|
LBH
LBH
LBH - Liberty Holdings Limited - Operational update for the three months ended
31 March 2012
Liberty Holdings Limited
Registration number 1968/002095/06
Incorporated in the Republic of South Africa
Share code: LBH
ISIN code: ZAE0000127148
("Liberty Holdings" or "the Company")
LIBERTY HOLDINGS LIMITED
OPERATIONAL UPDATE FOR THE THREE MONTHS ENDED 31 MARCH 2012
Group operating performance
The results of the first quarter of 2012 reflect continued strong growth in
Retail SA new business, positive client net cash inflows in both asset
management and insurance operations, and a good operational performance across
the group. Returns on our shareholder investment portfolio were supported by the
positive investment markets. In summary:
Long-term insurance indexed new business (excluding premium escalations) was up
22% to R1 283m for the period.
Insurance net cash inflows of R819m are substantially higher compared to the
corresponding 2011 period of R296m.
Total group assets under management increased to R469bn from R455bn at 31
December 2011.
The shareholder investment portfolio reflected the performance of favourable
financial markets during the quarter.
The capital adequacy level of Liberty Group Limited, the entity which conducts
the bulk of the company`s insurance activities, remains strong at 2.81 times the
required cover (31 December 2011: 2.89) after the payment of R750m to support
Liberty Holdings 2011 final dividend distributions paid in March and April 2012.
All the other life license subsidiaries remain well capitalised.
Retail SA
Retail SA continues to deliver on its strategy in both the traditional and
emerging consumer (ECM) markets.
Retail SA indexed new business was up 24%, with recurring new business up 20% to
R810m and single premium new business up 36% to R3 277m. The overall increase in
indexed new business was driven mainly by strong guaranteed investment, annuity
and risk business sales in the traditional and ECM markets as well as good
growth in credit life sales under the Standard Bank bancassurance agreement. ECM
indexed new business was up 54% off a low base.
Retail SA net cash inflows of R1 163m were up over 100% on the corresponding
2011 period of R457m driven by continued strong single premium business.
LibFin
LibFin continues to manage the shareholder investment portfolio within mandate
and returns for the first quarter were in line with benchmark. LibFin Markets
benefited from lower investment market volatility during the quarter.
Institutional and Asset Management
Corporate
Significant action to accelerate efforts to address historical systems and
administrative concerns has affected operating results. However, good progress
has been made and management is comfortable that the actions taken will have the
desired outcome.
Corporate indexed new business was down 15% to R 106m mainly as a result of
lower single premium business.
Corporate cash outflows increased to R488m in this quarter from R186m in 2011
due to the loss of certain scheme investment mandates, the acceleration of the
backlog administration project as well as lower single premium sales.
STANLIB
Assets under management for the period increased to R353bn compared to R341bn at
31 December 2011, reflecting a further R3.5bn in net inflows (excluding
intercompany life assets), as well as the increase in underlying asset values
resulting from market growth. Client net Inflows included R1.7bn in respect of
retail and institutional funds (excluding money market) and R1.8bn into the
money market products.
Investment performance continued to improve during the period.
Liberty Properties
Liberty Properties, which now constitutes property management and development,
has benefited from growth in property management fees supported by the recent
increases to rental areas at the flagship shopping centres. However, delays in
development mandates have resulted in reduced development fee income.
Fountainhead
Liberty Holdings has entered into agreements to sell its 50% joint venture
interests in Fountainhead Property Trust Management Limited and Evening Star
Trading 768 (Pty) Limited to Redefine Properties Limited for R330 million. The
current IFRS book value at 31 March 2012 of these interests is R203 million. The
sale is subject to regulatory approvals.
Diversification Initiatives
Liberty Africa
Net customer cash inflows in the asset management business amounted to R350m for
the period with assets under management remaining static at R39bn during the
period. The East African operations have benefited from the partial recovery of
investment markets in the region.
Liberty Health
Operational efficiencies continue to be enhanced under the new management team
and the medical risk loss ratio improved during the period.
Direct Financial Services (incorporating FRANK.NET)
The recently launched transactional initiative with Retail SA and Standard Bank
utilising the FRANK.NET technology platform is performing to expectation. In
addition, Vodacom South Africa has appointed FRANK.NET as its partner in its new
long-term insurance initiative.
Conclusion
Management`s focus remains on ensuring that the core South African insurance
operations are managed within acceptable sustainable long-term assumption sets,
whilst gaining profitable market share in all business lines and markets in
which we operate. The leveraging of our group capabilities and the execution of
our previously communicated strategy remains the key priority for management.
The operational update for the three months ended 31 March 2012 has not been
audited or reviewed by the Company`s auditors.
18 May 2012
Sponsor
Merrill Lynch South Africa (Pty) Limited
Date: 18/05/2012 07:10:04 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS. |
|