REG - Old Mutual Ltd - Q1 2026 Voluntary Operating update

Old MutualAnnouncement

04/06/2026 16:30

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20260604:nRSD0902Ha&default-theme=true

RNS Number : 0902H  Old Mutual Limited  04 June 2026

Old Mutual Limited

Incorporated in the Republic of South Africa

Registration number: 2017/235138/06

ISIN: ZAE000255360

LEI: 213800MON84ZWWPQCN47

JSE Share Code: OMU

JSE Alpha Code: OMLI

LSE Share Code: OMU

NSX Share Code: OMM

MSE Share Code: OMU

ZSE Share Code: OMU

("Old Mutual" or "Group" or "Company")

 

Ref: 15_26

4 June 2026

 

OLD MUTUAL VOLUNTARY OPERATING UPDATE FOR THE QUARTER ENDED 31 MARCH 2026

 

 

Performance overview: strong growth and improved solvency

·      Strong Life APE sales growth of 28%. Excluding a large risk deal
in Old Mutual Corporate, Life APE sales was up by 15%, indicating sales
momentum across most clusters

·      Strong recovery in the value of new business margin to 1.6%,
supported by the large risk deal and margin improvement in Wealth Management

·      Continued improvement in gross flows, driven by exceptional
inflows in Old Mutual Investments

·      Old Mutual Insure reported a strong net underwriting margin
exceeding the medium-term target range

·      OMLACSA's regulatory solvency ratio increased to 186%, within the
target range of 165% to 200%. Improved Group solvency remained well within the
target range of 155% to 185%

·      Completed R3 billion share buyback, demonstrating our commitment
to disciplined capital allocation and unlocking shareholder value

·      Solid progress on the integration of Old Mutual Finance and OM
Bank, while customer acquisition and deposits growth continue to gain traction

 

Sales and flows

The table below sets out certain key performance indicators for the quarter
ended 31 March 2026 ("first quarter") compared to the quarter ended 31 March
2025 ("prior period").

 

 Key Performance Indicators            31 March 2026  31 March 2025  change

 (R million unless otherwise stated)
 Life APE sales ((1))                  3 732          2 919          28%
 Gross written premiums                7 503          7 448          1%
 Gross flows ((1))                     60 008         52 469         14%
 Net client cash flow ((1))            (3 180)        (5 396)        41%
 Gross loans and advances ((2))        19 486         19 259         1%

(1) The comparative amount has been re-presented to exclude China

(2) The comparative amount reflects the 31 December 2025 balance sheet
position, which has been re‑presented for consistency to reflect amounts
previously classified within other receivables

 

Life APE sales increased by 28%, primarily driven by a large risk deal secured
in Old Mutual Corporate. Excluding this, Life APE sales would have been up by
15%, reflecting strong sales growth compared to the prior period,
notwithstanding lower guaranteed annuity sales in Personal Finance. Old Mutual
Africa Regions further boosted sales, generating higher retail and corporate
new business.

 

Gross written premiums were marginally higher than the prior period. In Old
Mutual Insure, gross written premiums increased by 4% compared to the prior
period, driven by good performance in Credit Guarantee Insurance Corporation,
Genric Insurance Company and ONE Financial Services Holdings. In Old Mutual
Africa Regions, the marginally higher volumes in general insurance and medical
new business in East Africa was offset by the appreciation of the rand against
the Kenyan shilling.

 

Gross flows increased by 14%, primarily driven by strong inflows in Liability
Driven Investments, Indexation funds and Equity and Multi-Asset capabilities
in Old Mutual Investments. Old Mutual Africa Regions recorded strong money
market inflows in Malawi and higher unit trust flows in Uganda. This was
partially offset by slightly lower inflows in the Old Mutual Life and Savings
cluster, particularly in Wealth Management where low-margin Cash and Liquidity
Solutions inflows were lower compared to the prior period.

 

Net client cash flow continued to improve, driven by the good gross flows
during the period and the non-repeat of low-margin indexation outflows in Old
Mutual Investments that were reported in the prior period.

