Old Mutual earnings up 13%, dividend rises 8%

Old Mutual reported a solid set of annual results, with higher operating earnings, a stronger dividend payout, and improved cash generation.

For the year ended 31 December 2025, results from operations increased 13% to R9.8 billion, while the board declared a final dividend of 56 cents per share, bringing the total dividend to 93 cents – up 8% year on year.

Adjusted headline earnings rose 24% to R8.3 billion.

Old Mutual’s share price 

Profit, calculated in line with International Financial Reporting Standards (IFRS), increased 10% to R8.4 billion, while headline earnings declined 2% to R8.6 billion, mainly due to the impact of Zimbabwe.

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The group says R682 million of the R3 billion share buyback announced in September 2025 was completed by December 2025. The buyback will continue while it remains value-accretive to shareholders.

Group CEO Jurie Strydom said: “We have reset our strategic priorities to unlock value and generate growth. Group equity value per share increased to R19.80, enhanced by business performance in Old Mutual Insure and Old Mutual Wealth.”

OM Bank gains traction

Old Mutual reported that customer and retail deposit trends at OM Bank continued to perform well, ahead of broader planned marketing campaigns, with around 46% of customers originating through its branch network.

OM Bank was launched to the public in September 2025, and aims to be profitable by 2028.

The group says it will disclose key banking performance indicators from 2026.

The bank remains central to the group’s strategy, which is focused on driving competitiveness in South Africa, strengthening its leadership in Southern Africa, and building a sustainable transactional banking business.

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Shareholder operational costs increased 11% to R1.89 billion, largely due to restructuring costs of R440 million aimed at reducing future expenditure. Excluding these costs, operational expenses declined by R246 million, a reduction of 15% from the prior year.

Old Mutual also reported progress on its R2.5 billion cost-saving target by 2027, with R450 million in savings delivered during the year.

Segmental performance 

In the life business, annual premium equivalent sales increased 3%, supported by improved sales in South Africa and strong performance from Old Mutual Africa Regions. Margins, however, declined due to persistency pressures and lower annuity sales.

The general insurance business delivered stronger growth, with gross written premiums up 5% and underwriting margins improving to 6.8%.

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Gross flows increased 7%, supported by stronger inflows in life and savings, wealth management platforms, and recurring premiums in corporate savings products.

Gross loans and advances declined 4%, reflecting deliberate actions to improve credit quality, including the sale of non-performing loan books. Net lending margins improved to 12.1%, with loan sales rising 22% to R9.4 billion.

Capital and outlook

The group reported a return on net asset value of 15.2%, within its target range, while its shareholder solvency ratio of 162% remained well within the 155% to 185% range.

Looking ahead, the group expects a challenging global environment but noted a more constructive domestic outlook supported by fiscal discipline and improving confidence.