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RMI Holdings earnings soar


Johannesburg – Insurance investment holding company Rand Merchant Insurance Holdings (RMI) reported a 49% hike in diluted headline earnings per share for the year ended June 2012 at 161.8 cents‚ from the previous corresponding period's 108.6c.

“The ongoing legacy of the 2008 financial crisis is one of significant macro-economic uncertainty.

"Such uncertainty in the major developed economies‚ combined with high levels of government indebtedness‚ ongoing stress in the European banking system and households continuing to rebuild balance sheets‚ weighed on economic activity‚” RMI said in a JSE Stock Exchange News Service statement on Thursday.

“This weakness spilled over into the major emerging economies and growth in countries such as China‚ India and Brazil slowed markedly during the latter part of the financial year‚” it said.

The group’s diluted earnings per share saw a 28% rise at 150.7c/share from 2011’s 117.7c.

RMI declared a final gross dividend of 50c/share. It also declared a special dividend of 55c/share.

Discovery Holdings [JSE:DSY]‚ in which RMI holds a 25% stake‚ reported a 21% rise in operating profit to R3.4bn.

MMI Holdings Limited [JSE:MMI]‚ which RMI holds 25% of‚ saw a 12% rise in core headline earnings to R3bn. OUTsurance‚ which RMI holds 83% of‚ recorded a 33% improvement in normalised earnings to R1.1bn.

“The macro environment will remain challenging during the 2013 financial year. The global economy is likely to register below average growth and will continue to face significant downside risk‚” RMI said.

“Economic activity in SA will remain under pressure.

"GDP (gross domestic product) growth is currently expected to be 2.5% for the 2013 financial year‚ and although interest rates are expected to remain flat for the rest of the year‚ there is downside risk if economic growth slows further‚” it said.

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