GROUP EQUITY VALUE at 31 December 2008
|
|
2008 |
2007 |
|
R million |
R million |
| Embedded value of covered business |
28 591 |
28 432 |
| Sanlam Personal Finance |
19 574 |
20 089 |
| Adjusted net worth |
8 275 |
8 285 |
| Value of in-force |
11 299 |
11 804 |
| Sanlam Developing Markets |
2 796 |
2 160 |
| Adjusted net worth |
1 032 |
860 |
| Value of in-force |
1 764 |
1 300 |
| Sanlam UK |
680 |
921 |
| Adjusted net worth |
234 |
447 |
| Value of in-force |
446 |
474 |
| Sanlam Employee Benefits |
5 541 |
5 262 |
| Adjusted net worth |
5 472 |
5 118 |
| Value of in-force |
69 |
144 |
| Other Group operations |
13 560 |
15 451 |
| Retail cluster |
2 287 |
1 820 |
| Institutional cluster |
6 000 |
7 256 |
| Short-term insurance |
5 273 |
6 375 |
| Capital diversification |
(1 429) |
(1 232) |
| Other capital |
2 416 |
2 542 |
|
43 138 |
45 193 |
| Discretionary capital |
2 100 |
6 100 |
| Group equity value |
45 238 |
51 293 |
| Group equity value per share (cents) |
2 213 |
2 350 |
| SHAREHOLDERS’ FUND AT FAIR VALUE at 31 December 2008 |
|
2008 |
2007 |
|
R million |
R million |
| Property and equipment |
228 |
214 |
| Owner–occupied properties |
613 |
612 |
| Goodwill |
473 |
487 |
| Value of business acquired |
802 |
843 |
| Deferred acquisition costs |
1 260 |
1 079 |
| Investments |
31 807 |
38 474 |
| Sanlam businesses |
13 560 |
15 451 |
| Sanlam Investments |
5 581 |
6 677 |
| SIM Wholesale |
3 903 |
4 443 |
| International |
1 358 |
1 857 |
| Sanlam Collective Investments |
320 |
377 |
| Sanlam Personal Finance |
1 423 |
1 192 |
| Glacier |
696 |
593 |
| Sanlam Personal Loans |
71 |
104 |
| Multi–Data |
190 |
143 |
| Sanlam Trust |
144 |
104 |
| Sanlam Home Loans |
133 |
177 |
| Sanlam Healthcare Management |
78 |
– |
| Other |
111 |
71 |
| Sanlam UK |
847 |
600 |
| Principal |
299 |
– |
| Punter Southall Group |
219 |
297 |
| Other |
329 |
303 |
| Alfinanz |
17 |
28 |
| Coris Administration |
54 |
38 |
| Sanlam Capital Markets |
365 |
541 |
| Short–term insurance |
5 273 |
6 375 |
| Associated companies |
234 |
347 |
| Joint ventures |
208 |
378 |
| Safair Lease Finance |
– |
209 |
| Shriram and other |
208 |
169 |
| Other investments |
17 805 |
22 298 |
| Other equities and similar securities |
9 036 |
11 112 |
| Public sector stocks and loans |
1 411 |
2 697 |
| Investment properties |
491 |
245 |
| Other interest–bearing and preference share investments |
6 867 |
8 244 |
| Net term finance |
– |
– |
| Term finance |
(5 101) |
(5 068) |
| Assets held in respect of term finance |
5 101 |
5 068 |
| Net deferred tax |
352 |
(95) |
| Net working capital |
(451) |
(909) |
| Minority shareholders’ interest |
(947) |
(857) |
| |
|
|
| Shareholders’ fund at fair value |
34 137 |
39 848 |
| Fair value per share (cents) |
1 670 |
1 826 |
SHAREHOLDERS’ FUND INCOME STATEMENT for the year ended 31 December 2008
|
| |
2008 |
2007 |
| |
R million |
R million |
| Result from financial services before tax |
4 260 |
4 539 |
| Sanlam Personal Finance |
1 975 |
1 857 |
| Sanlam Developing Markets |
218 |
343 |
| Sanlam UK |
68 |
49 |
| Sanlam Employee Benefits |
258 |
173 |
| Short-term Insurance |
1 161 |
987 |
| Investment Management |
825 |
1 230 |
| Capital Markets |
(61) |
73 |
| Corporate and other |
(184) |
(173) |
| Tax on financial services income |
(966) |
(997) |
| Minority shareholders’ interest |
(492) |
(513) |
| |
|
|
| Net result from financial services |
2 802 |
3 029 |
| Net investment income |
1 068 |
1 117 |
| |
|
|
| Core earnings |
3 870 |
4 146 |
| Net project expenses |
(56) |
(85) |
| BEE transaction costs |
(7) |
(5) |
| Net equity-accounted headline earnings |
16 |
152 |
| Net investment surpluses |
(1 699) |
1 264 |
| Amortisation of value of business acquired |
(77) |
(51) |
| Net loss from discontinued operations |
(22) |
(91) |
| Net Secondary Tax on Companies |
(59) |
(131) |
| |
|
|
| Normalised headline earnings |
1 966 |
5 199 |
| Other equity-accounted earnings |
33 |
- |
| Profit on disposal of subsidiaries and associates |
3 |
668 |
| Impairments |
(244) |
(7) |
| |
|
|
| Normalised attributable earnings |
1 758 |
5 860 |
| Fund transfers |
736 |
(366) |
| Atributable earnings per Group income statement A |
2 494 |
5 494 |
| NOTES TO THE SHAREHOLDERS' FUND INFORMATION for the year ended 31 December 2008 |
|
|
2008 |
2007 |
|
|
R million |
R million |
1.
