Wrap Text
Momentum Metropolitan delivers on its promises
Momentum Metropolitan Holdings Limited
(formerly MMI Holdings Limited)
Incorporated in the Republic of South Africa
Registration number: 2000/031756/06
JSE share code: MTM
NSX share code: MMT
ISIN code: ZAE000269890
(“Momentum Metropolitan” or “the Group”)
Momentum Metropolitan Life Limited
(formerly MMI Group Limited)
Incorporated in the Republic of South Africa
Registration number: 1904/002186/06
Company code: MMIG
Wednesday 4 September 2019
Momentum Metropolitan delivers on its promises
Disciplined execution offsets weak markets and economy
Momentum Metropolitan Holdings, (formerly MMI Holdings), is making steady progress on
the three-year Reset and Grow strategy it announced a year ago. The Group delivered
diluted normalised headline earnings of R3.1 billion for the year ended 30 June 2019. This
represents an increase of 53% on the prior year.
Risto Ketola, Group FD, contextualised what he termed “a pleasing performance” by pointing
out that the significant increase in diluted normalised earnings builds on a weak result in the
prior year, which was impacted by negative operating basis changes and investment
variances at the time. “However, if these changes and variances are excluded from both
years to provide a more accurate illustration of earnings growth, the improvement in diluted
normalised headline earnings was a very robust 21%. This is the result of the positive impact
of our Reset and Grow strategy,” he added.
Momentum Metropolitan’s diluted normalised headline earnings increased by 61% on a per
share basis, reflecting the impact of the share buy-back programme completed in
November 2018. Present value of new business premiums increased by 12% year-on-year,
while value of new business improved by 57% on the prior year.
Group CEO Hillie Meyer said that he is encouraged by improvements across the Group: “A
year ago we simplified our structure and created empowered, end-to-end business units. At
our previous annual results we presented a roadmap, and this year we are happy to report
that we are on track to deliver on our promises. We could not have asked for a better
response from our people,” he said.
“The improvement in our earnings growth for the year to June 2019 is the result of financial
discipline and a focus on our core activities; we have worked smarter with our money without
negatively impacting our market presence,” Meyer added.
Highlights for the financial year include resilient operational performance in most of the
Group’s businesses, supported by an emphasis on expense management and good
underwriting results. Growth in new business was driven by the Group’s distribution
capabilities and partnerships, improved client experience, and a comprehensive suite of
attractive product solutions.
Growth in new business volumes in specific areas boosted the Group’s performance.
Momentum Corporate saw strong flows of new business from a range of clients, including
good growth in recurring premium inflows for group insurance, as well as a number of large
annuity deals in the first and fourth quarters. Momentum Investment’s guaranteed products
and the new Investo retirement annuity in Momentum Retail created safe havens for clients
in an uncertain economy. These solutions enabled positive sales growth in a tough
environment – confirming that product innovation can convert into growth in a stagnant
market. Momentum Metropolitan Africa recovered from negative to positive growth in the
second half of the year.
Non-financial achievements during the reporting period include becoming the first major
insurance group to attain a Level 1 B-BBEE status under the revised Financial Services
Charter, and changing the name of the holdings company to Momentum Metropolitan to
enhance exposure of the two main consumer brands.
“Overall, we are pleased with the underlying improvements we have made over the last year,
such as improved efficiency ratios, increased commerciality in decision-making, improved
service metrics, modest growth in distribution footprint, and strengthening of the balance
sheet. Most importantly, we are seeing greater levels of engagement and energy across
employees of the Group. This positions us well to capitalise when the external environment
improves in due course,” Meyer said.
“Going into the next phase of our strategy, we have to continue our focus on growing
revenue through advancing our distribution capabilities and visibility of our brands, as well as
through continuous improvement of our product solutions and client experience. We remain
committed to delivering on our three-year Reset and Grow target to generate profits between
R3.6 billion and R4.0 billion by F2021”. Meyer pointed out that if the current challenging
operating environment persists, the pressure on revenue might result in Momentum
Metropolitan’s earnings heading for the lower end of the 2021 target range.
ENDS
About Momentum Metropolitan
Momentum Metropolitan Holdings Limited (www.momentummetropolitan.co.za), formerly MMI Holdings Limited,
is a South African based financial services group listed on the Johannesburg Stock Exchange (JSE code: MTM)
in South Africa and on the Namibian Stock Exchange in Namibia (NSX code: MMT).
Through our client-facing brands Metropolitan (www.metropolitan.co.za) and Momentum
(www.momentum.co.za), with Momentum Multiply (wellness and lifestyle rewards programme), and our other
specialist brands, including Guardrisk, Exponential and Eris Property Group, we exist to help businesses and
people from all walks of life to achieve their financial goals and life aspirations.
We help people grow their savings, protect what matters to them and invest for the future. We help companies
and organisations care for and reward their employees and members. Through our own network of advisers or
via independent brokers and utilising new platforms Momentum Metropolitan provides practical financial solutions
for people, communities and businesses.
SENS issue: 4 September 2019
Sponsor: Merrill Lynch South Africa (Pty) Limited
Date: 04/09/2019 07:06:00
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