Good day, ladies and gentlemen. Welcome to the Old Mutual Quarter One of 2023 Operational Update. All attendees will be in listen-only mode. There will be an opportunity to ask questions when prompted. If you should need assistance during the call, please signal an operator by pressing star and then zero. Please note that this event is being recorded. I'd now hand the conference over to your host, Bonga Mriga. Please go ahead, sir. Thank you. Thank you, Judith. Good day, ladies and gentlemen, thank you for joining us on the call following the release of our voluntary operational update earlier today. I am Bonga Mriga. As it has been announced, I'm the Interim Head of Investor Relations. On the call, we are joined by our CEO, Iain Williamson, together with our CFO, Casper Troskie. We also have Ranen Thakurdin, who's our General Manager in Group Reporting and Insights, together with Farnaz Ahmed, who heads up our capital. Iain will take us through the call, we will open for Q&A after Iain has concluded on what he has to tell us today. The operator will guide you on how to queue up your questions. With that, I'll hand over to you, Iain. Thank you. All right, thanks, Bonga, and good evening, everybody, and thanks for taking the time to join the call this evening. Our business has shown great resilience overall in the first quarter of the year and demonstrated, I think, a continued momentum that we saw last year, despite economic pressures experienced across all of our markets and in particular, in South Africa. Just looking at some of the key performance indicators, Life APE sales were down 1%, mainly on the back of lower sales in China, following the withdrawal of a particular product in the Chinese business. Life sales, when you exclude China, were up 7%, with the momentum, particularly in our retail businesses, being maintained. Mass and Foundation Cluster Life sales grew 15% on the prior year, driven by Credit Life sales. In Personal Finance and Wealth Management, life sales were up 11%, mainly on the back of improved productivity in the channels and with a good contribution from guaranteed annuity sales, which should be encouraging for VNB and margins. There was strong growth both in the single and recurring premium arena. In our Africa regions, life sales are up 10%, driven by new business secured by renewals and by improved productivity in the East Africa region. Persistency does remain under pressure, despite the strengthening of our persistency basis at the end of last year, and particularly in the Mass & Foundation Cluster business, as you would expect in this economic climate. We remain focused on deploying an identified set of management interventions, which we believe will continue to improve our retention outcomes. Turning to gross written premiums on the short-term insurance side, GWP was up 19% with a strong showing across both the Africa regions businesses and in Old Mutual Insure. Africa regions being up 32% and Old Mutual Insure up 15%. Growth in the Africa regions was driven by the health and general insurance business in East Africa and by corporate new business in Southern Africa. Genric, which has been included in Old Mutual Insure's numbers for the first time in this quarter, contributed to the growth in GWP there, with the other channels also showing positive momentum. Gross flows were up 22% on the prior year, and in Old Mutual Investments, gross flows are up 90%, boosted by money market flows, fixed income, and corporate cash inflows into future growth. We have seen some drawdowns on from an investment perspective, from our alternatives, IDEAS, and AIIF4 funds. That's the infrastructure, the fourth infrastructure fund. We've seen strong growth in gross flows, resulting in stronger performance in net client cashflow as well. Loans and advances are flat on the year-end position at December, if you look back to the equivalent end of March last year, we're up 3% on the prior year. The business in the Mass and Foundation Cluster is up 6% in line with the constrained economic environment. The Africa Region's loan book is down 8% due to lower disbursements, given the tough economic climate, and in particular, in Kenya. I'm gonna move now from the operational to some more strategic matters. We will be hosting an investor update on the 28th of July this year in Cape Town. We will include a hybrid option for that meeting. We will update you in detail on our strategy for the medium to long term. In that session, we will include detailed content on both the progress on the bank build as well as the impacts from IFRS 17. We will include a teaching session on IFRS 17, over and above what we have already spoken you through at our annual results in March this year. From a capital perspective, we have now received approval from the regulator for our share buyback, which we announced in March. We are happy to confirm that we will be aiming to conclude a buyback of ZAR 1.5 billion. The share buyback, the Genric acquisition, and the Old Mutual Finance Namibia acquisitions have resulted in discretionary capital decreasing to ZAR 1.4 billion from ZAR 3.5 billion at the end of December. We continue to monitor group solvency, and our Group solvency ratio remains stable and within our target range of 170%-200%. As you all know, one of the main contributors to the tough operating environment at the moment is that the energy crisis in South Africa has worsened over time, and that's been coupled with strong depreciation of the rand against major currencies, and particularly against the US dollar. These present grave concerns around consumers' ability to handle additional financial pressure in an already financially stressful environment. We continue to call on the South African government to demonstrate leadership and take decisive action to address the concerns faced by the business community and by the citizenry of the country. We will strive to continue to balance the interests of all our stakeholders, including customers and shareholders. The time has come for our government to implement concrete, actionable steps to reverse the recent negative events. To achieve this, we believe