Slide 1: Annual Results 2024 Analyst presentation
ANNUAL RESULTS 2024 Analyst presentation
Slide 2: Agenda
AGENDA 1 Highlights 2 Operational overview 3 Strategic delivery 4 Financial review 5 Conclusion 6 Q&A ANNUAL RESULTS 2024
Slide 3: Highlights
is) OLDMUTUAL HIGHLIGHTS IAIN WILLIAMSON
Slide 4: 2024 Financial highlights
2024 Financial highlights Strong double-digit growth in earnings, AHE excluding new growth increasing by 30% in 2H24 versus 2H23 150.6 cents R6.69 bn 12.7% 86 cents 17% 14% 160bps 6% AHE per share1 Adjusted headline Return on net Total dividend earnings (AHE) asset value per share 2.5% 6.2% R1.5 trn
Slide 5: Reflection on value creation
Reflection on value creation • Diversified business in a strong market position to deliver profit growth • R89 billion returned to our shareholders since FY 2018 • Capital allocation strategy continues to prioritise enhancing returns RFO per share AHEPS and RoNAV (cents) 15.6% 13.1% +7% 12.7% 11.0%
Slide 6: Operational overview
OPERATIONAL OVERVIEW IAIN WILLIAMSON
Slide 7: Operating environment
Operating environment Resilient profit and earnings growth in a demanding macro-economic and consumer environment Wages (%) CPI inflation (%) vs Repo (%) Household debt to disposable income (%) Growth in average wages Headline CPI Repo 75 9 65 8 7.75 55 7 6 45 5 % 4 35 3 2 3.02 25 1 15 0 2014 2016 2
Slide 8: Strategic framework
Strategic framework ORY CONDIT E OP E T IO NUTH MA RA IC N E V W RG V TI NS O GR E NG R I TO BE OUR CUSTOMERS’ RESPONSIBLY EFFICIEN 1ST CHOICE TO SUSTAIN, BUILD THE MOST RE ETITIVE CAPITA IES GROW AND PROTECT VALUABLE BUSINESS HS IN OUR INDUSTRY THEIR PROSPERITY NGT ST MP L C CO EXECUTION AND DELIVE
Slide 9: The hallmarks of an integrated financial services business
Strategic framework The hallmarks of an integrated financial services business ife & Savings L Growing and protecting the core ces e rvi Bu dg ls ta et • Holistic coverage of customer needs i g As Dig in g cial welln ing & Lendin set an • Distribution and digital engagement n es Fi Managem s • Opera
Slide 10: Mass and Foundation Cluster
Mass and Foundation Cluster Deliberate shift in sales mix and focused multi-channel strategy sustained our profitable market share Life APE sales and VNB margin Loans and advances and credit loss ratio 8.7 6.2 7.5 8.8 9.0 11.2% 0.5 8.9% 8.9% 7.2% 4.8% 7.1% +9% 18 491 0.9% (5%) 5 245 16 019 16 371 4
Slide 11: Personal Finance & Wealth Management
Personal Finance & Wealth Management Strengthened high-net-worth value propositions delivered diversification benefits in affluent market Retail sales and VNB margin Wealth Management AUMA and RFO +27% 1.3 1.2 0.9 0.9 0.9 0.6 1 009 +9% 9 118 795 8 236 8 360 7 722 7 304 653 6 833 4 279 3 673 575 +14%
Slide 12: Old Mutual Investments
Old Mutual Investments Our diverse capability set delivered strong topline growth with a record R28 billion in deal flow AUM Revenue (Rm) (Rm) +8% +20% 906 4 046 839 809 774 3 302 3 374 690 702 2 957 2 672 1 766 3 135 2 787 2 945 2 169 2 608 2 296 911 503 349 515 429 (530) FY 2019 FY 2020 FY 2021 FY
Slide 13: Old Mutual Corporate
Old Mutual Corporate We continue to write new profitable business, our VNB margin grew by 50 basis points to 1.5% Life APE sales and VNB margin Funds under management (Rm) 1.5 +1% 1.0 1.0 1.0 1.0 305 294 0.9 276 278 3 636 267 272 (42%) 32 82 3 190 86 2 624 66 2 416 186 2 212 1 841 312 71 3 095 2 439
Slide 14: Old Mutual Insure
Old Mutual Insure Exceptional performance, with strong margin recovery and topline growth ahead of nominal GDP Gross written premiums and net underwriting margin Net underwriting result and claims ratio 4.8 4.2 6.2 67 0.4 64 0.3 (3.8) 59 57 57 +9% 21 930 20 196 49.7 17 190 >100% 15 927 14 699 14 771
Slide 15: Old Mutual Africa Regions
