Sanlam expects earnings to skyrocket

Sanlam expects its headline earnings to jump by as much as 53% as the company benefitted from higher investment returns.

Sanlam informed shareholders today that it is in the process of finalising its financial results for the year ended 31 December 2023. 

The company expects a massive jump in earnings and an up to 25% increase in its net result from financial services per share (NRFFS).

It also expects net operational earnings per share to grow by between 23% to 33%, due to higher investment returns on the shareholder capital portfolio, which also supported the growth in headline earnings. 

Sanlam expects the following earnings ranges for the year ended 31 December 2023 –

2022(cents per share)Expected increase2023 Expected(cents per share)
NRFFS47415% to 25%545 to 592
Cash NRFFS per share47415% to 25%545 to 592
Net operational earnings per share50123% to 33%616 to 666
Headline earnings per share47343% to 53%676 to 723
Diluted HEPS46644% to 54%671 to 718
Earnings per Share59812% to 22%670 to 730
Diluted EPS59012% to 22%661 to 720

Sanlam said the growth in NRFFS was strong across all lines of Sanlam’s business.

In particular, the increase was supported by:

  • Strong risk experience in the life insurance business.
  • Higher investment market levels and overall book growth supported asset-based revenue in the life and investment management lines of business, as well as good investment returns on insurance funds in the general insurance businesses.
  • Improved performance from the credit portfolio backing life insurance liabilities.
  • Higher loan advances in Sanlam’s Indian operations positively impacted the credit and structuring earnings.

The increase in earnings per share and diluted earnings per share is due to strong operational performance but partly dampened by lower accounting profit on disposal of operations.