Ian Kirk, Sanlam Group CEO.
The Sanlam Group has reported a solid overall performance for the four months ended 30 April 2016 despite challenging operating conditions which impacted on performance across most of the markets in which the Group operates.
Sanlam has attributed its performance to its diversification across geographies, market segments and product lines.
The salient features of the Group’s performance are:
• New business volumes of R74 billion, up by 9% compared to the same period in 2015;
• Net VNB increased by 7% on a comparable basis;
• Net result from financial services up by 7%;
• Overall net fund inflows of R16 billion, up from R3 billion in 2015; and
• Normalised headline earnings per share down 13%.
Says Sanlam Group Chief Executive Officer, Mr Ian Kirk: “Our diversification strategy has once again enabled us to deliver an overall solid performance in challenging operating conditions which have impacted our businesses in a number of areas.”
Sanlam Personal Finance achieved growth of 11% in new business sales, a particularly satisfactory performance given the challenging operating conditions in South Africa. Glacier achieved overall growth of 13% as demand remained strong for its offshore and wrap product solutions.
Sanlam Emerging Markets achieved overall new business growth of 53%, supported by a weaker average Rand exchange rate and the impact of corporate activity during 2015. New life business volumes increased by 42%, augmented by 65% and 50% growth in investment and general insurance business respectively. Excluding the impacts of the Rand and 2015 corporate activity, new business volumes increased by some 40%.
The Sanlam Investments cluster increased its new business volumes by 5%, with Sanlam Employee Benefits and the international businesses achieving particularly good growth.
All businesses contributed satisfactory growth in net result from financial services with the exception of Sanlam Investments (SI) where fund-based fee income was impacted by lower average market levels.
The Saham Finances acquisition which was concluded on 29 February 2016, contributed to the Group’s earnings with effect from 1 March 2016.
As at 30 April 2016, the Group had discretionary capital amounting to R3.1 billion which remains earmarked for transactions currently under consideration.
“While Standard & Poor’s affirmed South Africa’s investment-grade sovereign credit rating last week, we expect the economic and operating environment to remain challenging for the remainder of 2016. We believe our sustained focus on our strategy will continue to support our performance this year,” Kirk concluded.
Conference call
A conference call for analysts, investors and the media will take place at 16:00 (South African time) today. A toll free dial-in facility will be available. Callers should dial in five to 10 minutes before the conference call starts. Recorded playback will be available for three days after the conference call.
Access numbers for participants dialing live from their country:
Access Numbers for Recorded Playback (access code for recorded playback: 48527#)
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