The group said in a trading statement yesterday that normalised profit from operations was expected to increase by between 43 percent and 48 percent. Core new business Annual Premium Income (API) increased by 6 percent.
New initiatives progressed well in the year, with a strong performance by Discovery Bank and a focus on the build out of Amplify Health, the joint venture with AIA. The joint venture aims to create Asia’s biggest digital insurtech company.
Discovery intends to report its full year results on September 7.
The group said its focus through the year had been to build on its strong competitive positioning in the SA Composite, UK Composite and Vitality Global, through focused execution while continuing to invest in the Vitality Shared Value business model.
Another focus area was to drive new business initiatives, led by Discovery Bank as well as initiatives within Vitality Group, notably the build out of Amplify Health, while streamlining some other initiatives.
Another focus was to maintain capital strength, with high levels of liquidity and solvency and a reduction in the financial leverage ratio.
The group said its SA Composite performed strongly with normalised operating profit expected to increase by between 38 percent and 43 percent and new business increasing by 15 percent.
Discovery Insure was severely impacted by adverse weather, notably the severe flooding in KwaZulu-Natal, and supply-side inflation related to the cost of repairing motor vehicles.
The UK Composite performed strongly with normalised operating profit expected to increase by between 23 percent and 28 percent, and new business by 19 percent. Vitality Health’s performance was strong across all metrics.
The operating performance of Vitality Global, represented by Vitality Group and PAH, the health insurer in China, reflected dynamics of the impact of Covid-19 on the Asian markets. Vitality Group’s normalised operating profit increased by between 10 percent and 15 percent over the previous period, despite a reduction in new business volumes experienced by some key markets.
PAH delivered a strong operational performance, but profits were impacted by the decline in Chinese investment markets.
BUSINESS REPORT