IN­SUR­ANCE

New chief ex­ec­u­tive will re­place for­mer boss Peter Moyo, who was fired af­ter a pro­longed court bat­tle

Pretoria News - - BUSINESS REPORT - DINEO FAKU [email protected]

Old Mu­tual ex­pects to an­nounce its new chief ex­ec­u­tive soon |

SOUTH Africa’s sec­ond largest in­sur­ance com­pany Old Mu­tual said yes­ter­day that it ex­pected to an­nounce a new chief ex­ec­u­tive in the com­ing months af­ter it fired its for­mer boss Peter Moyo last year.

Old Mu­tual chief ex­ec­u­tive Iain Wil­liamson said that the group stood by its de­ci­sion to axe Moyo af­ter it recorded lower re­sults from its op­er­a­tions dur­ing the year ended De­cem­ber 2019.

“The board re­mains con­fi­dent that the de­ci­sion made was in the best in­ter­ests of our stake­hold­ers and that their du­ties were dis­charged in line with the high stan­dard of gov­er­nance and ethics ex­pected of an es­tab­lished and re­spected or­gan­i­sa­tion like ours,” said Wil­liamson.

Old Mu­tual sus­pended Moyo over a con­flict of in­ter­est and a break­down in trust and con­fi­dence last May be­fore ax­ing him a month later.

Yes­ter­day, Wil­liamson said the group took the dif­fi­cult de­ci­sion af­ter care­ful con­sid­er­a­tion of the rel­e­vant facts and ac­tions.

Wil­liamson made the an­nounce­ment af­ter the group flagged that it was likely to miss its 2020 growth target on global eq­uity mar­ket jit­ters and pres­sure on gross do­mes­tic prod­uct (GDP) growth rates.

Wil­liamson said that the group’s target of 2 per­cent plus nom­i­nal GDP de­pended on a turn­around in the South African econ­omy and higher eq­uity mar­ket lev­els.

“Over the medium term, we ex­pect that meet­ing sev­eral of our most im­por­tant tar­gets will be chal­leng­ing.

We will re­main very closely fo­cused on our op­er­a­tional re­sults, dig­i­tal en­able­ment and ex­ploit­ing op­por­tu­ni­ties for growth,” said Wil­liamson.

The group said re­sults from its op­er­a­tions fell 2 per­cent to R8.9 bil­lion from R9.1bn in 2018, with the Old Mu­tual In­sure record­ing a 65 per­cent de­cline to R233 mil­lion from R670m in 2018. It said the per­sonal fi­nance seg­ment fell 14 per­cent to R1.7bn in 2019 from R2.02bn a year ear­lier.

Chief fi­nan­cial of­fi­cer Casper Troskie said the de­cline was driven by lower in­flows in most of its seg­ments and height­ened catas­tro­phe losses in Old Mu­tual In­sure.

“The weather-re­lated catas­tro­phes hurt us badly dur­ing the year,” said Troskie.

Old Mu­tual said its profit af­ter tax at­trib­ut­able to eq­uity hold­ers of the par­ent fell 74 per­cent to R9.39bn from R36.57bn, re­flect­ing the un­bundling of the group’s 32 per­cent stake in Ned­bank and the spin-off of Quil­ter, its wealth man­age­ment busi­ness.

The group said the turn­around of the east of Africa mar­ket was ham­pered by a R40m loss due to poor claims and lower new busi­ness vol­umes. In West Africa, the group de­liv­ered strong re­sults from op­er­a­tions growth.

Some of the high­lights in­cluded the 5 per­cent in­crease in ad­justed head­line earn­ings to R9.8bn from R9.3bn in the prior year on the back of higher in­vest­ment re­turns in South Africa. The group also achieved R1.2bn in cost sav­ings, ex­ceed­ing the target of R1bn.

Wil­liamson said that the rapid spread of the virus since the start of 2020, and par­tic­u­larly in re­cent weeks, had caused sig­nif­i­cant dis­rup­tion in global eq­uity mar­kets.

Old Mu­tual shares de­clined 15.19 per­cent on the JSE yes­ter­day to close at R12.05.

SIG­NAGE on the Old Mu­tual build­ing in Sand­ton, Jo­han­nes­burg. The in­surer’s shares closed 15.19 per­cent lower on the JSE yes­ter­day. | KAREN SANDISON African News Agency (ANA)

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.