Australian bushfires and load-shedding hit RMI
Spending on initiatives at Discovery and Outsurance also weighed on the group in its half-year to end-December
Rand Merchant Investment Holdings (RMI), which owns Outsurance and has stakes in Discovery and MMI, said the recent Australian bushfires weighed on its half-year profits to end-December.
The group, headed by CEO Herman Bosman and chair Jannie Durand, reported an 8% fall in group profit to R1.847bn, with its Australian subsidiary Youi Insurance expecting a net estimated loss of R206m.
Youi offers insurance for homes and motor vehicles, with Australia also suffering the effects of a severe hailstorm in January — which will effect second-half earnings.
Outsurance also experienced two catastrophic events in SA during the six months to end-December, with a combined net cost of R84m.
Power surges and power dips that were related to load-shedding also led to Outsurance incurring R20m more in claims.
Discovery’s normalised earnings had also fallen by 11% during the period, related to its move to mitigate its exposure to UK interest rates, while it had invested R1bn in new initiatives with most going to Discovery Bank.
On Thursday, RMI kept its interim dividend unchanged at 45c per share. In afternoon trade, the company’s share price was down 5.99% to R22.59, having fallen 29.18% over the past 12 months.
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