| Thu 19 Mar 2026, 7:30 | | MOMENTUM GROUP LIMITED - Unaudited interim results for the six months ended 31 December 2025 and dividend declaration |
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Unaudited interim results for the six months ended 31 December 2025 and dividend declaration
MOMENTUM GROUP LIMITED
Incorporated in the Republic of South Africa
Registration number: 2000/031756/06
JSE share code: MTM
A2X share code: MTM
NSX share code: MMT
ISIN code: ZAE000269890
("Momentum Group" or "the Group" or "the Company")
MOMENTUM METROPOLITAN LIFE LIMITED
Incorporated in the Republic of South Africa
Registration number: 1904/002186/06
LEI: 378900E0A78B7549C212
Bond issuer code: MMIG
("Momentum Metropolitan Life")
Unaudited interim results for the six months ended 31 December 2025 and dividend declaration
Basic Diluted
1HF2026 1HF2025 Change 1HF2026 1HF2025 Change
Earnings (R million) 3 376 3 320 2% 3 376 3 320 2%
Headline earnings (R million) 3 564 3 311 8% 3 564 3 311 8%
Normalised headline earnings (NHE, R million)(1) 3 695 3 437 8%
Operating profit (R million)(2) 3 127 2 842 10%
Investment return (R million) 568 595 (5)%
Earnings per share (cents) 259.9 244.3 6% 251.9 239.9 5%
Headline earnings per share (cents) 274.4 243.6 13% 266.0 239.2 11%
Normalised headline earnings per share (cents) 274.9 244.8 12%
Dividend per share (cents) 110 85 29%
Contractual service margin (CSM, R million) 21 184 20 156 5%
Growth in the CSM for the six-month period 4% 4%
New business CSM (R million) 496 764 (35)%
Present value of new business premiums (PVNBP, R million) 43 344 38 928 11%
Value of new business (VNB, R million) 238 279 (15)%
Value of new business margin 0.5% 0.7%
Diluted embedded value per share (R) 44.55 39.29 13%
Return on embedded value per share (annualised) 14.3% 16.8%
Return on equity (ROE) (annualised)(3) 24.0% 24.6%
(1) NHE adjusts the JSE definition of headline earnings for the impact of finance costs related to preference shares that can be
converted into ordinary shares of the Group when it is anti-dilutive, the impact of treasury shares held by the iSabelo Trust,
the amortisation of intangible assets arising from business combinations and broad-based black economic empowerment ('B-BBEE') costs.
Additionally, the iSabelo special purpose vehicle, which houses preference shares issued as part of the employee share ownership
scheme's funding arrangement, is deemed to be external from the Group, and the discount at which the iSabelo Trust acquired the
Momentum Group's treasury shares is amortised over a period of 10 years and recognised as a reduction to NHE. NHE is the responsibility
of the directors and is presented for additional information purposes only.
(2) Operating profit represents the profit (net of tax) that is generated from the Group's operational activities and reflects NHE excluding
the investment return on shareholders' funds.
(3) Return on equity expresses NHE as a percentage of start-of-year net asset value. In this calculation, net asset value is adjusted for the
items outlined in footnote 1, consistent with NHE.
Momentum Group delivers strong results
Disciplined execution drives earnings growth
Introduction
Momentum Group has achieved robust results for the six months ended 31 December 2025, delivering NHE of R3 695 million, up 8% on the prior period,
demonstrating the disciplined execution of our Impact strategy across all business units and the resilience of our diversified portfolio. The dividend
increases by 29% to 110 cents per share. Notable contributions to earnings were from life annuity profits in Momentum Investments, improved new business
profitability in Metropolitan Life, higher earnings from group risk in Momentum Corporate, continued strong underwriting performance in Momentum Insure
and excellent results from Guardrisk. Earnings were lower in Momentum Retail due to notable yield curve movements. Our earnings were further supported by
overall favourable mortality, persistency and alterations experience variances and positive investment market returns.
Group financial performance
Momentum Group achieved NHE growth of 8% to R3 695 million for the six months. NHE per share increased by 12% from 244.8 cents to 274.9 cents, reflecting
the positive impact of the share buyback programme. Headline earnings per share improved by 13% from 243.6 cents to 274.4 cents, and earnings per share
increased by 6% from 244.3 cents to 259.9 cents.
Operating profit increased by 10% from R2 842 million to R3 127 million. This result was largely due to higher CSM releases across the life businesses,
aided by a larger CSM opening balance, which reflects the underlying growth in our core life insurance businesses. Momentum Investments reported fewer onerous
contracts following the repricing of the back-to-back whole life product, positive longevity experience variance on life annuities and higher asset-based
fees following an increase in assets under management. Metropolitan Life delivered improved new business profitability and positive mortality experience
variance. Momentum Corporate achieved robust results supported by good underwriting profits and higher market variances. Guardrisk achieved solid growth in
underwriting profit and investment income, while Momentum Insure continued to deliver strong underwriting results. Momentum Health noted an improvement in
operating profit, aided by overall membership growth. The turnaround in Momentum Africa's operating profit was driven by positive contributions from all
countries across the life, asset management and health administration businesses. Momentum Retail's operating profit was impacted by lower market variances
following a reduction in the yield curve and a change in the ultimate spot rate following the reduced inflation rate target. India's operating loss widened
as the prior period included a one-off gain. Excluding this, the year-on-year result improved and was supported by strong gross written premium growth and
an improved combined ratio.
