excluding variable remuneration) is targeted below
the respective inflation rates in each of the group`s core geographies. The
group has also introduced a non-cash deferred component to variable remuneration
payments.
Goodwill
The current year goodwill impairment largely relates to certain of the
consolidated investments held within the group`s Private Equity portfolio.
Taxation
The operational effective tax rate of the group decreased from 22.6% to 21.1% as
a result of the decrease in tax rates in key geographies and an increase in
income earned that is subject to lower tax rates or is non-taxable.
Losses attributable to minority interests
Losses attributable to minority interests of GBP5.4 million largely comprise:
- GBP30.9 million relating to investments consolidated in the Private Equity
division; offset by;
- GBP25.8 million relating to Euro denominated preferred securities issued by
a subsidiary of Investec plc which are reflected on the balance sheet as
part of minority interests. (The transaction is hedged and a forex
transaction profit arising on the hedge is reflected in operating profit
before goodwill with the equal and opposite impact reflected in earnings
attributable to minorities).
Balance sheet analysis
Since 31 March 2008:
- Total shareholders` equity (including minority interests) increased by
18.6% to GBP2.6 billion largely as a result of retained earnings and
foreign currency translation gains.
- Net asset value per share increased from 260.6 pence to 308.8 pence and net
tangible asset value per share (which excludes goodwill and intangible
assets) increased from 215.0 pence to 266.3 pence.
- Total assets increased from GBP34.1 billion to GBP37.1 billion largely as a
result of foreign currency adjustments.
The return on adjusted average shareholders` equity decreased from 23.6% to
14.8%.
The compulsorily convertible debentures that were outstanding at 31 March 2008
were converted to ordinary shares on 31 July 2008. This resulted in an increase
in share capital and share premium with no impact on total equity.
Strategy
Investec is a focused, niche specialist banking group striving to be distinctive
in all that it does. In order to deliver value to shareholders through economic
cycles and achieve the group`s growth objectives the group will continue to
focus on:
- Moderate loan growth, shifting emphasis to increasing the proportion of its
non-lending revenue base;
- Maintaining credit quality;
- Strictly managing risk and liquidity;
- Creating additional operational efficiencies and containing costs;
- Building business depth rather than business breadth by deepening existing
client relationships and generating high quality income through
diversified, sustainable revenue streams.
Outlook
Investec`s geographical and operational diversity has enabled it to navigate a
steady course during a year of unprecedented turmoil in financial markets. The
group has adapted its business model in response to this environment. The
outlook for the global economy is uncertain and markets are likely to remain
volatile. Investec has a sound balance sheet and believes that the market
upheaval since September last year will present opportunities to strengthen its
market position across core geographies.
On behalf of the boards of Investec plc and Investec Limited
Hugh Herman Stephen Koseff Bernard Kantor
Chairman Chief Executive Officer Managing Director
Notes to the commentary section above
- Presentation of financial information
Investec operates under a Dual Listed Companies (DLC) structure with
primary listings of Investec plc on the London Stock Exchange and Investec
Limited on the JSE Limited.
In terms of the contracts constituting the DLC structure, Investec plc and
Investec Limited effectively form a single economic enterprise in which the
economic and voting rights of ordinary shareholders of the companies are
maintained in equilibrium relative to each other. The directors of the two
companies consider that for financial reporting purposes, the fairest
presentation is achieved by combining the results and financial position of
both companies.
Accordingly, the year end results for Investec plc and Investec Limited
present the results and financial position of the combined DLC group under
IFRS, denominated in Pounds Sterling. In the commentary above, all
references to Investec or the group relate to the combined DLC group
comprising Investec plc and Investec Limited.
Unless the context indicates otherwise, all comparatives included in the
commentary above relate to the year ended 31 March 2008.
- Foreign currency impact
The group`s reporting currency is Pounds Sterling. Certain of the group`s
operations are conducted by entities outside the UK. The results of
operations and the financial condition of the individual companies are
reported in the local currencies in which they are domiciled, including
Rands, Australian Dollars, Euros and US Dollars. These results are then
translated into Pounds Sterling at the applicable foreign currency exchange
rates for inclusion in the group`s combined consolidated financial
statements. In the case of the income statement, the weighted average rate
for the relevant period is applied and, in the case of the balance sheet,
the relevant closing rate is used. In calculating currency neutral numbers
(referred to in the "Overall performance section") the group assumes that
the Rand: Pound Sterling closing exchange rate has remained neutral since
31 March 2008.
The following table sets out the movements in certain relevant exchange rates
against Pounds Sterling over the financial year:
31 March 2009 31 March 2008
Currency per Period end Average Period end Average
GBP1.00
South African Rand 13.58 14.83 16.17 14.31
Australian Dollar 2.07 2.19 2.18 2.32
Euro 1.08 1.21 1.25 1.42
US Dollar 1.43 1.73 1.99 2.01
Exchange rates between local currencies and Pounds Sterling have fluctuated over
the year. The most significant impact arises from the depreciation/appreciation
of the Rand. The average exchange rate over the year has depreciated by 3.7% and
the closing rate has appreciated by 16.0% since 31 March 2008.
