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MET
MET
MET - Metropolitan Holdings - Financial Services Unaudited Group Results For The
Six Months Ended 30 June 2008 And Dividend Declaration
Metropolitan Holdings Limited
Incorporated in the Republic of South Africa
Registration Number: 2000/031756/06
JSE share code: MET
NSX share code: MTD
ISIN: ZAE000050456
("Metropolitan" or "the company")
METROPOLITAN HOLDINGS - FINANCIAL SERVICES GROUP UNAUDITED RESULTS FOR THE SIX
MONTHS ENDED 30 JUNE 2008
- Net funds received from clients - R5.6 billion
- Diluted core headline earnings per share - up 14%
- Retail new business premiums - up 21%
- International new business premiums - up 17%
- Total assets under management exceeded R106 billion
REVIEW OF OPERATIONS AND PROSPECTS
Operating environment
Until very recently South Africa had been enjoying a prolonged period of buoyant
equity and property markets, strong GDP growth and significant disposable income
across most consumer classes. Then in the first half of 2008 there was an almost
complete reversal. The investment markets were extremely turbulent and
unpredictable, interest rates continued to increase and inflation soared to
above 10%, driven mainly by imported price pressures (particularly relating to
food and oil). All of these factors put pressure on financial and other
operating measures.
The risk discount rate (RDR), which is based on the ten-year interest rate yield
curve, was increased by 2.5% over the six months to 30 June 2008, the largest
increase in a single reporting season since embedded value reporting was
introduced in South Africa in 1998.
Salient features and highlights
- Diluted core headline earnings per share for the half-year remained very
strong at 70 cents, increasing by 14% over 2007.
- The growth in diluted core headline earnings per share was partially
assisted by a further reduction of shares in issue - a direct result of
ongoing capital management activities.
- Earnings and headline earnings, which include adjustments for negative
economic and other market value impacts, reflected an overall decline on
2007.
- The general economic slow-down challenged operating profit across the
group; however, most of the businesses still managed to grow their
contributions.
- Total recurring new business premiums increased by 6%, while the value of
new business was severely reduced as a result of the spike in the RDR.
- Investment income on shareholder assets was 38% higher.
- Positive operating experience variances once again emerged in the embedded
value, highlighting the successes achieved through pro-active management
interventions.
- The economic capital model is subject to constant refinement and the
capital required as at 30 June 2008 remained stable despite the recent
turbulent markets.
- Enhanced by share buy-backs, embedded value per share held up very well,
reducing slightly from 1 857 cents to 1 838 cents, despite a final
dividend pay-out of 59 cents per share in April.
- The unbroken record of positive cashflow from clients continued, with a net
inflow of R5.6 billion being recorded.
Operational overview
Retail
- New business APE (annual premium equivalent, comprising recurring premiums
plus 10% of single premiums) was 21% higher.
- The increasingly difficult consumer conditions led to a higher propensity
to lapse or surrender life insurance policies. However, management action
in this area has been intensified, resulting in better-than-expected
overall persistency during the period under review.
- The new business margin reduced from 1.6% to 0.7% (present value of future
premiums (PVP) basis) as the increase in the economic parameters together
with higher new business expenses had a greater impact than the improved
new business production. A reduction in the RDR of 1.5%, as has been
experienced post the reporting date, would have increased the value of new
business to levels similar to those reflected in the prior year.
- At the end of 2007 a deferred tax asset was recognised for accumulated tax
losses in the policyholder funds. As a result, the tax profits (tax charged
but not paid) that emerged during 2007 in the retail business were not
repeated in the current year.
- Operating profit increased by 4%, boosted by higher average investment
assets and a lower income tax charge, but dampened by the change in
accounting policy referred to above as well as the worsening economic
environment.
Corporate
- New business APE could not match the stellar performance recorded during
2007, and ended the period down 45%. Excluding the very large single
premium received in 1Q07, new single premium business was up by over 80%.
- The new business PVP margin, however, showed an increase from 1.0% to 1.1%,
reflecting the higher proportion of more profitable recurring premium
business written.
- Risk margins remained under pressure throughout the period while expenses
were firmly under control.
- Operating profit was 3% higher, with an increased contribution from
investment business and a lower tax charge having been almost totally
neutralised by the lower risk profits.
International
- New business APE, which includes only the established southern African
operations, was boosted by the performance in Lesotho, ending 17% up.
- The three northern operations all increased their APE and are progressing
well.
- The agreement to establish a life insurance business in Swaziland was
finalised and the company has started operating, increasing our non South
African life companies to seven.
- Overall, the southern operations recorded a strong new business margin of
2.7% (PVP).
- Total operating profit increased by an impressive 10% despite start-up
losses in all of the northern operations.
Asset management
- The value of new business, comprising collective investment inflows and new
third-party mandates, grew by 38%.
- MetAM delivered very good relative investment performance over the period.
Operating profit, however, declined by 31% as a result of lower absolute -
investment market performance as well as increased staff costs.
Health
- New business continued to add value, mostly as a result of the tremendous
growth in membership of the Government Employees Medical Scheme (GEMS).
- Total principal members under administration, including franchise, at the
end of June were in excess of 700 000 (more than 1.8 million lives),
confirming MHG`s status as South Africa`s largest administrator of closed
schemes.
- As a result of the continued growth in members, together with the improved
operational efficiencies, operating profit increased by 34%.
Prospects
- Metropolitan continues to capitalise on its focused market positioning, in
line with its strategy to create prosperity for Africa`s people by
providing accessible, affordable and appropriate products.
- All the businesses within the group are well prepared for the opportunities
and threats posed by ongoing changes in the highly regulated environments
in which they operate.
- Food and transport inflation remain the biggest challenges to the group`s
core target market. Further increases in these factors will continue to
curtail new business prospects.
- The board is satisfied that the business is well positioned, thanks to its
strong focus on client service, product innovation, business retention,
cost containment and capital management.
DIRECTORS` STATEMENT
The directors take pleasure in presenting the unaudited interim results of the
Metropolitan Holdings financial services group for the six months ended 30 June
2008.
These results have been prepared in accordance with International Accounting
Standard 34 (IAS34) - Interim financial reporting; guidelines issued by the
Actuarial Society of South Africa; and the disclosure requirements of the JSE
Limited (JSE).
