Santam (SNT) H1 2024 earnings summary

Executive summary

• Achieved strong financial performance in H1 2024 despite challenging economic conditions and adverse weather events, with underwriting results within the 5%-10% target range.

• Strategic initiatives, including MiWay turnaround, property portfolio actions, MTN partnership, and execution of the FutureFit 2030 strategy, supported resilience and growth.

• Diversification across segments and geographies, and focus on direct channels and non-traditional segments, accelerated growth and inclusion.

• Improved customer experience, with net promoter score rising from 52 to 56.

• Strong investment returns and robust Alternative Risk Transfer (ART) business performance contributed to results.

Financial highlights

• Gross written premium (GWP) grew 8% year-over-year; net earned premium (NEP) up 7%.

• Underwriting margin improved to 6.5% (2023: 3.8%).

• Net income rose 34% to R1,718 million (2023: R1,281 million).

• Interim dividend of 535 cents per share, up 8.1% year-over-year.

• Return on capital increased to 33.6% (2023: 24.0%).

Outlook and guidance

• Focus remains on profitable growth, digital and data capability acceleration, and property portfolio improvement.

• Continued scaling of direct and specialist businesses, with emphasis on diversification and efficiency.

• Operating conditions expected to remain subdued for the rest of 2024, with positive sentiment post-elections but persistent structural constraints.

• La Niña effect anticipated in Q3 2024, likely increasing weather-related volatility.

• Management remains confident in delivering enhanced growth and profitability through continued execution of the FutureFit 2030 strategy.