Absa Group predicts tough operating environment in 2024, as 2023 financial results released

Absa Group says it expects the operating environment to remain challenging for the next six to 12 months, as it releases its annual financial results for 2023.

Announcing the results on Monday, group’s Chief Executive Officer (CEO), Arrie Rautenbach, expressed confidence that the firm had the correct strategies in place to support it on its continued growth trajectory.

Rautenbach said these strategies would also set the group up for even further success.

“Accordingly, we remain confident in achieving our medium-term financial targets. We will continue to build on the many advances we have made on our culture transformation and brand journeys.

“Now, as we head towards our next horizon, we must work together to embed the key pillars of our brand commitment and deliver an empathetic and a seamless customer experience,” he said.

On the performance of the group in 2023, Rautenbach stated that the group had made tangible progress on its journey towards outperformance ambition.

The group’s revenue increased eight percent to R104.5 billion while its operating costs increased 10 percent to R54.5 billion.

The results, he said, were resilient in this context and tell a story of a focused and aligned business with a growing customer base, supported by a strong balance sheet.

Rautenbach, however, acknowledged that 2023 results were lower than expected and were delivered in a tough operating environment, with consumers particularly impacted by the high interest rates and high cost of living.

“Pleasingly, we reported strong revenue growth of eight percent, with our revenues exceeding R100 billion for the first time ever, with growth across all our businesses.

“This was driven by growth in our customer and client base across all sectors and geographies as we improved our product offerings and customer experience,” he noted.

He noted that the group saw its impairments increasing by 13 percent, largely from the strain on consumers in South Africa.

“This increase was the main reason for the reduction in our return on equity to 15.3 percent in 2023,” Rautenbach said.

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