The accounting policies of the group have been applied consistently to all the
periods presented. The preparation of financial statements in accordance with
IFRS requires the use of certain critical accounting estimates as well as the
exercise of managerial judgement in the application of the group`s accounting
policies. Such critical judgements and accounting estimates are disclosed in
detail in the annual financial statements at 31 December 2007 and, with the
exception of the principal economic assumptions, have remained unchanged since
then.
The accounting treatment of certain items has been changed from that disclosed
in June 2007. In finalising the December 2007 annual financial statements,
various refinements were made to the application of IFRS, as disclosed in the
2007 annual report. As a result, certain line items were reclassified in the
balance sheet at 30 June 2007. Neither shareholder equity nor earnings were
affected.
More information on these restatements and reclassifications is available in the
SENS announcement or on the Metropolitan website, www.metropolitan.co.za.
Corporate activity during the year
Metropolitan cancelled 26 million listed ordinary shares held at 31 December
2007, and bought back a further 16 million such shares for R201 million.
Related parties
There have been no significant changes to the nature of the related party
transactions as described in note 42 of the 2007 annual financial statements.
CORPORATE GOVERNANCE
The board has satisfied itself that appropriate principles of corporate
governance were applied throughout the period under review.
DIRECTORATE CHANGES AND DIRECTORS` SHAREHOLDING
Peter Doyle and Abel Sithole resigned as directors with effect from 31 March
2008. No further changes have been made to the directorate. All transactions in
listed shares involving directors were disclosed on SENS as required.
CAPITAL COMMITMENTS AND CONTINGENT LIABILITIES
The group had no material capital commitments at 30 June 2008. The group is
party to legal proceedings in the normal course of business, and appropriate
provisions are made when losses are expected to materialise.
POST BALANCE SHEET EVENTS
No material post balance sheet events occurred between the balance sheet date
and the date of approval of the interim results.
DIVIDEND DECLARATION
Ordinary listed shares
The dividend policy for ordinary listed shares, approved by the directors and
consistent with prior years, is to provide shareholders with stable dividend
growth that reflects expected growth in underlying earnings in the medium term,
while allowing the dividend cover to fluctuate.
An interim dividend of 40.00 cents per ordinary share was declared on 2
September 2008. This dividend is payable to the holders of ordinary shares
recorded in the register of the company at the close of business on Friday, 3
October 2008 and will be paid on Monday, 6 October 2008. The last day to trade
"cum" dividend will be Friday, 26 September 2008. The shares will trade "ex"
dividend from the start of business on Monday, 29 September 2008.
Share certificates may not be dematerialised or rematerialised between Monday,
29 September and Friday, 3 October 2008, both days inclusive.
Where applicable, dividends in respect of certificated shares will be
transferred electronically to shareholders` bank accounts on payment date. In
the absence of specific mandates, dividend cheques will be posted to
certificated shareholders on or about payment date. Shareholders who have
dematerialised their shares will have their accounts with their CSDP or broker
credited on Monday, 6 October 2008.
Preference share (unlisted) dividend
Dividends of R32 million (16.9%), R5 million (40.00 cents per share) and R29
million (18.7%) were declared on 2 September 2008 on the A1, A2 and A3
Metropolitan preference shares respectively, payable on 30 September 2008. The
declaration rates were determined as set out in the company`s articles. These
amounts are included under finance costs in these results.
Signed on behalf of the board
Wiseman Nkuhlu Group chairman
Wilhelm van Zyl Group chief executive
Cape Town
2 September 2008
Directors:
Wiseman Nkuhlu (non-executive group chairman), Wilhelm van Zyl (group chief
executive), Phillip Matlakala (executive director), Preston Speckmann (group
finance director), Fatima Jakoet, Peter Lamprecht, Syd Muller, Bulelwa Ndamase,
John Newbury, JJ Njeke, Andile Sangqu, Marius Smith, Franklin Sonn, Johan van
Reenen
Secretary: Bongiwe Gobodo-Mbomvu
Registration number: 2000/031756/06
Registered office: 7 Parc du Cap, Mispel Road, Bellville 7535
JSE code: MET
NSX code: MTD
ISIN NO: ZAE000050456
Transfer secretaries Sponsor
Link Market Services SA Merrill Lynch
(Proprietary) Limited
(Registration number 2000/007239/07)
5th Floor, 11 Diagonal Street,
Johannesburg 2001
P O Box 4844, Johannesburg 2000
Telephone: +27 11 834 2266
E-mail:
info@linkmarketservices.co.za
METROPOLITAN HOLDINGS - GROUP RESULTS
CONSOLIDATED BALANCE SHEET 30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
ASSETS
Intangible assets 525 433 562
Owner-occupied properties 607 435 592
Property and equipment 278 171 233
Investment properties 2 790 2 468 2 710
Investment in associates 592 1 047 405
Investment in joint ventures 54 - 61
Employee benefit assets 319 131 177
Financial instrument assets (1) 62 884 57 739 60 489
Insurance and other receivables 1 425 1 262 1 476
Deferred income tax 7 4 15
Reinsurance contracts 271 237 179
Current income tax assets 40 - -
Cash and cash equivalents 6 466 7 623 8 274
Non-current assets held for sale 19 - 185
Total assets 76 277 71 550 75 358
EQUITY
Capital and reserves attributable 6 527 6 542 6 817
to equity holders
Minority interests 131 79 124
Total equity 6 658 6 621 6 941
LIABILITIES
Insurance contract liabilities
Long-term insurance contracts (2) 33 283 32 579 33 531
Capitation contracts 2 3 1
Financial instrument liabilities
Investment contracts 28 343 27 092 28 426
- with discretionary 13 637 13 849 14 273
participation features (2)
- designated as at fair value 14 706 13 243 14 153
through income
Other financial instrument 3 949 2 394 2 863
liabilities (3)
Deferred income tax 428 267 492
Employee benefit obligations 246 237 252
Other payables 3 368 2 133 2 545
Current income tax liabilities - 224 307
Total liabilities 69 619 64 929 68 417
Total equity and liabilities 76 277 71 550 75 358
1. Financial instrument assets consist of the following:
Assets designated as at fair value through income: R59 629 million
(30.06.2007: R55 582 million; 31.12.2007: R58 264 million)
Assets held for trading: R1 814 million (30.06.2007: R768 million;
31.12.2007: R850 million)
Available-for-sale assets: R7 million (30.06.2007: R104 million;
31.12.2007: R7 million)
Loans and receivables: R1 434 million (30.06.2007: R1 285 million;
31.12.2007: R1 368 million)
2. Under IFRS4, the group continues to account for long-term insurance
contracts and investment contracts with discretionary participation
features using SA GAAP.
