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RAND MERCHANT INVESTMENT HOLDINGS LIMITED - Trading statement for the year ended 30 June 2021

Release Date: 15/09/2021 09:18
Code(s): RMI     PDF:  
Wrap Text
Trading statement for the year ended 30 June 2021

(Incorporated in the Republic of South Africa)
Registration number: 2010/005770/06
ISIN: ZAE000210688
Share code: RMI
("RMI" or "the group")


RMI regards normalised earnings (which excludes non-operational items and
accounting anomalies) as the key indicator of the group’s operational
performance. Although the operating environment during the 2021 financial
year was once again dominated by the COVID-19 pandemic, with elevated
mortality experience impacting materially on the group’s life insurance
operations, the group delivered a strong overall operational performance,
with pleasing growth in normalised earnings as guided in the table below.
The growth in normalised earnings was driven by OUTsurance and Hastings,
the group’s two large short-term insurance investments, the impact of the
lower interest rate environment on the group’s funding costs and an
excellent performance by RMI Investment Managers.

The main reason for the significant increase in earnings and headline
earnings compared to the previous financial year ended 30 June 2020 ("prior
year") is the stabilisation of long-term interest rates in South Africa and
the United Kingdom which resulted in materially lower economic assumption
adjustments at Discovery compared to the prior year. This item is excluded
from normalised earnings. There were also significantly lower impairment
charges included in earnings compared to the prior year, mainly at Momentum
Metropolitan, which are excluded from headline earnings and normalised

Pursuant to paragraph 3.4(b) of the JSE Limited Listings Requirements, the
following guidance is provided to RMI shareholders regarding the group’s
expected earnings for the year ended 30 June 2021:

                                  Reported   Guidance for the year ended
                                year ended          30 June 2021
                                   30 June
                                      2020    Expected %     Expected range
                                   (cents)      increase            (cents)
Normalised earnings per share        201.5    10% to 20%     221.7 to 241.8
Headline earnings per share          127.9    45% to 55%     185.5 to 198.2
Earnings per share                   104.1    75% to 85%     182.2 to 192.6

The financial information on which this trading statement is based has not
been reviewed and reported on by the group’s external auditor.

RMI’s audited results for the year ended 30 June 2021 are expected to be
released on the Stock Exchange News Service on Monday, 20 September 2021.

15 September 2021

RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Date: 15-09-2021 09:18:00
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