Lloyds’ annual profits hit 10-year high

As Lloyds reports its full year results Helal Miah, investment research analyst at The Share Centre, explains what it could mean for investors.

Lloyds’ annual profits hit 10-year high

Today Lloyds reported Q4 profits despite being faced with restructuring costs, beating the consensus of analyst expectations.

Indeed, investors should appreciate that Britain’s biggest mortgage lender stated that pre-tax profits for the period rose to £973m, which was up from a £507m loss in the same period last year.

The profit will undoubtedly be a boost to the British government, given that it hopes to restore Lloyds to full private ownership in the next few months after the bank was bailed out by the tax payer in the 2008 financial crisis.

The good news continued as the group also stated this morning that the acquisition of MBNA, made in December 2016, will give a boost its profits margins, as it tackles the low UK interest rate environment.

Furthermore income investors should be pleased as Lloyds announced a dividend of 1.7 pence per share taking the total ordinary dividend for the year to 2.55 pence. It also confirmed a special dividend of 0.5 pence per share.

Looking ahead, investors should appreciate that Lloyds expresses confidence in its capabilities and the expectation that the simplification and transformation of its business should see it deliver superior returns for shareholders. Nevertheless, whilst our confidence in the group continues to grow, we continue to recommend Lloyds as a ‘hold’ for medium risk investors seeking growth.

Please remember, no news or research item is a recommendation or advice to buy. Every Investor is not responsible for accuracy and may not share the author’s views. If you are unsure of the suitability of any investment for your circumstances please contact an adviser. All investments can fall as well as rise in value so you could get back less than you invest. 

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