Post on 27-Sep-2020
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Overview of Sanlam Group Strategy:
Strategic focus
South African strategy
International strategy
Growth & diversification
Results originating from strategy:
Financial review
Strategic delivery
Growth & diversification
Focus on quality
Critically focused on two areas:
Effective
capital
manage-
ment
Sourcing new growth
opportunities
Identification of core
markets for growth
and expansion
SOUTH AFRICA: Delivery of sustainable growth
Maximising return on
investment in the
existing business
Efficient & effective
management of the
existing business
INTERNATIONAL: Creating a platform for future growth
Improving performance through top-line earnings growth by:
increasing market share in key segments, and
diversifying the base (including diversification of geographical
presence, products, market segments and distribution platforms);
Improved operating and cost efficiencies (including quality);
Improving capital-efficiency on an on-going basis,
Prioritising Sanlam’s international positioning (diversification)
Embracing and accelerating transformation of the Group.
Returns
(ROGEV)
Growth/
Operational
Efficiency Operational Efficiency
Diversification
Net Business Flows
Capital
Efficiency
Optimal Application
Focus Areas
Return of Excess
Themes Target
Strategic Investments
Optimise, expand and achieve a leadership position as a diversified
financial services group, servicing retail, corporate & institutional markets
Improve efficiency and performance:
operational (including effective use of technology & synergy seeking)
capital efficiency and utilisation
Continued diversification:
product offering,
distribution
geographical presence,
client base / market segments
Building a credible institutional/corporate offering
A focused credit offering & bancassurance/transactional banking capability
Transformation
Offshore expansion into existing and new markets (untapped,
non-traditional and niche) to achieve growth
Sanlam Emerging Markets
Africa, India & Asia – lower middle market focus
Position for achievement of scale over time
Sanlam International Investments
A differentiated strategy / niche approach
Provision of specialist financial services, mainly investments, to high
net-worth and mass-affluent market:
Sanlam International Investment Partners
Sanlam UK
SPI International
Africa Funds
Country approach
focussing on all different aspects of financial services
Anglophone countries
Partnership model
generally not Sanlam-branded
Management/partner equity participation
Deferred payment approach on acquisition
Milestone/targets
Technical partner
Actuarial, IT, product development, finance & governance
South Africa
Emerging markets
Developed markets
UK
Europe
Australia / USA
Affluent
Entry level
Middle market
SE Asia
Rest of Africa
India
Growth Cross
sell
Consolidate
Growth
Niche
Defensive
Corporate
South Africa
Risk
Entry-
level
Middle-
income Affluent
Short-term insurance
Savings / Investment
Risk
Credit
Trust / Admin
Health Admin
Risk
Investment
Short-term
Credit
Health
Corporate
Admin
All
segments
Emerging
markets
Risk
Short-term
Investment
Credit
Health
Affluent /
Corporate
Developed
markets
Investment
Admin Admin
Earnings per share
Net operating profit per share increased by 14%
Normalised headline earnings per share up 16%
Business volumes
New business volumes increased by 11% to R61bn
Net fund inflows of R10bn
Net life VNB up 38% to R491m
VNB margin of 2,86% – up from 2,52%
Group Equity Value of 3 293 cents per share
Annualised RoGEV per share of 18,4%
2012 2011
Group Equity Value * cps 3 293 3 146 5%
RoGEV per share % 18.4 12.8
RoGEV per share (adjusted) % 17.1 12.6
CAR cover (Sanlam Life) * 3.7 3.7
Net operating profit R mil 1 946 1 716 13%
cps 96.2 84.7 14%
Normalised Headline earnings R mil 2 539 2 202 15%
cps 125.5 108.6 16%
Diluted Headline earnings cps 120.1 109.6 10%
New business volumes + R mil 56 774 51 851 9%
New Life business EV (net) R mil 491 356 38%
New Life EV margin % 2.86 2.52
+ Excluding white label
* Comparative figure as at 31 December 2011
Equity Value * RoGEV
R million 2012 2011 Rm
Group operations 59 695 56 809 6 074 10.7%
