6th Aug 2015 13:30
LONDON (Alliance News) - Old Mutual PLC on Thursday reported a 19% increase in adjusted operating profit for the first half of 2015, and increased its interim dividend by 8%, bolstered by operations in the UK and South Africa.
The FTSE 100 Anglo-South African financial services company said its adjusted operating profit amounted to GBP904 million in the six months to the end of June, a 20% increase at constant currency. It increased its interim dividend to 2.65 pence from 2.45p.
"Our businesses in South Africa continue to perform very well in the context of challenging economic conditions in large emerging markets," Chief Executive Julian Roberts said in a statement.
Roberts, who is making way for Bruce Hemphill, previously of Standard Bank, said there is further evidence that Old Mutual has right right business model in the UK, where there have been big changes in pensions rules that no longer require individuals to buy annuity products in retirement.
"Pressure to deliver full access to pension freedoms, including drawdown for beneficiaries of a pension, creates additional opportunities for Old Mutual Wealth as one of the leading retail investment businesses. Nevertheless, I believe that the government must balance pension liberalisation with the need for individuals to save for their retirement," Roberts said.
Old Mutual has been building its retail investment business in the UK and acquired discretionary fund manager Quilter Cheviot and adviser network Intrinsic as part of that goal.
Old Mutual's funds under management increased to GBP335.7 billion, up 5% on a reported basis and by 7% at constant currency on the end of 2014.
"Last year, we reallocated significant capital to buy quality businesses in our core markets. This year is about ensuring that these investments are fully integrated and making the returns we expect. We have an absolute focus on achieving this, while being a responsible business," Roberts said in a statement.
"While we expect the next six months to be challenging for emerging markets, and exchange rate movements will likely temper sterling reported growth, I am confident that by remaining focused on meeting our customers' needs and improving the operating efficiencies of the business we will continue to make good progress," Roberts said.
Old Mutual shares were up 4.9% at 229.10 pence on Thursday afternoon, one of the best performers in the FTSE 100.
By Samuel Agini; [email protected]; @samuelagini
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