Healthy underwriting results lift MMI’s interim earnings
CEO Hillie Meyer says the results are unlikely to be repeated in the next six months, given stock markets’ recent performance and the tough economic environment
Financial services group MMI Holdings, whose brands include Metropolitan and Momentum, said on Friday that earnings edged higher in the six months ended December, thanks to healthy underwriting results and better earnings from fixed-rate and annuity products.
The group’s diluted normalised headline earnings rose 2% to R1.6bn, helping it to reinstate dividend payments. MMI declared an interim ordinary dividend of 35c a share.
MMI Group CEO Hillie Meyer said the firm was on track towards its three-year goal of increasing earnings to between R3.6bn and R4bn in the 2021 financial year.
New business volumes were up 19% to R28.8bn due to “strong single-premium inflows”, especially in Momentum Corporate, MMI said.
Momentum Life grew normalised headline earnings by 35% to R462m, thanks in part to the better-than-expected adoption of voluntary premium increases by policyholders, MMI said.
Momentum Corporate’s normalised headline earnings rose 9% to R319m, while MMI’s nonlife insurance business grew normalised headline earnings by 29% to R135m.
However, Metropolitan Retail’s new business volumes and earnings declined, as expected, MMI said.
“Given the recent performance of stock markets and the tough economic environment, we don’t expect these results to be repeated in the next six months,” Meyer said.
“In fact, a more modest result will be in line with our targets for the full financial year.”