You are currently viewing our desktop site, do you want to visit our Mobile web app instead?
 Registered users can save articles to their personal articles list. Login here or sign up here

Sanlam could invest in Egypt within 1 year -CEO

Ian Kirk is on the lookout for new investment opportunities.

South Africa’s largest insurer Sanlam could invest in Egypt in the next year, CEO Ian Kirk told Reuters on Thursday, following interim results bolstered by its pan-African strategy.

Sanlam has previously said it wanted to take a stake in an Egyptian firm, but it had yet to find a suitable partner.

CEO Kirk told Reuters it was now looking at a number of potential companies.

“I would say [we could invest] within the next 12 months… we’re busy on it,” Kirk said.

He was speaking after Sanlam reported a 32% drop in profits largely due to one-off costs, including a R1.7 billion ($111.57 million) expense related to a black economic empowerment transaction and a R200 million amortisation charge.

Sanlam’s headline earnings per share – the main profit measure in South Africa – for the six months to June 30 fell to 170.7 cents from 251 cents a year earlier.

Its shares were up 2.67% at 0813 GMT following the results, which were slightly better than the 35% profit fall which the company had flagged in August.

Sanlam’s net result from financial services – its measure of operating profit – rose 13%, which the insurer described as a “credible” performance considering an ailing economy in South Africa and volatility in global markets amid a Sino-US trade war and other uncertainties such as Brexit.

It said its results were buoyed by its newly acquired Moroccan unit Saham Finances, which it brought for $1 billion in March 2018 in the 101-year-old company’s largest-ever purchase.

The acquisition of the firm, which operates in 26 countries via 65 subsidiaries across the continent, is part of Sanlam’s drive to become a pan-African insurance group. It is already one of the largest insurers by assets on the continent.

Continental operations have proven valuable assets for South African financial services firms, helping to offset stagnant growth at home.

“This is the number one priority for the group,” Kirk said, adding the Saham Finances integration was on track while realising returns on the deal would take a little bit longer.

The unit’s net result from financial services was down 7%, however its growth was a key contributor to the Sanlam’s operational performance.

While some of its other African operations enjoyed a turnaround in profitability, Kirk said the company had to write down the value of its 2015 investment in Zimbabwe by around R188 million in the first half of the year.

Rival insurer Old Mutual had to ringfence its Zimbabwean unit after severe foreign currency shortages and rapidly rising inflation meant it could not get its capital out of the country.

Get access to Moneyweb's financial intelligence and support quality journalism for only
R63/month or R630/year.
Sign up here, cancel at any time.

COMMENTS   5

To comment, you must be registered and logged in.

LOGIN HERE

Don't have an account?
Sign up for FREE

“Let’s hope not this is another PYRAMID scheme!”

(sorry everyone, I simply couldn’t resist letting that one go *lol*)

On serious note…hmmm…Sanlam also aiming to expand abroad (in the name of seeking better growth abroad), or is this favorite method for SA corporates to get large portions of their accumulated profits abroad…away from ANC socialists??

The accounting industry will likely not pick anything up, like it let Steinhoff, Tongaat, EOH, and many others slip through.)

If Sanlam also ends up over-paying for assets/projects abroad, known SA style…we know why….it’s just the fashionable way to do it. I’m becoming very distrustful of SA corporations real intentions, but do we blame them(?) in the light of EWC/prescribed assets talk/looming higher tax. I’ll wait a year or two to view comp financials on this event.)

Good move, nothing much doing down here and the anc thugs will just loot you and everyone else in the long run.

You better check political, security stability and their culture b4 you do that, consult with relevant stakeholders within the country

Load All 5 Comments
End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR

Podcasts

SHOP NEWSLETTERS TRENDING CPD HUB

Follow us:

Search Articles:Advanced Search
Click a Company: