/ 2 September 2009

Discovery profit up as new business grows

Discovery Holdings reported a rise in full-year profit on Wednesday as new business accelerated despite an economic slowdown.

Discovery, which owns the country’s largest health insurer, said diluted headline earnings per share for the year to end June rose 31% to 224,1 cents from 170,5 cents, matching its forecast of a 25% to 35% increase.

The firm, which said in February it expected to report a full-year profit after posting a rise in first-half profit, said total new business, excluding its US unit Destiny Health, which is being wound down, climbed 20% to R5,78-billion.

Discovery has so far outperformed its peers, which have been hit by the global slide in equity markets and reduction in consumer demand as South Africa grapples with a recession.

Discovery’s rival Liberty Holdings, majority-owned by Standard Bank, reported last month it had swung to a first-half loss, while Metropolitan posted a drop in first-half profit earlier on Wednesday as more customers stopped paying for or cancelled life insurance policies.

Discovery was unbundled from financial services firm FirstRand in 2007. — Reuters