COMPANY NEWS IN BRIEF

Momentum Metropolitan's profit surgesThe Momentum Metropolitan Holdings stable has seen a large improvement in its fortunes as the impact of the Covid-19 pandemic fades.The group increased its operating profit by 248% from R299 million in the three months to the end of September 2021 to just over R1 billion, and its normalised headline earnings grew by 73% to R1.23 billion.MMH said that this time last year its life insurance businesses, especially Momentum Life, were impacted by Covid-19 death claims, but the mortality experience has since improved significantly.Momentum Life saw significant growth in its profits in the three months to 30 September. In the same period in 2021, Momentum Life had an operating loss of R3 million. This year, it recorded an operating profit of R330 million. Its normalised headline earnings jumped from R39 million to R353 million.Metropolitan Life, which sells life insurance mostly to low-income consumers, also grew its normalised headline earnings by 110% to R176 million, from R84 million in the prior period. It also benefitted from lower death claims as well as better investment returns this time around."The current economic conditions are placing pressure on this segment's customer base, and lapse experience is expected to remain negative in the short term," warned MMH in the trading update published on Tuesday.-Fin24Old Mutual plans to launch bank in 2024Financial services group Old Mutual has received approval from the South African Reserve Bank's prudential authority to apply for a banking licence.This will help it expand its relationship with some of its customers and secure cheaper sources of funding available through accepting retail deposits.The firm plans to spend R1.75 billion on building the bank's transactional capacity, eyeing a launch in the second half of 2024. It expects this bank to break even three years after launch. It has already spent R830 million on the bank in the current year. Old Mutual already has existing lending and transactional products, through its Money Account, as well as an unsecured lending product. This is largely aimed at the lower- to middle-income markets. Because it doesn't have a banking licence, this requires a commercial relationship with a third party, and the firm's Money Account is in association with Bidvest Bank.As of the end of June, the end of the group's half-year, loans and advances within that cluster stood at R14.78 billion, while net interest income came in at just above R1 billion. In the firm's 2021 year, banking and lending results from operations, which includes both South Africa and the rest of Africa, came in at R1.68 billion, compared to R4.38 billion for the group.-Fin24Naspers says worst of losses should be behindGlobal media and technology giant Naspers says it believes the worst of its trading losses in its unprofitable businesses are behind after some hefty spending, reporting on Wednesday that its preferred measure of profits slumped almost three quarters in its half-year to end-September.Naspers, whose interests span food delivery, e-commerce, payments and media, reported a US$1.1 billion (R19 billion) fall in core headline earnings to US$372 million to end-September, with most of this relating to a lower contribution from Tencent, although new initiatives contributed $484 million of a $557 million trading loss.Trading losses in the group's classified business, which includes vehicle trader OLX, almost quadrupled, while losses in payments and fintech nearly tripled, with Naspers saying it was pursuing initiatives such as building its delivery footprint or investing in new products.E-commerce revenue, however, climbed 38% to US$5.6 billion, with group CFO Basil Sgourdos saying in a statement that the firm's e-commerce businesses are all profitable or breakeven "at the core," and the group had picked up efforts to drive profitable growth."We expect half-year 2023 to mark our peak investment spend, with profitability and cash flow generation in half-year 2025," he said.The firm's stake in Chinese media giant Tencent, however, continues to dominate the results, and Tencent had contributed US$2.1 billion of the firm's US$1.4 billion in core headline earnings from continuing operations in its 2022 year, amid losses elsewhere.Prosus, the group's Amsterdam-listed consumer internet arm, holds the valuable Tencent stake in the group, which it has been selling in part in order to fund an ongoing share buyback programme, announced in June. The stake in Tencent has fallen to 27.86% at the end of September from 28.81%, yielding $3.86 billion in proceeds.-Fin24

COMPANY NEWS IN BRIEF

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Republikein 2026-07-09

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