Old Mutual, the insurer locked in a prolonged spat with its fired chief executive officer, said earnings from its operations probably fell as much as 5%, weighed down by a stuttering local economy.
South Africa’s economy expanded at the slowest pace in a decade in 2019 as business and consumer confidence plunged amid a shortage of electricity and shrinking disposable incomes. Old Mutual is also having to contend with hyperinflation and the worst economic crisis in Zimbabwe in a decade.
It’s been in and out of court since firing CEO Peter Moyo in June last year.
Adjusted earnings per share before one-time items will probably increase 4%-9% for the 12 months through December, buoyed by higher returns on investments, Old Mutual said in a statement on Thursday. The shares dropped 0.7% by 10:34 a.m., reversing an earlier gain of as much as 2.8%.
Its rival the Liberty Group is focusing on taking market share in order to grow earnings, CEO David Munro said on February 27. Liberty’s adjusted EPS rose 44% after South African equities gained 8.2% in 2019.