09 Sep - 6 min read

Interim results for the six months ended 30 June 2021

Interim results for the six months ended 30 June 2021

Sanlam Limited
Incorporated in the Republic of South Africa
(Registration number 1959/001562/06)
"Sanlam", "Sanlam Group", or "the Company"
JSE Share code (Primary listing): SLM
A2X share code: SLM
NSX share code: SLA
ISIN: ZAE000070660


Sanlam Group Interim results for the six months ended 30
June 2021

Key features

Earnings
• Net result from financial services increased by 16%
• Net operational earnings increased by 33%

New business
• New business volumes up 12% to R176 billion
• Net fund inflows of R38 billion compared to R33 billion in June 2020
• Net value of new covered business increased by 94% to R1.3 billion
• Net new covered business margin of 2.82% (2.06% in 2020)

Group Equity Value
• Group Equity Value per share of R58.48
• Return on Group Equity Value per share of 3.9%
• Adjusted Return on Group Equity Value per share of 6.1%

Capital management
• Discretionary capital of R537 million at 30 June 2021
• Sanlam Group solvency cover ratio of 175% (31 December 2020: 186%)

Dividend
• No interim dividend declared in line with Group policy

SALIENT RESULTS
for the six months ended 30 June 2021                                      Measure            2021        2020           ??
                                                                                                                     ?
SANLAM GROUP
Group Equity Value
Group Equity Value(1)                                                      R million     130 218 131 812            (1%)
                                   (1)
Group Equity Value per share                                                   cents        5 848       5 920       (1%)
Return on Group Equity Value per share                                             %           3.9       (4.6)
Adjusted Return on Group Equity Value per share                                    %           6.1       (0.9)

Earnings
Net result from financial services                                         R million        4 529       3 898       16%
Net operational earnings                                                   R million        4 679       3 511       33%
Headline earnings                                                          R million        4 003       3 893        3%
Adjusted weighted average number of shares (2)                                million     2 229.6     2 233.9            -
Weighted average number of shares (2)                                         million      2091.6     2 095.8            -
Net result from financial services per share                                   cents        203.1       174.5       16%
Net operational earnings per share                                             cents        209.9       157.2       34%
Basic headline earnings per share                                              cents        193.9       188.5        3%
Diluted headline earnings per share                                            cents        191.4       185.8        3%
Basic profit attributable to the shareholders’ fund per
share                                                                          cents        180.0     (170.9) (205%)

Business volumes
New business volumes                                                       R million     176 426 157 480            12%
Net fund inflows                                                           R million       37 814     33 413        13%
Net new covered business
  Value of new covered business                                            R million        1 289         666       94%
  Covered business PVNBP (3)                                               R million       45 672     32 403        41%
  New covered business margin                                                      %          2.82       2.06
Solvency cover
Sanlam Group(1) (4)                                                                %          175         186
Sanlam Life Insurance Limited(1)                                                   %          232         257
Sanlam Life Insurance Limited covered business(1)                                  %          195         197


(1) Comparative figures as at 31 December 2020
(2) Weighted average number of shares excludes Sanlam shares held directly or indirectly through consolidated
    investment funds in policyholder portfolios, as well as Sanlam shares held by the Group’s Broad-Based Black
    Economic Empowerment special purposes vehicle (B-BBEE SPV) that is consolidated in terms of International
    Financial Reporting Standards. These shares are treated as shares in issue for purposes of adjusted weighted
    average number of shares, which are used for the per-share metrics for the Shareholders’ fund information.
(3) PVNBP = present value of new business premiums and is equal to the present value of new recurring premiums
    plus single premiums.
(4) The reported Sanlam Group solvency position at 31 December 2020 of 191% has been restated to 186% to reflect
    the Prudential Authority’s revised methodology in the treatment of certain Sanlam Emerging Markets entities in the
    calculation of Sanlam Group solvency that was applied retrospectively.

