OLD MUTUAL LIMITED - Old Mutual trading statement for the six months ended 30 June 2021

Old Mutual trading statement for the six months ended 30 June 2021

Old Mutual Limited
Incorporated in the Republic of South Africa
Registration number: 2017/235138/06
ISIN: ZAE000255360
LEI: 213800MON84ZWWPQCN47
JSE Share Code: OMU
LSE Share Code: OMU
NSX Share Code: OMM
MSE Share Code: OMU
ZSE Share Code: OMU
("Old Mutual" or “Company” or “Group”)


Ref 18/21
18 August 2021

OLD MUTUAL TRADING STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2021

Shareholders are advised that Old Mutual is currently in the process of finalising
its interim results for the six months ended 30 June 2021 ("current
period"). Following on the Old Mutual Voluntary Operating Update on 23 June 2021,
this trading statement provides an indication of a range for headline earnings
per ordinary share (HEPS) and earnings attributable to equity holders of the
Group per ordinary share (EPS) in terms of paragraph 3.4(b) of the JSE Limited
Listings Requirements compared to the six months ended 30 June 2020 ("comparative
period"). The Group's interim results will be released on the Stock Exchange
News Service of the JSE Limited on Tuesday, 31 August 2021.

The local and global equity markets have recovered given the improvement in
corporate profits as lockdown restrictions have eased. Markets have rallied ahead
of pre-COVID-19 levels, however, the environment remains volatile as we navigate
the challenging impact of the pandemic.

We continue to demonstrate agility in our response to the impact of the pandemic
on our business, with good recovery in sales and earnings for the first half of
the year. Productivity levels in our South African retail segments, Mass and
Foundation Cluster and Personal Finance have materially improved in the first
half of the year. There has been a strong customer take up in the Old Mutual
Protect (OMP) proposition, which has seen rapid growth supporting the recovery
in risk sales. In Mass and Foundation Cluster, issued sales in the first half of
the year were above the comparative period due to the significant impact that
lockdown had on issued sales in 2020. This was supported by improved credit
experience in the banking business. Personal Finance had higher single and
recurring premiums, driven by an increase in productivity. In Old Mutual
Corporate, SuperFund umbrella quote activity improved relative to the comparative
period. The recovery in local equity markets, combined with positive flows in
our Asset Management business have benefited Old Mutual Investments. In Rest of
Africa, we continue to upgrade the digital channels to improve customers
experience and providing connectivity support to enable intermediaries to work
remotely.

The mortality claims paid relating to COVID-19 in our life businesses are driving
negative Net Client Cash Flows (NCCF), however this is offset by inflows in our
Asset Management and Wealth businesses. Our mortality experience has been worse
than anticipated with impact on profits mitigated by a partial release of
provisions raised at the end of 2020. Our COVID-19 provisions have been increased
by R2 billion as at 30 June 2021 to take into account the emerging expectations
of wave 3 and 4 as well as potential future waves. The provisions have been
updated to take into account the additional available data to date as well as
the anticipated impact of the proposed vaccination rollout plan.

In Old Mutual Insure, business interruption claims paid in the first half of the
year were offset by the reserves raised at the end of 2020. The reserves raised
in the comparative period still remain as the best estimate and no further
provisions were raised. There was a significant turnaround in the Credit
Guarantee Insurance Corporation (CGIC) business profitability due to large COVID-
19 related claims in prior year that did not repeat, as well as lower attritional
claims in the current year.

Taking into account the increase in operating earnings and the significant
improvement in sales momentum outlined above shareholders are advised that the
Group’s key profit measures are expected to fall within the ranges outlined
below:

  Key Performance Indicators
  (R million unless stated              Estimated        Estimated
  otherwise)                             % change     30 June 2021   30 June 2020
  Results from Operations              37% to 47%    2,113 – 2,267          1,541
  Adjusted Headline Earnings           65% to 75%    2,813 – 2,984          1,704
  AHEPS (cents)¹                       65% to 75%      61.6 – 65.3           37.3

1 AHEPS defined as Adjusted Headline Earnings divided by WANS adjusted to reflect

the Group's B-BBEE shares and shares held in policyholder and consolidated
investment funds.

HEPS and Basic EPS are expected to fall within the ranges outlined below:

Key Performance Indicators
(R million unless stated           Estimated           Estimated 30
otherwise)                         % change            June 2021        30 June 2020
IFRS profit after tax
attributable to equity holders
of the parent                          >100%           2,704 – 3,266        (5,621)

Basic EPS (cents)                      >100%             61,4 - 74,3        (128.5)

Headline Earnings               (20%) - (30%)          2,946 – 3,368          4,215

HEPS (cents)                    (21%) - (31%)            66,9 – 76,5           96.3


Shareholders are reminded that the impairments in respect of the carrying value
of our investment in Nedbank and the goodwill related to our investment in Old
Mutual Finance were recognised in the IFRS income statement in H1 2020 and were
not repeated. These are however, not recognised in Headline Earnings, and
accordingly not recognised in Adjusted Headline Earnings (AHE), as this is an
explicit adjusting item in accordance with the JSE Headline Earning Circular
1/2021.

Headline earnings is lower than the prior year as AHE excludes adjustments in
respect of equity and debt instruments held in life funds, the impact of
restructuring as well as the results related to Residual Plc which were all lower
than H1 2020, partially offset by higher results related to Zimbabwe.

On the 23 June 2021 Old Mutual announced its intention to unbundle a portion of
its shareholding in Nedbank Group Limited (“Nedbank”). Subject to regulatory
approval, Old Mutual will unbundle all the Nedbank ordinary shares currently
held by Old Mutual Emerging Markets Limited (being 62,131,692 Nedbank ordinary
shares and comprising 12.2% of the issued ordinary share capital of Nedbank).
The remaining Nedbank Stake held by Old Mutual Life Assurance Company South
Africa (“OMLACSA”) (comprising c.7.2% of the Nedbank ordinary shares currently
in issue) continues to support the capital structure of OMLACSA and will be
managed in line with the Group’s Financial Management Framework. In order to
optimally manage the capital structure, we have entered into a zero cost collar
arrangement on the majority of the OMLACSA exposure to Nedbank.


The financial information in this trading statement is the responsibility of the
Old Mutual Limited Board of Directors and has not been reviewed or reported on
by the Group’s external auditors.


Sandton

Sponsors
JSE                           Merrill Lynch South Africa (Pty) Limited t/a BofA
                              Securities
Namibia                       PSG Wealth Management (Namibia) (Proprietary)
                              Limited
Zimbabwe                      Imara Capital Zimbabwe plc
Malawi                        Stockbrokers Malawi Limited

Enquiries
 Investor Relations
 Sizwe Ndlovu                 T: +27 (0)11 217 1163
 Head of Investor Relations   M: +27 (83) 500 8019
                              E: tndlovu6@oldmutual.com
Communications
Vuyo Mtawa                    M: +27 68 422 8125
Head: Group Communications    E: VMtawa@oldmutual.com

Notes to Editors

About Old Mutual Limited
Old Mutual is a premium African financial services group that offers a broad
spectrum of financial solutions to retail and corporate customers across key
market                                segments                               in
14 countries. Old Mutual's primary operations are in South Africa and the Rest
of Africa and it has a niche business in Asia. With over 176 years of heritage
across sub-Saharan Africa, Old Mutual is a crucial part of the communities they
serve and the broader society on the continent.

For further information on Old Mutual and its underlying businesses, please visit
the corporate website at www.oldmutual.com.

Date: 18-08-2021 07:05:00
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