OUTsurance Group (OUT) H1 2025 earnings summary

Executive summary

• Group delivered strong operational and financial performance for the six months ending 31 December 2024, with normalized earnings up 52.9% to R2,158 million, driven by robust premium growth, improved profitability, and favorable weather across key segments.

• Operating profit increased 58.8% to R2,839 million, with record profits in all core businesses and higher investment income.

• OUTsurance Ireland launched in May 2024, achieving initial business targets but incurring expected start-up losses of R246 million.

• Strategic focus remains on organic growth, simplification, and capital discipline in South Africa, Australia, and Ireland.

Financial highlights

• Group normalised earnings rose 52.9% to R2,158 million; normalised ROE increased to 30.8%.

• Gross written premium (GWP) grew 17.4% to R18,916 million; annualised new business premium up 17.9%.

• Property & Casualty (P&C) operating profit surged 60.9% to R2,643 million; claims ratio improved to 53.0%.

• Dividend per share increased 44.8% to 88.6 cents, with payout ratio of 63.5%.

• OUTsurance Life operating profit more than doubled to R185 million; value of new business written up 83.8% to R68 million.

Outlook and guidance

• Premium inflation and interest rates expected to moderate over the next 12 months, but claims inflation may remain elevated due to technology and climate trends.

• Cyclone Alfred in March 2025 may impact Youi, but reinsurance is expected to limit net losses.

• Significant runway for organic growth in all geographies; focus on cost discipline and core business.

• OUTsurance Ireland expected to reach monthly break-even within five years.