The following table outlines the movement in the total assets and liabilities over the six-month period:
Net asset value
1HF2026 F2025 Change
R million
Total assets 882 707 803 213 10%
Total liabilities (848 828) (770 259) 10%
Total equity 33 879 32 954 3%
The following table outlines the contribution from operating profit and investment return from the Group's shareholder assets to NHE per business unit:
1HF2026 Restated 1HF2025(4) Change
Operating Investment Normalised Operating Investment Normalised Operating Investment Normalised
profit/(loss) return headline profit/(loss) return headline profit return headline
R million earnings earnings earnings
Momentum Retail 306 145 451 576 98 674 (47)% 48% (33)%
Momentum Investments 617 13 630 447 28 475 38% (54)% 33%
Metropolitan Life 431 67 498 373 65 438 16% 3% 14%
Momentum Corporate 722 154 876 756 101 857 (4)% 52% 2%
Momentum Health 201 6 207 151 3 154 33% 100% 34%
Guardrisk 509 (5) 504 412 (11) 401 24% 55% 26%
Momentum Insure 183 95 278 153 77 230 20% 23% 21%
Momentum Africa 136 216 352 (27) 215 188 >100% 0% 87%
India (62) 0 (62) (49) 1 (48) (27)% (100)% (29)%
Normalised headline earnings
from operating business units 3 043 691 3 734 2 792 577 3 369 9% 20% 11%
Shareholders segment 84 (123) (39) 50 18 68 68% <(100)% <(100)%
Normalised headline earnings 3 127 568 3 695 2 842 595 3 437 10% (5)% 8%
(4) 1HF2025 has been restated to reflect the changes in the Africa operating model from 1 July 2025, as businesses were transferred from Momentum
Africa to Momentum Health and Guardrisk.
Operating model change
As communicated in the F2025 annual results announcement, the operating model review of Momentum Africa has been completed, with changes effective from
1 July 2025. The Namibia short-term insurance business is now reported in Guardrisk, and the health insurance businesses in Lesotho, Botswana, and Mozambique
are reported as part of Momentum Health. As a result, the Momentum Africa business unit comprises the life insurance and asset management businesses across
Namibia, Lesotho and Botswana, as well as the Namibia health administration business together with Ghana up to the date of sale on 9 September 2025.
Group new business performance
Key metrics 1HF2026 1HF2025 Change
Recurring premiums (R million) 2 107 2 105 0%
Single premiums (R million) 32 889 29 257 12%
PVNBP (R million) 43 344 38 928 11%
VNB (R million) 238 279 (15)%
New business margin 0.5% 0.7%
The Group's new business sales, as measured by the present value of new business premiums (PVNBP), improved by 11% to R43.3 billion. Momentum Retail
delivered growth in long-term savings new business volumes. Momentum Investments achieved good growth on the Momentum Wealth platform, partially offset by
lower guaranteed annuity sales. Momentum Corporate delivered good growth in FundsAtWork protection new business. Momentum Africa achieved strong new
business volumes following increased corporate protection new business volumes in Lesotho, Namibia and Botswana, along with increased retail new business
volumes in Namibia. Metropolitan Life's PVNBP decreased following the business's stringent focus on the quality of new business and salesforce management.
The Group's VNB declined from R279 million to R238 million. This decline was largely impacted by lower guaranteed annuity new business volumes in Momentum
Investments. This was partially offset by improved VNB contributions from Momentum Retail, Metropolitan Life, Momentum Corporate, and Africa. Overall, the
Group's new business margin declined to 0.5%.
Contractual service margin
The CSM is a component of the insurance liability that represents the present value of expected future earnings on a large subset of the in-force insurance
business. The CSM is an important metric for assessing the future earnings prospects of an insurance entity. The CSM increased by 3.7% (annualised 7.5%) to
R21.2 billion, with new business contributing R0.5 billion, expected growth on in-force business adding R1.0 billion, and changes in estimates contributing
R0.7 billion to the opening balance. The CSM released into earnings was R1.5 billion (pre-tax) for the period.
Return on equity and embedded value
ROE decreased marginally from 24.6% to 24.0%, reflecting a higher opening equity compared to the prior period. The Group's embedded value per share was
R44.55 as at 31 December 2025, with a return on embedded value per share of 14.3% for the period.
Solvency
The solvency positions of most of the Group's regulated insurance entities remain within the specified target solvency ranges. For Momentum Metropolitan
Life, the Group's main life insurance entity, the solvency cover (pre-foreseeable dividend) decreased from 1.96 times the solvency capital requirement (SCR)
on 30 June 2025 to 1.64 times SCR on 31 December 2025, towards the lower end of the target range of 1.6 to 2.0 times SCR.