3. Other financial instrument liabilities consist of the following:
Liabilities designated as at fair value through income: R391 million
(30.06.2007: R205 million; 31.12.2007: R635 million)
Liabilities held for trading: R2 216 million (30.06.2007: R852 million;
31.12.2007: R858 million)
Liabilities at amortised cost: R1 342 million (30.06.2007: R1 337 million;
31.12.2007: R1 370 million)
METROPOLITAN HOLDINGS - GROUP RESULTS
STATEMENT OF ACTUARIAL VALUES OF 30.06.2008 30.06.2007 31.12.2007
ASSETS AND LIABILITIES ON REPORTING Rm Rm Rm
BASIS
Total assets per balance sheet 76 277 71 550 75 358
Actuarial value of policy (61 626) (59 671) (61 957)
liabilities per balance sheet
Other liabilities per balance sheet (7 993) (5 258) (6 460)
Minority interests (131) (79) (124)
Excess - group per reporting basis 6 527 6 542 6 817
Net assets - other businesses (1 274) (1 492) (1 102)
Excess - long-term insurance 5 253 5 050 5 715
business (4)
LONG-TERM INSURANCE BUSINESS (4)
Change in excess of long-term (462) (786) (121)
insurance business (4)
Increase in share capital (19) (4) (12)
Acquisition of Union Life (formerly - - (54)
known as HTG Life)
Change in other reserves (26) 37 (36)
Dividend paid 852 1 432 1 606
Total surplus arising 345 679 1 383
Operating profit 357 322 754
Investment income on excess 157 147 289
Net realised and fair value gains (42) 274 364
on excess
Investment variances (5) (7) 20 29
Basis and other changes (262) (89) (180)
Employee benefit assets (6) 142 5 48
Deferred tax (7) - - 79
Consolidation adjustments 45 127 217
Income tax expenses (8) (1) 210 549
Adjustment for finance costs 23 23 47
Results of long-term insurance 412 1 039 2 196
business (4)
Results of other group businesses (15) 242 289
Results of operations per income 397 1 281 2 485
statement
METROPOLITAN HOLDINGS - GROUP RESULTS
STATEMENT OF ACTUARIAL VALUES OF 30.06.2008 30.06.2007 31.12.2007
ASSETS AND LIABILITIES ON STATUTORY Rm Rm Rm
BASIS
Reporting excess - long-term 5 253 5 050 5 715
insurance business (4)
Disallowed assets in terms of (436) (211) (293)
statutory requirements (9)
Capital adjustments 330 402 91
Statutory excess - long-term 5 147 5 241 5 513
insurance business (4)
Capital adequacy requirement (CAR) 1 843 1 580 1 609
(Rm)
Ratio of long-term insurance 2.8 3.3 3.4
business excess to CAR (times)
Discretionary margins 1 956 2 341 2 151
4. The long-term insurance business includes both insurance and investment
contract business and is the simple aggregate of all the life insurance
companies in the group. It includes minority interests and other items,
which are eliminated on consolidation. It excludes non-insurance business.
5. Investment variances reflect the impact of actual investment returns on the
value of future expense recoveries and include any change in the PGN 110
(Allowance for embedded investment derivatives) liability.
6. Recognition of Metropolitan Staff Retirement Fund surplus
7. Deferred tax asset created at 31 December 2007 in respect of accumulated
tax losses.
8. June 2008 and December 2007 includes deferred tax on contract holder
capital gains.
9. Disallowed assets include goodwill, deferred acquisition costs and employee
benefit assets.
METROPOLITAN HOLDINGS - GROUP RESULTS
CONSOLIDATED INCOME STATEMENT 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Net insurance premiums received 4 585 4 101 8 792
Fee income 576 407 807
Investment income 2 026 1 513 3 632
Net realised and fair value gains (1 920) 3 703 4 407
Net income 5 267 9 724 17 638
Net insurance benefits and claims 3 736 3 069 6 192
Change in liabilities (1 042) 2 940 4 215
Change in insurance contract (326) 1 807 2 617
liabilities
Change in investment contracts (630) 1 155 1 562
with DPF liabilities
Change in reinsurance provision (86) (22) 36
Fair value adjustments on 496 848 1 518
investment contract liabilities
Fair value adjustments on 5 3 13
collective investment scheme
liabilities
Depreciation, amortisation and 125 71 169
impairment expenses
Employee benefit expenses 569 597 1 145
Sales remuneration and distribution 548 533 1 127
costs
Other expenses 433 382 774
Expenses 4 870 8 443 15 153
Results of operations 397 1 281 2 485
Share of profit of associates 3 2 5
Share of loss of joint ventures (7) - -
Finance costs (94) (92) (174)
Profit before tax 299 1 191 2 316
Income tax expenses (76) (362) (788)
Earnings 223 829 1 528
Attributable to:
Equity holders of group 206 818 1 503
Minority interests 17 11 25
223 829 1 528
METROPOLITAN HOLDINGS - GROUP RESULTS
RECONCILIATION OF HEADLINE EARNINGS attributable to equity holders of group
Basic earnings Diluted earnings
6 mths 6 mths 12 mths 6 mths 6 mths 12 mths
2008 2007 2007 2008 2007 2007
Rm Rm Rm Rm Rm Rm
Earnings 206 818 1 503 206 818 1 503
Finance costs - 69 61 124
preference shares
Diluted earnings 275 879 1 627
Goodwill 30 30
impairment
Headline earnings 236 818 1 503 305 879 1 627
(10)
Net realised and 41 (573) (719) 41 (573) (719)
fair value gains
on excess
Basis and other 267 66 64 267 66 64
changes and
investment
variances
Employee benefit (142) (5) (48) (142) (5) (48)
assets
Dilutory effect 1 1 6
of subsidiaries
(11)
Investment income - 12 13
on treasury
shares - contract
holders (12)
STC on special 60 60 - 60 60
dividend
Core headline 402 366 860 472 440 1 003
earnings (13)
10. Headline earnings consist of operating profit, investment income, net
realised and fair value gains, investment variances, basis and other
changes and the first-time recognition of an employee benefit asset.
Adjustments to headline earnings, as required by SAICA Circular 8/2007,
relate to returns on shareholder assets only.