|
NEW BUSINESS |
|
|
|
|
|
|
|
Analysed per market: |
|
|
|
Retail |
|
|
|
Life business |
12 862 |
12 195 |
|
Sanlam Personal Finance |
11 413 |
9 428 |
|
Sanlam Developing Markets |
1 449 |
2 767 |
|
Non-life business |
29 105 |
29 601 |
|
Sanlam Personal Finance |
11 231 |
9 709 |
|
Sanlam Private Investments |
7 094 |
8 300 |
|
Sanlam Collective Investments |
10 780 |
11 592 |
|
|
|
|
|
South African |
41 967 |
41 796 |
|
Non-South African |
11 921 |
9 520 |
|
Sanlam Personal Finance |
8 426 |
7 379 |
|
Sanlam Developing Markets |
1 145 |
848 |
|
Sanlam UK |
2 350 |
1 293 |
|
|
|
|
|
Total Retail |
53 888 |
51 316 |
| |
|
|
|
|
Institutional |
|
|
|
Group life business |
1 500 |
2 388 |
|
Sanlam Employee Benefits (1) |
515 |
878 |
|
Investment Management (1) |
985 |
1 510 |
|
Non-life business |
23 324 |
23 490 |
|
Segregated |
11 810 |
10 012 |
|
Sanlam Multi-Manager |
4 040 |
5 238 |
|
Sanlam Collective Investments |
7 474 |
8 240 |
|
|
|
|
|
South African |
24 824 |
25 878 |
|
Investment Management non-SA |
2 778 |
4 407 |
| |
|
|
|
|
Total Institutional |
27 602 |
30 285 |
| |
|
|
|
|
White label |
6 481 |
8 996 |
|
Sanlam Collective Investments |
6 481 |
7 794 |
|
Sanlam Developing Markets |
– |
1 202 |
|
Short-term insurance |
12 165 |
11 407 |
| |
|
|
|
|
Total new business |
100 136 |
102 004 |
|
|
|
|
| (1) |
Comparative figures have been restated for a reclassification of life licence business from Sanlam Employee Benefits to Investment Management and Botswana Insurance Fund Management business from life insurance to life licence. |
|
|
| |
|
|
|
|
|
2008 |
2007 |
|
|
R million |
R million |
2.
|
NET FLOW OF FUNDS |
|
|
|
|
|
|
|
Analysed per market: |
|
|
|
Retail |
|
|
|
Life business |
795 |
162 |
|
Sanlam Personal Finance |
794 |
(1 210) |
|
Sanlam Developing Markets |
1 |
1 372 |
|
Non-life business |
7 058 |
9 569 |
|
Sanlam Personal Finance |
2 897 |
3 762 |
|
Sanlam Private Investments |
3 215 |
3 762 |
|
Sanlam Collective Investments |
946 |
2 045 |
|
|
|
|
|
South African |
7 853 |
9 731 |
|
Non-South African |
1 491 |
1 863 |
|
Sanlam Personal Finance |
185 |
1 141 |
|
Sanlam Developing Markets |
1 217 |
894 |
|
Sanlam UK |
89 |
(172) |
|
|
|
|
|
Total Retail |
9 344 |
11 594 |
| |
|
|
|
|
Institutional |
|
|
|
Group Life business |
(2 736) |
(4 745) |
|
Sanlam Employee Benefits (1) |
(1 994) |
(3 594) |
|
Investment Management (1) |
(742) |
(1 151) |
|
Non-life business |
985 |
(1 907) |
|
Segregated |
2 663 |
(1 753) |
|
Sanlam Multi-Manager |
(3 406) |
75 |
|
Sanlam Collective Investments |
1 728 |
(229) |
|
|
|
|
|
South African |
(1 751) |
(6 652) |
|
Investment Management non-SA |
(760) |
1 235 |
| |
|
|
|
|
Total Institutional |
(2 511) |
(5 417) |
| |
|
|
|
|
White label |
(1 445) |
1 807 |
|
Sanlam Collective Investments |
(1 445) |
1 255 |
|
Sanlam Developing Markets |
– |
552 |
|
Short-term insurance |
3 734 |
3 379 |
| |
|
|
|
|
Total net flow of funds |
9 122 |
11 363 |
|
|
|
|
| (1) |
Comparative figures have been restated for a reclassification of life licence business from Sanlam Employee Benefits to Investment Management and Botswana Insurance Fund Management business from life insurance to life licence. |
3. NORMALISED DILUTED EARNINGS PER SHARE
In terms of IFRS, the policyholders' fund's investments in Sanlam shares and Group subsidiaries are not reflected as equity investments in the Sanlam balance sheet, but deducted in full from equity on consolidation (in respect of Sanlam shares) or reflected at net asset value (in respect of subsidiaries). The valuation of the related policy liabilities however includes the fair value of these shares, resulting in a mismatch between policy liabilities and policyholder investments, with a consequential impact on the Group's earnings. The number of shares in issue must also be reduced with the treasury shares held by the policyholders' fund for the calculation of IFRS basic and diluted earnings per share. This is not a true representation of the earnings attributable to the Group's shareholders, specifically in instances where the share prices and/or the number of shares held by the policyholders' fund varies significantly. The Group therefore calculates normalised diluted earnings per share to eliminate the impact of investments in Sanlam shares and Group subsidiaries held by the policyholders' fund.
