Financial services company Alexander Forbes said on Monday its headline earnings per share declined by 1% to 44 cents in the year to March 31, while profit before non-trading and capital items was down 7% to R915 million.
Alexander Forbes, which provides integrated retirement, investment, life and insurance solutions, said a strategy update announced in March 2019 reaffirmed its strength as an adviser with a renewed focus on the core businesses of consulting, administration, and investments.
The revised strategy resulted in the decision to exit the insurance businesses and sub-scale African operations – which have been classified as discontinued.
It said the termination of the IT contract for the group’s modernisation programme during the first half of the reporting period resulted in a R287 million write-off of capitalised software in development and a R50 million termination cost in operating expenses.
Alexander Forbes declared a final dividend of 12 cents per share, bringing the total dividend for the year to 30 cents.
The company said the economic environment would likely remain constrained for the foreseeable future and its focus for the next year would be on implementing its integrated target operating model and revised strategy to become more client-centric, simplify its business and deliver improved results.
“We expect a stable year where profit growth may be hampered while we correct some of the previous inefficiencies and invest to grow,” it said.
“We aim to conclude the disposal of our insurance businesses and commence a restructuring of the legal entities within the group, to ensure efficient allocation of capital within a capital-light business going forward. Any surplus capital generated as a result of these actions will be returned to shareholders, as appropriate.”
Alexander Forbes, which last year fired Andrew Darfoor as group chief executive citing loss of confidence and trust, said the legal processes over the matter were ongoing.
– African News Agency