11. Metropolitan Health and Metropolitan Kenya are consolidated at 100% in the
results. For the purposes of diluted core headline earnings, minority
interests and investment returns are reinstated.
12. For diluted core headline earnings, treasury shares held on behalf of
contract holders are deemed to be issued. For diluted earnings and
headline earnings, these shares are deemed to be cancelled.
13. Net realised and fair value gains on investment assets, investment
variances and basis and other changes can be volatile; therefore core
headline earnings have been disclosed that comprise operating profit and
investment income on shareholder assets.
EARNINGS PER SHARE (cents) 6 mths to 6 mths to 12 mths to
attributable to equity holders of 30.06.2008 30.06.2007 31.12.2007
group
Basic
Core headline earnings 76.72 67.65 160.15
Headline earnings 45.04 151.20 279.89
Earnings 39.31 151.20 279.89
Weighted average number of shares 524 541 537
(million)
Diluted
Core headline earnings 70.03 61.28 142.27
Weighted average number of shares 674 718 705
(million) (7)
Headline earnings 45.25 124.15 232.43
Earnings 40.80 124.15 232.43
Weighted average number of shares 674 708 700
(million) (7)
DIVIDENDS 2008 2007
Ordinary listed shares (cents per share)
Interim 40.00 36.00
Final 59.00
Total 95.00
METROPOLITAN HOLDINGS - GROUP RESULTS
DIVIDENDS
Convertible redeemable preference shares A1 A2 A3
Paid - 31 March 2007 Rate 13.5% 125.00 cps 13.3%
Rm 26 16 21
Paid - 30 September Rate 14.4% 36.00 cps 15.6%
2007
Rm 27 5 24
Paid - 31 March 2008 Rate 16.1% 59.00 cps 18.0%
Rm 31 8 28
Payable - 30 Rate 16.9% 40.00 cps 18.7%
September 2008
Rm 32 5 29
Redemption value (per R 5.12 9.18 9.18
share)
ANALYSIS OF DILUTED CORE HEADLINE 6 mths to 6 mths to 12 mths to
EARNINGS 30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Retail business 225 217 460
Operating profit 284 307 622
Tax (59) (90) (162)
Corporate business 72 70 176
Operating profit 93 98 248
Tax (21) (28) (72)
International business 45 41 110
Operating profit 49 46 116
Tax (4) (5) (6)
Asset management business 24 35 70
Operating profit 34 51 96
Tax (10) (16) (26)
Health business 43 32 64
Operating profit 61 53 116
Tax (18) (21) (52)
Shareholder capital 63 45 123
Holding company expenses (32) (26) (58)
Strategic ventures (36) (20) (44)
Investment income on shareholder 243 176 384
excess
Income tax on investment income (112) (85) (159)
Diluted core headline earnings 472 440 1 003
METROPOLITAN HOLDINGS - GROUP RESULTS
RESULTS OF Net Expenses Results of operations
OPERATIONS FROM income
ADMINISTRATION
BUSINESS
(gross of minority
interests and
before finance
costs and tax)
6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm Rm Rm
Health business 395 (334) 61 53 111
Asset 60 (37) 23 37 62
administration
Asset management 58 (43) 15 14 35
Metropolitan Card 24 (46) (22) (20) (22)
Operations
537 (460) 77 84 186
METROPOLITAN HOLDINGS - GROUP RESULTS
CONSOLIDATED STATEMENT OF CHANGES 6 mths to 6 mths to 12 mths to
IN EQUITY 30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Changes in share capital
Balance at beginning 19 (136) (136)
Staff share scheme shares released 3 72 105
Treasury shares held on behalf of 1 53 50
contract holders
Balance at end 23 (11) 19
Changes in other reserves
Balance at beginning 495 413 413
Total recognised income 12 - 70
Revaluation of land and buildings 12 5 65
Foreign currency translation - (5) 5
differences
Employee share schemes - value of 1 1 12
services provided
Transfer to retained earnings - (2) -
Balance at end (14) 508 412 495
Changes in retained income
Balance at beginning 6 303 6 417 6 417
Earnings for period 206 818 1 503
Dividend paid (312) (716) (926)
Shares repurchased (201) (380) (691)
Transfer from other reserves - 2 -
Balance at end 5 996 6 141 6 303
Capital and reserves attributable 6 527 6 542 6 817
to equity holders
Changes in minority interests
Balance at beginning 124 109 109
Total recognised income 20 12 26
Earnings for period 17 13 25
Foreign currency translation 3 (1) 1
differences
Dividend paid (12) (49) (49)
Net change in minority interests (1) 7 38
Balance at end 131 79 124
Total equity 6 658 6 621 6 941
14. Other reserves consist of the following:
Land and buildings revaluation reserve: R173 million (30.06.2007: R102
million; 31.12.2007: R161 million)
Foreign currency translation reserve: (R11 million) (30.06.2007: (R21
million); 31.12.2007: (R11 million))
Fair value reserve: R50 million (30.06.2007: R36 million; 31.12.2007: R50
million)
Non-distributable reserve: R296 million (30.06.2007: R295 million;
31.12.2007: R295 million)
METROPOLITAN HOLDINGS - GROUP RESULTS
CONSOLIDATED CASH FLOW STATEMENT 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Net cash (outflow)/inflow from (1 140) 2 075 3 166
operating activities
Net cash outflow from investing (85) (197) (115)
activities
Net cash outflow from financing (586) (1 145) (1 668)
activities
Net cash flow (1 811) 733 1 383
Net realised and fair value gains 3 3 4
on cash resources
Cash resources at beginning 8 274 6 887 6 887
Cash resources at end 6 466 7 623 8 274
SEGMENT REPORT 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Revenue
Premiums received 5 643 5 937 11 667
Retail 3 666 3 078 6 726
Corporate 1 490 2 397 3 947
Health 9 10 19
International 478 452 975
Fee income 457 398 787
Corporate 33 17 50
Asset management 105 102 213
Health 380 332 683
International 6 - -
Shareholder capital 6 5 11
Inter-segment fee income (73) (58) (170)
Expenses
Payments to contract holders 4 619 3 630 7 539
Retail 2 297 1 928 4 140
Corporate 1 992 1 362 2 712
Health 8 9 17
International 322 331 670
Other expenses 1 769 1 675 3 389
Retail 1 094 945 1 987
Corporate 168 154 312
Asset management 81 71 133
Health 325 285 587
International 169 141 305
Shareholder capital (10) 142 256
Inter-segment expenses (58) (63) (191)
- The South African operations are segregated into retail, corporate, asset
management, health and shareholder capital. The international companies -
Botswana, Ghana, Kenya, Lesotho, Mauritius, Namibia, Nigeria and Swaziland
- are all managed as a single operating segment.
- Segment assets and liabilities did not change materially from 31 December
2007, except for market-related movements.
- Other segment information used to assess the performance of the operating
segments is disclosed throughout the results and includes, diluted core
headline earnings, new business premiums, value of new business and
profitability of new business as a % of APE.
- Shareholder capital expenses are net of first-time recognition of employee
benefit assets.
METROPOLITAN HOLDINGS - GROUP RESULTS
EMBEDDED VALUE 30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Reporting excess - long-term 5 253 5 050 5 715
insurance business
Disallowed assets (15) (124) (85) (124)
Adjustments to reporting excess 2 188 2 470 2 057
Net assets - other businesses 1 274 1 492 1 102
Dilutory effect of subsidiaries 83 91 73
(16)
Staff share scheme loans 119 155 141
Liability - convertible 839 832 837
redeemable preference shares
Treasury shares held on behalf of 8 9 13
contract holders
Goodwill and value of in-force (135) (109) (109)
business acquired
Diluted net asset value 7 317 7 435 7 648
Value of in-force 4 870 4 873 4 960
Other businesses 582 470 540
Asset management 233 249 257
Health (17) 681 515 666
Holding company expenses (332) (294) (383)
Long-term insurance businesses 4 288 4 403 4 420
Individual life 3 479 3 554 3 566
Gross value of in-force 3 609 3 695 3 696
business
Less cost of capital (130) (141) (130)
Employee benefits 809 849 854
Gross value of in-force 874 924 911
business
Less cost of capital (65) (75) (57)
Diluted embedded value 12 187 12 308 12 608
Diluted embedded value per share 1 838 1 761 1 857
(cents)
Diluted net asset value per share 1 104 1 064 1 126
(cents)
Diluted number of shares in issue 663 699 679
(million) (18)
15. Disallowed assets include goodwill, deferred acquisition costs and deferred
revenue liabilities.
16. For accounting purposes, Metropolitan Health, Metropolitan Kenya and
Metropolitan Namibia have been consolidated at 100% (2007: Namibia 81%,
Health and Kenya 100%) in the balance sheet. For embedded value purposes,
disclosed on a diluted basis, the minority interests and related funding
have been reinstated.
17. The value of the health business is net of R54 million at 31.12.2007 and
R38 million at 30.06.2007, being the total liability in respect of the
option held by MHG management. The liability was settled during February
2008.
18. The diluted number of shares in issue takes into account all issued shares,
assuming conversion of the convertible redeemable preference shares and the
release of staff share scheme shares, and includes the treasury shares held
on behalf of contract holders.
METROPOLITAN HOLDINGS - GROUP RESULTS
EMBEDDED VALUE Net Value 30.06.2008 30.06.2007 31.12.2007
ATTRIBUTABLE TO asset of in- Rm Rm Rm
GROUP value force
Rm Rm
Metropolitan Life 4 557 3 785 8 342 8 463 8 940
Ltd
Metropolitan 35 - 35 34 34
Odyssey
Union Life 23 13 36 - 41
Metropolitan Life 52 - 52 48 50
International
Metropolitan 144 238 382 369 417
Namibia
Metropolitan 114 71 185 149 178
Botswana
Metropolitan 141 170 311 285 307
Lesotho
Metropolitan Kenya 15 2 17 9 17
Metropolitan Ghana 8 7 15 11 12
Metropolitan 54 2 56 - -
Nigeria
Asset management 62 233 295 363 394
Metropolitan Health 209 681 890 692 831
Group
Metropolitan 2 038 (332) 1 706 1 994 1 496
Holdings(after
consolidation
adjustments)
Goodwill and value (135) (135) (109) (109)
of business
acquired
Total embedded 7 317 4 870 12 187 12 308 12 608
value
Adjustments to (2 188)
reporting excess
Disallowed assets 124
Reporting excess - 5 253
long-term insurance
business
- Net of minority interests.
METROPOLITAN HOLDINGS - GROUP RESULTS
VALUE OF NEW BUSINESS 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Retail business 23 45 119
Gross value of new business 24 46 122
Less: Cost of capital (1) (1) (3)
Corporate business 13 23 46
Gross value of new business 17 26 53
Less: Cost of capital (4) (3) (7)
International business 6 9 15
Gross value of new business 6 9 15
Less: Cost of capital (0) (0) (0)
Value of long-term insurance new 42 77 180
business
Asset management 22 16 35
Health 48 55 121
Total value of new business 112 148 336
- 2008 and 2007 results exclude Metropolitan Ghana, Metropolitan Kenya and
Metropolitan Nigeria as these businesses were in start-up phase. 2007 also
excludes results for Union Life as the company was acquired late in 2007.
- Net of minority interests.
- Due to rounding, the cost of capital for the international business is less
than R1 million.
METROPOLITAN HOLDINGS - GROUP RESULTS
NEW BUSINESS PREMIUMS 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Recurring premiums
Retail business 416 361 804
Corporate business 86 116 207
International business 49 42 91
551 519 1 102
Single premiums
Retail business 1 474 1 060 2 519
Corporate business 589 1 487 2 154
International business 68 58 121
2 131 2 605 4 794
Annual premium equivalent (APE) 764 780 1 581
Retail business 563 467 1 056
Corporate business 145 265 422
International business 56 48 103
Present value premiums (PVP) 4 528 5 283 10 068
Retail business 3 098 2 808 6 033
Corporate business 1 209 2 241 3 613
International business 221 234 422
- 2008 and 2007 exclude Metropolitan Ghana (06.08: R9 million; 06.07: R4
million; 12.07: R9 million APE), Metropolitan Kenya (06.08: R5 million;
06.07: R4 million; 12.07: R4 million APE) and Metropolitan Nigeria (06.08:
R5 million) as these businesses are in start-up phase. 2007 excludes
results for Union Life as the company was acquired late in 2007.
- Net of minority interests.