Old Mutual Africa Regions Delivered solid results, with continued topline growth and R1 billion cash remittance to the Group Life APE sales and VNB margin Gross written premiums and net underwriting margin 2.9 2.2 2.8 1.6 1.3 0.2 (0.4) (5.5) (0.4) (6.3) (9.1) (9.1) (3.0) +2% 5 317 5 416 +7% 5 154 1
Slide 16: Strategic delivery
STRATEGIC DELIVERY IAIN WILLIAMSON
Slide 17: Strategic delivery overview
Strategic delivery overview Accelerating the pace to realising our integrated financial services ambitions Investment in the core Growing and Defending the core protecting the core Digital Modernisation Retiring our legacy platforms Perimeter review Exited Tanzania and Nigeria New growth engines OM
Slide 18: OM Bank update
OM Bank update A material growth catalyst and a concrete realisation of our Integrated financial services business Scalable Our right to win single-facility account • A digital-first bank delivered at scale and Interface Access to all payment lowers the cost to serve per customer unique per customer
Slide 19: Responsible business
Responsible business Sustainability is integral to our business and our value creation strategy Responsible investment • R179 bn of AUM invested in the green economy Awards and accolades Long-term Insurer of the Year – 2024 - News24 • R38.4 bn invested in renewable energy Sustainable Impact Corporat
Slide 20: Financial review
FINANCIAL REVIEW CASPER TROSKIE 20
Slide 21: Robust financial performance
Robust financial performance Enhancing returns while investing for the future Earnings Capital efficiency Value Results from operations RFO Return on net asset value Value of new business VNB (Rbn) per share (%) (Rbn) Margin +7% 2.5% +4% (8%) +160bps 8.3 8.7 1.9 1.8 12.7% 11.1% FY 2023 FY 2024 FY 20
Slide 22: Results from operations
Results from operations Up 10% excluding new growth investments Rm +4% 8 709 8 343 (26%) 3 710 +2% 2 741 +37% +4% >100% 1 846 1 884 1 786 1 808 (8%) 1 683 1 718 1 227 1 116 1 024 524 (73%) +11% (735) (1 063) ( 945) (1 272) Mass and Personal Finance Old Mutual Old Mutual Old Mutual Old Mutual Net res
Slide 23: Net result from group activities
Net result from group activities Stringent focus on cost management Rm 2 217 1 798 1 272 OM Bank moved out of net result from 1 478 735 group activities 713 1 614 1 695 1 123 Net shareholder operational costs 1 063 945 = 2022 levels + inflation 756 (358) (551) (750) FY 2022 FY 2023 FY 2024 FY 2026 I
Slide 24: Adjusted headline earnings up 14%
Adjusted headline earnings up 14% Up 21% excluding new growth investments Rm FY 2024 FY 2023 Change Results from operations 8 709 8 343 4% Shareholder investment return 2 697 2 162 25% Finance costs (1 091) (1 020) (7%) Income from associate 279 (118) >100% Adjusted headline earnings before tax and
Slide 25: AHE to IFRS profit reconciliation
AHE to IFRS profit reconciliation Zimbabwe remains the main adjustment Rm FY 2024 FY 2023 Change Adjusted headline earnings 6 685 5 861 14% Accounting mismatches and hedging impacts 1 (541) (>100%) Impact of restructuring (5) 21 (>100%) Ring fenced operations 2 145 2 039 5% Headline earnings 8 826 7
Slide 26: Group equity value
Group equity value Sum of the parts Rbn 92.5 90.1 1.6 6.8 8.3 7.2 6.2 FY 2024 FY 2023 8.9 9.5 Share price R12.51 R13.07 GEV per share R19.51 R18.81 67.9 66.9 Return on GEV 7.5% 7.2% (0.7) FY 2023 FY 2024 Covered Asset Management Banking & Lending Property & Casualty Other ANNUAL RESULTS 2024
Slide 27: Embedded value
Embedded value Covered business Rbn 9.7% Return on embedded value 7.2 1.4 (0.9) (0.3) (1.2) 1.8 67.9 0.1 66.9 (8.9) (0.2) R6.4bn Operating embedded value earnings FY 2023 New business Expected Development Experience Assumption Economic Capital and Foreign exchange Non-operating FY 2024 Embedded valu