 

Gross loans and advances were marginally higher than the prior period. In Old
Mutual Banking cluster, Old Mutual Finance's lending book was broadly stable
year-on-year, reflecting deliberate actions to manage asset quality, including
right-sizing the non-performing loan portfolio and cautious origination in
anticipation of macro-economic pressures. OM Bank will launch its lending
activities in the second half of the year. Gross loans and advances in Old
Mutual Africa Regions marginally improved, driven by loan book migration away
from retail into secured small and medium-sized enterprise, which has larger
loan sizes.

 

Margins

The value of new business margin, although below our medium-term target range,
increased to 1.6% from 1.2% at 31 December 2025. This was primarily driven by
the large risk deal in Old Mutual Corporate. The strong value of new business
margin in Old Mutual Corporate is expected to normalise over the remainder of
the year. The increase was further supported by margin improvement in Wealth
Management, partially offset by continued pressure in annuity volumes in
Personal Finance.

 

Old Mutual Insure delivered a strong underwriting start to 2026, achieving a
net underwriting margin above the target range of 5%-8%. This performance was
supported by disciplined underwriting, targeted claims-cost initiatives and
continued improvement in portfolio quality. Severe flooding in parts of
Limpopo and Mpumalanga during the first quarter has not resulted in material
net losses for Old Mutual Insure. Management notes that market conditions are
showing signs of rate softening. The business continues to prioritise
sustainable underwriting profitability over volume growth driven by pricing
erosion and adverse selection.

 

Old Mutual Africa Regions delivered improved net underwriting margin compared
to the prior period due to improved claims experience attributed to
disciplined underwriting, repricing to improve portfolio quality coupled with
lower expenses following cost saving initiatives.

 

 

 

 

 

Earnings

Results from operations of R2.5 billion was largely in line with the prior
period, despite ongoing pressure on customers and additional investment in OM
Bank. Earnings were not materially impacted by Malawi's performance in the
first quarter. Shareholder investment returns were significantly lower in the
first quarter due to market volatility caused by the geopolitical environment.

 

Capital

The regulatory solvency ratio for Old Mutual Life Assurance Company (South
Africa) Limited ("OMLACSA") increased to 186% from the reported 167% at 31
December 2025, remaining within the solvency target range of 165% to 200%. The
increase in the solvency ratio was primarily driven by the weakening in
markets during March 2026, with global markets impacted by the US/Israel and
Iran conflict. More particularly, the increase in the yield curve relative to
31 December 2025 resulted in a reduction in the solvency capital requirement
and an increase in own funds as liabilities reduced. Furthermore, the
weakening in the equity market also resulted in a reduction of the prescribed
equity shock, further reducing the solvency capital requirement.

 

Given the impact of the OMLACSA solvency on the Group solvency position, the
Group's position also improved during the quarter and is well within the
solvency target range relative to the 31 December 2025 position. The Group
solvency position benefited from the lower prescribed equity shock.

 

The discretionary capital balance decreased to R4.2 billion as at 31 March
2026 from R6.1 billion at 31 December 2025, after allocating R1.5 billion to
the share buyback programme executed in the first quarter of 2026. A further
R0.9 billion was allocated to the share buyback programme in the second
quarter.

 

Old Mutual share repurchase programme

Shareholders are referred to Old Mutual's Stock Exchange News Service of the
JSE Limited ("JSE") announcement dated 03 October 2025, wherein the Company
announced the commencement of the R3 billion Share Repurchase Programme. Old
Mutual confirms that the Share Repurchase Programme was concluded on 15 May
2026, by which time 214,860,122 Old Mutual ordinary shares had been
repurchased and cancelled on the JSE at an average purchase price of 1 396
cents per share, for an aggregate consideration of R3 billion. The Share
Repurchase Programme has been value accretive, as the average repurchase price
is below the group equity value per share reported at 31 December 2025. All
repurchased shares have been cancelled as issued shares and have reverted to
authorised but unissued share capital and the issued share capital of the
Company has reduced to 4,498,037,281.

 

Outlook and strategic execution

While South Africa's outlook continues to be positive, supported by the
gradual improvement in fiscal position and ongoing reforms, inflation is
expected to increase in the near term due to high fuel prices and food
inflation, raising the risk of interest rate hikes. The growth outlook also
remains positive across Old Mutual Africa Regions, although rising costs
driven by the US/Israel and Iran conflict are expected to increase consumer
inflation and weigh on topline and insurance margin growth.

