Select Page

Karasites want development – not only jobs

Karas Region Governor, Bernadus Swartbooi and former governor and deputy chief of the /Hai - /Khaua Traditional Authority, Stephanus Goliath, could not contain their joy at the groundbreaking ceremony of the Neckartal dam site. (Photograph by Alie Thaniseb)

Karas Region Governor, Bernadus Swartbooi and former governor and deputy chief of the /Hai – /Khaua Traditional Authority, Stephanus Goliath, could not contain their joy at the groundbreaking ceremony of the Neckartal dam site. (Photograph by Alie Thaniseb)

It took years of negotiations and months of court battles but the Neckartal Dam, 70 kilometres south of Keetmanshoop, came closer to realisation on 20 September 2013. Speaking at the ground breaking and site handover ceremony, Bernadus Swartbooi, Governor of the Karas Region, said the dam would be a sign of economic liberation for the people of the region who have been longing for development. “I know the people will do their best and not leave after they receive their first salary and I know they will come to work sober.  People from this area should also not only be given employment opportunities, small and medium enterprises, catering businesses and construction businesses should also benefit from this project. This is a national project and people from across the country are welcome to come and work here, but I feel preference should be given to the people of this region. Keetmanshoop should benefit from this project directly.” “We can do quarrying, catering… We have big businesses and we do not only have hands, we have brains as well,” Swartbooi said amidst loud applause from the community. He added that the project is the largest investment the government has made thus far and that the local people should therefore largely benefit from the project. Sharing Governor Swartbooi’s sentiments, Dawid Boois, Councillor of the Berseba Constituency, also emphasised that the local communities should benefit from the Neckartal Dam. “Snyfontein should also benefit from this project and from discussions that we had so far, electricity is one of the things Snyfontein will get as a direct result of this project. Keetmanshoop should also thrive as a result of the dam. I also want to urge the future employees of this project not to ‘touch and go’. You must work. I hear that some people are also thinking about leaving their jobs to come and work at the dam, but keep in mind that this work will only be temporary, so please stay at your jobs,” Boois urged. On his part, the deputy chief of the /Hai-/Khaua traditional authority, Stephanus Goliath expressed his hope that the “dust has settled and that no more court fights will take place.” “I really hope that the dust has settled and now that we are embarking on the construction of the damwall, we must keep a few things in mind: those who are building this dam are making use of the resources under the jurisdiction of the /Hai-/Khaua traditional authority and we believe that there should be some benefit for the people. Salini cannot take these resources without having the /Hai-/Khaua traditional authority in mind.” “Further, I want to tell my people that an opportunity, by nature, only comes once and if we do not take the opportunities coming with the construction of this dam, I do not know what opportunities we will grab. Now is the time to work. Employment will be given to the area and the whole region, so we must work,” Goliath emphasised. Salini S.p.A, an Italian construction company, was re-awarded the tender of the damwall in early August.  The company was initially awarded the tender on 28 March 2013 but the decision was challenged in court and the tender was withdrawn. The High Court then instructed the Tender Board to review the tender and subsequently, the Italian firm was re-awarded the tender. The Neckartal Dam project will cost N$2.8 billion and will create 12,000 permanent jobs. Once the dam is completed, it will store water and generate power for a 5000 hectare irrigation scheme. “The Neckartal Dam project, which was conceptualised more than a hundred years ago, has now become a reality, 23 years after Namibia’s attainment of political freedom and  independence. The fundamental objectives of the project have not essentially changed from what was conceptualised around 1911 which is systematic harnessing of this river to irrigate vast stretches of arable land. The water will also be used to drive other socio-economic developments in pursuit of Vision 2030 objectives,” said Hon John Mutorwa, Minister of Agriculture, Water & Forestry, at the groundbreaking ceremony. Mutorwa said the government is investing a huge amount of money in the project and therefore demands quality work and value for money. “Let the work begin in earnest now. Sound harmonious working relationships, particularly among employers and employees, must prevail at this project from day one onwards,” he concluded.

About The Author

Sanlam 2018 Annual Results

7 March 2019


Sanlam’s 2018 annual results provides testimony to its resilience amid challenging operating conditions and negative investment markets

Sanlam today announced its operational results for the 12 months ended 31 December 2018. The Group made significant progress in strategic execution during 2018. This included the acquisition of the remaining 53% stake in SAHAM Finances, the largest transaction concluded in the Group’s 100-year history, and the approval by Sanlam shareholders of a package of Broad-based Black Economic Empowerment (B-BBEE) transactions that will position the Group well for accelerated growth in its South African home market.

Operational results for 2018 included 14% growth in the value of new life insurance business (VNB) on a consistent economic basis and more than R2 billion in positive experience variances, testimony to Sanlam’s resilience in difficult times.

The Group relies on its federal operating model and diversified profile in dealing with the challenging operating environment, negative investment markets and volatile currencies. Management continues to focus on growing existing operations and extracting value from recent corporate transactions to drive enhanced future growth.

The negative investment market returns and higher interest rates in a number of markets where the Group operates had a negative impact on growth in operating earnings and some other key performance indicators. This was aggravated by weak economic growth in South Africa and Namibia and internal currency devaluations in Angola, Nigeria and Zimbabwe.

Substantial growth in Santam’s operating earnings (net result from financial services) and satisfactory growth by Sanlam Emerging Markets (SEM) and Sanlam Corporate offset softer contributions from Sanlam Personal Finance (SPF) and Sanlam Investment Group (SIG).

