Liberty swings to first-half profit
South African insurer Liberty Holdings swung to a first-half profit on Thursday, as a recovering economy led to fewer lapses on policy payments, but maintained a cautious outlook.
Liberty, majority owned by South Africa’s Standard Bank, said headline earnings per share totalled 351,9 cents in the six months to end-June, compared with a loss of 421,9 cents in the same period a year earlier.
Africa’s third-largest life insurer by market value had forecast headline earnings between 325 cents and 400 cents per share.
Headline earnings, the main profit gauge in South Africa, exclude some one-time items.
South African insurers were hit hard by the economic downturn, as debt-burdened customers let insurance policies lapse and declining equity markets hit investment portfolios.
Unemployment and household debts remain high, even after Africa’s largest economy exited a recession last year.
Liberty rivals Sanlam and Metropolitan have given upbeat outlooks for 2010, helped by an expected improvement in equity markets.
Shares of Liberty have gained 12% so far this year, outperforming a 9,7% rise in Johannesburg’s index of life insurance companies.—Reuters. .