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Investor presentation 2015 annual results
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Page 1: Sanlam Annual Results Investor Presentation 2015...Sanlam investor presentation 2015 annual results 11 Notes External operating environment Emerging market economies under pressure

Investor

presentation

2015 annual

results

Page 2: Sanlam Annual Results Investor Presentation 2015...Sanlam investor presentation 2015 annual results 11 Notes External operating environment Emerging market economies under pressure
Page 3: Sanlam Annual Results Investor Presentation 2015...Sanlam investor presentation 2015 annual results 11 Notes External operating environment Emerging market economies under pressure

Notes

1Sanlam investor presentation 2015 annual results

Page 4: Sanlam Annual Results Investor Presentation 2015...Sanlam investor presentation 2015 annual results 11 Notes External operating environment Emerging market economies under pressure

Notes

The Sanlam strategy

Operating environment

Strategic delivery

Financial review

Priorities

Outlook

2 Sanlam investor presentation 2015 annual results

Page 5: Sanlam Annual Results Investor Presentation 2015...Sanlam investor presentation 2015 annual results 11 Notes External operating environment Emerging market economies under pressure

Notes

The Sanlam Strategy

Maximising shareholder value

3Sanlam investor presentation 2015 annual results

Page 6: Sanlam Annual Results Investor Presentation 2015...Sanlam investor presentation 2015 annual results 11 Notes External operating environment Emerging market economies under pressure

Notes

Strategic focus

Optimising value creationS

trate

gic

pilla

rs

TransformationDiversification

Optimal capital utilisation

Operational efficienciesEarnings growth

Sustainable value creation for shareholders

Maximising RoGEV

4 Sanlam investor presentation 2015 annual results

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Notes

A strategy focused on growthDriving geographic, segment and product diversification

India/SE AsiaLower income

segments have similar

dynamics than SA ELM

and RoA

DevelopedNiche, solutions

for SA & RoA

clients

South AfricaSolid base & cash flows

Rest of AfricaDemographics, low

insurance penetration,

competitive

environment, Pan-Africa

opportunity

5Sanlam investor presentation 2015 annual results

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Notes

Core regional focus areas

Differentiated approach per region

Large player in mature market with strong competition

Further diversifying distribution capability to drive

growth: ELM footprint, Reality, health, digital, outcome

based solutions, UB partnership, big data

Operational and capital efficiencies key in managing

legacy book

South AfricaDelivering growth

in mature market

Effe

ctiv

e c

ap

ital m

an

ag

em

en

t

6 Sanlam investor presentation 2015 annual results

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Notes

Core regional focus areas

Differentiated approach per region

Large player in mature market with strong competition

Further diversifying distribution capability to drive

growth: ELM footprint, Reality, health, digital, outcome

based solutions, UB partnership, big data

Operational and capital efficiencies key in managing

legacy book

South AfricaDelivering growth in

mature market

Focus on accelerated organic growth to obtain

leadership position in all countries

Cross-border alliances and relationships; capitalise on

expanded footprint from Saham Finances transaction

Geographic expansion in line with client and

intermediary needs

Other

Emerging

MarketsBalance structural

and organic growth

Other

Emerging

MarketsBalance structural

and organic growth

Other

Emerging

MarketsBalance structural

and organic growth

Effe

ctiv

e c

ap

ital m

an

ag

em

en

t

7Sanlam investor presentation 2015 annual results

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Notes

Core regional focus areas

Differentiated approach per region

Focus on accelerated organic growth to obtain

leadership position in all countries

Cross-border alliances and relationships; capitalise on

expanded footprint from Saham Finances transaction

Geographic expansion in line with client and

intermediary needs

Other

Emerging

MarketsBalance structural

and organic growth

Products and services for SA and Rest of Africa client

base

Sanlam UK consolidation; focus on efficiencies and

distribution under new CEO

Wealth and investment management focus

Developed

MarketsNiche approach

Effe

ctiv

e c

ap

ital m

an

ag

em

en

t

8 Sanlam investor presentation 2015 annual results

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Notes

Operating EnvironmentEconomic, political and internal pressures

9Sanlam investor presentation 2015 annual results

Page 12: Sanlam Annual Results Investor Presentation 2015...Sanlam investor presentation 2015 annual results 11 Notes External operating environment Emerging market economies under pressure

