| Mon 4 Aug 2008, 10:26 | | SNT - Santam Limited - Trading Statement |
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SNT
SNT
SNT - Santam Limited - Trading Statement
SANTAM LIMITED
(Incorporated in the Republic of South Africa)
(Reg. No: 1918/001680/06)
JSE Share Code: SNT ISIN: ZAE000093779
("Santam")
Trading Statement
In terms of the Listing Requirements on Trading Statements, a listed company
is required to publish a trading statement as soon as it becomes reasonably
certain that the financial results for the current reporting period will
differ by at least 20% from the financial results for the previous
corresponding period.
Shareholders are referred to the operational update that was published on
SENS on 28 May 2008. Overall, growth and underwriting profit in South Africa
have been satisfactory. Underwriting performance of the personal and
commercial business, as well as the specialist classes, met or exceeded
expectations in the first six months. However, in line with industry
experience, Santam incurred a number of large industrial accident and fire
related claims during this period which adversely affected the company`s
underwriting margin in the corporate business unit. This unit recorded a loss
for the six months compared to a profit in the corresponding period.
The largest contributor to the variance in earnings, compared to 2007, was
the investment result. Performance of the investment portfolio has been under
pressure during the six months. Although the higher interest rates had a
positive impact on cash related investments, the equity portfolio performed
significantly below the exceptional performance in the first half of 2007,
especially due to a severe reduction in the value of financial and industrial
stocks. As previously indicated the company`s equity portfolio has been
overweight in the underperforming financial and industrial sectors whilst
underweight in resource shares. Cognisance should also be taken of the fact
that the investment portfolio reduced substantially due to the buy-back of
shares and payment of the special dividend in 2007.
Santam continued to make good progress with the disinvestment from the
European insurance operations, but this necessitated some additional
reserving in the run-off businesses.
As a result of the above items, the company expects headline earnings and
attributable earnings per share to be between 85% and 95% below those
reported for the prior corresponding period, being the six months to 30 June
2007.
The information in this trading statement has not been reviewed or reported
on by Santam`s auditors.
The interim results for the six months ended 30 June 2008 are expected to be
published on 27 August 2008.
By order of the board
Cape Town
4 August 2008
Sponsor:
Investec Bank Limited
Date: 04/08/2008 10:26:01 Produced by the JSE SENS Department.
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