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London - Anglo-South African financial group Old Mutual posted a 24% rise in gross sales of its products ranging from insurance to investment funds, helped by a strong performance in Africa.
The company - a member of Britain's FTSE 100 index - said in a trading statement on Thursday that gross sales in the first quarter reached £6.2bn ahead of a consensus forecast of £6bn, helping funds under management expand 2% on a constant currency basis to £297.7bn.
The company said it was well placed to benefit from recent changes to UK pensions, which will effectively remove the need for any retiree to buy an annuity from insurers and will allow them more flexibility in how to invest their money.
Annuities
Chief executive Julian Roberts said:"We expect to be a net beneficiary from the radical changes to the UK pensions system.
"We have no exposure to annuities but are a leading provider of pension income drawdown."
Sales in emerging markets were up 18% on a constant-currency basis at £1.9bn, helped by strong retail sales.
"We're making good progress towards our ambition to become Africa's financial services champion," said Roberts, who said sales in Africa were up 27%, excluding South Africa, and added that the group had signed new bank distribution agreements in Nigeria and Ghana.
Minority stake
Old Mutual, founded in Cape Town in 1845, had said in January that it planned to increase the share of profits generated by its African business to 15% by the end of 2015, up from 10%.[ID:nL5N0L32GF]
The group reiterated its intention to list a minority stake in its asset management business in the United States, USAM, which suffered cash outflows of $3.6bn in the quarter - a performance which analysts said was disappointing.
"We reiterate our 'hold' recommendation but highlight the continued excellent progress the group is making at the underlying level, especially as a regards asset accumulation, and its positioning in the UK post the Budget changes," said analyst Eamonn Flanagan at brokerage Shore Capital in a note to clients.
Disposal
Old Mutual shares were down just over% early on Thursday, having hit a near 12-month high last week.
Roberts also said Old Mutual had regulatory approval for the disposal of its Skandia Poland unit, after having already sold the Austrian and German businesses of its wealth management arm for €220m. [ID:nL5N0MO2G5]
The weakness of the South African rand and US dollar, which flattened the group's profits in 2013, wiped 50% off the group's gross sales on a reported currency basis, but Roberts remained upbeat.
"I believe that the results we've announced, despite the currency headwinds, are evidence of the strength and appropriateness of our business model," said Roberts.
The company - a member of Britain's FTSE 100 index - said in a trading statement on Thursday that gross sales in the first quarter reached £6.2bn ahead of a consensus forecast of £6bn, helping funds under management expand 2% on a constant currency basis to £297.7bn.
The company said it was well placed to benefit from recent changes to UK pensions, which will effectively remove the need for any retiree to buy an annuity from insurers and will allow them more flexibility in how to invest their money.
Annuities
Chief executive Julian Roberts said:"We expect to be a net beneficiary from the radical changes to the UK pensions system.
"We have no exposure to annuities but are a leading provider of pension income drawdown."
Sales in emerging markets were up 18% on a constant-currency basis at £1.9bn, helped by strong retail sales.
"We're making good progress towards our ambition to become Africa's financial services champion," said Roberts, who said sales in Africa were up 27%, excluding South Africa, and added that the group had signed new bank distribution agreements in Nigeria and Ghana.
Minority stake
Old Mutual, founded in Cape Town in 1845, had said in January that it planned to increase the share of profits generated by its African business to 15% by the end of 2015, up from 10%.[ID:nL5N0L32GF]
The group reiterated its intention to list a minority stake in its asset management business in the United States, USAM, which suffered cash outflows of $3.6bn in the quarter - a performance which analysts said was disappointing.
"We reiterate our 'hold' recommendation but highlight the continued excellent progress the group is making at the underlying level, especially as a regards asset accumulation, and its positioning in the UK post the Budget changes," said analyst Eamonn Flanagan at brokerage Shore Capital in a note to clients.
Disposal
Old Mutual shares were down just over% early on Thursday, having hit a near 12-month high last week.
Roberts also said Old Mutual had regulatory approval for the disposal of its Skandia Poland unit, after having already sold the Austrian and German businesses of its wealth management arm for €220m. [ID:nL5N0MO2G5]
The weakness of the South African rand and US dollar, which flattened the group's profits in 2013, wiped 50% off the group's gross sales on a reported currency basis, but Roberts remained upbeat.
"I believe that the results we've announced, despite the currency headwinds, are evidence of the strength and appropriateness of our business model," said Roberts.
