Alexforbes delivered a strong operational performance for the year to the end of March 2026, growing assets under management and administration to a record R733 billion while increasing normalised profit from operations by 22% to R1.03bn.
The financial services group reported a 10% increase in operating income to R4.85bn, supported by positive market performance, strong net inflows, and continued momentum across its institutional and retail businesses.
Assets under management and administration increased 22% from R599bn to R733bn. Over the past five years, the group’s assets have grown from R401bn to R733bn.
According to chief executive Dawie de Villiers, approximately 16 percentage points of the annual growth came from market appreciation, with the balance generated through new business and net inflows.
“For the first time, net new business has been driven through the strategy by institutional money … plus retail growth,” he said.
The group generated R25bn in new product business, R40bn in new platform business, and R55bn in ongoing inflows and transfers during the year, while client losses remained low at just R3bn across product and platform businesses.
Why earnings tell a more complicated story
While the operational numbers were strong, some of the headline earnings metrics painted a more mixed picture.
Headline earnings per share (HEPS) from total operations declined 5% to 67 cents, while profit for the year fell 5% to R860 million.
Management said these declines were largely the result of accounting adjustments and non-recurring items rather than any deterioration in the underlying business.
The first factor relates to IFRS 16 lease accounting.
In FY2025, Alexforbes benefited from a R70m IFRS 16 lease adjustment linked to the renewal of its Sandton head-office lease. That adjustment boosted reported earnings in the prior year and created a difficult comparison base for FY2026.
As a result, normalised profit from operations increased 22% to R1.03bn, while reported profit from operations increased by a more modest 12% to R1.02bn.
Chief financial officer Bruce Bydawell said the lease-related accounting adjustments have now largely worked their way through the income statement, meaning future differences between normalised and reported earnings should be considerably smaller.
A second factor was the group’s transition from an equity-settled long-term incentive plan (LTIP) to a cash-settled structure.
During the year, Alexforbes recognised approximately R51m relating to the cash settlement of LTIP awards. The accounting treatment requires these costs to be recognised through the income statement, increasing reported operating expenses.
Bydawell said the transition will continue over the next two to three years as older equity-settled awards vest and are replaced by cash-settled incentives.
The move also affects diluted earnings calculations. Alexforbes still has approval to issue shares under the legacy incentive scheme, creating potential dilution in earnings-per-share calculations. However, as the group transitions to cash-settled awards, the dilution effect should ultimately disappear because future incentive awards will no longer be settled through the issuance of shares.
The increase in the weighted average number of shares in issue was modest, rising from 1.249 billion to 1.267 billion, suggesting that dilution was not the primary driver of the decline in HEPS.
Management noted that headline earnings from continuing operations were specifically affected by the accounting treatment of the head-office lease and the cash settlement of LTIP awards.
A third factor affecting comparability was the final resolution of the group’s long-running ETV liability matter.
The ETV liability relates to a legacy obligation arising from the sale of Alexforbes’ UK subsidiary, Alexander Forbes Consultants and Actuaries Limited (AFCA), in 2012. Although the business was sold more than a decade ago, Alexforbes retained certain warranties and liabilities linked to historic financial advice provided before the transaction.
The matter escalated after the UK’s Financial Conduct Authority required industry-wide redress payments for historic pension-transfer advice failures, significantly increasing the potential liability. Alexforbes subsequently became involved in a dispute with one of the insurers in its layered insurance programme after the insurer declined to honour claims related to the redress payments.
Following a favourable court ruling in 2025, Alexforbes recovered a substantial portion of the claim and continued pursuing the balance. During FY2026, the group concluded a final settlement relating to the insurance claim, bringing the long-running matter to a close.
The lower contribution from discontinued operations – R95m compared with R161m in the previous year – was one of the factors that weighed on profit for the year. Management said the ETV matter has now been fully resolved and will not affect future reporting periods.
Expenses remain under control
Operating expenses increased 9% to R3.85bn.
However, excluding the LTIP settlement and the prior-period lease adjustment, underlying operating expenses increased by only 5%.
Personnel costs rose 7% as performance-related remuneration increased, while technology expenditure increased 17% as Alexforbes continued investing in digital capabilities and platform development.
The group’s normalised cost-to-income ratio improved from 80.9% to 78.8%.
Retail momentum continues
Retail remained one of the strongest-performing areas of the business.
Operating income from the retail segment increased 15% to R768m, while retail assets under management grew 21% to R112.3bn.
Assets under advice increased 17% to R131bn, and new business flows rose 39% to R36.5bn.
Growth was supported by higher direct investment flows, adviser-led business, and increased activity through the group’s discretionary fund management offering.
The adviser force expanded from 279 advisers to 315 during the year.
De Villiers said the retail business is beginning to benefit from investments made over several years in adviser capability, technology platforms, and partnerships.
“It’s R119bn [16%] of the R733bn [AuMA] and we’re expecting that to become a bigger portion of the total assets under management as we grow out from here,” he said.
Strong performance across core businesses
Within the corporate segment, operating income increased 6% to R1.98bn.
The number of active members increased 17% to more than 1.33 million, while assets in Alexforbes’ umbrella fund solutions grew 20% to R197.7bn.
Management described the recently launched Alexforbes One umbrella fund as a key strategic initiative and said it is gaining traction in the market.
The investments business continued to perform strongly, with investment portfolios achieving top-quartile rankings against both single-manager and multi-manager peer groups across one-, three-, five- and ten-year periods.
The multinational business increased operating income by 5% to R478m, while annualised new business revenue almost doubled to R42.4m.
Capital position remains robust
Alexforbes ended the year with a strong balance sheet.
Available cash before dividend payments increased 23% to R860m, while the group’s regulatory surplus stood at R1.19bn.
Return on equity improved to 21.2%, up from 20.8% a year earlier.
The board declared a final dividend of 33 cents per share, bringing the total annual dividend to 57 cents, up 4% from the previous year.
Looking ahead
Management believes the group is entering the next phase of its growth strategy, with much of the investment undertaken over the past several years now shifting into execution.
De Villiers said the group’s priorities remain focused on strengthening its position as a leading investment partner, expanding retail solutions, growing the newly launched Alexforbes One umbrella fund, scaling sustainability consulting and improving operational efficiency through a single fund-administration platform across multiple jurisdictions.
Artificial intelligence is expected to play an increasingly important role in those plans. During the results presentation, management indicated that the group has moved beyond experimentation and established formal governance structures around AI deployment, including the adoption of Microsoft Copilot as its enterprise platform.
According to Alexforbes, AI is already being deployed across client servicing, analytics, risk management, and operational workflows. Management said the focus is on improving client experience, decision-making, and scalability as the business grows, while maintaining appropriate governance and oversight.
De Villiers noted that AI presents both opportunities and risks, particularly in the area of cybersecurity, and said the group is focused on practical applications that can deliver measurable business outcomes.
The group expects several AI initiatives to begin producing measurable results over the next 12 months.
Despite ongoing market volatility and global uncertainty, management said the business remains well positioned for future growth, supported by a diversified earnings base, strong capital position, and growing retail and intermediary capabilities.
“The next phase, for us and for South Africa, is really about doing the basics well and doing them consistently,” said De Villiers.