- Accounting policies and disclosures
The accounting policies applied in the preparation of the results for the
year ended 31 March 2009 are consistent with those adopted in the financial
statements for the year ended 31 March 2008, except as noted below.
The group has elected to early adopt IFRS 8 (Operating Segments) as of 1
April 2008. This standard requires disclosure of information about the
group`s operating segments on the same basis as is used internally for
evaluating operating segment performance and deciding how to allocate
resources to operating segments. Adoption of this standard did not have any
impact on the financial position or performance of the group. The group
determined that operating segments were the same as the business segments
previously identified under IAS 14 (Segment Reporting).
IAS 39 (Financial Instruments: Recognition and Measurement) was amended
with effect from October 2008. Following the amendment, a non-derivative
financial asset held for trading may be transferred out of the fair value
through profit and loss category in the following circumstances:
- In rare circumstances, it is no longer held for the purpose of selling
or repurchasing in the near term; or
- It is no longer held for the purpose of selling or repurchasing in the
near term, it would have met the definition of a loan and receivable
at initial recognition and the group has the intention and ability to
hold it for the foreseeable future or until maturity.
The initial value of the financial asset that has been reclassified, per the
above, is the fair value at the date of reclassification. The group has not
applied the initial transitional rules. This change in accounting policy has had
no impact on the prior year financial statements.
These preliminary condensed consolidated financial statements have been prepared
in terms of the recognition and measurement criteria of International Financial
Reporting Standards, and the presentation and disclosure requirements of IAS 34,
Interim Financial Reporting.
Reclassifications
The group had previously included the par value and share premium received on
the issue of perpetual preference shares (an equity instrument) in a single line
item within equity on the balance sheet. The presentation has been amended to
include the share premium received of GBP299.5 million (2008: GBP272.2 million)
within the share premium account. This change in presentation has no impact on
overall equity, assets and liabilities.
- Proviso
- Please note that matters discussed in this announcement 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 group`s control.
- These factors may cause the group`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 group
at 21 May 2009.
Ordinary dividend announcements
Investec plc
In terms of the DLC structure, Investec plc shareholders who are not South
African resident shareholders may receive all or part of their dividend
entitlements through dividends declared and paid by Investec plc on their
ordinary shares and/or through dividends declared and paid on the SA DAN share
issued by Investec Limited.
Investec plc shareholders who are South African residents, may receive all or
part of their dividend entitlements through dividends declared and paid by
Investec plc on their ordinary shares and/or through dividends declared and paid
on the SA DAS share issued by Investec Limited.
Notice is hereby given that final dividend (No. 14) of 5.0 pence (2008: 13.5
pence) per ordinary share has been declared by the board in respect of the
financial year ended 31 March 2009 payable to shareholders recorded in the
members` register of the company at the close of business on Friday, 31 July
2009, which will be paid as follows:
- for non-South African resident Investec plc shareholders, through a
dividend payment by Investec plc of 5.0 pence per ordinary share
- for South African resident shareholders of Investec plc, through a dividend
payment on the SA DAS share equivalent to 5.0 pence per ordinary share
The relevant dates for the payment of the dividends are as follows:
Last day to trade cum-dividend:
On the London Stock Exchange (LSE) Tuesday, 28 July 2009
On the Johannesburg Stock Exchange (JSE) Friday, 24 July 2009
Shares commence trading ex-dividend:
On the London Stock Exchange (LSE) Wednesday, 29 July 2009
On the Johannesburg Stock Exchange (JSE) Monday, 27 July 2009
Record date (on the LSE and the JSE) Friday, 31 July 2009
Payment date (on the LSE and the JSE) Tuesday, 18 August 2009
Share certificates on the South African branch register may not be
dematerialised or rematerialised between Monday, 27 July 2009 and Friday, 31
July 2009, both dates inclusive, nor may transfers between the UK and SA
registers take place between Monday, 27 July 2009 and Friday, 31 July 2009, both
dates inclusive.
Shareholders registered on the South African register are advised that the
distribution of 5.0 pence, equivalent to 66.0 cents per share, has been arrived
at using the Rand/Pound Sterling average buy/sell forward rate, as determined at
11h00 (SA time) on
Wednesday, 20 May 2009.
By order of the board
D Miller
Company Secretary
20 May 2009
Investec Limited
Notice is hereby given that a final dividend (No. 107) of 66.0 cents (2008:
202.0 cents) per ordinary share has been declared by the board in respect of the
financial year ended 31 March 2009 payable to shareholders recorded in the
members` register of the company at the close of business on Friday, 31 July
2009.
