Investec plc

Okay, good morning, ladies and gentlemen.

It really is a privilege for Nicheline and I to present the results for the six months ending 30 September 2022. The results are written by 8,500 of our colleagues. across the world we just have the pleasure to present them to you and i really am glad that over the last four years or so since the pandemic we have seen continued execution on the strategy that we outlined over that period of time the environment has been particularly difficult, a level of volatility in markets, a recovery from COVID, which has been interrupted obviously by where we are today. So as we start our results, we obviously do recognize that we have a level of volatility that continues to characterize the environment ahead and goes into the outlook, the macroeconomic outlook that we use in looking at our results. As Nouriel Roubini says, in the history of modern capitalism, crises are the norm and not the exception. And that is the mindset that we take as we move forward, and we look obviously to continue to execute with discipline, but also to take advantage of opportunities that do come out of these environments that are disrupted. Just looking at the key take-outs of the results, As I said, over the last four years or so, or four reporting periods, we have seen COVID, and now we are in a macroeconomic environment that is highly disrupted. Over those four years, we now see that our earnings per share, adjusted earnings per share, are up 47%. That, we believe, is a fantastic achievement for the business over a disrupted period of time. We see also that the quality of our results continues to improve as we see recurring income increasing as our client franchises continue to generate results that are pleasing as we support our clients the way we do. we also see a strong generation of capital, as you see on the graph, that our net asset value has continued to increase. And that generation of capital allows us, first and foremost, to continue to invest in growth, but importantly in this period, to also return a significant amount of capital to our shareholders. The ability to support growth and to return capital to our shareholders are the twin tracks that we are running on. As I said, we've made significant progress, and we are now at a point where we are returning to our shareholders. We are achieving returns to our shareholders that are within the targets that we set. Also, our cost-to-income ratio is where we said we would like to be by 2024 financial year. year-end. So pleasing results indeed. If we have a snap look at the results, a 25.1% increase in adjusted earnings per share, a 24% increase in adjusted operating profit, driven largely by significant revenue growth of 19% that is supported by the diversified client franchises that we have, but also the focused approach that we have towards client service and client support, particularly in an environment that is uncertain and that has a lot of risk attached to it. Our cost-to-income ratio came in at 60.5%, which is much lower than our FY24 target of less than 63%. In this reporting period, our costs were up about 11.5%. Initially, we'll unpack that. But if you look at our costs relative to 2019, you will realize that costs have been up only about 3.9%. Those who follow Investec will know that there has been a step change in our costs in the UK bank. Hence, the... cross-discipline that we have exercised over the last four years or so continue to support us and as we go forward we will continue to exercise that level of discipline. Our asset quality continues to be very good and our exposures are supported by very good collateral. In this reporting period, our credit loss ratio came in at 15 basis points compared to the prior period of 7 basis points and this is driven largely by the outlook in the microeconomy, particularly in the UK, where there is a significant level of deterioration. In fact, I'm glad I'm not Jeremy Hunt, who at about this same time has to deliver in the UK the autumn statement because the fiscal numbers there are much more constrained. So that increase to 15 basis points is still lower than our medium-term range of 25 to 35 basis points in terms of credit loss ratios. But going into this environment, we obviously expect that you will see some creeping towards our medium-term targets. Our return on equity, as I've said, is at 13%. Inside, of our medium-term targets, and we really are pleased that we've been able to execute as we have. The net asset value at 507 seems to be fairly stable, but what it hides is the fact that in the prior period, we distributed 15% of 91. So we see strong capital generation, as I've indicated. That allows us to have a proposed dividend of 13.5p, which equates to a payout ratio of 41%. And importantly for this set of results, the board has approved... a share purchase program that totals seven billion if we take into account the prior announcement that we have made. We have said to our shareholders that we will set to deal with the excess capital that we have on the South African balance sheet and we are now at a point where we can do so. If we move forward and look at our two core geographies, being South Africa and the UK, we see a loan book growth in South Africa of 10.3%. Your books say 10.2%. The number is 10.3%. I see that my team has updated that number on our screen. So strong growth. within an environment that is constrained because we need certain fiscal and