San­lam weathers rand tur­moil, new busi­ness up 20%

The Star Early Edition - - COMPANIES - Sizwe Dlamini

SAN­LAM Emerg­ing Mar­kets recorded over­all new busi­ness growth of 20 per­cent, with struc­tural growth more than off­set­ting the neg­a­tive im­pact of a stronger av­er­age rand ex­change rate.

This is ac­cord­ing to the in­surer’s op­er­a­tional up­date re­leased yes­ter­day where it re­ported a rise in profit in the four months to April. San­lam said eco­nomic con­di­tions in Namibia were plac­ing pressure on new busi­ness per­for­mance, with over­all new busi­ness vol­umes in line with last year. Namibia also ex­pe­ri­enced a change in mix from in­di­vid­ual life busi­ness to the less prof­itable group life line of busi­ness. An­nu­ity sales in Botswana de­clined sig­nif­i­cantly dur­ing the pe­riod, the com­bined ef­fect of a re­duc­tion in the value of re­tire­ment funds be­com­ing avail­able as well as com­pet­i­tive pres­sures. San­lam’s nor­malised head­line earn­ings a share in­creased by 9 per­cent com­pared with the first four months of the 2016 fi­nan­cial year. The in­surer said a rel­a­tively stronger in­vest­ment mar­ket per­for­mance this year sup­ported in­vest­ment re­turn earned on the cap­i­tal base.

Di­luted head­line earn­ings a share, which in­clude fund trans­fers recog­nised in re­spect of San­lam shares held in pol­i­cy­holder port­fo­lios, in­creased by 15 per­cent com­pared with the first four months of the 2016 fi­nan­cial year.

New busi­ness vol­umes de­clined by 4 per­cent to R71 bil­lion largely due to lower lump­sum in­flows at Glacier, San­lam In­vest­ments Retail and San­lam Pri­vate Wealth. San­lam Per­sonal Fi­nance achieved strong growth in the more prof­itable re­cur­ring pre­mium risk busi­ness lines. How­ever, the in­surer said this more than off­set a de­cline in dis­cre­tionary sin­gle pre­mium busi­ness in the mass af­flu­ent mar­ket, as in­vestor risk aver­sion re­main el­e­vated in the un­cer­tain po­lit­i­cal and eco­nomic en­vi­ron­ment.

Over­all new busi­ness sales at San­lam Per­sonal Fi­nance de­clined by 10 per­cent as a re­sult. San­lam Sky new busi­ness sales in­creased by 27 per­cent in the com­pa­ra­ble 2016 pe­riod. The change in mix to­wards risk busi­ness con­tin­ued to yield pos­i­tive re­sults, con­tribut­ing to 18 per­cent growth in San­lam Sky’s in­di­vid­ual life risk busi­ness sales. Sales of sav­ings prod­ucts de­clined by 49 per­cent. San­lam shares rose 0.26 per­cent on the JSE yes­ter­day to close at R65.89.


San­tam San­lam head of­fice north of Jo­han­nes­burg.

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