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South Africa: Sanlam achieves solid results despite volatile investment markets- Report

Sanlam reported solid results in the four months to 30 April despite challenging investment market conditions caused by the global impact of the Coronavirus.

The Group had a solid start to the 2020 financial year as communicated to shareholders in the Covid-19 update released on the JSE News Service in March this year. However, the operating environment deteriorated substantially from the end of February as governments around the world implemented strict measures to control the spread of Covid-19. These included the declaration of states of disaster and emergency in several countries where Sanlam operates, as well as severe limitations on people movement and preventing face-to-face sales in most operations. These were in line with similar measures implemented globally. Global growth estimates were revised down sharply, driving significant volatility in investment markets across the world.

The Group’s new business volumes across the board were up on the previous period. However, they were significantly impacted since the last week of March. This was as a result of restrictions on intermediary activity imposed under Covid-19 lockdown regulations. Investment in digital businesses such as MiWay and Sanlam Indie, as well as digital sales tools for Sanlam advisors, alleviated pressure to some extent. The available digital sales tools are, however, targeted at the middle-income and affluent market segments. The Sanlam Sky intermediated distribution channel and many other emerging markets channels are still predominantly based on personal interaction, with a commensurately more pronounced negative impact on new business sales in these areas. The new business slowdown will impact new business volumes for the financial year.

Despite these challenges, Sanlam achieved solid operational results and responded rapidly to the lockdown measures in South Africa, its largest market, from 27 March 2020 as well as the lockdowns and curfews implemented in the Group’s other markets. Close to 90% of office staff were enabled to work from home. The Group is carefully managing the employees’ return to work in line with the amendments to lockdown levels, with the health and safety of staff being the priority.

Sanlam Group Chief Executive Officer, Mr Ian Kirk, said: “We are pleased with our results for the four months to 30 April 2020 in the context of the operating environment we faced. This bears testimony to the resilience of our diversified operations and the skills and exemplary dedication of our employees under challenging conditions.”


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