Old Mutual first-half earnings fall 30% as Middle East tensions hit investment returns
Old Mutual first-half earnings fall 30% as Middle East tensions hit investment returns By Nqobile Dludla
JOHANNESBURG, Sept 8 (Reuters) - South African insurer Old Mutual Ltd OMUJ.J reported a 30% decline in half-year adjusted headline earnings on Tuesday as market volatility sparked by conflicts in the Middle East hit investment returns.
Old Mutual, the largest life insurer in South Africa, said its adjusted headline earnings totalled 2.95 billion rand ($184 million) in the six months ended June 30, down from 4.2 billion rand a year earlier.
Life annual premium equivalent sales increased 21% to 7.85 billion rand, mainly driven by strong group risk and annuity sales in Old Mutual Corporate, higher living annuity and endowment sales in Wealth Management, and strong retail and corporate sales growth in Old Mutual Africa Regions.
The value of new business increased 32% to 569 million rand, while the value of new business margin improved by 10 basis points, supported by higher sales volumes and a more profitable business mix.
Results from operations per share increased 11% to 126.3 cents, supported by positive growth in Old Mutual life and savings earnings and strong contributions from Old Mutual Investments and Old Mutual Africa Regions, as well as lower central costs.
The insurer declared an interim dividend of 40 cents per share, up 8%, and a 1 billion rand share buyback.
Customer acquisition and deposit growth in newly launched OM Bank continued to track well during the period, with customer numbers increasing to 742,000 and retail deposits increasing to 1.4 billion rand, the insurer said.
($1 = 16.0416 rand)
(Reporting by Nqobile Dludla. Editing by Mark Potter)
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