JOHANNESBURG (Reuters) – Old Mutual Ltd will launch its second share buyback of the year on Sept. 3, South Africa’s second-largest insurer said on Monday after posting a 10% rise in half-year profit.

The company will buy back up to 2.4 billion rand ($157.51 million) worth of shares subject to market conditions.

“The board believes that the share price is trading at a discount to its intrinsic value and is of the view that a share repurchase programme will deliver longer term incremental value to shareholders,” Old Mutual said.

In the past few years, the 173-year-old company has broken up an international conglomerate structure to return to its roots as an African financial services group with its primary listing in Johannesburg.

Shareholders had hoped this homecoming would bolster the value of the group’s stock, but instead it has dropped amid a damaging public dispute with sacked Chief Executive Officer Peter Moyo.

Shares have lost around 18% since the company suspended Moyo in May. Old Mutual fired him in June, but he has been temporarily reinstated by a court – a decision the insurer is appealing.

The company launched a buyback programme at the end of its last financial year in March, again intended to placate shareholders after a more than one-third drop in its share price since a listing in June 2018.

Adjusted headline earnings per share (HEPS) stood at 109.1 cents in the six months to June 30, compared with 98.9 cents a year earlier, Old Mutual said.

HEPS is the main profit measure in South Africa that strips out certain one-off items.

($1 = 15.2369 rand)

Reporting by Emma Rumney; Editing by Subhranshu Sahu

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