REG - Old Mutual Ltd - Q1 Voluntary Operating Update

Old MutualAnnouncement

Thu 16:45

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250529:nRSc6675Ka&default-theme=true

RNS Number : 6675K  Old Mutual Limited  29 May 2025

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")

 

 

Ref: 17/25

29 May 2025

 

OLD MUTUAL VOLUNTARY OPERATING UPDATE FOR THE QUARTER ENDED 31 MARCH 2025

 

The global economy continues to experience significant uncertainty with the
risk of rising trade barriers reducing demand and triggering new inflationary
pressures. Global GDP growth showed signs of moderation, with projections for
2025 revised slightly downward.

 

In South Africa, investor sentiment was dampened by uncertainty over the
stability of the Government of National Unity and the impact of US tariffs on
exports. Inflation decelerated to 2.7% year-on-year in March 2025, but higher
interest rates continue to strain consumer credit affordability, impacting
persistency.

 

Our Old Mutual Africa Regions markets experienced mixed macro performance in
the first quarter of 2025, driven by tariffs, the withdrawal of donor funding,
inflationary pressures and currency volatility.

 

 

Financial key performance indicators for the quarter ended 31 March 2025

 

The table below sets out certain key performance indicators for the quarter
ended 31 March 2025 compared to the quarter ended 31 March 2024 ("prior
period").

 Key Performance Indicators            31 March 2025  31 March 2024  change

 (R million unless otherwise stated)
 Life APE sales                        3 095          3 170          (2%)
 Gross flows ((1))                     53 208          50 178        6%
 Net client cash flow                  (4 834)        166                              (>100%)
 Loans and advances ((2))              18 672         18 761          (0%)
 Gross written premiums                7 448           6 936         7%

(1) The prior period amounts for Old Mutual Investments were re-presented to
include institutional products that are an alternative to bank deposits on a
net flow basis

(2) Comparative amounts represent 31 December 2024 ("FY2024") balance sheet
amounts

 

Life APE sales was marginally lower than the prior period, primarily due to a
decrease in guaranteed annuities sales in Personal Finance, in line with the
overall market decline resulting from a drop in yields. The non-repeat of
significant savings sales secured in the prior period in Old Mutual Corporate
further contributed to reduced sales. Large corporate sales are lumpy by
nature with long and sometimes unpredictable lead times. This was partially
offset by good risk sales across all distribution channels in Mass and
Foundation Cluster as well as strong corporate sales in Old Mutual Africa
Regions, particularly in Namibia and Malawi.

 

Gross flows increased by 6% from the prior period. This was mainly driven by
strong inflows in Wealth Management across the local and offshore platforms,
Private Clients and Cash and Liquidity Solutions. Old Mutual Africa Regions
reported higher asset management inflows into the international US dollar fund
in Namibia, following the strengthening of the US dollar. These were partially
offset by reduced inflows in Old Mutual Investments, particularly in the
Equity and Multi-Asset capability, where the prior period included a large
client inflow. Additionally, Old Mutual Corporate experienced lower inflows
due to the non-repeat of significant savings flows recorded in the prior
period.

 

Despite good growth in gross flows, net client cash outflow was adversely
impacted by significant outflows in Old Mutual Investments and Old Mutual
Corporate. Old Mutual Investments reported low-margin indexation outflows of
R6.4 billion from a large offshore investor that continues to restructure
their existing investment mandate. Higher outflows in Old Mutual Corporate
were attributable to terminations of R3.6 billion in respect of the exit of
unprofitable business on an investment platform.

 

Loans and advances remained consistent with the prior period, in line with our
cautious lending strategy.

 

Gross written premiums grew by 7%, mainly due to fee increases in Old Mutual
Insure, particularly in the Specialty business. Old Mutual Insure delivered
growth of 12% in gross written premiums, with an underwriting margin well
above the upper end of our 4-6% target range, coupled with strong investment
performance. The growing diversity of insurance revenue makes Old Mutual
Insure increasingly resilient with respect to claims correlated to climate
change. In Old Mutual Africa Regions, gross written premiums were lower than
the prior period due to lower renewals and the impact of discontinued
operations from the Nigeria business, which was disposed of in June 2024
following our perimeter review.

 

The launch of OM Bank remains on track, with internal customers actively
refining processes and enhancing the service experience ahead of the public
rollout later this year.

 

We ceased to apply hyperinflation accounting for Zimbabwe for FY2024 following
the change in functional currency from ZiG to the US dollar. Consequently, we
expect reduced transfers to the foreign currency translation reserve in the
future. IFRS profits and headline earnings arising from Zimbabwe are expected
to reduce, with no impact on adjusted headline earnings. We expect a limited
impact on the net asset value of the Zimbabwean business.

 

Amid ongoing economic uncertainty and constrained household disposable income,
we have not seen an improvement in Mass and Foundation Cluster persistency and
we continue to closely monitor the impact on our economic recovery reserves.
We will reassess the need to strengthen our persistency basis as at 30 June
2025.

 

The regulatory solvency ratio for Old Mutual Life Assurance Company (South
Africa) Limited ("OMLACSA") remains strong, at the upper end of our target
range while the Group shareholder solvency ratio remains well within our
target range.

 

 

 

 

Investor engagement

 

Investors are invited to participate in a conference call to address matters
related to this voluntary operating update on 2 June 2025 at 14:30 pm, SAST.
Investors and media may register on the following link:

Diamond Pass Registration
(https://services.choruscall.eu/DiamondPassRegistration/register?confirmationNumber=6468469&linkSecurityString=f3f50f6fc)

 

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: 47521

 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 180 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  UPDSEDFLUEISEII