Momentum Group (MTM) Q1 2026 earnings summary

Executive summary

• Entered the second year of a three-year impact strategy, achieving normalized headline earnings of ZAR 1.76 billion for Q1 2026, reflecting strong operational performance and disciplined strategy execution.

• Sales improved by 8% to ZAR 22.4 billion year-over-year, with strong operational performance despite lower market variances compared to the prior year.

• Life annuity sales dropped 28% year-over-year, impacting value of new business (VNB), which declined from ZAR 197 million to ZAR 146 million.

• Improvement in VNB across other business lines, but new business margin reduced from 2.7% to 0.7%.

• Positive market variances contributed ZAR 201 million, though less than the prior period, and short-term insurance underwriting experience remained excellent.

Financial highlights

• Normalized headline earnings reached ZAR 1.76 billion, with positive market variances contributing ZAR 201 million, down from ZAR 570 million in the prior year.

• Recurring premiums grew by 8% to ZAR 1,154 million and single premiums by 5% to ZAR 16,490 million year-over-year.

• Adjusted for one-offs, operational earnings are in line with the ZAR 1.5 billion per quarter target.

• SCR (solvency coverage ratio) decreased to 1.76, moving from the top to the middle of the 1.6-2 target range, mainly due to dividend payouts, buybacks, and lower yield curves.

• Savings of ZAR 389 million from performance optimisation realised, with a further ZAR 500 million identified.

Outlook and guidance

• F2027 targets remain achievable: normalized headline earnings of ZAR 7 billion, ROE of 20%, and VNB margin between 1%-2%.

• Modest growth expected in South Africa due to improved energy, logistics, and easing inflation, but short-term economic growth may be lower.

• Continued focus on driving sales volumes, managing expenses, and improving VNB margin, with strategic initiatives under the Impact strategy gaining momentum.