METROPOLITAN HOLDINGS - GROUP RESULTS
PROFITABILITY OF NEW BUSINESS 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
% of APE 5.5 9.9 11.4
Retail business 4.1 9.6 11.3
Corporate business 9.0 8.7 10.9
International business 10.7 18.8 14.6
% of PVP 0.9 1.5 1.8
Retail business 0.7 1.6 2.0
Corporate business 1.1 1.0 1.3
International business 2.7 3.8 3.6
SOURCE OF NEW BUSINESS 30.06.2008 30.06.2007 31.12.2007
PRODUCTION - GROUP
Individual life -
insurance and
investment business
APE % Total % APE % Total % APE % Total %
Tied agents and 40 32 37 29 36 26
personal financial
advisors
Brokers 25 28 24 23 25 25
Wholesale and credit 17 5 21 8 21 8
life
Third party business 9 29 8 33 9 34
International 9 6 10 7 9 7
PRINCIPAL ASSUMPTIONS (South 30.06.2008 30.06.2007 31.12.2007
Africa) (19) % % %
Pre-tax investment return
Equities 13.0 10.5 10.5
Properties 13.0 10.5 10.5
Government stock 11.0 8.5 8.5
Cash 9.0 6.5 6.5
Risk discount rate (RDR) 13.5 11.0 11.0
Investment return (before tax) - 12.4 9.9 9.9
smoothed bonus
Expense inflation rate 7.8 5.3 5.3
19. The principal assumptions relate only to the South African life insurance
business. Assumptions relating to international life insurance businesses
are based on local requirements and can differ from the South African
assumptions.
METROPOLITAN HOLDINGS - GROUP RESULTS
MINORITY INTERESTS 30.06.2008 30.06.2007 31.12.2007
% % %
Metropolitan Health Group 17.6 17.6 17.6
Union Life 50.0 - 50.0
Metropolitan Namibia 18.0 19.0 19.0
Metropolitan Botswana 24.2 24.2 24.2
Metropolitan Kenya 33.3 33.3 33.3
Metropolitan Ghana 40.0 40.0 40.0
Metropolitan Nigeria 50.0 - 50.0
METROPOLITAN HOLDINGS - GROUP RESULTS
LONG-TERM INSURANCE Net In-force business New business written
BUSINESS: worth
SENSITIVITIES -
30.06.2008
Net Gross Cost Net Gross Cost of
value value of value value CAR
CAR
Rm Rm Rm Rm Rm Rm Rm
Base value 5 253 4 288 4 483 (195) 42 47 (5)
1% increase in risk 3 926 4 235 (308) 29 36 (7)
discount rate
% change (8) (6) 58 (30) (22) 44
1% reduction in 4 689 4 756 (67) 55 57 (2)
risk discount
rate
% change 9 6 (66) 32 23 (49)
10% increase in 3 985 4 180 (195) 25 30 (5)
future expenses
% change (1) (7) (7) - (40) (36) -
10% increase in 4 193 4 387 (195) 26 31 (5)
policy
discontinuance
% change (2) (2) - (38) (34) -
10% increase in 3 942 4 137 (195) 17 22 (5)
mortality and
morbidity
% change (2) (8) (8) - (59) (53) -
1% reduction in 5 314 4 335 4 530 (195) 55 60 (5)
gross investment
return,
inflation rate
and risk
discount rate
% change (3) 1 1 1 - 33 30 7
1% reduction in 5 187 3 975 4 297 (322) 34 41 (7)
gross investment
return only (no
change in risk
discount rate)
% change (3) (1) (7) (4) 65 (18) (11) 47
1% reduction in 5 369 4 232 4 427 (195) 53 58 (5)
inflation rate
% change 2 (1) (1) - 28 25 -
10% fall in market 4 984 3 983 4 272 (289)
value of
equities
% change (5) (7) (5) 48
METROPOLITAN HOLDINGS - GROUP RESULTS
LONG-TERM INSURANCE Net In-force business New business
BUSINESS: worth written
SENSITIVITIES -
30.06.2008
Net Gross Cost Net Gross Cost
value value of value value of CAR
CAR
Rm Rm Rm Rm Rm Rm Rm
Base value 5 253 4 288 4 483 (195) 42 47 (5)
10% reduction in 4 202 4 397 (195) 38 43 (5) 4 202
premium
indexation take-
up rate
% change (2) (2) - (9) (8) - (2)
10% increase in non 24 28 (5)
commission
related
acquisition
expenses
% change (44) (39) -
Notes
1. No corresponding changes in variable policy charges are assumed, although
in practice it is likely that these will be modified according to
circumstances.
2. Mortality decreases by 10% for annuities; mortality and morbidity increase
by 10% for assurance.
3. Bonus rates are assumed to change commensurately.
4. The change in the value of cost of CAR is disclosed as nil where the
sensitivity test results in an insignificant change in the value.
METROPOLITAN HOLDINGS - GROUP RESULTS
ANALYSIS OF CHANGES IN Other Long-term 6 mths 6 mths 12 mths
GROUP EMBEDDED VALUE busi- insurance 2008 2007 2007
nesses business Total Total Total
NAV VoIF Rm Rm Rm
Rm Rm Rm
Profit from new 72 (89) 132 115 151 352
business
Embedded value from 70 (89) 131 112 147 336
new business
Expected return to 2 - 1 3 4 16
end of year
Profit from existing (70) 454 37 421 462 781
business
Expected return - 39 - 262 301 262 540
unwinding of RDR
Expected (or actual) - 346 (346) - - -
net of tax profit
transfer to net
worth
Operating experience (126) 224 48 146 141 414
variances
Operating assumption 17 (116) 73 (26) 59 (173)
changes
Embedded value profit 2 365 169 536 613 1 133
from operations
Investment return on (44) 126 - 82 453 768
net worth
Investment variances (11) 7 (199) (203) 133 138
Economic assumption 30 (140) (122) (232) (48) (1)
changes
Exchange rate - (9) 5 (4) - (4)
movements
Total embedded value (23) 349 (147) 179 1 151 2 034
profit
Changes in share (201) - - (201) (380) (691)
capital
Reallocations (53) 37 16 - - -
Dividend paid 491 (821) - (330) (751) (960)
Finance costs - (69) - - (69) (61) (124)
preference shares
Change in embedded 145 (435) (131) (421) (41) 259
value
Time weighted return on embedded value (%) 2.9 20.3 17.8
(June results annualised)
ANALYSIS OF VARIANCES AND OPERATING ASSUMPTION CHANGES - 30.06.2008
Operating
experience
variances
Other Negative variances from losses or a reduction in
businesses profit margins in certain of the non-life companies.
