South African financial-services firm Sanlam reported a 24% drop in first-half diluted headline earnings per share (EPS) on Thursday, and said volatile debt and equity markets could continue to crimp its growth.
The firm said normalised headline EPS for the six months to end June dropped 57%, in line with its forecast of a 55% to 60% drop. It said the deterioration in markets had worsened during the period.
”Relative market movements for the remainder of 2008 may therefore have an impact on the level of group earnings to be reported for the full 2008 financial year,” Sanlam said in a statement.
Higher interest rates, inflation, a power supply crunch and market volatility have taken their toll on South Africa’s economy, where the central bank has raised interest rates by 500 basis points since June 2006 in a bid to tackle inflation.
Despite last month’s decision by the central bank to hold rates steady, Absa, Nedbank and Standard Bank all warned of rising bad debts and slower business in their retail units when they recently released interim results. — Reuters