Investec plc

Okay, good morning. We have a pretty exciting presentation today, so I propose that we start. I'd like first to welcome our colleagues in London. Today, the A-Team will present from London. I have in London joining the presentation later today, Nishlin Samuj, our group finance director, he will go through a bit of detail of the group performance, and then we will have Ruth Lees give us a bit more detail of color on our UK business. As you can see in these results, we've seen significant growth in profits and really impressive performance from our UK business. And Ruth will be followed by Kumesh Mudlia, our new chief executive of our South African business. Again, that business has performed pretty impressively in a very difficult market. So excited to be joined by this A team coming in from London. So I'll go straight into the presentation. As you all know, this year marks 50 years of our existence as a business. In 1974, In one small office here in Johannesburg, 18 people gathered and decided to start what would become the Investec of today. 50 years later, we are in 11 countries. In fact, we were in more five, six years ago, and we have 7,500 colleagues around the world. And in fact, as we report today, you will see that we will be reporting revenues of over 2 billion pounds. For a little startup in the southern tip of africa that really is an impressive feat to achieve over the time in 1986 we listed in on the johannesburg stock exchange and in 2002 and i still remember the tears in stephen's eyes when we got permission to list uh I'll talk about 91, which we demerged a few years ago. And in doing so, we released significant value to our shareholders, approximately 780 million pounds. Recently, we deconsolidated Burrstone, again, a really high-quality international-type business. Very recently, we bolstered our position within the UK market with the very strategically exciting combination of Investec Wealth and Investment UK and Rathbones. That transaction brought about the UK's largest investment. DFM with over £108 billion, around £100 billion of assets under management and administration. And that really strengthens our position going forward within the UK market. Obviously, when you get to a moment like 50 years of existence and you celebrate it, we have to again say how grateful we are to our founders for founding this most incredible business that is Investec. And we also want to appreciate everyone. who has been a part of Investec, our colleagues, our clients, so on and so forth. The magic of Zebra and out of the ordinary would not have been possible but for the contribution of everyone that has been here at Investec that has made a contribution. In 2018, as you know, we had a fundamental change in the business in that the business transitioned from the founders. I know there were risks at that time about whether we would sustain the business. The transition was smooth. While the founders are gone, our commitment to our clients, our commitment to our entrepreneurial culture, our commitment to playing a positive role in society remains undiminished. And following on the transition in 2019, we looked to review the business as a whole and to chart a path forward that would lead to better sustainability for the business and, in fact, that would lead us to achieving the returns on capital that we require. As a consequence of that, we de-merged IAM, now called 91. In fact, last night Hendrik sent me a congratulatory message. That was really lovely of him to do around this set of results. And following on that, as you know, we have executed a share buyback that has returned approximately 7 billion rand to to our shareholders. Later in the presentation, I will touch on some of the achievements we have made against the commitments we made in 2019 in Cape Town. We now stand after 50 years at a point where we are well positioned to execute a strategy for sustainable growth over the next coming years. We stand here with humility, yet with confidence in our people and in our clients. We can justifiably be proud, but as I say, remain humble. Moving on to the next slide, I'm going to have a high level view of the numbers. As you can see on this slide, the momentum in earnings as represented by earnings per share, adjusted earnings per share, has continued. But this is really a consequence of what we do for our clients. We don't chase profits for the sake of profits. We chase service to our clients, and as a consequence, we are successful. So I'm grateful to all our colleagues for serving our clients as they have over the last year. There also has been very pleasing growth in the fundamental drivers of our business. These are... core loans and advances and you can see the growth over between 2020 and now and you can see in the funds and the management similarly very pleasing growth and you can see in deposits that we have seen significant progress as we go forward we will continue to redouble our efforts to get a deposit franchise that is deeper particularly in non-wholesale deposit taking. That is really important for our strategy as we go forward. Again, when we started off in 2019, we said we wanted to achieve returns above our cost of capital. And I'm really pleased that we are now at the top end of our previously guided ROE range. Why are we so persistent about getting the likes, the returns that are as high as we do? we do so because higher returns allow us to serve our clients better they allow us to reinvest in the business they allow us to invest in our people higher returns also allow us to play a more meaningful role in society and in fact they allow us to reward Those who have given us capital, rest their capital behind us. So we reward our shareholders through distribution. So I'm really pleased that we could get this level of return. 14.6% return in pounds. This return has been diluted. by the effects of the combination with Rathbones, I think there's a 60 basis points or so dilution, meaning that the undiluted return or the return pre, the combination would have been 15.2%, an amazing return for a pound denominated business. If we go into the next slide, initially we'll go into the numbers quite in detail, so I won't spend much time on this. I'll just highlight two or three numbers. The growth in adjusted earnings per share of 13.4% against the backdrop of uncertainty in the markets, volatile markets, high interest rates, pressure on clients. We think it's a creditable performance. For our South African shareholders, The increase in rents is 30.8%, a really fantastic performance from our business. The cost discipline that we committed to in 2019 continues. As you can see, the cost to income ratio remains well within target. We continue to manage the business quite conservatively with respect to risk consciousness and risk management, and I've spoken, obviously, about the return on equity. With these improvements, we are at a point where we have announced A recalibration upwards of our targets by 200 basis points at a group level, a significant acknowledgement and testament of the progress that has been made. I also would like to point out the increase of 11.2% in net asset value. Our business has a great capacity to generate capital, and that you see in that number that is there. Just looking at the geographic picture, again, as I said earlier, Ruth and Quimesh will go through the detailed numbers. In each of these geographies, we have scale, we have relevance, and we are seeing momentum. in everything that matters. If you look at the underlying loan books, in home currency, impressive growth given the environment, deposits, significant growth in home currency given the environment, and of course, funds under management. In the UK, we report the Funds under management from Rathbones, our associate there. And of course, in South Africa, the net inflows in this period have been absolutely fantastic, thanks to the team in IWNI International. And if you look at the UK, you look at an ROTE of 15.7, really at the higher end of what businesses like ours produce in the UK. In the UK, we concentrate on ROTE. because that market reports ROTE in terms of performance, and to the mix of our business with Rathbones, post-Rathbones, is such that it makes sense for us to report ROTE. We will continue, obviously, to publish ROE for our UK business in South Africa. We are pleased to report ROTE. the 17.3% ROE for our business in pounds, not rands. In rands, obviously, that performance is much more significant. In closing in this first section, we continue to run our business with a great commitment towards sustainability, and in particular, net zero. We've made our commitments in terms of fossil fuel exposure, and you can see at the bottom of this slide the commitments we have made. We continue to track quite positively against those commitments. Over the last number of months, we have been refining our sustainable finance framework And we have increased and we are driving activities across the group in trying to contribute more in terms of sustainable finance. And of course, as a bank, we have clients, we have suppliers, and we have taken a role of advocacy to work in partnership to assist our suppliers and our clients. as we commit ourselves to a faster pace of decarbonization. So great profits reported, but an even greater commitment to making sure that we can run a business that is sustainable. I'm now going to hand over the presentation to Ruth Lees to give us a bit more depth and color on our UK business. Ruth, over to you. Or is it Nish, Lynn? I'm sorry.

Sorry to disappoint you.

Sorry, Nish. I'm so excited to hear that I skipped you. Nish will give his analysis of... I even wore a color-coded tie. Thanks, Nish. Over to you. Sorry.