South Africa’s Barclays Africa Group said on Friday its half-year profit rose 7 percent, driven by solid earnings growth in its local market and the rest of Africa and a strong performance in corporate banking, despite an economic downturn.
The results marked the first time that the company has reported results following Barclays Plc’s sell-down of its majority stake in the African business. Barclays retains just 15 percent of the group.
Barclays Africa Group said normalised diluted headline EPS was 9.177 rand ($0.7055) in the six months ended June compared with 8.567 rand a year earlier.
Headline EPS strips out certain one-off items and is the main profit measure in South Africa.
“We are presenting a set of results that demonstrate the real value of the 2013 acquisition of the Barclays businesses in Africa,” Chief Executive Maria Ramos said in a statement.
“Both geographically, as well as by customer segment, they are proving their worth in yielding a strong performance for the first half, even as our biggest market, South Africa, has suffered the impact of an economic downturn.”
Despite the profit rise, shares were down 1.52 percent to 144.87 rand by 0708 GMT.
In 2013, Britain’s Barclays handed over ownership of all but two of its African subsidiaries to its South African unit in exchange for a 62.3 percent stake in the new combined entity.
Barclays on Friday reported a 1.2 billion pound ($1.57 billion) attributable first half loss after taking a 2.5 billion pound hit from the sale of its Africa business.
Barclays Africa Group’s South Africa banking headline earnings grew 6 percent to 6 billion rand ($462.01 million), while the rest of Africa banking rose 19 percent to 1.5 billion rand.
The group said for the remainder of the year, its main focus will be on its retail and business bank performance, which both under-performed in the first-half, in South Africa and on driving opportunities in its businesses outside of South Africa.
The bank, which launched a court challenge on July 13 to the anti-graft watchdog’s findings that the lender’s South African unit unduly benefitted from an apartheid-era bailout, raised its interim dividend by 3 percent to 475 cents per share.
The group lowered its gross domestic product forecast for South Africa to just 0.3 percent in 2017 and said it expects low to mid single-digit loan growth.
Africa’s most industrialised country slid into recession in March. The country is also struggling with high unemployment, and credit downgrades by two of the top three ratings agencies, triggered by economic and political turmoil, have dented business and consumer confidence.