Old Mutual Holdings has announced that it has posted a Ksh. 5 million net profit for the half year period ended June 30th 2025. This is a 99% drop from the Ksh. 327 million the company posted in a similar period in 2024.
The drop in profitability by the company was attributed to a challenging macroeconomic environment across the East African region marked by lower interest rates and higher claims. The surge in claims during the period spread across both the short-term and long-term insurance businesses, which stood at Ksh. 452 million compared to the same period in 2024.
The performance was impacted by lower interest income and mark to market losses on fixed income securities, which reduced earnings by Ksh. 625 million, alongside higher insurance claims and service expenses, particularly in the medical and life businesses.
Profitability was also weighed down by reduced performance in the asset management and property operations, driven in part by lower occupancy in Uganda and South Sudan properties.
Speaking during the 2025 interim results announcement, Old Mutual Holdings Group CEO Arthur Oginga expressed confidence in the outlook, saying that the increase in claims underscores Old Mutual’s commitment to honour its promise to safeguard the well-being and financial security of its clients.
“Although higher claims placed short-term pressure on profitability, it is a demonstration of the strength of our promise to customers and the resilience of our business model. I am encouraged by the growth in investment income, the expansion of our asset management business, and the strengthening of our balance sheet. These fundamentals give us confidence in our ability to deliver long-term value for our shareholders, while continuing to stand firmly with our customers in times of need,” Mr. Oginga said.
The life insurance business recorded a profit after tax increase of Ksh. 580 million, mainly attributable to fair value gains on financial assets following a decline in the yield curve, as well as lower reinsurance costs.
“As a company, we are transitioning from being viewed as an insurance provider to becoming a partner in our customers’ overall well-being. Through Thrive app, we bring together physical, mental, and financial wellness in one seamless experience, empowering communities across all our markets to lead healthier lives and achieve greater financial security. Already, more than 18,000 users are benefiting from Thrive, and we will continue to leverage the app to deepen engagement and reimagine how we support our customers’ journey to prosperity,” Mr. Oginga noted.
Financial highlights
- Net investment income strengthened by 13% to Ksh. 4.2 billion from Ksh. 3.7 billion in 2024, supported by the appreciation of the Kenya shilling against the dollar, increase in underlying assets, and fair value gains.
- Fee income increased on the back of rising funds under management.
- Total assets rose to Ksh. 79.2 billion (up from Ksh. 74.8 billion in December 2024).
- Property rental income declined as occupancy fell to 72.6% in Uganda (from 92%) and 53.9% in South Sudan (from 63%).
- Group commission fee and operating expenses increased to Ksh. 1.6 billion from Ksh. 900 million in H1 2024. This increase was impacted by one-off costs in the current year and one-off provision reversal in the prior period, coupled with higher.
- Funds under management in Uganda rose to Ksh. 145 billion, driving higher fee and commission income.
- The asset management line of business reported good growth in Unit trust business, reaching AUM of Ksh. 142 billion, a growth of 25%.
- Life profits before tax grew with over 100% to reach Ksh. 419 million from Ksh. 168 million in the prior period.
- Digital sales reached Ksh. 373 million and value from data commercialization delivered savings of Ksh. 138 million.