Discovery shares fall after decline in earnings
DURBAN - DISCOVERY’S share price fell by more than 2 percent on the JSE after the financial services group reported a double-digit decline in earnings for the six months to end December and the board decided not to pay an interim ordinary dividend.
Its headline earnings per share slid by 10 percent to 280.3 cents a share and normalised headline earnings per share was marginally down by 1 percent to 347.9c.
But chief executive Adrian Gore said the group released a strong operating performance against the backdrop of the Covid-19 environment.
“We are pleased with the strong performance from all areas of the business – established, emerging and new – during a very complicated and uncertain time. The performance of our core businesses has been incredibly robust and our global partnerships through Vitality Group and Ping An Health have delivered exceptional results,” Gore said.
He added that despite the Covid19 impacts in the US, John Hancock’s sales from Vitality integrated products outperformed 2019 by 12 percent, and the election rate for Vitality integrated products over non-Vitality integrated products increased to 50 percent.
Discovery established Covid-19 provisions of R3.4 billion at the end of its full-year results for the future effects of claims and lapses across its operations in South Africa and the UK.
The group said the use of these previously established provisions had been relatively low by the end of the reporting period.
Looking ahead, Gore said the growth achieved during the past six months reflected the agility of the business.
Discovery Holdings shares closed 3.37 percent lower at R141 on the JSE yesterday.