Big­gest slump in 12 years for in­surer

The Star Early Edition - - COMPANIES -

LIB­ERTY Hold­ings slumped the most since April 2009, af­ter the South African in­surer said full-year profit tum­bled more than an­a­lysts ex­pected. The stock slid al­most 10.88 per­cent to R109.91 at the close on the JSE on Fri­day, the big­gest de­cline of 162 securities on the all share in­dex. Vol­umes traded in Lib­erty soared, reach­ing 2.7 times the daily av­er­age over the past three months. Earn­ings per share for 2016 dropped 40 per­cent to 60 per­cent from a year ago, Lib­erty said. That com­pares with a me­dian es­ti­mate of four an­a­lysts for a de­cline of 2 per­cent, ac­cord­ing to data com­piled by Bloomberg. The in­surer, con­trolled by the Stan­dard Bank Group, said it was hit by weaker re­turns on in­vest­ments, gains in the rand against the dol­lar, and a write-down of in­fra­struc­ture hold­ings in its al­ter­na­tive port­fo­lios. It also ex­pe­ri­enced higher risk claims and costs re­lated to the re­or­gan­i­sa­tion of its South African and East African as­set-man­age­ment busi­ness, and had to take ac­count­ing charges for the con­sol­i­da­tion of a prop­erty unit listed on the Johannesburg bourse. “Lib­erty has not diver­si­fied its busi­ness very suc­cess­fully and it is strug­gling with its health busi­ness,” Tracy Brodziak, the head of re­search at Old Mu­tual Eq­ui­ties, said from Cape Town. “There were clearly per­sis­tency is­sues,” she added. – Bloomberg

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