The relevant dates for the payment of the dividend are as follows:
Last day to trade cum-dividend Friday, 24 July 2009
Shares commence trading ex-dividend Monday, 27 July 2009
Record date Friday, 31 July 2009
Payment date Tuesday, 18 August 2009
The final dividend of 66.0 cents per ordinary share has been determined by
converting the Investec plc distribution of 5.0 pence per ordinary share into
Rands using the Rand/Pounds Sterling average buy/sell forward rate at 11h00 (SA
time) on Wednesday, 20 May 2009.
Share certificates may not be dematerialised or rematerialised between Monday,
27 July 2009 and Friday, 31 July 2009, both dates inclusive.
By order of the board
B Coetsee
Company Secretary
20 May 2009
Non-redeemable non-cumulative non-participating preference shares dividend
announcements
Investec plc
Share Code: INPP
ISIN: GB00B19RX541
Declaration of dividend number 6
Notice is hereby given that preference dividend number 6 has been declared for
the period 01 October 2008 to 31 March 2009 amounting to 16.03 pence per share
payable to holders of the non-redeemable non-cumulative non-participating
preference shares as recorded in the books of the company at the close of
business on Friday, 19 June 2009.
For shares trading on the Johannesburg Stock Exchange (JSE), the dividend of
16.03 pence per share is equivalent to 211.00 cents per share, which has been
determined using the Rand/Pound Sterling average buy/sell forward rate as at
11h00 (SA Time) on Wednesday, 20 May 2009.
The relevant dates relating to the payment of dividend number 6 are as follows:
Last day to trade cum-dividend:
On the Johannesburg Stock Exchange (JSE) Thursday, 11 June 2009
On the Channel Islands Stock Exchange Tuesday, 16 June 2009
(CISX)
Shares commence trading ex-dividend:
On the Johannesburg Stock Exchange (JSE) Friday, 12 June 2009
On the Channel Islands Stock Exchange Wednesday, 17 June 2009
(CISX)
Record date (on the JSE and CISX) Friday, 19 June 2009
Payment date (on the JSE and CISX) Thursday, 2 July 2009
Share certificates may not be dematerialised or rematerialised between Friday,
12 June 2009 and Friday, 19 June 2009, both dates inclusive, nor may transfers
between the UK and SA registers may take place between Friday, 12 June 2009 and
Friday, 19 June 2009, both dates inclusive.
By order of the board
D Miller
Company Secretary
20 May 2009
Investec Limited
Share Code: INPR
ISIN: ZAE000063814
Declaration of dividend number 9
Notice is hereby given that preference dividend number 9 has been declared for
the period 01 October 2008 to 31 March 2009 amounting to 518.77 cents per share
payable to holders of the non-redeemable non-cumulative non-participating
preference shares as recorded in the books of the company at the close of
business on Friday, 19 June 2009.
The relevant dates for the payment of dividend number 9 are as follows:
Last day to trade cum-dividend Thursday, 11 June 2009
Shares commence trading ex-dividend Friday, 12 June 2009
Record date Friday, 19 June 2009
Payment date Thursday, 2 July 2009
Share certificates may not be dematerialised or rematerialised between Friday,
12 June 2009 and Friday, 19 June 2009, both dates inclusive.
By order of the board
B Coetsee
Company Secretary
20 May 2009
Further information
Information provided on the Company`s website at www.investec.com includes:
- Copies of this statement.
- The results presentation.
- Additional report produced for the investment community including more
detail on the results.
- Excel worksheets containing the salient financial information under IFRS in
Pounds Sterling.
Alternatively for further information please contact the Investor Relations
division on e-mail investorrelations@investec.com
or telephone +44 207 597 5546 / +27 11 286 7070.
Investec plc Investec Limited
(Registration number 3633621) (Registration number
1925/002833/06)
JSE Code: INP JSE Code: INL
ISIN: GB00B17BBQ50 ISIN: ZAE000081949
Registered office Registered office
2 Gresham Street 100 Grayston Drive
London, EC2V 7QP Sandown
United Kingdom Sandton 2196
Transfer secretaries Transfer secretaries
Computershare Investor Computershare Investor
Services (Pty) Ltd Services (Pty) Ltd
70 Marshall Street 70 Marshall Street
Johannesburg, 2001 Johannesburg, 2001
Company secretary: D Miller Company secretary: B Coetsee
Directors: H S Herman (Chairman), S Koseff (Chief Executive),
B Kantor (Managing Director), S E Abrahams, G F O Alford+,
G R Burger, C A Carolus, H Fukuda OBE+, G M T Howe+,
I R Kantor, Sir Chips Keswick+, M P Malungani,
Sir David Prosser+, A Tapnack+, P R S Thomas, F Titi.
Executive +British
