Old Mutual had a mixed performance in the first six months of 2025, as higher-than-expected market returns boosted its results while a hit in Zimbabwe weighed on profit and earnings.

Old Mutual was established in Cape Town in 1845 as South Africa’s first mutual life insurance company.

Today, it is a financial services group that operates in 12 countries, offering insurance, asset management and, more recently, banking. It is listed on the JSE and has a market cap of around R64 billion.

On Wednesday, 10 September, Old Mutual released its results for the six months ended 30 June 2025, the first half of its 2025 financial year.

These results showed a mixed performance. The insurer’s results from operations increased by 16% to R4.94 billion, while profit and headline earnings declined.

The increase in results from operations was primarily driven by exceptional growth in Old Mutual Insure and favourable market conditions.

However, the company noted that this growth was partially offset by the negative impact of a persistency basis change in its Mass and Foundation Cluster and higher central costs.

These costs include a once-off restructuring provision incurred to reduce future expenditure.

The company’s adjusted headline earnings grew by 29% to R4.20 billion, supported by an 88% increase in shareholder investment returns. This comes as the JSE All-Share Index returned 16.7% in the first half of 2025.

However, Old Mutual’s headline earnings, not adjusted, declined by 29% to R4.16 billion, mainly due to reduced profits from its Zimbabwean business.

This business unit experienced a R2.2 billion decrease in profits as Old Mutual implemented a change in functional currency from Zimbabwe Gold to the United States dollar from 1 July 2024.

This is the same reason Old Mutual’s basic earnings per share dropped by 20% to 96.1 cents, and its IFRS profit after tax declined by 22% to R4.10 billion.

The company further noted that it saw muted sales growth with the present value of new business premiums decreasing by 7%.

Old Mutual’s Life APE sales increased by 1%, but higher retail risk volumes in its Mass and Foundation Cluster and good sales in Old Mutual Africa Regions were largely offset by lower guaranteed annuity sales in Personal Finance.

Overall, gross written premiums increased by 5%, driven by good growth in Old Mutual Insure.

Old Mutual’s return on net asset value grew by 290 basis points to 15.5%. When excluding the company’s newly launched bank, these figures go up to 390 basis points and 18.7%, respectively.

On the back of these results, Old Mutual declared an interim dividend of 37 cents per share, up from 34 cents in the first half of 2024.

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