Solid growth across life assurer Old Mutual's (OML) South African, UK and US operations pushed underlying operating profit up 15 per cent in 2013 to £1.6bn. Unfortunately, however, this was largely wiped out by persistent rand weakness.
South African economic growth slowed to 1.9 per cent in 2013, but that didn’t seem to hinder Old Mutual's underlying performance much. Boosted by its wholesale operation, Nedbank grew currency-adjusted operating profit by 12 per cent to £797m. The emerging-market unit, focused on life and savings products in Africa, also grew adjusted operating profit 12 per cent to £590m - helped by double-digit sales growth in both its mass and affluent South African customer segments.
Meanwhile, an improving investment backdrop boosted both the US asset management arm and the Old Mutual Wealth unit, so that total assets under management jumped 19 per cent to £294bn. US assets under management soared 23 per cent to £155bn and Old Mutual plans to float a minority interest in this business during 2014. In the UK, meanwhile, Old Mutual sees opportunities arising from the Retail Distribution Review.
Prior to these figures, JP Morgan Cazenove was expecting adjusted EPS of 17.5p for 2014 (2013: 18.4p) and adjusted embedded value of 219p (2013: 208p).
OLD MUTUAL (OML) | ||||
|---|---|---|---|---|
| ORD PRICE: | 195p | MARKET VALUE: | £9.5bn | |
| TOUCH: | 194-195p | 12-MONTH HIGH: | 224p | LOW: 168p |
| DIVIDEND YIELD: | 4.2% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 148p* | EMBEDDED VALUE: | 179p | |
| Year to 31 Dec | Gross life premiums (£bn) | Pre-tax profit (£m) | Earnings per share (p)† | Dividend per share (p)† |
|---|---|---|---|---|
| 2009 | 3.02 | 0.4 | -6.3 | 1.51 |
| 2010 | 3.46 | 1.1 | 8.5 | 4.02 |
| 2011 | 3.58 | 1.0 | 9.0 | 5.02** |
| 2012 | 3.73 | 1.4 | 12.6 | 7.00 |
| 2013 | 3.70 | 1.5 | 14.9 | 8.10 |
| % change | -1 | +7 | +18 | +16 |
Ex-div: 23 Apr Payment: 30 May *Includes intangible assets of £2.8bn or 58p a share **Excludes special dividend of 18p †Adjusted for 2012's seven-for-eight share consolidation | ||||
