The financial services group Sanlam reported a 4% increase in operating profit to R1 085 million for the first six months of 2002, compared with the first half of 2001, Sanlam’s chief executive, Dr Leon Vermaak, announced on Thursday.
Sanlam’s headline earnings of R1 554 million, including investment returns, were down by 5% on the first six months of 2001.
Headline earnings per share amounted to 58,9 cps compared with 61,1 cps for the first half of 2001.
On a comparable basis – excluding the impact of Absa’s Unifer losses, which Sanlam equity accounts, a change in recognition of currency translation differences and the impact of the introduction of capital gains tax on investment income – headline earnings per share for the first six months show an increase of 14% on 2001.
There was a 15% growth in the operating profit of Sanlam Life, the group’s insurance business, and an increase of 52% in the underwriting results from Santam, the short-term insurer in which Sanlam holds 54,3%. Sanlam’s international businesses contributed 11% to its operating profit.
A disappointing 3% drop in new inflows of funds blemished these results.
Vermaak said that the adverse market conditions during the first six months of the year had had a marked impact on local and corporate activity and investment patterns and preferences.
”This was evident in the sales and operating results of our group businesses in the six months to June.
”In view of the impact of these trading conditions, the Sanlam board advised shareholders in June this year that these adverse market conditions, coupled with the negative impact of the losses suffered by Unifer on the Absa results to be accounted for by Sanlam, would prevent us from achieving our stated earnings growth target for the six-month period.” – Sapa