Notes

External operating environmentGlobal events impacting on our key markets

Slower

growth in

China

US interest

rates

Government

& consumer

debt

Commodity

prices

Commodity-

based

economies

under pressure

10 Sanlam investor presentation 2015 annual results

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Notes

External operating environment

Emerging market economies under pressure from global events

Robust economic growth in 2015

Macro-economic adjustment required to address wide

government budget and current account deficits

Currency weakened in line with ZAR

Strong competitive environment across all segments

Namibia

Macro environment and structural constraints limiting

capital investment and economic activity

Modest growth in employment and disposable income

Political events contributed to investment market and

currency volatility

Public/private sector engagement and cooperation to drive

economic and employment growth very necessary

South

Africa

11Sanlam investor presentation 2015 annual results

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Notes

External operating environment

Emerging market economies under pressure from global events

Commodity prices and tight financial conditions impacting

on growth and currencies of a number of countries

Softer economic growth to persist in 2016

Low insurance penetration enables new business growth

despite short-term challenges

Longer term growth potential remains intact

Rest of

Africa

Best sovereign rating in Africa due to sound management

of government finances

Robust economic growth, but need to diversify economy

away from reliance on diamonds

BIHL maintains strong competitive advantage

Botswana

12 Sanlam investor presentation 2015 annual results

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Notes

External operating environment

Emerging market economies under pressure from global events

Below-potential economic growth in 2015, but improving

Delays in roll out of infrastructure projects impacted on

credit businesses � activity picked up towards end of 2015

More stringent provisioning regulations implemented

during 2016 will not affect IFRS-based results

Robust long-term growth expectations

India

Relatively firm economic growth in 2015, some

moderation expected in 2016

Lower two-wheeler sales and competitive pressure

impacting on general insurance growth

Uncertainty around effect of de -tariffing in 2016

Malaysia

13Sanlam investor presentation 2015 annual results

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Notes

SA economy

Growth in real retail sales, GDP and PDI

Modest growth in all key metrics

-10%

-5%

0%

5%

10%

15%

20%

Growth y-o-y in real retail sales Growth y-o-y in real GDP Growth y-o-y in real PDI

