Momentum Group on Friday said normalised headline earnings a share for the year to June 30 were expected to increase by between 33% and 38%.
Despite the rise in earnings, Momentum Metropolitan Holdings’ share price fell relatively sharply by 3.18% to R27.11 Friday afternoon, although the price was still 36% higher than the price at the same time last year.
Normalised headline earnings per share were expected to be between 304 to 315 cents, compared with 228 cents per share in the previous financial year, the financial services and insurance group said in a trading statement. The full results are expected to be released on September 27.
Earnings per share were expected to increase by between 30% and 38% to between 278 cents and 288 cents per share, compared with 212.8 cents the previous year.
The group directors said its improved performance during the year was aided by strong profits from life annuities in Momentum Investments; a big lift in persistency experience in Metropolitan Life; fee income growth and underwriting profits in Guardrisk; and, a recovery in Momentum Insure’s earnings.
Normalised headline earnings were also supported by higher investment income following a favourable interest rate environment. This performance was slightly dampened by fair value losses on the group’s investment in venture capital funds.
The increase in earnings per share was lower than the increase in normalised headline earnings per share, mainly due to a goodwill impairment recognised in Momentum Investments in respect of the Momentum Global Investment Management business.
BUSINESS REPORT