Slide 28: Value of new business
Value of new business Margin remains within target range Value of new business margin Value of new business (%) (Rm) 3 year CAGR 12% +20bps 9.0 (8%) 8.8 1 921 1 758 +1% 1 180 1 190 (100bps) +20bps 2.8 +50bps 2.3 2.5 +6% (18%) +0bps (92%) 1.5 312 331 272 224 0.9 0.9 1.0 157 0.2 13 Mass and Personal
Slide 29: Contractual service margin
Contractual service margin Allocation within expected range Rbn Predictable Not predictable 6.7 3.4 1.0 (7.7) (1.0) 62.0 0.1 61.6 (2.9) Expected range of future CSM allocation to P&L: 8% - 12% FY 2023 New business Interest accretion CSM release Economic Non-economic Non-economic Foreign exchange FY
Slide 30: Capital management framework
Capital management framework Enhancing value for shareholders Considered capital deployment Balance sheet efficiency Balance sheet strength Cash remitted Appropriately balanced RONAV from subsidiaries for protection and potential Ordinary dividends Group Group shareholder solvency ratio Discretionar
Slide 31: Cash remitted from subsidiaries
Cash remitted from subsidiaries Significant capital optimisations resulted in ratio > 100% Rm FY 2024 FY 2023 OMLACSA 7 646 3 550 Old Mutual Investments 415 900 Old Mutual Capital Holding 2 160 462 Old Mutual Africa Regions 1 000 100 Old Mutual Residual plc 92 88 Central working capital (775) (321)
Slide 32: Discretionary capital
Discretionary capital Considered capital deployment Rbn 6.7 (0.3) (1.9) (1.2) (1.0) 3.1 (0.3) 1.1 FY 2023 Cash remitted from Capital injection Current year 2025 investment Share buyback Other FY 2024 Discretionary subsidiaries, post into Two Mountains investment into OM Bank Discretionary capital di
Slide 33: Return on net asset value
Return on net asset value Continuing upward trend Group return on net asset value Return on net asset value excluding new growth initiatives (%) (%) Ongoing balance sheet and cost 15.6% optimisations 13.1% 12.7% 11.1% 11.0% Expanding 9.4% market share in retail segments External factors FY 2022 FY 2
Slide 34: OML Group shareholder solvency
OML Group shareholder solvency Appropriately balanced for protection and potential % 199% 190% 188% 189% 184% 182% FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 Adjusted IFRS equity¹ Solvency ratio (%)² Bottom of target range Top of target range Continued optimisations to reduce equity while maint
Slide 35: Medium-term targets
Medium-term targets Strong delivery KPI Target 2024 outcome Medium-term outlook Gross flows and gross written Deliver growth of nominal GDP +1% Growth Strong delivery Continue to regain market share premiums over the medium term Value of new business margin Between 2% and 3% 2.5% Within range Net un
Slide 36: Conclusion
is) OLDMUTUAL CONCLUSION IAIN WILLIAMSON
Slide 37: Building an attractive returns profile
Building an attractive returns profile Despite our significant investments in new growth, we continue to enhance our returns profile AHE and RoNAV AHEPS and DPS 15.6% 86.0 13.1% 81.0 12.7% 76.0 11.0% 11.1% +14% 9.4% +17% 6 685 150.6 5 861 129.0 4 850 106.4 FY 2022 FY 2023 FY 2024 FY 2022 FY 2023 FY
Slide 38: 2025 focus areas
2025 focus areas Launch Savings & Launch OM Bank Income solution Margin-accretive Diligent expense sales growth management Capital efficiencies Improve collections and RoNAV and persistency ANNUAL RESULTS 2024
Slide 39: Q&A
Q&A OldMutualSA oldmutualSA Old-mutual—south-africa OldMutualSA ANNUAL RESULTS 2024
Slide 40: Disclaimer
Disclaimer Cautionary statement This report may contain forward-looking statements with respect to certain of Old Mutual Limited’s plans and its current goals and expectations relating to its future financial condition, performance and results and in particular estimates of future cash flows and cos