14 Sanlam investor presentation 2015 annual results

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Notes

Regional economic growth

Higher growth outside of SA

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

South Africa Namibia Botswana Ghana Kenya India Malaysia

IMF

estimates

15Sanlam investor presentation 2015 annual results

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Notes

4%

5%

6%

7%

8%

9%

10%

12-1

3

01-1

4

02-1

4

03-1

4

04-1

4

05-1

4

06-1

4

07-1

4

08-1

4

09-1

4

10-1

4

11-1

4

12-1

4

01-1

5

02-1

5

03-1

5

04-1

5

05-1

5

06-1

5

07-1

5

08-1

5

09-1

5

10-1

5

11-1

5

12-1

5

9-year 5-year Short-term Avg Short-term

+200bps

+40bps

Interest rates

SA bond yields and short-term interest rates

Higher SA rates; other regions stable

Impact on growth

VNB overall -12%

Sanlam Sky VNB -25%

Higher float income

16 Sanlam investor presentation 2015 annual results

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Notes

SA equity and bond markets

Pressure on fee income in 2015 and 2016

Limiting growth in assets under management

95

100

105

110

115

120

125

12-1

3

01-1

4

02-1

4

03-1

4

04-1

4

05-1

4

06-1

4

07-1

4

08-1

4

09-1

4

10-1

4

11-1

4

12-1

4

01-1

5

02-1

5

03-1

5

04-1

5

05-1

5

06-1

5

07-1

5

08-1

5

09-1

5

10-1

5

11-1

5

12-1

5

All Share rebased All Bond rebased

7,6%

1,9%

10,1%

-3,9%

Average Alsi up 6%

Average Albi up 8%

17Sanlam investor presentation 2015 annual results

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Notes

Rand exchange rate

Sharp depreciation in 2015 against most currencies

80

90

100

110

120

130

140

150

160

12-1

3

01-1

4

02-1

4

03-1

4

04-1

4

05-1

4

06-1

4

07-1

4

08-1

4

09-1

4

10-1

4

11-1

4

12-1

4

01-1

5

02-1

5

03-1

5

04-1

5

05-1

5

06-1

5

07-1

5

08-1

5

09-1

5

10-1

5

11-1

5

12-1

5

United Kingdom United States Botswana India Malaysia Rest of Africa

18 Sanlam investor presentation 2015 annual results

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Notes

Average Rand exchange rate

Supported non-SA results

17.1%

8.6%

3.8%

-3.2%

11.7%

-1.4%

-5%

0%

5%

10%

15%

20%

USA UnitedKingdom

Botswana Rest of Africa India Malaysia

Contribution to growth

Net result from financial

services +R82m

New business +R1.5bn

Net VNB +R6m

RoGEV +4%

19Sanlam investor presentation 2015 annual results

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Notes

Internal operating environment

2015 results impacted by internal challenges and one-offs

Bad debt provisioning at STFC equipment finance

One-off item in Shriram Capital 2014 base

System implementation challenges in Kenya

Actuarial reserving in Malaysia

Sanlam

Emerging

Markets

Loss of PIC funds in 2014 and 2015 impacting on SI

results

SI admin costs elevated by projects, regulatory

compliance and additional marketing spend

One-off items in 2014 base at SEB and SI International

(UK)

Sanlam

Investments

20 Sanlam investor presentation 2015 annual results

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Notes

Strategic DeliveryExceeding overall targets despite headwinds

21Sanlam investor presentation 2015 annual results

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Notes

Top-line earnings growth

Earnings per share

Net operating profit per share increased by 6% (11% excl one-offs)

Normalised headline earnings per share up 6%

Business volumes

New business volumes increased by 16% to R211bn

Net fund inflows of R19bn

Net life VNB up 6% on comparable basis & excl large SEB policy in �14

Net VNB margin of 2.91% on comparable basis

Group Equity Value

Group Equity Value of R50.57 per share

RoGEV per share of 12.8%

Financial performance in 2015

22 Sanlam investor presentation 2015 annual results

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Notes

Diversification

International positioning focused on emerging markets

India

Malaysia

Philippines

Ghana

The Gambia

Kenya

Uganda

Rwanda

Burundi

Tanzania

Malawi

Zambia

Botswana

Namibia

Swaziland

South Africa

Switzerland

United Kingdom

USA

Australia

Ireland

Mozambique

Morocco

Algeria

Tunisia

Mali

Senegal

Guinea

Burkina Faso

Cote D�Ivoire

TogoBeninNigeria

CameroonGabon

Republic of the Congo

Angola

Zimbabwe

Madagascar

Mauritius

Lesotho

Emerging Markets - Indirect presence

Emerging Markets - Direct presence

Developed Markets

Saham Finances presence

Sanlam and Saham Finances presence

23Sanlam investor presentation 2015 annual results

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Notes

SA Traditional58%SA Entry-level

18%

Namibia4%

Botswana9%

Rest of Africa7%

Other international4%

2015

R1 360m

SA Traditional67%

SA Entry-level11%

Namibia5%

Botswana5%

Rest of Africa2%

Other international10%

Diversification � better balanced portfolio

Geographic diversification

Net VNB Net operating profit

2015

R7 269m

24 Sanlam investor presentation 2015 annual results

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Notes

Life business46%

General insurance15%

Investment management

14%

Credit & structuring10%

Admin, health & other15%

2015

R103 506m

Life business62%

General insurance14%

Investment management

12%

Credit & structuring11%

Admin, health & other1%

Diversification � better balanced portfolio

Line of business diversification

Group Equity Value Net operating profit

2015

R7 269m

25Sanlam investor presentation 2015 annual results

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Notes

Capital efficiency

Balance 1 January 2015 3 300

Net investments (6 285)

Saham Finances (4 224)

Rest of Africa other (29)

Shriram Insurance (969)

Afrocentric (703)

Other (360)

Investment return & excess cover 1 285

Capital released from portfolios 4 000

Available for investment 2 300

Discretionary capital

Available for

strategic

initiatives

26 Sanlam investor presentation 2015 annual results

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Notes

Financial Review

27Sanlam investor presentation 2015 annual results

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Notes

Changes in presentation / key assumptions

Accounting policies & basis of presentation

No change from 2014

Changes in RDR:

Sanlam Life (10.1%): 200 bps up from December 2014

Sanlam Sky (9.6%): 200 bps up from December 2014

Negative impact on RoGEV and VNB

Weaker Rand exchange rate largely offset adverse impact of higher interest

rates in SA and Namibia, apart from VNB

28 Sanlam investor presentation 2015 annual results

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Notes

Salient features

2015 2014

Group Equity Value cps 5 057 4 684 8%

RoGEV per share % 12,8 18,5

CAR cover (Sanlam Life) 5,8 4,5

Net operating profit R mil 7 269 6 879 6%

cps 355,2 336,2 6%

Normalised Headline earnings R mil 8 851 8 340 6%

cps 432,5 407,6 6%

New business volumes R mil 210 842 182 297 16%

Net fund flows R mil 19 049 41 994 -55%

New Life business EV (net) R mil 1 360 1 592 -15%

New Life EV margin % 2,62 2,92

29Sanlam investor presentation 2015 annual results

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Notes

Sanlam Personal

Finance

30 Sanlam investor presentation 2015 annual results

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Notes

Sanlam Personal Finance

R million 2015 2014

New business volumes 63 825 52 566 21%

Sanlam Sky 1 279 1 127 13%

Individual Life 12 829 12 443 3%

Glacier 49 717 38 996 27%

Net flows 22 895 19 580

Sanlam Sky 2 739 2 635

Individual Life (3 005) (1 372)

Glacier 23 161 18 317

31Sanlam investor presentation 2015 annual results

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Notes

Sanlam Personal Finance

R million 2015 2014

Value of new life business 955 1 084 -12%

Sanlam Sky 241 361 -33%

Individual Life 502 551 -9%

Glacier 212 172 23%

Comparable economic basis 1 148 1 084 6%

New business margin 2,48% 3,12%

Sanlam Sky 5,86% 9,51%

Individual Life 2,59% 2,88%

Glacier 1,40% 1,45%

Comparable economic basis 2,89% 3,12%

32 Sanlam investor presentation 2015 annual results

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Notes

Sanlam Personal Finance

R million 2015 2014

Gross operating profit 5 313 4 801 11%

Sanlam Sky 1 125 949 19%

Individual Life life and investments 3 378 3 162 7%

Glacier 426 339 26%

Personal loans 346 308 12%

Other 38 43 -12%

Net operating profit 3 831 3 476 10%

Group Equity Value 38 249 38 453

RoGEV 12,1% 17,9%

label

33Sanlam investor presentation 2015 annual results

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Notes

Sanlam Emerging

Markets

34 Sanlam investor presentation 2015 annual results

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Notes

Sanlam Emerging Markets

R million 2015 2014

New business volumes 11 913 9 259 29%

Namibia 2 780 3 322 -16%

Botswana 5 398 3 031 78%

Rest of Africa 2 099 1 560 35%

India/Malaysia 1 636 1 346 22%

Net fund flows (7 346) 3 971

Namibia 358 1 021

Botswana (9 781) 1 129

Rest of Africa 1 459 1 451

India/Malaysia 618 370

Value of new life business 448 431 4%

Margin 5,97% 7,60%

35Sanlam investor presentation 2015 annual results

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Notes

Sanlam Emerging Markets

R million 2015 2014

Gross operating profit 2 248 2 213 2%

Namibia 618 534 16%

Botswana 858 706 22%

Rest of Africa 208 265 -22%

India/Malaysia 572 749 -24%

Corporate (8) (41) 80%

Net operating profit 1 197 1 241 -4%

Group equity value 18 047 14 571

RoGEV 29,9% 28,0%

36 Sanlam investor presentation 2015 annual results

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Notes

Sanlam Investments

37Sanlam investor presentation 2015 annual results

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Notes

Sanlam Investments

R million 2015 2014

Net investment business flows (3 251) 4 097

Investment management SA (753) 4 152

Wealth management 3 569 (29)

International (6 065) (246)