Long-term
insurance
business
Net asset Significant contribution of R142 million from the
value (NAV) recognition of an additional employee benefit asset.
Positive contribution from higher than expected
mortality profits, partially off-set by negative
variances from higher than expected expenses.
Value of in Positive contributions from persistency on certain
force (VoIF) lines of individual life business as well as some
mortality profits.
Operating
assumption
changes
Other business Positive contribution from the reduction in the
corporate tax rate from 29% to 28%.
Long-term
insurance
business
Net asset Negative change from an increase in the assumed per
value (NAV) policy expense for individual life contracts.
Positive change in respect of the assumed mortality
on certain lines of business.
Value of in Positive contribution mainly from the reduction in
force (VoIF) the transfer tax rate from 29% to 28%. Negative
change due to an increase in the assumed future
expenses of the corporate business.
METROPOLITAN HOLDINGS - GROUP RESULTS
FUNDS RECEIVED 6 mths to 6 mths to 12 mths to
FROM CLIENTS 30.06.2008 30.06.2007 31.12.2007
Gross Gross Net inflow Net inflow Net inflow
inflow outflow Rm Rm Rm
Rm Rm
Retail business 3 666 (2 297) 1 369 1 150 2 586
Corporate business 1 490 (1 992) (502) 1 035 1 235
International 478 (322) 156 121 305
business
Long-term 5 634 (4 611) 1 023 2 306 4 126
insurance business
cash flows
Health business 6 926 (5 775) 1 151 247 1 364
Asset 10 916 (8 478) 2 438 4 139 6 708
administration
business
Asset management 1 037 (76) 961 42 222
business
Corporate business 5 - 5 - 78
Total funds 24 518 (18 940) 5 578 6 734 12 498
received from
clients
PREMIUMS RECEIVED 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Recurring premiums 3 561 3 319 6 913
Retail business 2 235 2 018 4 288
Corporate business 901 910 1 793
International business 425 391 832
Single premiums 2 073 2 608 4 735
Retail business 1 431 1 060 2 438
Corporate business 589 1 487 2 154
International business 53 61 143
Capitation contracts - health 9 10 19
business
Segment premiums received 5 643 5 937 11 667
Adjustment for premiums received (1 058) (1 836) (2 875)
from investment contract holders
Net insurance premiums per income 4 585 4 101 8 792
statement
- Excluding premiums received in Nigeria.
METROPOLITAN HOLDINGS - GROUP RESULTS
PAYMENTS TO CONTRACT HOLDERS 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Individual life 2 526 2 179 4 623
Death and disability claims 559 435 952
Maturity claims 839 677 1 417
Annuities 323 285 581
Withdrawal benefits 68 - 7
Surrenders 813 824 1 759
Re-insurance recoveries (76) (42) (93)
Employee benefits 2 085 1 442 2 899
Death and disability claims 566 426 886
Maturity claims 143 53 136
Annuities 335 300 614
Withdrawal benefits 209 212 469
Terminations 191 123 106
Disinvestments 742 397 837
Re-insurance recoveries (101) (69) (149)
Capitation contracts 8 9 17
Total payments to contract holders 4 619 3 630 7 539
Adjustment for payments to (883) (561) (1 347)
investment contract holders
Net insurance benefits and claims 3 736 3 069 6 192
per income statement
- Segment information is disclosed in the segment report and reconciles to
total payments to policyholders.
- Excluding payments to contract holders in Nigeria.
METROPOLITAN HOLDINGS - GROUP RESULTS
NUMBER OF EMPLOYEES 30.06.2008 30.06.2007 31.12.2007
Indoor staff 5 134 4 651 4 866
Insurance companies 2 684 2 560 2 573
Retail 1 248 1 338 1 305
Union Life 103 - -
Cover2Go 16 5 7
Employee benefits 389 349 359
International 403 354 381
Group services 525 514 521
Metropolitan Health Group 2 057 1 765 1 956
Asset management 80 74 75
Asset administration 65 61 69
Metropolitan Card Operations 50 41 42
Metropolitan Retirement 132 132 132
Administrators
DirectFin Solutions 47 - -
Holding company 19 18 19
Field staff 3 672 3 216 3 409
Retail 2 619 2 445 2 554
Union Life 186 - -
DirectFin Solutions 36 - -
International 831 771 855
Total 8 806 7 867 8 275
METROPOLITAN HOLDINGS - GROUP RESULTS
ANALYSIS OF EXPENSES 6 mths to 6 mths to 12 mths to
30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Depreciation, amortisation and 125 71 169
impairment expenses
Employee benefit expenses 569 597 1 145
Sales remuneration and 548 533 1 127
distribution costs
Other expenses 433 382 774
Finance costs 94 92 174
Total expenses 1 769 1 675 3 389
Long-term insurance business 1 395 1 224 2 598
Management expenses 833 612 1 288
Administration expenses 731 555 1 165
Distribution costs 102 57 123
Sales remuneration 445 473 1 001
Asset management fees 98 114 242
Direct property expenses 19 25 67
Administration business 447 385 787
Finance costs - preference shares 92 85 170
and subordinated redeemable debt
Holding company 38 28 65
Employee benefit assets (142) (5) (51)
Consolidation adjustments (61) (42) (180)
Total expenses 1 769 1 675 3 389
- Segment information is disclosed in the segment report.
