Old Mutual increases its 2015 full year dividend by 2%

DividendMax Ltd.

Old Mutual increases its 2015 full year dividend by 2%

Strong financial performance

Pre-tax adjusted operating profit (AOP) of £1.7 billion up 11% in constant currency, up 4% in reported currency

AOP earnings per share 19.3p up 15% in constant currency, 8% in reported currency

Second interim dividend of 6.25p flat versus prior year, with a total dividend of 8.9p up 2% (up 25% in rand)

Net client cash flow of £6.6 billion, £(1.5 billion) including Rogge which is now held for sale

FUM (excluding Rogge) at £303.8 billion up 8% in constant currency, 6% in reported currency

£945 million net free surplus generated (2014: £897 million)

Group RoE 14.2%, well within target range of 12%-15%

Solvency II surplus of £1.6 billion with ratio of 135%, excluding surplus of £0.8 billion from Old Mutual Emerging Markets and Nedbank

IFRS profit after tax distributable to equity holders of the parent of £614 million, up 5% in reported currency

New strategy to separate underlying businesses and unlock value

Four strong businesses with combined pre-tax operating profits of £1.8 billion 

Old Mutual Emerging Markets, Old Mutual Wealth, Nedbank and OM Asset Management to be separated

Managed separation expected to be materially completed by end of 2018

New capital management policy; intention to reduce Group holding company debt materially; phased reduction of central costs

Bruce Hemphill, Group Chief Executive, commented:

"The strategy we have announced today sets out a bold new course to unlock value currently trapped within the Group structure.

"We have four strong businesses that can reach their full potential by freeing them from the costs and constraints of the Group. As you can see from our results, these businesses are performing strongly, have excellent competitive positions in sizeable markets and the underlying growth potential to flourish independently.

"Our new strategy will allow each business to have simpler access to capital markets to fund its growth more easily and be valued more appropriately, with more straight forward regulatory arrangements. We are announcing today a strategy that will allow us to release the potential within the Group for the benefit of all its stakeholders for many years to come.

"There is likely to be a range of external influences on future Group reported earnings including slower economic growth, exchange rates and equity market volatility and how we execute the managed separation. We nevertheless believe that our four strong businesses are well placed to continue to perform strongly in their domestic markets."

Companies mentioned