Old Mutual Announces 28% Rise in Full-Year Profit
Old Mutual Ltd, a prominent South African insurer, has announced a significant increase in its full-year earnings, marking a notable recovery from recent challenges. The company reported a 28% rise in headline earnings per share (HEPS), a key profitability metric, reaching 165.5 South African cents for the year ending December 31. This growth represents a substantial improvement from the 129.2 cents reported in the previous year, with adjusted HEPS also showing a solid increase of 21%.
Despite facing headwinds such as COVID-19-related mortality claims and business disruptions, Old Mutual managed to maintain profitability and deliver strong financial performance. The insurer attributed its resilience to double-digit sales growth and expansion in new business opportunities.
Old Mutual’s commitment to shareholder returns is evident in its declaration of a final dividend of 49 cents per share, representing a 4% increase from the previous period. This decision reflects the company’s confidence in its financial position and prospects for future growth.
The insurer highlighted its robust operational performance, with results from operations increasing by 14% to 8.3 billion rand ($437 million). Strong sales growth across its life segments, particularly in Africa, Mass, and Foundation clusters, contributed to this positive outcome. Additionally, Old Mutual Corporate witnessed notable growth, further bolstering the group’s overall financial performance.
Driven by its strategic initiatives and market expansion efforts, Old Mutual achieved a 17% increase in sales, totaling 14.6 billion rand. The company’s focus on growing market share profitably within key markets yielded positive results, with the value of new business experiencing a substantial 37% growth.
Despite challenges posed by rising interest rates and domestic economic uncertainties such as daily power cuts, Old Mutual remains optimistic about its future prospects. The company’s ability to navigate the evolving landscape and capitalize on emerging opportunities underscores its resilience and strategic agility in the face of adversity.
Overall, Old Mutual’s strong financial results underscore its position as a leading insurer in South Africa and reflect its commitment to delivering sustainable value to shareholders while navigating challenging operating environments.
