Staff Writer
Old Mutual Limited says Zimbabwe remains strategically relevant within the broader Old Mutual Africa Regions cluster, where the group is pursuing growth in retail and high-net-worth segments.
The group in its 2025 annual financials said a new high-net-worth offering rolled out in partnership with its wealth management division has been extended to affluent clients in Zimbabwe alongside markets such as Uganda and Eswatini, as part of efforts to deepen penetration in higher-value customer segments.
At the same time, Old Mutual’s fintech wallet platform, O’mari, continued to gain traction in Zimbabwe, with its customer base surpassing two million users during the year, reflecting strong adoption of digital financial services despite the challenging economic environment.
However, the group’s latest annual report shows that Zimbabwe operations weighed on earnings in the year to December 31, 2025, as currency issues and structural constraints offset otherwise strong growth across its African footprint.
Headline earnings declined by 2% during the period, “mainly due to the impact of Zimbabwe,” underscoring the continued drag from the market.
While IFRS profit rose 10% to R8.4 billion, supported by improved operating performance and the absence of prior-year impairments, this was “partially offset by reduced profits from our Zimbabwean business” following major currency shifts in 2024.
The impact from Zimbabwe stems largely from significant monetary and accounting adjustments triggered by the country’s evolving currency regime.
During 2024, authorities introduced the Zimbabwe Gold (ZiG), prompting Old Mutual to reassess its functional currency before ultimately switching to the US dollar by mid-year.
The group noted that Zimbabwe remains classified as a hyperinflationary economy, requiring inflation-adjusted accounting under international standards, a process that continues to distort earnings and complicate comparability.
Further highlighting structural constraints, Old Mutual said the equity value of its Zimbabwe operations is effectively carried at zero within group valuation metrics due to “continued restrictions to access capital by way of dividends.
This means that while the business continues to operate, it is not contributing to group equity value, reflecting persistent challenges in repatriating capital.
Regionally, Old Mutual’s Africa business delivered a strong rebound, with results from operations rising 64% to R1.68 billion, supported by improved pricing, cost optimisation and investment performance.
However, this growth was largely driven by other markets such as Malawi, masking the ongoing drag from Zimbabwe.
At group level, Old Mutual reported steady operational progress, including an 8% increase in total dividend per share to 93 cents and a 2% rise in group equity value per share to R19.80, as it continues to execute a strategic reset focused on value creation and growth.
The group is also pursuing cost efficiencies and capital optimisation, including a R3 billion share buyback programme, while positioning its banking and digital platforms for future expansion.
