Momentum Group Ltd. is set to revamp its Africa operations as part of a broader strategy to drive a 60% profit boost and increase its headline earnings from the region to $386.1 million by 2027.
The Johannesburg-based insurer aims to improve efficiency and expand market share in its remaining African markets—Mozambique, Namibia, Botswana, Ghana, and Lesotho—where it already commands a 65% market share.
Speaking in an interview on Thursday , Momentum CEO Jeanette Marais highlighted the company’s ambitions, stating that stabilising African operations at $27 million to $32.9 million in annual earnings would be a major milestone.
“Part of that review is actually to just get efficiency into the system,” she said. “Potentially giving the business more in-country capabilities for marketing, distribution and tailored product development will make it ‘a master of its own destiny.’’
Momentum has been streamlining its African presence, having exited Nigeria and Kenya in recent years.
The insurer now seeks to lower costs at its centralised service centre while lifting its market share in remaining territories to a top-three position.
The strategy, which was presented to the board last week, comes at a time when the group is recording robust financial performance, as reflected in its latest half-year results.
Strong half-year earnings fuel growth drive
The insurer reported a 55% increase in headline earnings per share (HEPS) for the six months ending 31 December 2024, with operating profit climbing 33% to $153.7 million.
The value of new business rose 40% to $15.3 million, largely supported by higher-margin protection products in Momentum Retail and improved profitability in Metropolitan Life. Underwriting profits from its short-term insurance arm and fee income from Guardrisk also contributed significantly to the results.
Momentum’s new business margin improved to 0.7%, reflecting better product pricing and persistency levels across its life insurance businesses. The group attributed its overall strong performance to higher contractual service margin releases, improved underwriting, and growth in new business.
Share buybacks and economic outlook
Momentum’s board has approved another $54.9 million share buyback, following the completion of a repurchase programme of the same amount in February.
The company noted that its stock continues to trade at a 23% discount to embedded value, making buybacks an attractive tool for creating shareholder value.
Looking ahead, the diversified insurer expects lower interest rates and easing inflation to improve disposable income levels, potentially driving further demand for insurance products in South Africa.
However, it remains cautious about global economic uncertainty, local fiscal pressures, and ongoing market volatility.
Despite these challenges, investor confidence remains strong, with Momentum’s shares rising 3% in early trade, underscoring optimism in the company’s long-term growth strategy.