This change in solvency cover reflects the net effect of strong operational earnings offset by an increase in both the SCR and risk margin following the
substantially lower nominal yields observed in the South African fixed income markets. Momentum Group's solvency cover (pre-foreseeable dividend) decreased
from 1.58 times SCR on 30 June 2025 to 1.39 times SCR on 31 December 2025 and remains within the target range of 1.35 to 1.65 times SCR.
Share buyback programme
By 17 March 2026, the Group had repurchased 21.7 million shares at an average price of R36.73 per share for a total consideration of R796 million,
including costs. This represents an average discount of 17.5% to the embedded value of R44.55 per share on 31 December 2025.
Dividends
Momentum Group has declared an interim dividend of 110 cents per ordinary share. This represents a payout ratio of 40% of NHE for the six-month period,
towards the lower end of the Group's new dividend payout range of 40% to 60% of NHE. The decision to declare a dividend towards the lower end of the payout
range is considered prudent given the recent market volatility.
The interim dividend is payable from income reserves to all holders of ordinary shares recorded in the Company's register on the record date. The interim
dividend will be subject to local dividend withholding tax at a rate of 20% unless the shareholder is exempt from paying dividend tax or is entitled to a
reduced rate. This will result in a net interim dividend of 88 cents per ordinary share for those shareholders who are not exempt from paying dividend tax.
The number of ordinary shares at the declaration date was 1 322 644 371.
The income tax number of the Momentum Group is 975 2050 147.
Publication of declaration date Thursday, 19 March 2026
Last date to trade cum-dividend Tuesday, 7 April 2026
Trading ex-dividend Wednesday, 8 April 2026
Record date Friday, 10 April 2026
Payment date Monday, 13 April 2026
Share certificates may not be dematerialised or rematerialised between Wednesday, 8 April 2026 and Friday, 10 April 2026, both days inclusive.
Outlook
In South Africa, the latest outlook signals modest yet improving growth momentum, supported by a lower inflation target, improved energy supply, and
strengthened investor sentiment following the country's successful removal from the Financial Action Task Force grey list and a recent credit rating
upgrade. However, despite these gains, the operating environment remains constrained by high unemployment, ongoing logistical constraints and elevated cost
of living, all of which continue to weigh on new business growth and margins.
Globally, economic volatility is expected to persist amid heightened geopolitical tensions, which have resulted in risk-sensitive market conditions,
including higher energy prices and inflationary pressures. This emphasises the need for financial advice to support our policyholders and underscores the
importance of a diversified business model and our disciplined capital and robust risk management approach.
We are proud of the strong earnings performance the Momentum Group achieved over the period, underpinned by the resilience of our empowered and accountable
business units. We remain committed to delivering value for our clients and stakeholders and will maintain our enhanced focus on maintaining sales volume
growth and improving VNB outcomes.
We are steadfast in delivering on our Impact strategy and have made notable progress on strategic initiatives. Our financial ambitions for F2027 (NHE of
R7 billion, ROE of 20% and VNB margin of 1% to 2%) remain achievable in our view, with continued focus on improving the VNB margin in the near term.
Results announcement statement
The information in this results announcement, which has been prepared in compliance with the JSE Listings Requirements, including the financial information
on which the outlook is based and any non-IFRS financial measures (which are presented for additional information purposes only), is the responsibility of
the directors and has not been reviewed and reported on by Momentum Group's external auditors.
Our outlook is based on several assumptions including continued recovery in consumer confidence and disposable income due to easing inflation and interest
rates, experience aligned to recent trends, successful execution of strategic initiatives under the Impact strategy and no material adverse changes to
regulation, tax or macroeconomic conditions. These ambitions were initially published on 23 July 2024 and should be read in conjunction with the Group's
previously published results, specifically NHE (income statement), shareholders' equity (statement of financial position) and VNB (EV statement) in the
condensed interim financial statements toward our F2027 ambitions.
The condensed interim financial statements for the period ended 31 December 2025 are accessible from Thursday, 19 March 2026 and can be found on the Group's
website at: https://www.momentumgroupltd.co.za/investor-relations/reporting-centre/annual-results and via the JSE cloudlink
at: https://senspdf.jse.co.za/documents/2026/jse/isse/MTME/1H26Result.pdf
Any investment decisions should be based on the condensed interim financial statements as the information in this results announcement does not provide all
the details.
In addition, shareholders are advised that a combined pack including the operating update, condensed interim financial statements and the results presentation
is accessible from Thursday, 19 March 2026, via the Group's website at: https://www.momentumgroupltd.co.za/investor-relations/reporting-centre/interim-results
SENS issue: 19 March 2026
Equity sponsor
Tamela Holdings (Pty) Limited
Sponsor in Namibia
Simonis Storm Securities (Pty) Limited
Debt sponsor
Nedbank Corporate and Investment Banking, a division of Nedbank Limited
Date: 19-03-2026 07:30:00
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