DURBAN – FirstRand is anticipating tougher trading conditions in South Africa as the country entered a technical recession, but the group remains confident that its diversified portfolio will pull it through as it continues to report top-line growth in its businesses.
South Africa’s gross domestic product (GDP) shrank by 0.7 percent in the second quarter of 2018 after recording 2.6 percent decline in the first quarter of the year.
Chief executive Alan Pullinger said the group expected the economic environment to remain challenging well into 2019 and 2020.
“However, this should be not an excuse for poor performance. As the group that it is operating in the financial services sector we will be affected, but we believe we have the right strategies in place and we must not take unnecessary risks,” Pullinger said.
In the year to end June, the group delivered 8 percent increase in normalised earnings to R26.55 billion, up from R24.47bn, mainly driven by FNB which reported 16 percent growth in normalised earnings. FNB contributes 56 percent to the group’s normalised earnings. The group declared a dividend a share of 275c, up by 8 percent compared to last year’s 255c.