Alex Forbes sees its way through crisis
But it reported a 20% drop to 35.4c in headline earnings per share
FINANCIAL services company Alexander Forbes yesterday reported a 20 percent drop to 35.4 cents in headline earnings per share for the year to the end of March, but said it was confident of finding its way through the economic upheaval wrought by the Covid-19 pandemic.
“There is no doubt that the Covid19 pandemic and its impact on the world economy is a tipping point in global history, and that of Alexander Forbes,” it said, noting that the speed and complexity of the global health crisis had forced companies to reconsider their responses to the impact on their businesses.
“We are no different, and through our business continuity strategy we have effected, in the financial services industry, a market-leading transition into the new era of operating a fully virtual company,” the group said.
Alexander Forbes said the pandemic had dampened the short-term outlook and impacted the company’s original revenue targets for the 2021 financial year, but it had a solid foundation for growth over the long term.
For the year under review, operating income from continuing operations was up 1 percent to R3.153 billion, while profit from continuing operations was flat at R757 million, partly due to muted growth in operating income.
The company had written off R1.145bn in goodwill and a further R47m in related intangible assets, included as non-trading and capital items, reflecting the uncertainty of projected income arising from the coronavirus crisis.
It declared a final dividend of 12c per share, resulting in a total dividend for the year of 30c per share, the same as 2019.
Chief executive Dawie de Villiers said the company’s decision to de-risk its business model, simplify its structure and adopt an advice-led, client-centric strategy was gaining traction.
“Our focus on our core offering will further enhance shareholder value, while combining our market-leading integrated consulting framework with a capital-light strategy has allowed us to reshape a new Alexander Forbes,” he said.
After robustly stress-testing various scenarios for the business, driven by Covid-19 and a sovereign downgrade for South Africa, he said the company was “confident that we will be able to navigate steadily through these turbulent economic times”.
Alexander Forbes is one of Africa’s leading financial services organisations, providing retirements, asset management, insurance and wealth management solutions.
Headquartered in Johannesburg, it has a presence in Namibia, Botswana, Zambia, Uganda, Nigeria, Zimbabwe and the Channel Islands through an offshore Jersey operation.