Old Mutual Limited says a strong performance from its Zimbabwe operations helped support group headline earnings and IFRS profits in the six months to June 30, 2026, even as lower shareholder investment returns put pressure on its adjusted headline earnings.

The financial services group, which is finalising its interim results, said headline earnings and IFRS profits benefited from the strong performance in Zimbabwe, although this was not reflected in adjusted headline earnings.

Old Mutual said adjusted headline earnings, its primary profit metric, are expected to decline by between 25% and 35% to between R2.73 billion and R3.15 billion, from R4.20 billion in the comparable period.

The decline was mainly attributed to lower shareholder investment returns, with the group saying its shareholder portfolio performance followed equity and bond indices during the period.

The company said sharp risk-off conditions, driven by ongoing geopolitical conflicts in the Middle East, negatively affected equity and bond performance.

Despite the pressure on adjusted headline earnings, Old Mutual recorded growth in its underlying operating performance, with results from operations expected to increase between 2% and 12% to between R5.04 billion and R5.53 billion, from R4.94 billion.

Results from operations per share are expected to rise by between 6% and 16%, reaching between 120.3 cents and 131.7 cents, compared with 113.5 cents previously.

Headline earnings are expected to range between R3.70 billion and R4.12 billion, representing a decline of between 1% and 11% from R4.16 billion.

IFRS profit after tax attributable to equity holders of the parent is expected to range between R3.69 billion and R4.10 billion, compared with R4.10 billion in the prior period.

Basic earnings per share are expected to move between a 5% decline and a 5% increase, giving a range of 91.3 cents to 100.9 cents, compared with 96.1 cents in the first half of 2025.

Old Mutual’s stronger operating performance was accompanied by significant growth in new business.

Life annual premium equivalent (APE) sales rose 21% to R7.86 billion from R6.47 billion, while gross flows increased 21% to R128.91 billion from R106.76 billion.

The value of new business increased 32% to R569 million from R432 million, while the value of new business margin improved to 1.4% from 1.3%.

The group said Life APE sales growth was mainly driven by strong group risk and annuity sales in Old Mutual Corporate, alongside higher living annuity and endowment sales in Wealth Management.

Old Mutual Africa Regions also delivered strong growth across both retail and corporate sales.

However, excluding Old Mutual Corporate risk sales secured during the current period—which the group does not expect to recur at the same level in the second half of the year—Life APE sales growth would have been 12%.

Gross flows were supported by strong inflows in Wealth Management, particularly the local platform business and the inclusion of 10X Investments.

Old Mutual Investments also recorded higher inflows, which the group attributed to improved third-party client activity across key investment capabilities.

In Old Mutual Africa Regions, growth was driven by strong money market inflows in Malawi and improved unit trust flows in East Africa.

Net client cash flow improved significantly, although it remained negative at R3.13 billion compared with negative R10.13 billion in the prior period.

Old Mutual attributed the improvement to stronger gross flows and the non-repeat of low-margin indexation outflows recorded by Old Mutual Investments in the previous period.

Gross written premiums increased 3% to R14.93 billion from R14.51 billion, supported by growth in Old Mutual Insure.

The increase was partly offset by currency movements and lower renewals resulting from underwriting management actions in Old Mutual Africa Regions.

Old Mutual Insure’s net underwriting margin declined to 7.6% from 9.7%, but remained at the upper end of the group’s medium-term target range of 5% to 8%.

The group said this performance came despite elevated catastrophe losses during the period, with underwriting profitability supported by disciplined underwriting, effective claims management and a diversified portfolio.

Old Mutual said the growth in results from operations was primarily driven by stronger revenue from Wealth Management and Old Mutual Investments.

This was supported by a higher average base of assets under management and administration, as well as lower central costs.

The gains were partly offset by lower underwriting earnings at Old Mutual Insure compared with the strong prior period and continued investment to scale Old Mutual Banking.

The group also said its life businesses were affected by negative economic variances during the period, following positive economic variances in the comparable period.

Underlying growth in results from operations, after adjusting for the period-on-period impact of economic variances, remained robust and benefited from strong operational delivery during the period.

Adjusted headline earnings per share are expected to decline between 22% and 32% to between 65.7 cents and 75.3 cents, from 96.6 cents.

The group said its results from operations per share, adjusted headline earnings per share and other per-share measures benefited from its share repurchase programme implemented in 2025 and completed at the beginning of May 2026.

The programme contributed to a reduction in the adjusted weighted average number of ordinary shares to 4.179 billion at June 30, 2026, from 4.352 billion a year earlier.

Old Mutual is expected to release its interim results for the six months ended June 30, 2026, on September 8, 2026, through the Stock Exchange News Service of the Johannesburg Stock Exchange.

The group said its 2026 interim results presentation and question-and-answer webcast will also be held on September 8 at 11am South African time.

Old Mutual cautioned that the financial information contained in its voluntary operating update and trading statement includes forward-looking statements and non-IFRS financial measures that had not been reviewed or reported on by its external auditors.

The group operates across 12 countries, providing financial solutions to retail and corporate customers across key market segments. Its primary operations are in Africa, with a niche business in China.