Old Mutual, a prominent insurer, has reported a decline in its interim profits due to the impact of hyperinflation in Zimbabwe, where the company operates.
- Despite overall growth in the company’s operations, its Zimbabwean branch has been severely affected by the economic crisis, leading to a dip in profits.
- The company’s headline earnings per share (HEPS), a key profitability measure, dropped by 8% year-on-year to 96.8 cents, while its fiscal profit decreased by 6.6% to R4.9 billion for the six months ending in June.
- The decline in profits would have been significantly less if it weren’t for the challenges faced by Old Mutual in Zimbabwe, indicating the severity of the hyperinflation crisis in the country.
- Old Mutual’s Zimbabwean operations are affected by the country’s hyperinflation, which erodes the value of the local currency and creates significant economic instability.
- The company’s overall valuation on the Johannesburg Stock Exchange (JSE) stands at approximately R59 billion.
- Despite the challenging economic environment, Old Mutual remains committed to navigating the crisis and sustaining its operations in Zimbabwe, which is an important market for the company.