Sanlam Trading Statement
Sanlam Limited
At Sanlam`s Annual General Meeting on 5 June 2002, the Chairman, Mr Ton
Vosloo gave an overview of industry issues. This address is available on the
Sanlam website (www.sanlam.co.za) as a link on the news release on the AGM
and/or from Sanlam Corporate Communication. (Tel: 021 947 4893).
During the Board meeting, which took place after the AGM, the Board
considered the current state of the businesses in the Group and decided to
make this interim communication to the investment public on the progress
with performance and current expectations. In the interest of improved
stakeholder disclosure, similar communication is likely to be made after
future AGMs.
Sanlam set a target of 10% real growth per annum in operating profit, which
it has achieved over the past few years. In the review, the Board recognised
that, in general, trading conditions are currently not as favourable as
envisaged when the budgets were compiled during the last quarter of 2001.
It is expected that Sanlam Life will, by and large, achieve its targeted
growth for the half year, while reasonable growth in profit can be expected
from Sanlam Investment Management. Barring unforeseen events, Santam is on
track to realise its profit expectations for the first half of the year.
Conditions in the markets in which Gensec Bank operates, in particular the
equity market, have not been favourable. It achieved a pre-tax profit of
R112 million in the first half of 2001 and the expectation is that its
profit for the first half in 2002 will be substantially lower. Management
has identified areas of non-performance and specific action plans are being
implemented. Although the Bank`s performance is disappointing, the
underlying business remains sound and Sanlam remains fully committed to
Gensec Bank.
In the light of this it is expected that the rate of growth in Sanlam`s
operating profit for the six months to 30 June 2002 will be below target. It
is, however, expected that anticipated improvement in market conditions and
the implementation of specific action plans will contribute to an
improvement in performance. Prospects for the financial year will be
reviewed and communicated when the results for the first half are announced
on 5 September 2002.
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