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Sanlam has noticed an increase in life insurance and health operations in the last months.
In the insurance company’s 2024 interim results released on Thursday, Sanlam said the results are based on the implementation of the business strategy in the last four years.
“The strategy centres on enhancing organic growth while complementing this with strategic acquisitions.”
The group’s earnings grew net result from financial services (NRFFS) by 19% per share to over R7 billion for the first half of the year. This can be attributed to trading performances across the group, the advantages of scale and market positions, diversification by geography and line of business, and continued focus on operational efficiency.
The group said they have noticed life insurance and health operations grew NRFFS by 14%, new business volumes by 14% and the value of new business by 10%. This can be attributed to consumers finding their feet in tough economic times.
Other financial highlights included in the results are general insurance operations, which recorded a 16% rise in NRFFS.
The insurance company said this was highlighted by a robust performance from Santam, where effective management actions and lower attritional losses offset the impact of continued adverse weather-related claims.
Credit and structuring operations recorded growth in NRFFS of 9%, while investment management performance recorded a 10% growth in NRFFS and net client cash inflows of R4.1 billion for the six-month period.
“The group’s discretionary capital balance rose to R3,8 billion on 30 June 2024, up from R2,7 billion at the end of December 2023.”
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“The strategic choice to concentrate our efforts on fortifying our South Africa operations through leveraging our substantial scale and competitive edge, alongside focusing on Pan-Africa and Asia where we already have robust market positions in rapidly growing economies, continues to position our business favourably for long-term growth and value creation for all stakeholders,” said Sanlam CEO, Paul Hanratty.
In February 2024, the group expressed their interest to acquire Assupol Holdings (Assupol) for R6.5 billion. “The transaction received Competition Tribunal approval on 22 August 2024 and is subject to an employment-related condition. Remaining regulatory approvals are imminent.”
“In June 2024, the group announced its intention to acquire 60% of the insurance business of MultiChoice group. The transaction, which is subject to regulatory approval, offers Sanlam significant cross-sell opportunities into MultiChoice’s extensive client base across the continent.”
The conclusion of the Capitec funeral JV at the end of October 2024 is expected to result in a reinsurance recapture fee of R1,9 billion (gross of tax) being paid to Sanlam in November 2024.
“Strategic acquisitions that the group undertook in 2023 are making valuable contributions to operations.”
“Sanlam is prepared for the implementation of the two-pot retirement fund, allowing members access to a small portion of their retirement fund savings, for emergency purposes, before retirement.”
It remains mindful of the risks posed by global geopolitics and the risks of a global recession as the global economy brings inflation under control.
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