| Thu 24 Nov 2011, 17:01 | | LBH - Liberty Holdings Limited - Operational update for the nine months ended |
|
LBH
LBH
LBH - Liberty Holdings Limited - Operational update for the nine months ended
30 September 2011
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
OPERATIONAL UPDATE FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2011
The company`s strategic objective is to strengthen the insurance business,
excel in balance sheet management, and diversify revenue streams. The third
quarter performance continues to indicate progress in this regard.
Life Assurance (South Africa)
Capital
The capital adequacy level of Liberty Group Limited, remains strong at 2.9
times the required cover (31 December 2010: 2.7). All the other life license
subsidiaries remain well capitalised.
Long-term insurance indexed new business
Long-term insurance indexed new business (excluding premium escalations) was
up 14% to R3 688m for the period. Retail SA indexed new business increased by
14%, with recurring business up 8% to R2 220m and single premium new business
up 31% to R9 292m. The overall increase in indexed new business was achieved
despite an anticipated decrease in entry level market business of 32% to
R129m. Corporate indexed new business volumes were up 11.6% to R444m for the
period.
Cash Flows
Insurance net cash inflows of R2 634m are substantially improved compared to
the prior period (negative R611m). Corporate net cash flows, whilst still
negative, showed a 45% reduction on the prior period.
Insurance operational performance
Policyholders` experience within Retail SA remains broadly in line with that
evidenced at the half year. In Corporate, management has increased its focus
on remedial action related to historical operational retirement fund
administration issues which has increased costs.
LibFin
The shareholder investment portfolio reflected the performance of investment
markets and beat the benchmark measured against returns of comparable asset
classes as a result of improved asset management performance at STANLIB.
LibFin Markets performed in line with expectations. However, some exposure to
investment market volatility remains inherent in the asset liability matching
process.
Asset Management (South Africa)
STANLIB
Assets under management for the period declined by 3.4% to R343bn, reflecting
net outflows of R6.3bn (excluding intergroup life funds). Institutional money
market outflows were the key contributor to net outflows and were reduced by
strong retail net cash inflows into higher margin products. Investment
performance continued to improve during the period.
Liberty Properties
Liberty Properties continues to deliver its existing projects on schedule and
within budget. The unlisted property portfolio remains competitive in terms
of returns and demand for product containing the unlisted property portfolio
remains strong. The extension to Sandton City was successfully opened during
November.
Diversification Initiatives
Liberty Africa
Net customer cash inflows in the asset management business amounted to R207m
and assets under management improved to R31.4bn during the period (31 December
2010: R29.0bn). Significant investment market volatility in Africa and the
weakening of African currencies against the Rand has affected operations.
Liberty Health
Strong growth in African risk product sales has offset administration life
attrition in South Africa. The medical loss ratio is worse than target but the
management team has been strengthened and operational effectiveness has
improved in the period.
Frank.net (Frank)
Frank made good progress in establishing its brand in the market and
delivering its business case.
Conclusion
Operational performance continues to improve, capital ratios remain well above
minimum requirements, and management has made substantial progress in
generating sustained quality new business.
The operational update for the nine months ended 30 September 2011 has not
been audited or reviewed by the Company`s auditors. Liberty`s year end results
for 2011 are due to be released on 1 March 2012. Shareholders are advised that
this is not a trading statement as per section 3.4 of the JSE Listings
Requirements.
24 November 2011
Sponsor
Merrill Lynch South Africa (Pty) Limited
Date: 24/11/2011 17:01:00 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
