Sanlam sustains delivery with continued focus on strategy execution

Sanlam Group Chief Executive, Dr Johan van Zyl

The Sanlam Group has released another set of solid results for the half year ended 30 June 2012 despite persistent volatility in global investment markets and generally challenging economic conditions.

The Group’s results reflect a track record of sustainable delivery to shareholders resulting from its consistent focus on executing its five-pillar strategy over a number of years.

The Group grew new business volumes by 11% to R61 billion and increased the net value of new covered business by 38% compared to the same period last year. Other highlights in the six months to 30 June 2012 were:

· Net result from financial services per share up 14%
· Net fund inflows of R10 billion
· Normalised diluted headline earnings per share up 16%
· Annualised Return on Group Equity Value per share of 18,4%

Commenting on the results, Sanlam Group Chief Executive, Dr Johan van Zyl said: “We are pleased with our performance and despite the economic and regulatory challenges in our industry, we remain confident that we have the depth of skills and experience to withstand these challenges.

“We will continue to focus on the execution of the Group’s strategy in pursuit of sustainable growth,” Dr Van Zyl said.

The Group was satisfied with the progress made in achieving its priorities for 2012. The following are some of the main achievements:

· Sanlam Personal Finance (SPF) successfully expanded its distribution reach with advisers in the South African entry-level market growing by 12% to 2 357 from the end of December 2011 (up 20% since June 2011) without compromising on the quality of new business.

· Sanlam Investments acquired the 50% interest in Satrix Managers that it did not own. The index tracking market is growing rapidly in South Africa and also globally. Satrix Managers is the leading manager of listed index tracking instruments in South Africa and through this transaction Sanlam will have a larger stake in the future growth of this market. Sanlam Investments also acquired a 50% interest in JP Morgan’s South African investment administration operations upon its exit from this market segment.

· Sanlam Emerging Markets (SEM) achieved exemplary growth in the first half of 2012, increasing new business volumes by 40% and net result from financial services by 56%, despite challenging economic conditions.

Referring to SEM’s progress outside South Africa, Dr van Zyl said that good progress has been made on the regulatory approvals required for the Group’s acquisition of a 26% interest in Shriram Capital in India. “We are confident that the final conclusion of this transaction is imminent,” he said.

He added that while Sanlam would consider attractive expansion opportunities into African countries where the Group does not have a presence, its immediate focus is on strengthening business relationships in existing operations. SEM is actively working with its partners to identify appropriate opportunities in this regard. South East Asia has also been identified as a potential growth market and SEM is currently investigating a number of opportunities in the region.

Sanlam remains well capitalised with discretionary capital of R4 billion as at 30 June 2012.

Details of the results for the half year period are available at http://www.sanlam.co.za/wps/wcm/connect/Sanlam_EN/sanlam/investor+relations/financial+results.