Capital management (2) 220

New life business 6 664 13 859 -52%

Employee benefits 2 913 10 154 -71%

Sanlam UK 3 751 3 705 1%

Net life business (261) 8 002

Value of new life business 111 228 -51%

Margin 1,34% 1,43%

38 Sanlam investor presentation 2015 annual results

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Notes

Sanlam Investments

R million 2015 2014

Gross operating profit 1 877 1 927 -3%

Investment management 1 205 1 337 -10%

Employee benefits 501 325 54%

Capital management 171 265 -35%

Net operating profit 1 417 1 468 -3%

Group Equity Value 22 412 20 122

Covered business 7 210 7 833

Other 15 202 12 289

RoGEV 21,3% 20,4%

39Sanlam investor presentation 2015 annual results

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Notes

Sanlam Investments

Percentage of SIM�s benchmark-managed funds exceeding hurdle

Investment performance

2011

2012

2013

2014

2015

Rolling 3 year Rolling 5 year

100% 80% 60% 40% 20% 0% 20% 40% 60% 80% 100%

40 Sanlam investor presentation 2015 annual results

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Notes

Santam

41Sanlam investor presentation 2015 annual results

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Notes

Santam

R million 2015 2014

Net earned premiums 18 522 17 222 8%

Gross operating profit 2 321 1 968 18%

Underwriting surplus 1 777 1 489 19%

Working capital & other 544 479 14%

Net operating profit 933 801 16%

Underwriting margin 9,6% 8,7%

Group Equity Value 12 850 14 593

RoGEV -8,4% 19,1%

42 Sanlam investor presentation 2015 annual results

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Notes

Sanlam Group

43Sanlam investor presentation 2015 annual results

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Notes

Business flows

Gross Net

R million 2015 2014 2015 2014

by business

Personal Finance 63 825 52 566 21% 22 895 19 580

Emerging Markets 11 913 9 259 29% (7 346) 3 971

Sanlam Investments 116 582 103 250 13% (3 512) 12 099

Santam 18 522 17 222 8% 7 012 6 344

by licence

Life insurance 39 976 42 290 -5% 12 081 18 430

Investment 150 670 121 383 24% (523) 16 853

General insurance 20 196 18 624 8% 7 491 6 711

Total 210 842 182 297 16% 19 049 41 994

44 Sanlam investor presentation 2015 annual results

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Notes

Operational efficiencies

Persistency � SA middle-income market

Focus on quality supports net fund flows

4.8

3.9 3.9

3.6 3.4

3.8 3.9

3.0 2.9 2.9 2.8 2.9 2.9

4.2 4.0

3.8 3.7 3.6

4.2

3.4

2.9 2.8 2.7 2.9 2.8 2.8

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Lapses, surrenders & fully paid-ups as % of in-force per half year

H1 H2

45Sanlam investor presentation 2015 annual results

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Notes

Operational efficiencies

Persistency � SA lower income market

Focus on quality supports net fund flows

9.6

8.7

10.6

9.8

8.5

9.6 9.2

9.9

0

2

4

6

8

10

12

2012 2013 2014 2015

Lapses, surrenders & fully paid-ups as % of in-force per half year

H1 H2

46 Sanlam investor presentation 2015 annual results

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Notes

Value of new covered business

Value of New Business Margin

R million 2015 2014 2015 2014

Personal Finance 955 1 084 -12% 2,48% 3,12%

Emerging Markets 448 431 4% 5,97% 7,60%

Employee Benefits 85 198 -57% 1,96% 1,66%

Sanlam UK 26 30 -13% 0,66% 0,75%

Total 1 514 1 743 -13% 2,80% 3,09%

Net of minorities 1 360 1 592 -15% 2,62% 2,92%

Comparable economic basis 1 545 1 592 -3% 2,91% 2,92%

47Sanlam investor presentation 2015 annual results

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Notes

Value of new covered business

Large SEB policy in 2014, Kenya and Zambia also affecting growth

Significant impact from higher long-term interest rates

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

0

200

400

600

800

1 000

1 200

1 400

1 600

1 800

2 000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

South Africa Rest of AfricaOther International Margins - rhs

48 Sanlam investor presentation 2015 annual results

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Notes

Net operating profit

R million 2015 2014

Personal Finance 3 831 3 476 10%

Emerging Markets 1 197 1 241 -4%

Sanlam Investments 1 417 1 468 -3%

Santam 933 801 16%

Corporate & other (109) (107) -2%

Total 7 269 6 879 6%

49Sanlam investor presentation 2015 annual results

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Notes

Income statement

R million 2015 2014

Net operating profit 7 269 6 879 6% Per share 355,2 336,2 6%

Net investment return 1 946 1 794 8%

Other (364) (333) -9%

Normalised headline earnings 8 851 8 340 6% Per share 432,5 407,6 6%

Fund transfers 449 (15)

