Changes give PSG Konsult a lift

INDEPENDENT financial services group PSG Konsult has said that the improved economic outlook and political leadership changes in South Africa have made its clients more optimistic and confident of their financial wellbeing.

The group said the sentiment was reflected in its annual results as it posted 16 percent growth in recurring headline earnings per share to 43 cents a share, and achieved a 24 percent return on equity for the year to end February.

Chief executive Francois Gouws said the continuing positivity has pushed its key operating and financial metrics to demonstrate resilience

“Given this environment, the board decided to declare a 21 percent increase in the final gross dividend of 12.3c a share, up from 10.2c a share from income reserves,” Gouws said. “This brings the full year increase in the total dividend to 18 percent, which for the first time in several years is more than its per share earnings growth.”

PSG Konsult total income increased 11 percent to R4.20 billion during the period from R3.84bn, while profit increased 16 percent to R566.48 million from R486.86m for the year.

The group said its divisions performed in line with expectations.

PSG Insure reported 4 percent growth in recurring headline earnings.

“The 4 percent growth in PSG Insure does not mean the division was poor. The Cape floods and fires in Knysna resulted in insurance claims during the period so we are happy with its performance and we don’t expect to be impacted by those events in the near future,” Gouws added.

PSG Insure is in an early growth phase and it achieved gross written premium growth of 15 percent.

“This, combined with quality underwriting practices, resulted in a net underwriting margin of 8.3 percent,” he said.

PSG Insure’s gross written premiums now amount to R3.30bn. PSG Asset Management recorded the best performance during the year, achieving 20 percent growth in recurring headline earnings, while PSG Wealth reported 18 percent growth.

The group said management and other fees increased 11 percent and clients’ assets managed by Wealth’s 539 advisers increased by 14 percent to R163bn, which included R11.8bn of positive net inflows.

PSG shares rose 0.11 percent on the JSE yesterday to close at R8.77.