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(Alliance News) - Old Mutual Ltd on Tuesday said the easing of lockdowns across its geographies last year helped it to return to its pre-pandemic profit level, although its annual payout still lagged.
The Cape Town-based financial services firm reported pretax profit of ZAR13.43 billion in 2021, swinging from a ZAR3.27 billion loss in 2020. In 2019, pretax profit came in at ZAR13.80.
Total revenue rose by 69% to ZAR247.81 billion from ZAR146.53 billion in 2020 and beat 2019's ZAR176.12 billion.
Within total revenue, gross insurance premium revenue increased 2.8% to ZAR83.84 billion from ZAR81.57 billion in 2020; and net earned premiums inched 0.1% higher to ZAR72.55 billion from ZAR72.46 billion.
The healthy rise in revenue was somewhat offset by higher gross claims and benefits, which jumped 46% to ZAR139.25 billion from ZAR95.41 billion.
"2021 was a significant year for the group, with a strong recovery from the impact that Covid-19 had on our operational and financial performance. Whilst the operating environment was challenging in most of our markets, the easing of lockdown restrictions compared to 2020 supported considerable growth in our productivity levels," said Chief Executive Iain Williamson.
Old Mutual declared a final dividend of 51 rand cents per share, up 46% from 2020's sole dividend of 35 cents, bringing the total annual payout to 76 cents a share. In 2019, the company returned 120 cents per share back to shareholders.
Looking ahead, Old Mutual noted broader economic headwinds but said it still expects to meet its medium-term goals.
"The conflict in Ukraine-Russia has dramatically increased the level of uncertainty around the global economic growth and inflation, with a stagflation scenario now more likely. The recent oil price hikes and the risk of negative sentiment towards emerging markets are also likely to lead to an increase in inflation and lower growth in our local markets," Old Mutual said.
"Despite a subdued growth outlook, we remain confident of delivering our medium term targets. Our balance sheet remains well capitalised with strong liquidity to help us withstand the challenging operating environment."
By Greg Roxburgh; gregroxburgh@alliancenews.com
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