Headline earnings 9 300 8 325 12% Per share 459,5 411,6 12%

50 Sanlam investor presentation 2015 annual results

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Notes

Group Equity Value

Equity Value RoGEV

R million 2015 2014 Rm %

Group operations 91 558 87 739 12 191 13,8%

Personal Finance 38 249 38 453 4 658 12,1%

Emerging Markets 18 047 14 571 4 369 29,9%

Investments 22 412 20 122 4 386 21,3%

Santam 12 850 14 593 (1 222) -8,4%

Discretionary & Other 11 948 8 197 35 0,5%

TOTAL 103 506 95 936 12 226 12,7%

cps 5 057 4 684 598 12,8%

Adjusted return 14,8% Return target 12,1%

51Sanlam investor presentation 2015 annual results

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Notes

Group Equity Value earnings

R million 2015 2014

Net value of new business 1 360 1 592 -15%

Existing business 5 328 4 881 9%

Expected return on VIF 3 759 3 368 12%

Operating experience variance 1 081 991 9%

Operating assumption changes 488 522 -7%

6 688 6 473 3%

Inv variances in-force 320 551 -42%

Tax changes and goodwill (62) (168) 63%

Economic assumption changes (1 608) 86 >-100%

5 338 6 942 -23%

Return on net worth 1 699 1 297 31%

EV earnings 7 037 8 239 -15%

Non-life 5 189 7 344 -29%

GEV earnings 12 226 15 583 -22%

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Notes

Experience variancesPositive experience persisting

241

142 138

277 288 278

636

468

681

555

1 021 991

1 081

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

4.5%

5.0%

0

200

400

600

800

1 000

1 200

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

R'million % of VIF (rhs)

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Notes

Return on Group Equity Value

Out perform growth target of long-bond rate + 400bp

13.4 12.4 12.210.8

12.2 12.1 12.2

4.8

3.3

9.8

6.2

6.3

0.7

5.2

0

5

10

15

20

25

2010 2011 2012 2013 2014 2015 Avg

Target Out performance

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Notes

2016 Priorities

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Notes

Challenges

South African life business

Maintaining new business and profit growth over the long term

New business margins

Sanlam Emerging Markets headwinds

Appropriate capacity and level of support

Sanlam Investments

Growing the base, in particular institutional net flows

Addressing challenges a key priority

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Notes

Sanlam Personal Finance

Continue to anticipate evolving consumer needs and demands

Focus on profitable sales growth

Adapt and expand product range across entry-level, middle and affluent

market

Continued focus on risk business in middle and affluent markets

Expand and adapt distribution footprint

Enhance Glacier product set and intermediary support

Improve big data and advanced analytics capabilities

Focus on operational efficiencies in distribution and operations

Transforming with the high levels of regulatory change

Ensure that all business units are agile, cost efficient and market orientated

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Notes

Sanlam Emerging Markets

Shift in focus to accelerated organic growth through enhancing

partnerships, strategic alliances and expanding product range sensibly

Increased visibility of Sanlam brand as partnership brand for markets and

employees

Vest and integrate the Saham Finances acquisition

Deliver on corporate opportunities in Africa in line with client and broker

service needs to support the retail growth

Increased collaboration on human resource development across the cluster

Continued focus on governance, compliance and ethics

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Notes

Sanlam Investments

Maintain consistent superior investment performance

Further leverage business model in SA to grow net inflows in retail

Enhance competitive positioning for institutional segments

Focus on implemented solutions for both retail and institutional clients

Further align UK businesses to enhance competitiveness in international

market

Continued focus on transformation and people development

Continue focus on passive (Satrix)

Grow Alternative Investments

Focus on operational efficiencies in low growth environment

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Notes

Santam

Focus on profitable growth � both in SA and emerging markets

Capital review to consider future regulatory requirements, pending SAM

implementation, review asset allocations

Technical support to SEM general insurance partners to unlock value

Improve operational efficiencies to optimise acquisition cost ratio

Implementation of new underwriting platform for intermediated business in

SA

Work with local municipalities to reduce risk on the ground

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Outlook

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Notes

Outlook for 2016

Growth in most markets (particularly SA) to remain below longer term

potential � pressure on new business growth and margins

Investment market volatility to persist, adversely affecting fund -based fee

income and return on capital portfolio

Exceptional underwriting performance at Santam will be difficult to repeat

Conclude and embed AfroCentric and Saham Finances transactions

Investment opportunities will remain under consideration � primary focus on

Pan-African financial services positioning

Implementation of regulatory changes in SA and UK will continue to be a

challenge � strategic focus on managing risks and capturing opportunities

Difficult year ahead; medium to long-term prospects intact

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Notes

thank you

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Notes

64 Sanlam investor presentation 2015 annual results

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