Emerging markets a high point in challenging year for Sanlam

Cape Town – The Sanlam Group on Thursday described its overall performance for the year to the end of December as “satisfactory ... in a challenging environment”, but noted that its emerging markets business had beaten all targets for the year.

The diversified Pan-African financial services group that was established in 1918 as a life insurance company said it had seen double-digit growth in all key operational performance indicators in the year under review.

The company boosted its dividend by 9.4 percent to 268 cents per share on an increase of 6 percent in headline earnings per share. Sanlam said new business volumes had increased by 11 percent during the year under review to R233 billion.

The new business performance contributed to net fund inflows of R41 billion compared to R19 billion in the year before.

Sanlam Emerging Markets increased its net result from financial services by 30 percent, comprising organic growth of 18 percent and a 12 percent contribution from structural growth. Sanlam said all countries had delivered strong growth, apart from Malawi and Zambia.

The general insurance operations in Malawi experienced pressure on claims, while Zambia continued to be impacted by a difficult operating environment.

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The Zimbabwean and Nigerian operations exceeded expectations.

Net result from financial services increased by 10 percent from R7.3 billion to R8 billion which, Sanlam said, was a particularly satisfactory performance.

The newly established business cluster, Sanlam Corporate, which includes Sanlam Employee Benefits and Sanlam Health, grew net results from financial services by 36 percent, including a first-time contribution of R82 million by Afrocentric (14 percent growth excluding Afrocentric).

Sanlam added that the benign claims environment of 2015 had reversed with higher claims experienced across most lines of business. The crop and property business lines were severely affected by drought-related and large corporate claims respectively.

Sanlam’s chief executive officer, Ian Kirk, said the group expected the challenging operating environment and economic climate to persist in 2017. AFRICAN NEWS AGENCY