REG - Old Mutual Ltd - Voluntary Operating Update

Old MutualAnnouncement

30/05/2024 13:15

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RNS Number : 5005Q  Old Mutual Limited  30 May 2024

Old Mutual Limited

Incorporated in the Republic of South Africa

Registration number: 2017/235138/06

ISIN: ZAE000255360

LEI: 213800MON84ZWWPQCN47

JSE Share Code: OMU

LSE Share Code: OMU

NSX Share Code: OMM

MSE Share Code: OMU

ZSE Share Code: OMU

("Old Mutual" or "Group")

 

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30 May 2024

 

OLD MUTUAL VOLUNTARY OPERATING UPDATE FOR THE QUARTER ENDED 31 MARCH 2024 -
DOUBLE DIGIT SALES GROWTH DELIVERED ACROSS OUR BUSINESS

The global economy has proven resilient despite continued concerns regarding
escalation of conflict in Ukraine and the Middle East. China's economic growth
was stronger than expected at 5.3% in the first quarter of 2024 and will
likely continue with incremental policy change to ensure that their 5% growth
target for 2024 is met. Central banks are cautious of the impact of inflation
and interest rates will likely remain high for longer than previously
expected. In the markets where we operate in Africa, inflation is still
elevated but with a downward trend.

These economic conditions continued to negatively impact our customers'
disposable income in the retail segments. Overall, we expect our diversified
business to remain well positioned for growth and we delivered double digit
sales growth across our business for the quarter ended 31 March 2024.

Financial key performance indicators for the quarter ended 31 March 2024

 

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

 Key Performance Indicators            31 March 2024  31 March 2023  change

 (R million unless otherwise stated)
 Life APE sales                        3 170          2 873          10%
 Gross flows                           51 130         49 046         4%
 Net client cash flow                   166           899            (82%)
 Loans and advances(1)                  20 058        19 391         3%
 Gross written premiums                 6 936         6 512          7%

(1)Comparative amounts represent FY2023 balance sheet amounts.

 

 

Life APE sales recorded robust growth of 10% from the prior period. Sales in
the current period benefitted from strong risk sales across all channels in
Mass and Foundation Cluster. Personal Finance recorded higher guaranteed
annuity sales, strong recurring premium savings and funeral sales, partially
offset by lower risk sales. Life APE sales in Old Mutual Africa Regions were
lower than the prior period. This was driven by the appreciation of the rand
against the local currencies.

 

Gross flows increased by 4% from the prior period. This was driven by higher
inflows in the offshore business in Wealth Management and strong inflows in
Old Mutual Africa Regions following the acquisition of a large new mandate in
Malawi as well as higher unit trust sales in East Africa. These were partially
offset by lower inflows in Old Mutual Investments particularly in fixed income
and community property for Futuregrowth and lower Alternatives flows compared
to the prior period.

 

Good growth in net client cash flow recorded in Wealth Management was offset
by large outflows in Old Mutual Investments and Personal Finance. The growth
in Wealth Management was driven by strong inflows and better retention in the
offshore business. Old Mutual Investments reported net outflows in fixed
income and money market funds in Futuregrowth. Personal Finance experienced
higher disinvestments and annuity payments as well as higher risk claims
compared to the prior period.

 

Loans and advances were higher by 3% compared to the prior period mainly due
to the increase in the loan book in Old Mutual Africa Regions, supported by
the depreciation of the rand against the Kenyan shilling. Loans and advances
in Mass and Foundation Cluster were marginally higher than the prior period
and in line with our cautious lending strategy.

 

Gross written premiums grew by 7% from the prior period. This was driven by
strong new business growth in Retail and Specialty businesses in Old Mutual
Insure. In Old Mutual Africa Regions, gross written premiums were marginally
lower than the prior period mainly due to the appreciation of the rand against
the local currencies.

 

Strategic delivery

 

The Group's perimeter review is on track with the announcement of our exit of
our general insurance business in Tanzania which followed the exit of our
general and life insurance businesses in Nigeria. Both transactions are
pending regulatory approval. These exits followed a thorough strategic review
in line with our disciplined approach to capital allocation and in support of
strengthening our return on net asset value.

 

In April 2024, we also announced that the Prudential Authority granted the
Group approval to establish OM Bank subject to certain licence conditions. The
process of testing with partner banks in the industry has commenced. The
substantive progress on both the perimeter review and the bank-build are
concrete proof-points of our focus on strategic execution to accelerate value
creation.

 

Investor engagement

 

Investors are invited to participate in a conference call to address matters
related to this voluntary operating update on 30 May 2024 at 5pm, SAST.
Investors and media may register on the following link:

Diamond Pass Registration (choruscall.za.com)
(https://services.choruscall.za.com/DiamondPassRegistration/register?confirmationNumber=5064245&linkSecurityString=1399ff11b0)

 

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 30 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: 46269

 South Africa   010 500 4108
 UK             0 203 608 8021
 Australia      073 911 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            Tamela Holdings (Proprietary) 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 Limited

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 14 countries. Old Mutual's primary operations are in Africa
and it has a niche business in China. With over 179 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) .
 

 

 

 

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