Strong Financial Performance and Strategic Focus of Leading Insurance Company

The company reported strong financial results for fiscal year 2026, achieving a 34% compound annual growth rate (CAGR) in operating profit over three years, alongside an EBITDA of R2.0 billion. This success stems from a strategic focus on growth and portfolio optimization centered around platform businesses. These platforms now generate more than 90% of the company's earnings and revenue, characterized by a substantial annuity revenue stream and improved earnings quality.

The return on invested capital reached 23%, significantly exceeding the company's weighted average cost of capital. The ordinary dividend per share saw a 51% increase, supplemented by a special dividend, culminating in approximately ZAR 1 billion returned to shareholders in 2026. Throughout the reporting period, the company maintained a debt-free balance sheet.

Revenue from ongoing operations rose by 1% to R9.6 billion, propelled by a 12% increase in the Platform segment, which has recorded an 11% CAGR over the past three years. The company also reported a 10% rise in EBITDA to R2.0 billion, a 25% increase in operating profit to R1.2 billion, a 34% increase in headline earnings per share to 239 cents, a 35% increase in earnings per share to 210 cents, and a 30% rise in operating cash flow to nearly ZAR 2 billion. The gross margin improved to 42%, while operating expenses remained stable compared to the previous year.

Net finance expenses fell by 48% to R45 million, while net profit after tax rose by 32%. The combined ordinary and special dividends equaled a full payout of headline EPS for the year. Moving forward, the company aims to continue its transformative growth by embracing data analytics and artificial intelligence, and investing in high-margin annuity opportunities. The Platform segment is expected to achieve an operating margin exceeding 26% in the medium term, with the IT Services segment maintaining margins above 7%.

The company's dividend policy commits to paying at least 50% of earnings per share or headline earnings per share, with the special dividend noted as a unique occurrence. Despite potential challenges in the operational environment, particularly for IT Services, the Platform businesses remain robust and operate independently of GDP fluctuations.