Slide 1: Annual Results 2023
ANNUAL RESULTS 2023
Slide 2: Agenda
Agenda Alessandro Bottega www.presentationists.com Strategic review Financial review Looking ahead Q&A Iain Williamson Casper Troskie Iain Williamson OML Executive Group CEO Group CFO Group CEO Committee 2
Slide 3: Strategic Review
STRATEGIC REVIEW ANNUAL RESULTS 2023
Slide 4: 2023 Financial Highlights
2023 Financial Highlights Strategic choices across our segments driving profitable top-line growth Alessandro Bottega www.presentationists.com Growth Value Capital and Returns 17% 14% Life APE sales¹ Results from operations In range R14.6 bn R8.3 bn Group solvency ratio 178% 14% 37% Gro
Slide 5: Our strategic framework
Our strategic framework Alessandro Bottega www.presentationists.com ORY CONDIT UE OP E T IO N TH MA RA IC N VE W RG V TI NS O GR E NG R I TO BE OUR CUSTOMERS’ RESPONSIBLY BUILD THE MOST RE ETITIVE 1ST CHOICE TO SUSTAIN, EFFICIE VALUABLE BUSINESS CAPIT CIE HS GROW AND PROTECT IN OUR INDUSTRY NGT THEI
Slide 6: The hallmarks of an integrated financial services business
The hallmarks of an integrated financial services business Alessandro Bottega www.presentationists.com LIFE & Strategic Framework SAVINGS Advice-led CUSTOMER ADVISERS Growing and protecting the core FINANCIAL PLAN A Holistic coverage of customer needs Customer Life Budgeting Events Integrated B Dist
Slide 7: Growing and protecting the core
Growing and protecting the core Delivering integrated financial services through disciplined execution and considered capital allocation Alessandro Bottega www.presentationists.com Holistic coverage Distribution & digital C A B Operational efficiencies of customer needs engagement Delivered Delivere
Slide 8: Unlocking new growth engines
Unlocking new growth engines Accelerating profitability and building our integrated financial services business Alessandro Bottega www.presentationists.com Strategic growth markets Strategic growth businesses D China; East and West Africa E Bank build & ecosystem adjacencies Delivered Delivered Our
Slide 9: Leading sustainability
Leading sustainability Responsibly building the most valuable business in our industry Alessandro Bottega www.presentationists.com Leading impact and sustainability Awards & Ratings S&P Global ESG Score of 43 Funders into 39% (2.6 Gigawatts) Improvement of 34% from 2022 of South Africa’s total renew
Slide 10: Operating Environment
OPERATING ENVIRONMENT ANNUAL RESULTS 2023
Slide 11: Macro overview
Macro overview We navigated growth constraints and market volatility in a difficult macro environment Alessandro Bottega www.presentationists.com Economies & Markets Businesses & Consumers Growth-constrained, volatile markets and weak currencies Tight financing conditions and low business confidence
Slide 12: Segment Reviews
SEGMENT REVIEWS ANNUAL RESULTS 2023
Slide 13: Mass and Foundation Cluster
Mass and Foundation Cluster Our diversified distribution channels and focus on underwritten sales is delivering profitable growth Alessandro Bottega www.presentationists.com Life APE sales 14% Value of new business (Rm) and value of new business margin (%)1 Rm 8.7% 6.2% 7.5% 8.8% 4 824 4 191 4 216 0
Slide 14: Personal Finance and Wealth Management
Personal Finance and Wealth Management We have scaled our adviser footprint and deployed tech-forward productivity toolsets to driveAlessandro growth Bottega www.presentationists.com Life APE sales 15% Value of new business (Rm) and value of new business margin (%)1 Rm 1.3% 1.2% 4 687 0.9% 0.6% 0.9%
Slide 15: Old Mutual Investments
Old Mutual Investments Diverse capability set with a peer-leading Private Markets franchise delivered resilient results in difficult Alessandro markets Bottega www.presentationists.com Assets under management Revenue 2% 8% (Rbn) (Rm) 839 3 302 3 374 809 774 2 957 2 672 515 429 690 702 1 766 349 503
Slide 16: Old Mutual Corporate
Old Mutual Corporate Expanding the core through new solution offerings and leveraging group synergies to drive growth Alessandro Bottega www.presentationists.com Life APE sales Value of new business (Rm) and value of new business margin (%)1 Rm 68% 3 636 1.0% 0.9% 1.0% 1.0% 1.0% 82 3 190 2 624 86 35
Slide 17: Old Mutual Insure
Old Mutual Insure Growth from acquisitions and operational efficiencies supporting insurance revenue momentum Alessandro Bottega www.presentationists.com Gross written premiums Claims ratio1 (Rm) (%) 17% 66.7 20 196 64.1 17 190 (50bps) 15 927 14 699 14 771 59.3 57.3 56.8 FY 2019 FY 2020 FY 2021 FY 2
Slide 18: Old Mutual Africa Regions
Old Mutual Africa Regions Pivot to corporate in East and West Africa and the turn-around of P&C has delivered improvedAlessandro profitability Bottega www.presentationists.com Life APE sales1 (Rm) and value of new business margin (%) Gross written premiums1 (Rm) 3% 2.9% 1.6% 2.2% 2.8% 1.3% 5 154 5 3
Slide 19: Financial Review
FINANCIAL REVIEW ANNUAL RESULTS 2023
Slide 20: Robust financial performance
Robust financial performance Our diverse business delivering strong results Alessandro Bottega www.presentationists.com Earnings Capital efficiency Value Results from operations Return on net asset value Value of new business (Rbn) 14% (%) 170bps (Rbn) 37% 11.1% 1.9 8.3 7.3 9.4% 1.4 FY 2022 FY 2023
