Barclays (BARC)

Sector:

Banking

Index:

FTSE 100

174.40p
   
  • Change Today:
    -0.60p
  • 52 Week High: 192.46
  • 52 Week Low: 136.16
  • Currency: UK Pounds
  • Shares Issued: 17,322m
  • Volume: 24,949,884
  • Market Cap: £30,210m
  • RiskGrade: 127

Barclays reports drop in half-year profits, but raises dividend

By Alexander Bueso

Date: Thursday 01 Aug 2019

LONDON (ShareCast) - (Sharecast News) - Barclays reported a large jump in interim profits thanks to the non-recurrence of litigation and conduct charges, higher capital buffers and increased its dividend - despite the risks around Brexit.


On the potential impact of the UK's exit from the European Union, Barclays said: "Brexit is one of the most significant economic events for the UK, and at the date of this report its effects are subject to unprecedented levels of uncertainty of outcomes, with the full range of possible effects unknown.

"An interim review cannot be expected to predict the unknowable factors or all possible future implications for a company and this is particularly the case in relation to Brexit."

Against that backdrop, for the six months to 30 June, the lender posted an 82.0% increase in profits before tax to £3.0bn, thanks to the non-recurrence of the £2.0bn-worth of charges incurred in the first three months of 2018 and a good showing for its investment bank over the second quarter.

But if litigation and conduct charges were excluded then profits before tax in fact declined by 16.2% to roughy £3.1bn.

Group operating expenses however rose by 1.0% to £6.8bn, pushing the group cost-to-income ratio from 61% one year ago to 63%.

However, management guided towards full-year costs below £13.6bn.

Barclays's CET capital buffers on the other hand improved from 13.2% to 13.4%, versus a 13.0% target.

In terms of guidance, management reiterated that it was targeting a return on tangible equity of greater than 9.0% for 2019 and above 10.0% for 2020.

Notably, the lender hiked its half-year dividend payout from 2.5% to 3.0%, instead of staying put as some analysts including those at Jefferies had anticipated.

Barclays reiterated its capital returns policy, comprised of a progressive ordinary dividend, supplemented by share buybacks as "and when appropriate".

Ahead of the results, on 22 July, analysts at Jefferies forecast that Barclays's CET1 ratio 1 would hit 13.5% in the second quarter, but anticipated that it would not suffice for Barclays to start buying back shares, not before the quarter at least.

"Whilst we expect a robust performance on capital at Q2, we do not expect any updates to the capital distribution policy - notably we believe share buybacks are likely to be a Q4 19 phenomenon at best."

Commenting on Barclays's results, Michael Hewson, chief market analyst at CMC Markest UK said: "At the end of Q1 there were a number of questions about how Jes Staley's plan for the bank was playing out. After a better performance in Q2 these voices may start to get a little bit quieter, with the bank broadly meeting expectations in this quarter.

"The bank did add a number of caveats with respect to its guidance, particularly around Brexit, trade and the problems in the euro area, which it said could materially affect its outlook."

As of 0811 BST, shares of Barclays were 0.83% higher to 155.36p.

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Note 1: Prices and trades are provided by Digital Look Corporate Solutions and are delayed by at least 15 minutes.

Note 2: RiskGrade figures are provided by RiskMetrics.

 

Barclays Market Data

Currency UK Pounds
Share Price 174.40p
Change Today -0.60p
% Change -0.34 %
52 Week High 192.46
52 Week Low 136.16
Volume 24,949,884
Shares Issued 17,322m
Market Cap £30,210m
RiskGrade 127

Barclays Star Ratings

Compare performance with the sector and the market.
more star ratings
Key: vs Market vs Sector
Value
94.74% above the market average94.74% above the market average94.74% above the market average94.74% above the market average94.74% above the market average
29.41% above the sector average29.41% above the sector average29.41% above the sector average29.41% above the sector average29.41% above the sector average
Price Trend
14.80% above the market average14.80% above the market average14.80% above the market average14.80% above the market average14.80% above the market average
55.56% above the sector average55.56% above the sector average55.56% above the sector average55.56% above the sector average55.56% above the sector average
Income
66.06% above the market average66.06% above the market average66.06% above the market average66.06% above the market average66.06% above the market average
38.46% below the sector average38.46% below the sector average38.46% below the sector average38.46% below the sector average38.46% below the sector average
Growth
5.90% above the market average5.90% above the market average5.90% above the market average5.90% above the market average5.90% above the market average
11.11% below the sector average11.11% below the sector average11.11% below the sector average11.11% below the sector average11.11% below the sector average

What The Brokers Say

Strong Buy 11
Buy 3
Neutral 5
Sell 0
Strong Sell 1
Total 20
buy
Broker recommendations should not be taken as investment advice, and are provided by the authorised brokers listed on this page.

Barclays Dividends

  Latest Previous
  Interim Final
Ex-Div 08-Aug-19 28-Feb-19
Paid 23-Sep-19 05-Apr-19
Amount 3.00p 4.00p

Trades for 21-Jan-2020

Time Volume / Share Price
16:37 265,000 @ 174.40p
16:35 11,373,990 @ 174.40p
16:29 267 @ 174.36p
16:29 4,856 @ 174.38p
16:29 207 @ 174.36p

Barclays Key Personnel

Finance Director Tushar Morzaria
CEO James E Staley
Chair Nigel Higgins

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