Sanlam shares fall after R1.7bn B-BBEE cost

DURBAN – Sanlam’s share price declined by more than 5percent on the JSE on Friday morning, after the financial services group flagged a fall in earnings for the year to end December, impacted by a once-off expense of R1.7billion related to its broad-based black economic empowerment scheme (B-BBEE).

As a result, Sanlam said it expected its headline earnings per share (Heps) to decline by between 15percent and 25percent to between 334.2cents a share and 378.8c, down from last year’s Heps of 445.6c.

The share price closed 3.86percent lower at R64.22 on the JSE on Friday.

The group said its earnings were also likely to take a knock on an additional amortisation charge of about R250million on the business acquired in 2018, as well as a net loss of R868m on the consolidation of the Sanlam Foundation, and the B-BBEE entity.

Its diluted Heps was also expected to decline by between 15percent and 25percent to between 330.8c and 374.9c, down from 441.1c last year.