August 2, 2018 / 6:34 AM / a year ago

UPDATE 1-S.Africa's Liberty sees H1 profit rise as turnaround gains traction

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JOHANNESBURG, Aug 2 (Reuters) - South African insurer Liberty Holdings reported a 6 percent rise in half-year profit on Thursday, a sign that a turnaround strategy launched a year ago is gaining momentum.

Liberty, a unit of lender Standard Bank, is in the middle of a financial recovery plan under current Chief Executive David Munro that includes a greater focus on higher-margin products and slower offshore expansion. Munro took the reigns a year ago from Thabo Dloti.

Dloti resigned after clashing with the board over his acquisition-fuelled expansion across Africa, while Standard Bank accused him of neglecting the vast, largely untapped lower-income market at home.

Normalised headline earnings, a closely-watched profit measure that excludes certain one-off items, rose to 482 cents per share in the six months ended June compared with 457 cents a year earlier.

“Our results for the half year reflect a stabilisation of our business, but we are still some distance from where we need to be, especially given weak new business volumes,” Munro said in a statement.

Munro also said new business volumes, or new insurance policy sign-ups, were expected to remain under pressure in the face of a weak South African economy and job losses.

Liberty, which was founded in 1957 by businessman and philanthropist Donald Gordon, said a data breach of some of its customers’ emails in June remained a subject of criminal investigation.

Reporting by Tiisetso Motsoeneng; editing by Alexander Winning and Emelia Sithole-Matarise

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