The Sanlam Group continued to demonstrate its valuable contribution to stakeholders during the first
half of 2021, amidst the ongoing devastating impact of the COVID-19 pandemic on economies and
communities in all the countries in which we operate. The Sanlam Group’s response to this
challenging environment was guided by its purpose of empowering generations to be financially
confident, secure and prosperous. This purpose-driven approach was expressed through our
continuing passionate support of clients, employees and broader society over the period.

Sanlam Life and Savings and Sanlam Emerging Markets paid R8 billion and some R2 billion of gross
mortality claims in the first six months of 2021 respectively, with cumulative payments of some R22
billion since the start of 2020. Santam continued to settle contingent business interruption (CBI)
claims and paid R700 million to policyholders in addition to the R1 billion paid in interim relief in
August 2020, bringing the total CBI payments to R1,7 billion at 30 June 2021.

Net result from financial services increased by 16% relative to the first half of 2020. Sanlam Life
and Savings’ net result from financial services declined by 11% compared to the first half of 2020 as
a result of strong positive mortality experience in the prior period following the COVID-19 lockdown.
Excluding the positive risk experience of R359 million (net of tax) in the prior period and the negative
excess claims experience of R110 million (net of tax) not absorbed by discretionary reserve releases
in the first half of 2021, net result from financial services was up by 10%. Sanlam Emerging Markets’
net result from financial services increased by 33% substantially due to an improved performance of
the Sanlam Pan Africa General Insurance (SPA GI) portfolio. SPA GI earnings more than doubled
due to positive investment return earned on insurance funds in the first six months of 2021 relative
to the loss recorded in the prior period. Sanlam Investment Group’s (SIG) contribution to net result
from financial services increased significantly, largely due to a reversal in the marked-to-market
losses on local and offshore listed bonds at SanFin. Santam recorded a satisfactory performance for
the six-month period with the net result from financial services increasing by 57%.

New business volumes increased by 12%. Life insurance new business volumes increased by
50%, investment business inflows increased by 6% and general insurance earned premiums
increased by 2%. In South Africa, a generally supportive environment from increased levels of
savings and higher equity market levels resulted in strong new business growth.

Shareholders are advised that the final gross cash dividend of 300 cents per share for the year ended
31 December 2020 was paid on Monday, 12 April 2021 by way of electronic bank transfers to
ordinary shareholders recorded in the register of Sanlam at close of business on Friday, 9 April 2021.
Shareholders who have not yet provided their banking details for dividend payments are requested
to do so by contacting Sanlam’s transfer secretary, Computershare, at 0861 100 913 or +27(0)11
370 5000.

31 December 2020 earnings per share restatement
Shareholders are advised that the previously reported attributable earnings per share and headline
earnings per share information has been restated for the correction of Hyperinflation accounting
applied in the 31 December 2020 results. The restatement does not have an impact on the net
asset value at 31 December 2020 and also had no impact on the 30 June 2020 interim results.
Refer to note 13.2 in the full 2021 interim results announcement for additional information.

This short-form results announcement is the responsibility of the Sanlam board of directors and is
a summary of the information contained in the full announcement released on SENS today and
which can be found at: https://senspdf.jse.co.za/documents/2021/jse/isse/slm/HY21.pdf
and furthermore available on the Sanlam website at www.sanlam.com. Direct company link to full
announcement: http://sanl.am/Rv4ZF

Copies of the full reviewed results are available via email requests at ir@sanlam.co.za or from
Sanlam’s JSE Sponsor at jsesponsor@standardbank.co.za. Any investment decision should be
based on a consideration of the full reviewed results.

SANLAM LIMITED
Registered office: 2 Strand Road, Bellville, 7530, South Africa


Sanlam Investor Relations
Tel: +27 21 947 8455
E-mail: ir@sanlam.co.za

JSE SPONSOR
The Standard Bank of South Africa Limited
Registered office: 30 Baker Street, Rosebank, Johannesburg, 2196, South Africa.

9 September 2021

Date: 09-09-2021 07:05:00
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