the government needs to engage in a much more open dialogue with the business community, fostering a relationship of trust and collaboration. The willingness from the business community to assist is certainly there, but the ability to attain any traction in initiatives has proved to be incredibly difficult. With that, I will stop talking and ask the operator to help us manage the Q&A process. Thank you very much. Thank you, sir. Ladies and gentlemen, we will now be conducting the question and answer session. If you would like to ask a question, please press star and then one on your telephone keypad or the keypad on your screen. A confirmation tone will indicate that your line is in the question queue. You may press star two to exit the question queue. In the interest of time, we ask that you please limit yourselves to a maximum of three questions. Thereafter, you're welcome to rejoin the queue for any additional questions. Just a reminder, if you'd like to ask a question, you're welcome to press star and then one. The first question comes from Andrew Baker of Citi. Thank you so much for taking my questions. The first is just on the persistency pressure that you're seeing. Should we read into what you're saying today, that you are expecting further strengthening of your basis in the first half, or are you just flagging for sort of experience, variances, purposes? Related to the same topic, are you beginning to see any early signs of the benefits from the management actions that you've been referencing or that you referenced for the full year results around persistency? Secondly, just on China and the regulatory changes that you mentioned, are you able just to give a little bit more detail on what they were and then potentially maybe a% of the 2022 China APE that was contributed to from the products that are now ceased? Thank you so much. Okay. Thanks, Andrew. On the persistency, we have seen some positive indicators from some of our management actions in the sense that our first premium collection success rates have improved, NQU rates have got a bit better, et cetera. The pressure on the, I guess, the longer-dated enforced book remains a concern and something that we will continue to monitor. I think it's too early to say whether this pattern is something that would result in an assumption change being required. Obviously, three months of data is not very much, and historically, as you know, or you may know, our practice has been that we mainly revisit bases at the end of the year, although it is possible we could review a short-term provision at the half year, but I think it would require quite a significant variation from experience. As far as the China piece goes, we actually withdrew a product from our own product set in advance of the regulator, then essentially clamping down on a similar kind of product range across the market. That was for reasons of concerns around essentially the adequacy of pricing for risk in the way that that product was constructed. It was a single premium Universal Life type product. I mean, as you can see from the. It was a fairly material contribution to total sales last year, but I don't have the% off the top of my head to help you with, so we would need to come back to you with that number. Thanks. That's great. Caper, anything to add? No, Iain, I don't have anything to add. We haven't started, you know, we've started to work on experience investigations, but we're nowhere near concluding on what we're gonna be doing for the half year, so it's too early to give you any guidance on that. Thanks. Thanks. Operator, I think you can go to the next question. Thank you. No problem, sir. Going on to the next question, which comes from Anderson Chola of Bank of America. Evening, everyone. Thanks. Thanks for the time today. Three from me, please. First was on the buyback. Great to hear it's been signed off. Just really wondering if you can give us some color on the timescale and format of the buyback, please. Second, was just going back on persistency. I mean, it's just over two months since you last updated the market and announced the persistency provisions that have been taken. What's been said today leaves quite a bit of uncertainty until the next update in September. Just really wonder if you can give us a bit more context on potential impact and potential for more provisioning. I'm sure we'd all like to get ahead of this debate and feel we've, we can kind of, do one and done. The third question was just on China again, actually, just on the products, given that you withdrew it even before the regulatory changes. Can you give us any details on concerns on the backbook of product that's been written there? Any risks on that? Any thoughts there? Thanks. Sanesh, can you deal with the buyback process and issues, please? Yeah, sure. Thanks, thanks, Iain. Yeah, it all kind of happened at once in terms of getting Prudential Authority approval over the line and getting through our board steps. AGM is also coming up, we will effectively get that vote count into the AGM, and then we will execute basically imminently. I think the results are expected by tomorrow afternoon. You could effectively say we will start early next week. The timing, obviously, just looking at the trading volumes, we do expect that we will conclude over H1, to towards the end of, let's say, Q3 and Q4, but just depending on trading volumes. We will definitely execute before the end of 2023. That would just be the full ZAR 1.5 billion in one tranche? Yeah. We did note a range of one to one and a half. We have now confirmed it will be one and a half that we will execute. Thanks very much. Okay. On persistency, I don't have much to add to the way that we answered the question earlier. Unfortunately, it is a bit early to call it, and I realize that everyone would like clarity. We would, too. The truth of the matter is, I think that with the way that the economy has played out in South Africa, we saw another 50 basis points interest rate hike today, you know, I think we are seeing pressure on that sort of lower income consumer group. I think it is really just too early to answer, you