METROPOLITAN HOLDINGS - GROUP RESULTS
ASSETS UNDER MANAGEMENT 30.06.2008 30.06.2007 31.12.2007
Rm Rm Rm
Intangible assets 525 433 562
Owner-occupied properties 607 435 592
Property and equipment 278 171 233
Investment properties 2 790 2 468 2 710
Investment in associates 592 1 047 405
Investment in joint ventures 54 - 61
Employee benefit assets 319 131 177
Financial assets 62 884 57 739 60 489
Equity securities 30 442 29 267 31 990
Debt securities 14 082 12 077 14 268
Funds on deposit and other money 4 388 2 389 2 150
market instruments
Unit-linked investments 10 724 11 953 9 863
Derivative financial instruments 1 814 768 850
Loans and receivables 1 434 1 285 1 368
Insurance and other receivables 1 425 1 262 1 476
Deferred income tax 7 4 15
Reinsurance contracts 271 237 179
Current income tax assets 40 - -
Cash and cash equivalents 6 466 7 623 8 274
Non-current assets held for sale 19 - 185
Total on-balance sheet assets 76 277 71 550 75 358
Collective investments 20 135 15 700 18 403
Health 4 434 3 723 4 091
Asset management - segregated assets 3 893 2 801 2 950
Employee benefits - segregated 1 399 1 246 1 392
assets
Total assets under management 106 138 95 020 102 194
METROPOLITAN HOLDINGS - GROUP RESULTS
ANALYSIS OF ASSETS 30.06.2008 30.06.2007 31.12.2007
BACKING GROUP
EXCESS
Rm % Rm % Rm %
Equity securities 3 379 51.8 2 451 36.6 3 575 52.4
Collective 927 14.2 2 088 31.2 1 325 19.4
investment schemes
Debt securities 328 5.0 597 8.9 523 7.7
Owner-occupied 607 9.3 344 5.1 592 8.7
properties
Investment 170 2.6 18 0.3 103 1.5
properties
Cash and cash 1 585 24.3 1 478 22.1 1 490 21.9
equivalents
Goodwill 214 3.3 109 1.6 244 3.6
Other net assets 657 10.1 942 14.1 303 4.4
Redeemable (839) (12.9) (832) (12.4) (837) (12.3)
preference shares
Subordinated (501) (7.7) (501) (7.5) (501) (7.3)
redeemable debt
Excess - group per 6 527 100.0 6 694 100.0 6 817 100.0
reporting basis
METROPOLITAN HOLDINGS - GROUP RESULTS
GROUP EXCESS - TOP 10 30.06.2008 30.06.2007 31.12.2007
EQUITY HOLDINGS
Rm % Rm % Rm %
MTN Group Ltd 275 8.1 256 10.4 293 8.2
Anglo American Plc 263 7.8 144 5.9 133 3.7
Impala Platinum 243 7.2 138 5.6 157 4.4
Holdings Ltd
Billiton Plc 238 7.0 144 5.9 182 5.0
Sasol Ltd 222 6.6 130 5.3 167 4.7
Standard Bank Group Ltd 167 4.9 195 8.0 211 5.9
Richemont Securities AG 138 4.1 - - - -
Remgro Plc 117 3.5 - - 70 2.0
Grindrod Ltd 76 2.3 - - - -
FirstRand Ltd 72 2.1 111 4.5 130 3.7
Imperial Holdings Ltd - - 101 4.1 111 3.1
Nedbank Group Ltd - - 97 4.0 90 2.5
Barloworld Ltd - - 88 3.6 - -
1 811 53.6 1 404 57.3 1 544 43.2
Total equities backing 3 379 100.0 2 451 100.0 3 575 100.0
excess
METROPOLITAN HOLDINGS - GROUP RESULTS
STOCK EXCHANGE 30.06.2008 31.12.2007 30.06.2007 31.12.2006
PERFORMANCE
6 month period
Value of listed shares 2 592 2 570 4 454 2 945
traded (rand million)
(21)
Volume of listed shares 200 170 286 233
traded (million) (21)
Shares traded (% of 72.7 61.4 100.6 78.8
average listed shares
in issue) (20, 21)
Value of shares traded 47.8 54.4 53.6 35.4
- life insurance (J857
- Rbn)
Value of shares traded 1 367.3 1 277.0 1 051.1 824.5
- top 40 index (J200 -
Rbn)
Trade prices
Highest (cents per 1 520 1 635 1 691 1 581
share)
Lowest (cents per 1 080 1 314 1 421 1 105
share)
Last sale of period 1 093 1 509 1 486 1 500
(cents per share)
Percentage (%) change (47.5) 3.1 9.1 61.6
during period (20, 22)
Percentage (%) change - (55.1) (4.1) 10.8 32.1
life insurance sector
(J857) (20)
Percentage (%) change - 19.6 5.4 27.9 33.9
top 40 index (J200)
(20)
30 June / 31 December
Price/diluted core 7.80 10.61 12.12 13.12
headline earnings ratio
Dividend yield % 9.06 6.30 5.65 5.13
(dividend on listed
shares) (20)
Dividend yield % - top 2.32 2.39 2.12 2.06
40 index (J200) (20)
METROPOLITAN HOLDINGS - GROUP RESULTS
STOCK EXCHANGE 30.06.2008 31.12.2007 30.06.2007 31.12.2006
PERFORMANCE
Total shares issued
(million)
Listed on JSE 539 559 550 585
Ordinary shares 533 553 543 578
Share incentive 6 6 7 7
scheme
Unlisted - share 17 23 32 41
purchase scheme
Total ordinary shares 556 582 582 626
in issue
Treasury shares held (16) (26) (6) (27)
by subsidiary
Treasury shares held (1) (1) (1) (13)
on behalf of contract
holders
Adjustment to staff (21) (26) (37) (47)
share scheme shares
(23)
Share incentive (4) (4) (6) (7)
scheme
Share purchase (17) (22) (31) (40)
scheme
Basic number of 518 529 538 539
shares in issue
Adjustment to staff 21 26 37 47
share scheme shares
Treasury shares held 1 1 1 13
on behalf of contract
holders
Convertible 123 123 123 123
redeemable preference
shares
Diluted number of 663 679 699 722
shares in issue (24)
Market capitalisation 7.25 10.25 10.39 10.83
at end (Rbn) (25)
Percentage (%) of life 5.26 4.93 5.03 5.45
insurance sector (20)
20. Percentages have been annualised.
21. 30.06.2008 is net of 16 million shares acquired for R200 million as part of
a share buy-back programme (31.12.2007: 20 million shares acquired for R310
million; 30.06.2007: 24 million shares acquired for R380 million;
31.12.2006: 27 million shares acquired for R242 million).
22. 30.06.2007 has been adjusted for a special dividend of 77 cents per share
(31.12.2006: capital reduction of 100 cents per share).
23. These are shares which have been issued since 1 January 2001, the date on
which the group adopted AC133 (now IAS39).
24. The diluted number of shares in issue takes into account all issued shares,
assuming conversion of the convertible redeemable preference shares and the
release of staff share scheme shares, and includes the treasury shares held
on behalf of contract holders.
25. The market capitalisation is calculated on the fully diluted number of
shares in issue.
Date: 03/09/2008 07:31:01 Produced by the JSE SENS Department.
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