Sanlam Group sustains performance in challenging environment

Highlights

• New business volumes of R49 billion (excluding white label) up 30% compared to the same period in 2012
• Net result from financial services up 30%
• Normalised HEPS up 23%

The Sanlam Group is pleased to announce that in the first four months to 30 April 2013, it has achieved satisfactory operational results amid persistent challenging market conditions.

The operating results reported for the four months to April include a maiden contribution from the recent increase in the Group’s holding in Shriram Capital in India.

Sanlam has attributed its performance to its diversification strategy which has mitigated the impact of the challenging operating conditions experienced by some of the Group’s businesses.

Commenting on the results, Sanlam Group Chief Executive, Dr Johan van Zyl, said consistent focus on the diversification strategy supported the Group to absorb the relatively weak investment market performance in South Africa over the period as well as a challenging claims environment experienced by Santam.

“We are satisfied with our performance and will continue to implement our strategy which we believe has delivered value for our shareholders,” says Dr Van Zyl.

The business clusters largely performed well with Sanlam Personal Finance (SPF) recording a 28% increase in new business sales. The Investment cluster also grew new business volumes by 48%, with Wealth Management, Investment Services and International operations achieving strong growth.

Volatility of single premium business impacted Sanlam Emerging Markets’ results. However, recurring premium life sales remained strong and increased by some 26%, supported by all operations.

Santam experienced continued high levels of claims frequency and severity in its traditional intermediated business. This was aggravated by flood related claims, an increase in commercial fire claims and significant hail and drought claims in its agriculture business.

The Group’s available discretionary capital amounts to some R3 billion, which is earmarked for growth opportunities mainly in Africa and South-East Asia. The

Group recently announced the finalisation of the Pacific & Orient acquisition.

“We anticipate the current economic climate will continue to pose challenges and the trading conditions will remain challenging for the rest of the year. However, we expect that our continued focus on strategy will see us through,” Dr Van Zyl concluded.