Old Mutual (OMU) Status Update summary

Operating environment and macroeconomic context

• Global economic uncertainty, downward GDP revisions, and rising trade barriers impacted sentiment, with South Africa affected by political uncertainty and U.S. tariffs; inflation slowed to 2.7% in March 2025, but high interest rates pressured consumer affordability and credit.

• Africa Regions experienced mixed macro performance due to tariffs, donor funding withdrawal, inflation, and currency volatility.

Financial performance highlights

• Life APE sales declined 2% to ZAR 3.1 billion, mainly from a 39% drop in guaranteed annuity and corporate savings sales; Old Mutual Corporate life APE fell 38% due to a high prior-year base.

• Mass and Foundation Cluster APE rose 7% on strong risk sales, while Africa regions APE increased 12% driven by corporate sales in Namibia and Malawi.

• Gross flows grew 6% to ZAR 53.2 billion, led by a 28% increase in wealth management inflows and strong international fund flows.

• Net client cash outflow worsened to negative ZAR 4.8 billion, impacted by large outflows in Investments and Corporate, including R6.4bn indexation outflow and R3.6bn in terminated unprofitable business.

• Loans and advances remained stable, reflecting a cautious lending approach.

Insurance and banking developments

• Gross written premiums increased 7% to ZAR 7.4 billion, with Old Mutual Insure up 12% due to management actions, repricing, and benign weather; Africa regions saw a 5% decrease, partly due to discontinued operations in Nigeria.

• The insurance business showed broad-based improvement, especially in specialty lines and the new Sky Portfolio; insurance revenue diversity is improving resilience to climate-related claims.

• OM Bank's public rollout is on track for later in 2025, with internal testing underway; startup losses are expected to be ZAR 1.2–1.3 billion per annum, with break-even targeted by FY2028.