 

The Group continues to execute on the four strategic priorities, structured to
unlock value in the short to medium term, while positioning the Group to
generate growth over the medium to long term:

·      Drive the competitiveness of the South African business

·      Deepen market leadership in Southern Africa

·      Establish the right to win for OM Bank

·      Evaluate and pivot on growth markets

 

We remain on track to achieve our cost-saving commitments. Management actions
to improve persistency and the quality of new business in Mass and Foundation
are progressing as planned. The ongoing pressure on customers' disposable
income and elevated cost of living creates headwinds to improvement. The
observed rotation from guaranteed to market linked annuities continues to
exert pressure on new business margins.

 

The integration of Old Mutual Finance into OM Bank continues to progress in
line with the previously communicated integration plans which are on track to
conclude by year end, subject to the necessary governance and regulatory
processes. The cumulative number of customers for OM Bank increased
significantly from 284 000 at 31 December 2025 to 473 000 in the first
quarter. OM Bank will continue to roll out its value proposition to the
market. The cumulative retail deposits also increased to R541 million in the
first quarter from the R272 million recorded at 31 December 2025, driven by
the increase in savings deposits and the migration of money accounts, with
management actions focused on boosting transactional activities.

 

In Old Mutual Africa Regions, we will continue to drive underwriting margin
improvements through disciplined pricing, claims and cost management. In our
life businesses, we will continue to progress value of new business margin
growth through sustained volume growth and an improved sales mix. We will also
continue to drive capital optimisations.

 

Investor engagement

Investors are invited to participate in a conference call to address matters
related to this voluntary operating update on 8 June 2026 at 16:00 pm, SAST.
Investors and media may register on the following link:

Diamond Pass Registration
(https://services.choruscall.it/DiamondPassRegistration/register?confirmationNumber=8741191&linkSecurityString=19dc8b8735)

 

Please note that registered participants will receive their dial in number
upon registration. We advise callers to dial in at least five minutes before
the conference call starts. A recorded playback will be available for 3 days
after the conference call. The replay can be accessed in the following link:

https://services.choruscall.com/ccforms/replay.html
(https://services.choruscall.com/ccforms/replay.html)

 

Access numbers for recorded playback:

Access code for recorded playback: 48592

   South Africa                             +27
10 500 4108

 
 UK
+44 203 608 8021

   Australia                              +61
73 911 1378

   USA
                +1 412 317 0088

   International                        +27 10 500
4108

 

The financial information in this voluntary operating update including
forward-looking statements is the responsibility of the Old Mutual Board of
Directors and has not been reviewed or reported on by the Group's external
auditors.

 

Sandton

 

Sponsors

 JSE                                               Equity Sponsor: Tamela Holdings (Proprietary) Limited

                                                   Debt Sponsor: Nedbank Corporate and Investment Banking, a division of Nedbank
                                                   Limited
 Namibia                                           PSG Wealth Management (Namibia) (Proprietary) Limited
 Zimbabwe                                          Imara Capital Zimbabwe plc
 Malawi                                            Stockbrokers Malawi Limited

 Enquiries

 Investor Relations
 Langa Manqele                 M: +27 82 295 9840

 Head of Investor Relations    E: investorrelations@oldmutual.com

Communications

Wendy Tlou                                        M: +27
82 906 5008

Chief Communications

and Reputation Officer                       E:
oldmutualnews@oldmutual.com

 

Notes to Editors

About Old Mutual

Old Mutual is a premium African financial services group that offers a broad
spectrum of financial solutions to retail and corporate customers across key
market segments in 12 countries. Old Mutual's primary operations are in Africa
and it has a niche business in China. With over 181 years of heritage across
sub-Saharan Africa, Old Mutual is a crucial part of the communities it serves
as well as broader society on the continent.

 

For further information on Old Mutual and its underlying businesses, please
visit the Corporate website at www.oldmutual.com (http://www.oldmutual.com)
 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  UPDUPURAQUPQGCC



            Copyright 2019 Regulatory News Service, all rights reserved