Old Mutual reported higher operating earnings for the year to the end of December 2025, as improved underwriting performance in its insurance business, strong growth in asset management, and higher earnings from African operations offset weaker profitability in new life business.
The group described 2025 as a year of strategic reset focused on improving returns from its core businesses while building new growth platforms such as OM Bank.
Group chief executive Jurie Strydom said: “We have reset our strategic priorities to unlock value and generate growth. Group equity value per share increased to R19.80, enhanced by business performance in Old Mutual Insure and Old Mutual Wealth. On cash generation, the board declared a final dividend of 56 cents per share, bringing the total dividend to 93 cents per share, an increase of 8% year-on-year.”
The strategy centres on strengthening the competitiveness of the group’s South African operations, deepening its presence in southern Africa and building scale in its banking business.
Results from operations increased 13% to R9.8 billion (per share +15% to 225.6 cents), while adjusted headline earnings rose 24% to R8.3bn (adjusted HEPS +26% to 189.8 cents). IFRS profit increased 10% to R8.4bn. Headline earnings declined 2% to R8.6bn (HEPS -1% to 201.6 cents), which Old Mutual attributed mainly to the impact of its Zimbabwe operations following the functional-currency transition.
The group’s return on net asset value was 15.2%, within its target range, while group equity value per share increased 2% to R19.80. Return on embedded value was 7.8%, with the contractual service margin standing at R65bn and releasing predictably within the expected annual range of 8% to 12%.
Old Mutual operates a diversified portfolio spanning life insurance and savings, short-term insurance, asset management, banking, and financial services operations across several African markets. Performance across these businesses varied during the year.
Life and Savings
The Old Mutual Life and Savings cluster – which includes Mass and Foundation, Personal Finance, Wealth Management, and Old Mutual Corporate – recorded moderate growth in activity during the year.
Life APE (annual premium equivalent) sales increased 3% to about R12.3bn, while gross flows rose 7% to about R147.1bn. Funds under management in the Life and Savings cluster increased 11% to about R1.1 trillion.
However, profitability of new business declined significantly. The value of new business fell 52% and the value-of-new-business margin decreased to 1.2% (from 2.5% the previous year), below the target range.
According to Old Mutual, the decline was mainly because of strengthened persistency assumptions in the Mass and Foundation business, lower guaranteed annuity sales in Personal Finance, higher non-hedgeable risk costs, and variability in umbrella-fund sales in the corporate segment.
Sales performance differed across the cluster’s segments. Retail risk sales increased in Mass and Foundation and Personal Finance, while guaranteed annuity sales declined sharply. In Wealth Management, retail APE sales increased as customer retention improved and non-covered sales expanded. In the corporate segment, Life APE sales increased 18% to about R1.845bn, supported by growth in retirement fund business.
Old Mutual said restoring value-of-new-business margins will depend on improving product mix, strengthening customer retention, improving collections performance, and expanding the use of digital tools to support advisers. From 2026, the group will formally track and report progress on these metrics as part of its medium-term value-creation targets.
OM Bank and banking activities
Old Mutual’s banking operations continued to expand during the year following the public launch of OM Bank in August 2025.
By December 2025, the bank had attracted about 284 000 customers during its rollout phase, with onboarding averaging roughly 3 000 new customers per business day. Retail deposits reached approximately R272m, and about 62% of customers were active, with 46% of customers originating through the Old Mutual branch network.
Old Mutual also recognised a R3bn impairment on its investment in OM Bank, reducing the carrying value from R6bn to R3bn following an impairment assessment under IAS 36.
The group said updated forecasts indicate higher capital requirements and lower expected operating returns than previously projected. The valuation was determined using a dividend discount model based on a nine-year cash-flow forecast.
Despite the impairment, Old Mutual said its plan to reach monthly breakeven by 2028 remains on track.
Old Mutual Finance continued to expand lending activity during the year. Loan sales and disbursements increased 22% to about R9.5bn, while the gross loan book remained around R15bn and the net lending margin improved to 12.1%.
