Momentum Metropolitan, an insurance and financial services group, anticipates an increase in earnings for the year ending June, attributed to a decline in life claims as the impact of the Covid-19 pandemic subsides.
- The company highlights that earnings were further supported by a significant improvement in investment variances due to favorable shifts in yield curves.
- Headline earnings per share (HEPS) are expected to rise by 2%-7%, reaching up to 318c, according to the firm’s trading update. Normalized headline earnings per share are projected to rise by 15%-20% when full-year results are released on September 13.
- Momentum’s share price experienced a midmorning surge of up to 5.7% to R20.38 following the announcement.
- While earnings have increased, Momentum acknowledges that underwriting losses in Momentum Insure, deterioration in lapse experience in Metropolitan Life, and a decline in investment returns from venture capital funds have partially dampened the overall performance.
- The company has expressed concerns about the impact of rising interest rates, high inflation, and load-shedding on economic activity.
- Momentum recently appointed Jeanette Marais as group CEO, making her the first female leader of a large, listed life insurance and asset management group in South Africa. Marais will spearhead the company’s new strategy, “Beyond 2024,” which aims to regain market share in a low-growth economy with a shrinking savings pool.
In addition, Mike Adsetts assumed the role of chief investment officer (CIO) at Momentum Investment Management on July 1.