Quarterly earnings at Standard Chartered increase; Still-optimistic outlook for full-year 2025 income growth; Plans for a $1.3 billion share buyback program.
Standard Chartered Plc Reports Strong Second-Quarter Profit
In a recent update, Standard Chartered Plc announced a significant climb in its second-quarter profit, with earnings per share (EPS) increasing by 98 percent to 72.5 cents. This impressive growth was accompanied by a 19 percent increase in operating income to $5.53 billion, up from $4.66 billion in the same period last year.
The company's profit before taxation also saw a substantial rise, climbing 44 percent to $2.28 billion. Underlying profit before tax stood at $2.40 billion, and underlying earnings per share were 76.6 cents. Notably, underlying net interest income edged up, while net interest income fell 9 percent from last year to $1.46 billion.
In terms of operating income growth, it was 18 percent at constant currency rates. This growth was driven by the company's robust performance across various sectors. However, the specific growth in net interest income is not specified in the provided paragraph.
Despite the impressive financial results, no new information about the company's aim for total shareholder returns of at least $8 billion through to the end of 2026 was provided. Similarly, no new information about the company's further buyback of $1.3 billion or its income growth view for fiscal 2025 was disclosed.
The updated income growth view for fiscal 2025 indicates a slowdown in revenue growth to about 2.1-4.8 percent annually, below earlier targets. However, analysts have become somewhat more optimistic on EPS, forecasting revenues of approximately US$20.5 billion in 2025, reflecting around a 2.1 percent increase compared to the previous year. Earnings per share are forecast to decline slightly by 5.3 percent to US$1.85.
Standard Chartered’s management and market outlooks suggest 2025 earnings growth near 4.8 percent for the financial sector, driven by robust US consumer activity, contained credit losses, regulatory easing, and potential for dividend increases and share buybacks.
In summary, while revenue growth is expected to moderate below previous multi-year targets, earnings forecasts have been revised upwards, reflecting optimism around cost control, credit conditions, and capital management for fiscal 2025. The company's shares in Hong Kong lost around 4.3 percent, but the overall financial performance suggests a positive outlook for the future.
Investing in Standard Chartered Plc's business could yield high returns due to its robust performance in the second quarter, reflected in a 98% surge in EPS and a 19% increase in operating income. The finance sector, particularly US consumer activity, is expected to drive further earnings growth, hinting at a promising future for the company.
