Barclays PLC Unveils 33% Drop In Profit

barclaysThe shares of Barclays (LSE: BARC) (NYSE: BCS.US) rose nearly 2% to 176p in late trading this morning after the bank released profit figures a day early. The bank’s pre-tax profits for 2013 fell by 33% to a little over £5.2bn, which is below the £5.4bn forecast by analysts.

In addition, Barclays is expected to confirm the total amount of its bonus payments for 2013 tomorrow. Antony Jenkins, the chief executive, waived his £2.75m annual bonus in order to head off potential criticisms of the bank’s bonus structure. In 2012 the bank paid a little north of £2bn in bonuses.

A cost-cutting drive is currently under way at the bank — which terminated 1,700 jobs last year — in order to improve a return on capital as a result of stricter regulation. The bank is expected to reduce the size of its investment bank by 20% and thousands more jobs are at risk.

Today’s statement is released after it emerged this weekend that details from up to 27,000 customers’ accounts were stolen and then sold to rogue traders. The information includes customers’ earnings, savings, mortgages, health issues and insurance information. 

Before today, analysts were expecting Barclays’ upcoming annual results to show earnings at 29p per share, and a dividend equivalent to 7p per share.

After this morning’s price movement the shares may therefore trade on a P/E of 6 and offer a potential income of around 4%.

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> Mark does not own shares in Barclays.