|CATEGORY: RISERS AND FALLERS
Thu 16 Mar 2023
LONDON (SHARECAST) - (Sharecast News) - FTSE 250: 18,716.25, +0.49% at 1400 GMT.
Specialist lending and retail savings provider OSB Group reported a record profit before tax of £591.1m in its preliminary results on Thursday, a 13% increase from 2021.
The FTSE 250 company said its statutory profit before tax also increased, by 14% to £531.5m.
It said the strong performance in the 12 months ended 31 December was mainly driven by growth in its loan book, an improved net interest margin, and net fair value gains on financial instruments.
Underlying and statutory net loan books increased 12% to £23.5bn and £23.6bn, respectively, supported by organic originations of £5.8bn, a 29% increase year-on-year.
The firm's underlying net interest margin was 303-basis points, an increase from 282-basis points in 2021, and its statutory net interest margin rose to 278-basis points from 253-basis points, benefiting from base rate rises.
However, OSB's underlying cost-to-income ratio increased to 25%, and its statutory cost to income ratio rose to 27%, due to higher fair value gains partially offsetting the impact of higher administrative expenses.
The group said its underlying loan loss ratio was 14-basis points, and its statutory loan loss ratio was 13-basis points in 2022, reflecting a worsening economic outlook, including the potential impact of higher cost-of-living and borrowing on affordability.
Despite that, arrears remained stable with balances greater than three months at 1.1%, which was in line with December 2021.
The group's underlying return on equity was unchanged from the prior year at 24%, while its statutory return on equity increased to 21% from 20% due to strong profitability.
Its underlying basic earnings per share came in at 99.6p, up from 86.7p, and statutory basic earnings per share improved to 90.8p from 76p.
OSB Group's capital remained strong, with a Common Equity Tier 1 ratio of 18.3% in 2022, down from 19.6% in 2021, and a total capital ratio of 19.7%, a decrease from 21.2% in 2021.
The company said it would kick off a share repurchase programme of £150m on 17 March.
Its board announced a recommended final dividend of 21.8p per share, along with a special dividend of £50m or 11.7p per share.
The dividend, together with the interim dividend of 8.7p per share, represented a payout ratio of 30% of underlying earnings attributable to ordinary shareholders.
"Our business model and strategy continue to deliver strong outcomes," said group chief executive officer Andy Golding.
"We are capitalising on continued demand for our specialist lending products and are identifying opportunities to further digitise our business operations to deliver additional efficiencies.
"We will continue to invest in the group to ensure it remains well-positioned to meet the changing needs of our customers, brokers and wider stakeholders. I remain confident in the outlook for the group and our ability to deliver sustainable and attractive returns for our shareholders."
Investment company Bridgepoint posted a jump in full-year profits and revenue on Thursday as management fees across its private equity and credit strategies rose.
In the year to the end of December 2022, underlying earnings before interest, tax, depreciation and amortisation rose 23.2% to £140.3m, on revenue of £307.4m, up 13.6% on the previous year. Management and other fees were 22.2% higher at £241.5m.
Bridgepoint said key equity funds BE VI and BDC III both performed at or ahead of plan in 2022.
"The group's strong financial performance in 2022 can be attributed to increased management fees across its private equity and credit strategies, in addition to resilient investment returns," it said.
"The group has consolidated its financial position over its first full financial year since IPO and is well-capitalised at the beginning of 2023, with investments providing opportunity for future uplifts in profitability."
Electricals retailer Currys has replaced the chief executive of its troubled Nordics division and warned that group profits will be at the lower end of expectations.
Fredrik Tønnesen has been appointed Nordics CEO, replacing Erik Sønsterud, who is stepping down with immediate effect, the company said on Thursday.
"The Nordics performance remains very challenging as the group faces into a tough consumer environment, high cost inflation and unrelenting competitive intensity. Leadership change adds to several actions the group is taking to restore the Nordics business to its previously healthy levels of profit and cash generation," Currys said in a statement.
It added that group expected to deliver 2022/23 adjusted pre-tax profit "broadly" in-line with consensus of £104m, which is at the lower end of the previously guided range of £100-125m.
Investec said on Thursday that it expects to report a jump in full-year operating profit as it benefits from continued client acquisition, rising global interest rates and higher average advances.
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."
FTSE 250 - Risers
OSB Group (OSB) 516.00p 8.54%
Bridgepoint Group (Reg S) (BPT) 214.60p 4.58%
Investec (INVP) 456.80p 3.94%
4Imprint Group (FOUR) 4,715.00p 3.85%
Helios Towers (HTWS) 108.50p 3.73%
TP Icap Group (TCAP) 167.70p 3.58%
AJ Bell (AJB) 344.80p 3.36%
Dr. Martens (DOCS) 132.30p 3.12%
Mitchells & Butlers (MAB) 156.20p 3.10%
Synthomer (SYNT) 133.50p 3.09%
FTSE 250 - Fallers
National Express Group (NEX) 121.10p -5.69%
Currys (CURY) 67.65p -5.52%
Close Brothers Group (CBG) 881.50p -4.24%
CLS Holdings (CLI) 136.20p -4.08%
Spirent Communications (SPT) 170.20p -3.90%
Dunelm Group (DNLM) 1,128.00p -3.84%
TBC Bank Group (TBCG) 2,215.00p -3.70%
Crest Nicholson Holdings (CRST) 211.20p -3.65%
Balfour Beatty (BBY) 337.40p -3.05%
Molten Ventures (GROW) 306.40p -2.98%