Management said the banking strategy focuses on building a customer base and deposit base before expanding lending and payment services across the group’s distribution network.
Old Mutual Insure
The Old Mutual Insure business delivered improved underwriting profitability and continued premium growth.
Gross written premiums increased 7% to about R23.4bn, while results from operations rose 14% to about R2.06bn. The net underwriting margin improved to 6.8%, within the group’s target range of 5% to 8%.
Old Mutual said disciplined underwriting and improved pricing supported the stronger margins. Profitability was affected by a once-off provision related to a third-party cell in Old Mutual Alternative Risk Transfer Insure. Excluding this provision, the underwriting margin would have been about 8.3%.
The company also said the insurer recorded improved claims performance during the year, although the operating environment remains challenging because of claims inflation, rising repair costs, and increasing exposure to climate-related risks such as floods, wildfires, and hailstorms.
Old Mutual said it is expanding the use of digital tools and data analytics, including artificial intelligence, in underwriting and claims management while strengthening catastrophe modelling and risk management capabilities.
Old Mutual Investments
The Old Mutual Investments business continued to benefit from growth in assets under management and diversification across public and private markets.
Assets under management surpassed R1 trillion for the first time, reaching about R1.022 trillion, an increase of roughly 13% year on year. The group noted that its Alternatives platform has grown at a compound annual rate of about 19% over five years to approximately R130bn.
The asset management business generated results from operations of about R1.544bn during the year. Old Mutual said the business benefits from diversified revenue streams across management fees, private markets activity, and infrastructure investments.
Old Mutual Africa Regions
Outside South Africa, the Old Mutual Africa Regions cluster delivered strong earnings growth.
Results from operations increased 64% to about R1.7bn, driven largely by equity market returns in Malawi and operational improvements across the regional portfolio.
Life APE sales increased about 8%, while the value-of-new-business margin improved by roughly 170 basis points to about 1.9%, reflecting pricing adjustments and product-mix changes.
Old Mutual noted that Malawi remains the largest contributor to earnings in the regional portfolio. However, the company also highlighted currency risk, noting that a 30% to 50% depreciation of the Malawian kwacha would reduce group results-from-operations growth to about 7% to 9%.
Management said the regional business remains central to its strategy of strengthening market leadership in southern Africa and expanding access to financial services across the continent.
Capital management and cost discipline
Alongside these developments, Old Mutual continued to focus on capital returns and operational efficiency.
The board declared a final dividend of 56 cents per share, bringing the total dividend for the year to 93 cents, an 8% increase from the previous year.
The group also announced a R3bn share buyback programme, of which R682m had been executed during the second half of 2025. Strong cash generation lifted discretionary capital to R6.1bn – almost double the prior year.
Old Mutual said its cost-reduction programme aims to deliver R2.5bn in savings by 2027, equivalent to roughly a 10% reduction in the group’s 2024 operating cost base. The company reported R450m in savings during 2025.
Shareholder operational costs increased to R1.889bn, mainly because of R440m in restructuring costs incurred as part of the programme. Excluding these restructuring expenses, operating costs would have declined by R246m (15%) year on year.
The group maintained a strong capital position, reporting a shareholder solvency ratio of 162%, within its target range of 155% to 185%.
Outlook
According to Strydom, Old Mutual’s strategic priorities remain focused on improving returns from existing businesses while building new growth platforms. The company said restoring profitability in new life business, expanding its banking operations, and maintaining underwriting discipline in insurance will be key operational priorities.
From 2026, Old Mutual will track and report delivery of its medium-term value-creation targets, with a focus on cost-saving targets, customer retention and collections, new business volumes, and growth in OM Bank customers.
Old Mutual also said the outlook for South Africa may improve if fiscal consolidation and structural reforms outlined in the Budget support stronger economic growth and demand for financial services, although global economic conditions remain uncertain.
“With public debt projected to stabilise and decline over the medium term, alongside a sustained primary surplus and targeted relief for households, these conditions will provide a more supportive foundation for confidence and investment,” it said.