| |
|
2008 |
2007 |
| |
|
cents |
cents |
| |
Normalised diluted earnings per share: |
|
|
| |
Net result from financial services |
133,8 |
133,3 |
| |
Core earnings |
184,8 |
182,4 |
| |
Headline earnings |
93,9 |
228,7 |
| |
Profit attributable to shareholders' fund |
84,0 |
257,8 |
| |
|
|
|
| |
|
R million |
R million |
| |
Analysis of normalised earnings (refer shareholders' fund income statement): |
|
|
| |
Net result from financial services |
2 802 |
3 029 |
| |
Core earnings |
3 870 |
4 146 |
| |
Headline earnings |
1 966 |
5 199 |
| |
Profit attributable to shareholders' fund |
1 758 |
5 860 |
| |
|
|
|
| |
|
million |
million |
| |
Adjusted number of shares: |
|
|
| |
Weighted average number of shares for diluted earnings per share (refer below) |
2 043,5 |
2 189,3 |
| |
Add: Weighted average Sanlam shares held by policyholders |
50,5 |
83,9 |
| |
Adjusted weighted average number of shares for normalised diluted earnings per share |
2 094,0 |
2 273,2 |
| |
|
|
|
| |
Number of ordinary shares in issue at beginning of period |
2 303,6 |
2 303,6 |
| |
Shares cancelled |
(113,5) |
– |
| |
Number of ordinary shares in issue |
2 190,1 |
2 303,6 |
| |
Shares held by subsidiaries in shareholders' fund |
(197,3) |
(168,9) |
|
Outstanding long-term incentive scheme shares and options |
45,5 |
43,3 |
|
Number of shares under option to be issued at fair value |
(12,7) |
(7,3) |
|
Convertible deferred shares held by Ubuntu-Botho |
18,6 |
12,1 |
|
Adjusted number of shares for value per share |
2 044,2 |
2 182,8 |
4. SHARE REPURCHASES
The Sanlam shareholders granted general authorities to the Group at the 2007 and 2008 annual general meetings to repurchase Sanlam shares in the market. The Group acquired 117,2 million shares from 6 March 2008 to 31 December 2008 in terms of the general authorities. The lowest and highest prices paid were R15,33 and R21,49 per share respectively. The total consideration paid of R2,2 billion was funded from existing cash resources. All repurchases were effected through the JSE trading system without any prior understanding or arrangement between the Group and the counter-parties. Authority to repurchase 174,5 million shares, or 7,8% of Sanlam's issued share capital at the time, remain outstanding in terms of the general authority granted at the annual general meeting held on 4 June 2008.
The financial effects of the share repurchases during 2008 on IFRS earnings and net asset value per share are illustrated in the table below. Tangible net asset value excludes goodwill, value of business acquired and deferred acquisition cost included in the shareholders' fund at net asset value.
|
|
|
|
Before |
After |
|
|
|
|
repurchases |
repurchases |
|
|
Basic earnings per share: |
|
|
|
|
|
Profit attributable to shareholders' fund |
cents |
125,8 |
125,0 |
|
|
Headline earnings |
cents |
135,9 |
135,4 |
|
|
Diluted earnings per share: |
|
|
|
|
|
Profit attributable to shareholders' fund |
cents |
123,0 |
122,0 |
|
|
Headline earnings per share |
cents |
132,8 |
132,2 |
|
|
Value per share: |
|
|
|
|
|
Equity value |
cents |
2 201 |
2 213 |
|
|
Net asset value |
cents |
1 388 |
1 353 |
|
|
Tangible net asset value |
cents |
1 143 |
1 094 |
Content within this section:
