South African Insurer MMI Profit Increases 12% on Policy Sales

MMI Holdings Ltd. (MMI), South Africa’s third-largest insurer, said fiscal full-year profit climbed 12 percent after selling more policies and integrating units.

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 today in a statement. 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 the past three years and is developing new insurance and health products for African markets, resulting in a 19 percent gain in new business to 711 million rand.

Growth in new business volumes will “remain dependent on the economic environment, including a recovery in employment and stronger disposable income levels” MMI said.

MMI is the worst-performing stock on the five-member FTSE/JSE Africa Life Assurer’s Index this year, gaining 3.3 percent compared with the average increase of 17 percent.

MMI increased its total dividend 12 percent to 1.27 rand.

To contact the reporter on this story: Renee Bonorchis in Johannesburg at rbonorchis@bloomberg.net

To contact the editor responsible for this story: Dale Crofts at dcrofts@bloomberg.net

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