Johannesburg - MMI Holdings Ltd., South Africa’s third-largest insurer, said fiscal full-year profit climbed 12 percent after selling more policies and cutting costs.
Net income rose to 2.59 billion rand ($258 million) in the 12 months through June, from 2.3 billion rand a year earlier, the Cape Town-based company said in a statement today.
Earnings per share excluding one-time items rose 7 percent to 2.05 rand, beating the 2.01-rand median estimate of five analysts surveyed by Bloomberg.
MMI, formed by the merger of Metropolitan Group Ltd. and Momentum Group Ltd. in 2010, also operates in 12 countries outside of South Africa.
The company has been cutting costs in its home market for three years and will probably exceed its goal of 500 million rand in post-merger savings by the middle of 2014, chief executive Nicolaas Kruger said.
In the coming year, MMI wants to “fast track growth in markets where we already have a presence,” Kruger said in a telephone interview today.
“We have set aside 500 million rand to invest in Africa.”
MMI’s new business growth exceeded the company’s target, increasing by 19 percent to 711 million rand in the past year as it developed new insurance and health products for African markets.
Future growth will “remain dependent on the economic environment, including a recovery in employment and stronger disposable income levels,” MMI said.
MMI rose as much as 2.6 percent and was trading 1.6 percent higher as of 10:09 a.m. in Johannesburg, heading for its highest close in three months.
The stock was the biggest gainer on the five-member FTSE/JSE Africa Life Assurer’s Index.
MMI increased its total dividend 12 percent to 1.27 rand. - Bloomberg News