economic structural reforms within the South African environment. So an annualized rate of 10.3% is particularly pleasing for us. We've seen very strong demand in particular on the corporate client side of our business. Clearly in this environment where there is a lot of market volatility and economic uncertainty, we have seen funds under management down 3.7% to 20.1 billion within the South African wealth and investment business. Despite that, we still saw net inflows of 2.1%. billion rent in discretionary funds under management, a number that we obviously do monitor quite carefully. Overall, if you look at the two businesses, adjusted operating profit increased 21.1% to 230.6 million. So we are pleased with that level of increase in profitability, but it also underlines The fact that we have a business model that has diversified revenues. This is a season where asset managers and wealth managers have a lot of headwinds, but also a season at the same time where our banking businesses have a level of support from the rising global interest rates. ROE for our South African business printed at 14.8%, and this is before we implement the share purchase program that we talked about, the total $7 billion share purchase program. As we continue to implement the program, we would obviously hope to see a significant improvement in the return on equity of the South African business. Now turning to our UK business in Investec PLC, again a very robust growth in the loan book of 12.8% annualized. Driven, as in the case of South Africa, by good corporate client lending, but also by a good traction in our private client's business with a lot of growth in our mortgage book there. Remember, we serve very high net worth clients within that business. So a good level of growth in the loan book. As in the case of the South African business, funds under management are significantly down in this case by 9.4% to 38.8 billion pounds. Even in that environment, we saw over 440 million pounds of net inflows and a top ratio of around 2% in this instance. Again, the diversification or the diversity of our income streams comes through and we saw adjusted operating profit up 28.8% to 174.4 million pounds. Of note is that the banking business in the UK increased profitability by 52.3%. So the traction that we have gained within the UK market continues and our niche... segments that we serve, we will continue to serve even as we go into a much tougher environment. Again, our ROE in the UK business printed at 11.1% above our minimum target and in that market we generally focus on return on tangible equity and that came in at 12.6%. Overall, a very pleasing set of results for both Investec Limited and Investec PLC. Just before I ask Nish to go into these numbers in greater detail, we always look at our business not only as a business that serves shareholders, although shareholders are one of our most important stakeholders, we also want to make sure that we run our business in a sustainable manner. And specifically with respect to the chosen business, sustainable development goals one being around climate change and the second being around reduction of inequality we have made significant progress on the former we have now a baseline in terms of our scope 3 reporting in terms of climate change and we have made much more significant progress also with respect to signing up to a number of international conventions and treaties and where we will be reporting the progress we're making with respect to climate change. On inequality, we have made significant progress, as detailed on the slides. We also measure our progress with respect to a reduction in harm. And in this case, we measure our exposure to coal as an indicator of commitment to reduce harm. But on the positive side, we also measure... our progress with respect to positive investment making a positive contribution. So we've seen significant progress with respect to our support for social infrastructure. On the African continent, we also have made significant progress with respect to responsible investing on our wealth side. As you can see there, there has been some inflows into our invested global sustainable equity fund. So as we go forward, we will always measure our progress in terms of profitability for our shareholders. We will measure our support. For our colleagues inside of Investec, in this current period, given the crisis in terms of cost of living in the UK, we were able to support our colleagues that end up to £50,000. In the prior period, we supported our colleagues within the South African environment by given the performance that we reported in the prior year. So we will continue to look after our colleagues, and we will continue to look out to create an environment where our colleagues can be the best that they are capable of being. So we look out for issues relating to diversity. We look out to a culture of entrepreneurialism as we continue to support our clients. On a per capita basis, we continue to spend money higher than our competitors because we believe that living in society and not of it is a principal tenant of who we are as investing. So pleased with the result overall in terms of financial outcomes. and non-financial outcomes. I'm going to ask Nishlin to go into the detail of the result in terms of financial accounting and all the complexity that we will be able to unpack as we go. Nish, over to you. You know how to operate this, right?

Green and red.