Personal Finance 30 053 28 876 2 583 8.9%
Emerging Markets 3 443 3 409 215 6.3%
Investments 15 064 14 909 940 6.3%
Santam 11 134 9 615 2 336 24.3%
Discretionary & Other 7 126 6 712 (207)
TOTAL 66 820 63 521 5 867 9.2%
cps 3 293 3 146 277 8.8%
Adjusted return 8.2% Return target 5.9%
* Comparative figure as at 31 December 2011
Outperform cumulative growth target of long-bond rate + 400bp since
listing
0
100
200
300
400
500
600
700
800
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Target Cost of Capital (RFR + 300bps) Actual
Sanlam
Limited
Short-term
insurance
Admin,
health &
other
Discretionary & other capital
Life business Investment
management
Credit &
structuring
54% 17% 12% 3% 3%
11%
Based on Group Equity Value at 30 June 2012
South-East Asia
India
RSA based
Rest of Africa
Botswana
Namibia
Swaziland
Mozambique
Zambia
Tanzania
Kenya
Malawi
Uganda
Ghana
Nigeria
Developed markets
UK / Ireland
Switzerland
Australia
USA
Gross VNB grew by 33%, at higher average margins
1.50%
1.70%
1.90%
2.10%
2.30%
2.50%
2.70%
2.90%
0
50
100
150
200
250
300
350
400
450
500
550
1H06 1H07 1H08 1H09 1H10 1H11 1H12
South Africa Africa Other International Margins (net) - rhs
Value of new business (Rm) vs new business margins (%)
SA Traditional
77%
SA Entry-level 6%
Namibia 3%
Botswana 8%
Rest of Africa 1%
Other inter-national
4%
SA Traditional
98%
Namibia 1%
Other inter-
national 1%
1H2003 – R1 222m 1H2012 – R3 104m
Contribution to group operating profit
SA Tradi-tional 50%
SA Entry-level 28%
Namibia 5%
Botswana 7%
Rest of Africa 9%
Other interna-tional 1%
SA Traditional
75%
SA Entry-level 5%
Namibia 2%
Botswana 5%
Rest of Africa 4%
Other interna-tional 9%
New life business volumes – 1H2012 Gross VNB – 1H2012
Lapses, surrenders & fully paid-ups as % of in-force per half year
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
H1 H2
Sky - Number of NTUs, lapses and surrenders as % of in-force
2007 2008 2009 2010 2011 2012
15.2%
17.5%
14.1% 12.7%
11.4% 11.1%
27.6%
16.8%
14.5% 12.7%
11.1%
H1 H2
Strategic focus on quality + prudence = consistent positive experience
45 32
96
241
142 138
277 288 278
636
468
681
0
100
200
300
400
500
600
700
800
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
R'million Average
277
Percentage of SIM’s AUM to exceed benchmark (R327bn)
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Rolling 3 Yr
2008/12/31 2009/12/31 2010/12/31
2011/12/31 2012/06/30
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Rolling 5 Yr
2008/12/31 2009/12/31 2010/12/31
2011/12/31 2012/06/30
Unallocated balance 1 January 2012 1 900
Share buy-back (22)
Investments (245)
Sanlam Emerging Markets (85)
Sanlam Personal Finance (66)
Sanlam Investments (94)
Capital released 1 848
Illiquid investments 750
Santam special dividend 576
Excess return on life capital 522
Investment return & other 519
Buy-backs & corporate activity 4 000
2012 CityWealth
Offshore Awards :
Trust Company of
the Year
2012 Gold Category - World
Quality Commitment (WQC)
International Star Award
Deloitte Best Company to Work
For in the Medium Co Category &
Financial Services Insurance
Category
Short-term Insurance Category in
the Ask Afrika Orange Index for
Service Excellence
Won all awards in the
Fund of Funds category at
prestigious HedgeNews
Africa Awards in 2012
2012 Employee Benefits
Product Supplier of the Year
Short-term Insurer of the Year
– Personal Lines
2012 FIA Short-term Insurer of
the Year – Commercial
2012 Product Supplier of the
Year Award : Investment
Products Single Premium
Platform of the Year -
Aberdeen UK Platform
Awards 2011
The Sunday Times 100
Best Small Companies to
Work for 2012
Kokkie Kooyman
3rd year running
Sanlam & WWF partnership won:
First of the Sudley Adams
Memorial Award;
The award for Water Care and
Management
Excellence in Growth
Award 2011 in the
insurance segment as
the fastest growing
company over 3 years
2010 Manager of the
Year ~ Kenya
Life Insurance Company
of the year
2012 Best Foreign
Equity Fund
Ghana Club 100
No. 1 in the
Financial Services
Sector
Client Contact Centre
Best Client Contact Centre in SA
Best Business Processing Centre
in the country
Community involvement programme
won national 1st prize