Sanlam normalised HEPS up 35% - CNBC Africa

Sanlam normalised HEPS up 35%

Earnings

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Sanlam CEO Johan Van Zyl. PHOTO: African Business Review

Net result from financial services per share increased by 34 per cent to 189.9 million rand for the year ended 31 December 2013, from 266 million rand in the comparative period in 2012.  

Normalised headline earnings per share were also up 35 per cent to 395 cents from 292.1 cents in 2012.

“The Sanlam group in 2013 once again delivered the solid operational performance that stakeholders have come to expect from us. These excellent results were achieved despite a challenging local and global operating environment,” said in a statement.

“In 2013 we experienced a difficult environment mainly due to low short-term interest rates, which had a negative effect on several of our businesses, combined with tough economic conditions that severely restricted the disposable income of the South African consumer.”

The company’s operating margin also took an upward trend at 22.2 per cent from 19.4 per cent in 2012.

[DATA SLM:Sanlam LTD.] is a South African financial solutions group that provides services to individuals and institutions. Their services include short-term insurance, trusts, and estate planning and property asset management.

(READ MORE: Sanlam reports strong performance despite tough environment)

New business volumes for the period were also up 36 per cent to 184.8 billion rand from 135.9 billion rand in the previous comparative period.

“The group achieved exceptional operating earnings growth of 35 per cent for 2013, surpassing our own expectations,” said Sanlam.

“Earnings growth was driven by two main components. Organic growth contributed 71 per cent of the growth and was achieved by extracting more value from existing businesses, improving efficiencies and reducing costs. Acquisitions made with surplus capital contributed 29 per cent of earnings growth.”

Business volumes for Sanlam Personal Finance increased to 42.5 million rand from 32.3 million rand in 2012, and Sanlam Investments took a similar trend, with its volume increasing to 85.9 million rand from 62.1 million rand.

Business volumes for Sanlam Emerging Markets however decreased significantly to 9.7 million rand from 12.9 million rand in the previous comparative year. Santam business volumes increased to 16.7 million rand for the period from 15.6 million rand.

“Net operating profit (net result from financial services) grew by 35 per cent. All businesses contributed to this growth, with the exception of Santam. The short-term insurer was hit hard by the high claims experience caused by a succession of costly natural disasters and a volatile currency that resulted in excessive vehicle repair costs,” said Sanlam.

(READ MORE: Tough weather conditions dent Santam's first half earnings)

 A normal dividend of 200 cents per share was up 21 per cent.

“The strength of the Sanlam brand together with a well-diversified business, an increased distribution footprint and a strong focus on client service helped us weather this environment and our total new business volumes grew by more than 35 per cent,” the company said.  

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