PSG Konsult reports 5% increase in full-year headline earnings

PSG Konsult, the listed investment and insurance holding company, recently reported a 5 per cent increase in recurring headline earnings per share and a return on equity of 22.7 per cent for the year ended February 23. Mike Smith, the company's Chief Financial Officer, appeared on CNBC Africa to discuss the divisional performance and future growth prospects amidst a challenging operating environment. Smith highlighted the tough conditions in the market, with the Johannesburg Stock Exchange delivering only a 2 per cent return compared to the previous year's 15 per cent. Despite this, all of PSG Konsult's businesses managed to bring in positive net inflows. The wealth division saw significant growth, with $13 billion of positive net inflows during the period. This division's results were up by 11 per cent and contributed 60 per cent to the overall earnings. Asset management also performed well, winning awards and achieving good market returns. However, lower performance fees led to a slight decrease in earnings compared to the previous year. The insurance business, on the other hand, experienced a growth in gross written premiums but reported earnings 4 per cent lower than the previous year due to certain impacts. Smith expressed satisfaction with the top-line revenue and asset growth, indicating a sustainable and growing franchise for PSG Konsult. Looking ahead, Smith discussed the growth strategy for the company, emphasizing the potential for market share expansion in each business segment. PSG Konsult aims to leverage its high-caliber advisor base, diverse portfolios, and technology to attract more clients and achieve better outcomes. The company sees opportunities for growth in the wealth, asset management, and insurance sectors by focusing on client service excellence and utilizing technology to enhance the client experience. Despite the challenges in the South African investment landscape, including issues in network industries like rail and electricity, Smith remains optimistic about the country's potential. He believes that closer cooperation and effective project implementation can drive positive growth and create better employment opportunities for South Africans. Acknowledging the risks posed by a stagnating economy, Smith highlighted PSG Konsult's diversified asset base as a key strength that allows the company to navigate through difficult times. The company's ability to adapt and operate efficiently in challenging environments, such as the COVID-19 pandemic and energy crisis, demonstrates its resilience and commitment to success.