Alexander Forbes Group Holdings’ headline earnings per share of its continuing businesses were expected to increase between 20% and 30% in the 12 months to March 31, from 37.2 cents last year, the financial services group said in a trading statement yesterday.
Headline earnings per share from total operations were expected to increase between 42% and 47% from 33.2 cents last year. Basic earnings per share were expected to increase by between 42% and 46% from 39.3 cents, the group said.
The earnings were impacted by last year’s earnings of discontinued operations taking into account losses incurred because of insurance claims, and reserves relating to the Covid-19 pandemic.
These were partially offset by the R80 million profit on sale of the discontinued life insurance business. The profit on sale is excluded from headline earnings.
In the year under review, earnings were also influenced by a better financial performance of the discontinued operations, and profit from the sale of the group’s individual client administration business.
On March 1, the group completed the AFICA disposal to Sanlam Life Insurance. As a result of this disposal, the group recognised a profit on sale of R153m.
Headline earnings per share for the year ended excludes profit on the sale of the business, but includes operating profits from discontinued operations for eleven months prior to the AFICA disposal.
The group anticipated “pleasing” results from continuing operations, with profit from operations before non-trading and capital items expected to rise between 7% to 12% compared to the R720m in the prior year.
The expected increase reflected revenue growth across core business lines, despite macroeconomic headwinds that dampened asset-based revenue, demonstrating the value of a diversified income stream, the group said.
“This growth in revenue was a result of implementation of the strategy, the positive impact of new business wins, with important transactions and acquisitions concluded during the year,” the group said.
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