| Thu 13 May 2010, 7:30 | | LBH - Liberty Holdings Limited - Overview of trading for the three months |
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LBH
LBH
LBH - Liberty Holdings Limited - Overview of trading for the three months
ended 31 March 2010
Liberty Holdings Limited
Registration number 1968/002095/06
Incorporated in the Republic of South Africa
Share code: LBH
ISIN code: ZAE0000127148
("Liberty Holdings" or "the Company")
LIBERTY HOLDINGS LIMITED
OVERVIEW OF TRADING FOR THE THREE MONTHS ENDED 31 MARCH 2010
At the annual general meeting to be held later today, chief executive Bruce
Hemphill will make the following comments regarding Liberty Holdings`
trading for the first three months of 2010 in comparison with the similar
period in 2009:
When the 2009 results were released, it was noted that the business
environment remained challenging. Since then there has been some
improvement in gross domestic product, consumer disposable income and
financial markets generally. Although improved, economic activity has not
yet fully normalised. Focus during the period has therefore remained on
managing policyholder persistency, costs and capital.
The management of policyholder persistency in the Retail SA business unit
has been further enhanced. Experience has remained broadly stable with that
seen in the latter part of 2009, with encouraging signs that retention
strategies in the major book of risk business are proving effective. Whilst
representing a relatively small portion of the business unit`s book,
management is taking action to improve profitability by curtailing sales and
improving persistency in entry level market products distributed through
third party call centres.
Sales on an indexed basis are at similar levels to 2009, with investment and
credit life product sales performing above expectations. Policyholder cash
flows were marginally positive and costs remain well controlled.
Corporate Benefits indexed sales and cash flows are ahead of last year.
At STANLIB, new leadership has been appointed which is building on
investment processes already in place. Sales and cash flows of money market
products remain strong, although there have been some institutional
outflows. Assets under management have increased by 4% from last year end,
a function of money market inflows and positive market growth. Generally,
investment performance improved over that in the final quarter of 2009.
Liberty Properties continues to perform to expectation.
The capital management strategies followed by Libfin have contributed to a
good performance of its investment portfolio. Libfin also benefitted from
lower volatility and more favourable interest rate conditions during the
quarter. Its operations have stabilised and are maturing satisfactorily.
Liberty Africa has made good progress towards ensuring that the CfC
Insurance Holdings acquisition will be completed early in the second half of
2010. Sales, cash flows and assets under management are all showing
positive trends.
Liberty Health "lives" under management have increased in excess of 20% from
31 December 2009 and the business is making satisfactory progress towards
break-even earnings levels.
All regulated subsidiaries of Liberty Holdings remain well capitalised at
levels similar to those at 31 December 2009. With persistency, investment
and market returns being in line with expectations, return on embedded value
has been positive.
Bruce Hemphill will also make the following comments on the outlook for the
rest of 2010:
Although trading conditions are expected to improve steadily through the
year, risks to a sustained global economic recovery remain. Improving
persistency continues to be a key priority, which has been complemented by
an increased focus on sales productivity and improved margins.
Audit Review
Shareholders are advised that the results discussed above have neither been
audited, nor reviewed by Liberty Holdings` auditors. An actuarial valuation
was not performed on the first quarter results.
13 May 2010
Sponsor
Merrill Lynch South Africa (Pty) Ltd
Date: 13/05/2010 07:30:01 Produced by the JSE SENS Department.
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