Mutual & Federal Insurance Company Limited (MAF.J)
Interim results for the six months ended 30 June 2001
Mutual & Federal Insurance Company Limited ("Mutual & Federal")(MAF.J), the
South African general insurance group in which Old Mutual plc ("Old Mutual")
has a 51% interest, has today issued its interim results for the six months
ended 30 June 2001.
The company commented:
"The net income for the six months ended 30 June 2001 includes the results
of CGU which was formally acquired in October 2000 and consolidated from
that date. The integration of the CGU activities has progressed well and
will be complete by the end of the year.
"The General Insurance Result of R104 million, which includes an
underwriting surplus of R28 million, represents an encouraging improvement
on 2000. This result is largely attributable to an increase in rating levels
and an absence of substantial weather-related claims which characterised the
first quarter of 2000.
"There were, however, a number of significant fires during the period which
severely impacted the property portfolio. There has been a return to
profitability in the accident, engineering and marine portfolios, but, the
incidence of motor vehicle accidents and theft remains high, and corrective
action is being taken to ensure a return to profitability on the motor
account.
"Headline earnings increased by 14%. This is particularly encouraging in
view of the special dividend of 300 cents per share declared in November
2000, which had the effect of reducing shareholders' funds by approximately
R800 million. The solvency margin remains strong and was in excess of 100%
at 30 June 2001.
"The Board is cautiously optimistic about the prospects for the balance of
the period in light of the improvement in the underwriting cycle. It should
however be noted that short-term insurance results fluctuate and the outturn
for the first six months is not necessarily indicative of the likely results
for the remainder of the year.
"A maintained interim dividend of 22 cents per share has been declared
payable to shareholders in respect of the six months to 30 June 2001. "
The full text and table of results of the Mutual & Federal announcement is
available on the Stock Exchange News Service (SENS), and has been drawn up
in accordance with South African Generally Accepted Accounting Practice
(GAAP). The results will be consolidated in the interim accounts for Old
Mutual in accordance with UK GAAP. Old Mutual will release its interim
results on 4 September 2001.
Commenting on Mutual & Federal's results, Julian Roberts, Group Finance
Director of Old Mutual said:
"Mutual & Federal has made substantial progress in the first half of 2001,
achieving a positive underwriting result contributing towards a healthy
increase in profit. The integration of the CGU activities has progressed
well and will be complete by the end of the year."
7 August 2001
ENQUIRIES:
Old Mutual, London Tel: + 44 20 7569 0100
James Poole, Director Investor Relations
College Hill, London Tel: + 44 20 7457 2020
Matthew Gregorowski
Mutual & Federal, Johannesburg Tel: + 27 11 374 2207
Brian Laird-Smith, General Manager Finance
Clear Distinction Communications Tel: + 27 11 444 0650
Carol Dundas
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