Old Mutual (OMU) H2 2023 earnings summary

Executive summary

• Profitable top-line growth across key markets: Life APE sales +17% to R14.6bn, gross written premiums +14% to R25.5bn and funds under management +8% to R1.3tn.

• Results from operations rose 14% to R8.3bn; adjusted headline earnings increased 21% to R5.9bn, supported by operating growth and higher investment returns.

• Strategic priorities focused on integrating financial services, protecting the core and building growth engines, with balance-sheet strength and shareholder returns maintained.

Financial highlights

• Results from operations were R8.343bn versus R7.310bn in FY 2022, up 14%; adjusted headline earnings were R5.861bn versus R4.850bn, up 21%.

• IFRS profit after tax attributable to ordinary equity holders rose 35% to R7.065bn; headline earnings increased 26% to R7.380bn.

• Value of new business increased 37% to R1.9bn; gross written premiums rose 14% to R25.5bn and funds under management increased 8% to R1.3tn.

• Dividend per share increased 7% to 81 cents; a R1.5bn share buy-back was completed.

Outlook and guidance

• Medium-term gross flows and gross written premiums target: nominal GDP growth +1%; FY 2023 delivery was characterized as solid.

• Value of new business margin target is 2%-3%; FY 2023 outcome was 2.3%.

• Outlook priorities include regaining market share, maintaining returns above cost of equity, improving underwriting performance through efficiencies and accelerating growth engines.

• Savings and Income proposition launch, legacy platform decommissioning and bank launch are planned; bank transition phase is expected to finish before end-2024.