Key features of the 2018 annual results include:

Net result from financial services increased by 4% compared to the same period in 2017;

Net value of new covered business up 8% to R2 billion (up 14% on a consistent economic basis);

Net fund inflows of R42 billion compared to R37 billion in 2017;

Adjusted Return on Group Equity Value per share of 19.4% exceeded the target of 13.0%; and

Dividend per share of 312 cents, up 8%.

Sanlam Group Chief Executive Officer, Mr Ian Kirk said: “We are satisfied with our performance in a challenging operating environment. We will continue to focus on managing operations prudently and diligently executing on our strategy to deliver sustainable value to all our stakeholders. The integration of SAHAM Finances is progressing well. In addition, Sanlam shareholders approved the package of B-BBEE transactions, including an equity raising, at the extraordinary general meeting held on 12 December 2018. Our plan to implement these transactions this year remains on track.”

Sanlam Personal Finance (SPF) net result from financial services declined by 5%, largely due to the impact of new growth initiatives and dampened market conditions. Excluding the new initiatives, SPF’s contribution was 1% down on 2017 due to the major impact that the weak equity market performance in South Africa had on fund-based fee income.

SPF’s new business sales increased by 4%, an overall satisfactory result under challenging conditions. Sanlam Sky’s new business increased by an exceptional 71%. Strong growth of 13% in the traditional individual life channel was augmented by the Capitec Bank credit life new business recognised in the first half of 2018, and strong demand for the new Capitec Bank funeral product. The Recurring premium and Strategic Business Development business units also achieved strong growth of 20%, supported by the acquisition of BrightRock in 2017. Glacier new business grew marginally by 1%. Primary sales onto the Linked Investment Service Provider (LISP) platform improved by 5%, an acceptable result given the pressure on investor confidence in the mass affluent market. This was however, offset by lower sales of wrap funds and traditional life products.

The strong growth in new business volumes at Sanlam Sky had a major positive effect on SPF’s VNB growth, which increased by 7% (14% on a comparable basis).

Sanlam Emerging Markets (SEM) grew its net result from financial services by 14%. Excluding the impact of corporate activity, earnings were marginally up on 2017 (up 8% excluding the increased new business strain).

New business volumes at SEM increased by 20%. Namibia performed well, increasing new business volumes by 22% despite weak economic conditions. Both life and investment new business grew strongly. Botswana underperformed with the main detractor from new business growth being the investment line of business, which declined by 24%. This line of business is historically more volatile in nature.

The new business growth in the Rest of Africa portfolio was 68% largely due to corporate activity relating to SAHAM Finances, with the East Africa portfolio underperforming.

The Indian insurance businesses continued to perform well, achieving double-digit growth in both life and general insurance in local currency. The Malaysian businesses are finding some traction after a period of underperformance, increasing their overall new business contribution by 3%. New business production is not yet meeting expectations, but the mix of business improved at both businesses.

SEM’s VNB declined by 3% (up 6% on a consistent economic basis and excluding corporate activity). The relatively low growth on a comparable basis is largely attributable to the new business underperformance in East Africa.

Sanlam Investment Group’s (SIG) overall net result from financial services declined by 6%, attributable to lower performance fees at the third party asset manager in South Africa, administration costs incurred for system upgrades in the wealth management business and lower earnings from equity-backed financing transactions at Sanlam Specialised Finance. The other businesses did well to grow earnings, despite the pressure on funds under management due to lower investment markets.

New business volumes declined by 13% mainly due to market volatility and low investor confidence in South Africa. Institutional new inflows remained weak for the full year, while retail inflows also slowed down significantly after a more positive start to the year. The international businesses, UK, attracted strong new inflows (up 57%).

Sanlam Corporate’s net result from financial services increased by 4%, with the muted growth caused by a continuation of high group risk claims experience. Mortality and disability claims experience weakened further in the second half of the year, which is likely to require more rerating of premiums in 2019. The administration units turned profitable in 2018, a major achievement. The healthcare businesses reported satisfactory double-digit growth in earnings, while the Absa Consultants and Actuaries business made a pleasing contribution of R39 million.

New business volumes in life insurance more than doubled, reflecting an exceptional performance. Single premiums grew by 109%, while recurring premiums increased by a particularly satisfactory 56%.

The good growth in recurring and single premium business, combined with modelling improvements, supported a 64% (71% on a comparable economic basis) increase in the cluster’s VNB contribution.

Following a year of major catastrophe events in 2017, Santam experienced a relatively benign claims environment in 2018. Combined with acceptable growth in net earned premiums, it contributed to a 37% increase in gross result from financial services (41% after tax and non-controlling interest). The conventional insurance book achieved an underwriting margin of 9% in 2018 (6% in 2017).

As at 31 December 2018, discretionary capital amounted to a negative R3.7 billion before allowance for the planned B-BBEE share issuance. A number of capital management actions during 2018 affected the balance of available discretionary capital, including the US$1 billion (R13 billion) SAHAM Finances transaction. Cash proceeds from the B-BBEE share issuance will restore the discretionary capital portfolio to between R1 billion and R1.5 billion depending on the final issue price within the R74 to R86 price range approved by shareholders.

Looking forward, the Group said economic growth in South Africa would likely remain weak in the short to medium term future, and would continue to impact efforts to accelerate organic growth. The outlook for economic growth in other regions where the Group operates is more promising. Recent acquisitions such as the SAHAM transaction should also support operational performance going forward.

“We remain focused on executing our strategy. We are confident that we have the calibre of management and staff to prudently navigate the anticipated challenges going forward,” Mr Kirk concluded.

Details of the results for the 12 months ended 31 December 2018 are available at