Slide 21: Results from operations
Results from operations Strong sales growth and operational performance Alessandro Bottega www.presentationists.com Rm 14% 8 343 7 310 10% 3 710 22% 3 369 19% (1%) (23%) >100% 1 846 1 718 1 517 1 449 (22%) 1 240 1 227 1 116 678 524 535 (1 478) (1 798) Mass and Personal Finance and Old Mutual Old Mut
Slide 22: Adjusted headline earnings up 21%
Adjusted headline earnings up 21% Good operational growth supported by increased investment returns Alessandro Bottega www.presentationists.com Rm FY 2023 FY 2022 change Results from operations 8 343 7 310 14% Shareholder investment return 2 162 979 >100% Finance costs (1 020) (662) (54%) Loss from
Slide 23: Adjusted headline earnings to IFRS profit reconciliation
Adjusted headline earnings to IFRS profit reconciliation Zimbabwe remains the main driver Alessandro Bottega www.presentationists.com Rm FY 2023 FY 2022 Change Adjusted headline earnings 5 861 4 850 21% Accounting mismatches and hedging impacts (541) (187) (>100%) Impact of restructuring - (153) 100
Slide 24: Contractual service margin
Contractual service margin Allocation within expected range Alessandro Bottega www.presentationists.com Rbn Predictable Not predictable Expected range of future CSM allocation to P&L: 8% - 12% 1 CSM represents store of future profits - return on CSM of 14.5%2 for 2023 1. Release of contractual servi
Slide 25: Value of New Business
Value of New Business Robust result with work continuing in Personal Finance Alessandro Bottega www.presentationists.com Value of new business Value of new business margin FY 2022 (Rm) (%) FY 2023 130bps 37% 8.8 1 921 7.5 27% 1 400 1 180 930 60bps 10bps 2.8 64% 85% 2.2 2.2 2.3 0bps 18% 30bps 312 272
Slide 26: Embedded Value
Embedded Value Excellent growth in embedded value Alessandro Bottega www.presentationists.com Rbn 11.2% Return on embedded value R7.3bn Operating embedded value earnings 26
Slide 27: Group Equity Value
Group Equity Value Sum of the parts Alessandro Bottega www.presentationists.com R90.1bn 6.8 (0.7) 7.2 R18.81 GEV per share 8.9 R13.07 Share price 67.9 27
Slide 28: Capital management framework
Capital management framework Enhancing value for shareholders Alessandro Bottega www.presentationists.com Balance sheet strength Considered capital deployment Balance sheet efficiency Appropriately balanced Free surplus RONAV for protection and potential generated Group solvency ratio Ordinary divid
Slide 29: OML Group solvency
OML Group solvency Balance Considered Balance Appropriately balanced for protection and potential sheet capital sheet strength deployment efficiency Alessandro Bottega www.presentationists.com % 199% 189% 188% 184% 178% 168% FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 Adjusted IFRS equity¹ Solve
Slide 30: Free surplus generated
Free surplus generated Balance Considered Balance Continue to generate a high proportion of cash earnings sheet capital sheet strength deployment efficiency Alessandro Bottega www.presentationists.com Rbn 154% 82% 7.5 Expected free surplus generation of 70-80% of AHE 3.5 (before optimisations) Contr
Slide 31: Discretionary capital
Discretionary capital Balance Considered Balance Considered capital deployment sheet capital sheet strength deployment efficiency Alessandro Bottega www.presentationists.com Rbn 52% Used for Group growth initiatives Net contribution per 43% previous slide Returned to shareholders This balance is ear
Slide 32: Return on net asset value
Return on net asset value Balance Considered Balance Balance sheet efficiency sheet capital sheet strength deployment efficiency Alessandro Bottega www.presentationists.com Medium term target Long term target FY 2022 FY 2023 3 – 6 years 6+ years Old Mutual 9.4% 11.1% ~ COE + 2% ~ COE + 4% Group Excl
Slide 33: Medium-term targets
Medium-term targets Strong delivery Alessandro Bottega www.presentationists.com KPI Target 2023 outcome Gross flows and gross written Deliver growth of nominal GDP +1% Growth Solid delivery premiums over the medium term Value of new business margin Between 2% and 3% 2.3% Net underwriting margin Old
Slide 34: Looking Ahead
LOOKING AHEAD ANNUAL RESULTS 2023
Slide 35: Medium-term targets
Medium-term targets Strong delivery Alessandro Bottega www.presentationists.com KPI Target 2023 outcome Outlook Gross flows and gross written Deliver growth of nominal GDP +1% Growth Solid delivery Continue to regain market share premiums over the medium term Value of new business margin Between 2%
Slide 36: Conclusion
CONCLUSION ANNUAL RESULTS 2023
Slide 37: Conclusion
Conclusion The Integrated Financial Services is taking concrete shape, with a strong valueAlessandro proposition Bottega www.presentationists.com 1 Market share gains: double-digit top line growth in core lines of business 2 Profitable growth: outcome of deliberate strategic choices across our segme
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Slide 39: Disclaimer
DISCLAIMER Alessandro Bottega www.presentationists.com This presentation may contain certain 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,