Sanlam has reported a satisfactory operational performance in the four months to 30 April 2019, despite persisting headwinds in South Africa, the Group’s largest market, and international political and economic turmoil affecting emerging markets in general.
Despite the challenging operating conditions, the Group achieved some notable accomplishments. These include the recent SAHAM Finances acquisition complementing pleasing organic growth by contributing to 10% growth in the value of new covered business (VNB) written, a 30% rise in net fund inflows, and a 9% increase in net result from financial services. The Group is satisfied with its progress in bedding down the SAHAM Finances acquisition.
In addition, as announced in March 2019, the Group concluded the 5% share issuance to the new broad-based black economic empowerment (B-BBEE) entity, approved by Sanlam shareholders in December 2018. The transaction positions Sanlam as the foremost-empowered insurance and investment management group in South Africa.
The Group issued the shares at a price of R70 per share, representing a discount of about 10% to the three-day volume-weighted average price at the time. The issuance restored the discretionary capital portfolio to an appropriate level.
Notable figures in the financial report include:
- New business volumes of R72 billion, up 7%
- Sanlam Pan Africa recorded overall new business growth of 34%
- New business volumes at Sanlam Investment Group increased by 8%
- Sanlam Corporate had a strong start to the year, more than doubling its new business contribution
- Sanlam Personal Finance’s net result from financial services increased by 17%, supported by strong earnings growth at Glacier and Sanlam Sky.
‘We’re satisfied with our performance achieved under challenging operating conditions,’ says Group CEO Ian Kirk. ‘Our continued prudent implementation of our diversification strategy, together with our focus on implementing the strategy, again supported the delivery of resilient results.
‘We’ll remain focused on the SAHAM integration: delivering shareholder value, while at the same time controlling our costs given pressure on revenues, and executing future growth strategies.’
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Acknowledgements: FA News and Inside Sanlam