Alexander Forbes’ head office in Sandton. The financial services group plans to focus on structural costs and operational efficiency in its Emerging Markets business. Photo: Simphiwe Mbokazi/African News Agency (ANA)
Alexander Forbes’ head office in Sandton. The financial services group plans to focus on structural costs and operational efficiency in its Emerging Markets business. Photo: Simphiwe Mbokazi/African News Agency (ANA)
Alexander Forbes’ head office in Sandton. The financial services group plans to focus on structural costs and operational efficiency in its Emerging Markets business. Photo: Simphiwe Mbokazi/African News Agency (ANA)
Alexander Forbes’ head office in Sandton. The financial services group plans to focus on structural costs and operational efficiency in its Emerging Markets business. Photo: Simphiwe Mbokazi/African News Agency (ANA)
JOHANNESBURG - Listed financial services group Alexander Forbes said yesterday that it had accelerated the turnaround plan for its emerging markets business, with a focus on structural cost and operational efficiency.

The group said while its overall performance in the financial year to March 31 was laudable, its emerging markets business was lacklustre, with difficulties in Nigeria, Uganda and Zambia.

It said yesterday that it would take steps to reverse the under-performance. “Management has accelerated its turnaround plan for the business with structural cost and operational efficiency initiatives being implemented. The growth of emerging markets remains a key pillar of the group’s ambition to build a pan-African financial services leader,” Alexander Forbes said.

The company currently operates in five countries across sub-Saharan Africa - Namibia, Botswana, Nigeria, Uganda and Zambia. Alexander Forbes has discontinued the Alexander Forbes Kenyan operations.

It said the emerging markets unit recorded modest growth of 4percent in operating income, with the positive performance from Namibia offset by poor performances in other remaining markets. “The 9percent improvement in operating income reported in Namibia was largely driven by growth in retirements as well as improved performance in the insurance and investments businesses,” it said.

The Botswana business, on the other hand, reported a 5percent decrease in operating income. In the prior year, the government of Botswana’s insources the Public Officers Pension Fund, which constituted a large portion of the business’ operating income.

The group declared a final dividend of 24cents per share, up 4percent, compared to the same period last year. It said that it had paid a total of R2billion in dividends since its listing in 2014. Alexander Forbes’ operating income grew 5percent to R3.6bn.

Headline earnings per share were down 16.8percent to 44.4c a share. The company attributed the drop in earnings mainly to the disposal of UK-based consulting business Lane Clark & Peacock in December 2016. Alexander Forbes sold its 60percent interest in Lane Clark & Peacock as part of a broader disposal of non-core assets.

“Despite headwinds from macroeconomic and political uncertainty across our markets, we are starting to deliver better and more consistent results for our customers and investors. That said, we have further to travel than the distance we have come and we recognise that the fix-it phase of our journey is certainly not complete by any means and we believe this will take broadly another two years,” said Darfoor.

Alexander Forbes fell 5.76percent on the JSE yesterday to close at R5.73.

- BUSINESS REPORT