know, how that's likely to pan out. On the China product, essentially the crux of the issue was that the early termination values on the product had to earn returns from a yield perspective that were, you know, tight. Not ridiculous, but very tight. I don't expect material exposure, but equally, you know, the product was not going to pass sort of profitability return on capital criteria from our perspective. That was why we terminated it. I don't anticipate that it should result in any sort of material, big loss problems or anything like that. Great stuff. Thank you very much. Thank you. The next question comes from Michael Christakis of UBS. Afternoon, guys. Thanks for the time. Just, maybe three from me as well. You called out the Genric impact on South African GWP. Can you just give us a sense of what the size of that is? How much of the 15% is Genric? In other words, what's the rest of the book done? The second one, maybe a better comment on the credit quality in Old Mutual Finance and how that's tracking in the current environment. We've seen, you know, some of the financial businesses locally take quite a bit of strain in the last couple of months. The third one is a question around maturities and withdrawals from affluent market savings products. Are you seeing a pickup there in terms of outflows from those products at all? Maybe any color you can give us on trends there. Thank you. Thanks, Mike. Cassie, can you... Do you have the Genric picture off the top of your head and IMF credit bit? Yeah. On the generic, I'll just look it up. I I don't have it off the top of my head, but I'll try and find it quickly, Iain. On the credit piece, we have seen that tick up, Michael, to, you know, the top end of our range. There has been pressure on that on credit. Just to remind you that our range is 6%-8%. We're still comfortable with where that's sitting, and we're obviously watching that closely. I'll obviously be able to give you an update at the end. Obviously, our growth in that book has been a lot slower than, you know, than the market growth. You shouldn't see the same level of impairments widely elsewhere. So- Finally, on the maturities and withdrawals piece, I don't think we've seen anything specific to write home about, you know, as in terms of problematic issues. We're keeping quite a close eye on that top end, on things like impact of immigration and things like that. I don't think we've seen anything, you know, that I would call out as a material issue, you know, worthy of noting in terms of impact on outflows and things like that at this stage. Right. Thanks very much, guys. You get that generic rate, it'll be great. Sure. Look, off the top of my head, Michael, and don't hold me to it, but off the top of my head, I think the core book is sort of around circa sort of 9% growth, and then the balance would effectively be the generic impact. Let us confirm that number. Great. Thank you. Thank you. The next question comes from Larissa Van Deventer of Barclays. Good afternoon. Two questions from my side, though. To circle back on China, I said two part question, so I suppose that makes it three. First question is, can you give us a little bit more color on what exactly the regulatory change is that is pending, and whether you expect any more? Would you give an indication of the degree of profitability of the China product and what impact that may have on VNB? Then second, it appears that the growth in South African sales has been tending towards risk products. Is it fair to assume that the current trend suggests an improvement in the new business margin for the half year? Or how should we think about margins as the current economic scenario plays out? Okay, thanks, Larissa. Just to be clear on the Chinese regulatory piece, it's not a forthcoming change. The regulator essentially clamped down on a particular product construct that was prevalent in the market, which was essentially a in our language, I guess, a Universal Life sort of endowment with early surrender value guarantees embedded into the product. That was essentially the structure of it. That's done. All players in the market have effectively withdrawn the product from the beginning of this year. It's not a forthcoming thing. As I've described, the impact that I described earlier is the appropriate impact to think about it. I think the main impact on us will be simply on sales, because it was a popular product in the channels. There's a regulatory timeline, lead time to effectively constructing and getting approved a replacement product to fill the gap that it leaves in your product range in terms of your ability to sell. You know, China is very granular in its regulation around product. You have every product you construct, which we would regard as just a change in features or even a launching the same product into a different channel, requires a separate regulatory approval. There's quite a lot of, you know, lead time involved in getting that right. I think your statements around the mix and the probable impact on margin are likely to be correct. Yes, the growth in risk sales, both in MFC and PF, has been encouraging. The mix of, as I indicated in my voiceover earlier, the mix of guaranteed and new T sales in PF has picked back up again in this environment. I would expect both of those features of the volume and the mix to be supportive of margin. thank you. The contribution to the bottom line, roughly, of the Chinese products? I don't know off the top of my head, the answer to that question. I mean, our Chinese business broadly breaks even. I don't expect the picture of that to change as a consequence of the product change. It's primarily gonna be a question of: Is there pressure on essentially, the expense ratios as a consequence of the volume issue? That's gonna be the main consequential item. Okay. Thank you very much. Cool. Thank you. Just to, sorry, just to confirm that the growth rate in Insure without Genric on GWP was 9.5%. Thanks. That sounds pretty close. Okay. Thanks, Ranen. Thank you. Ladies and gentlemen, just a reminder, if you'd like to ask a question, you're welcome to press star and then one to place yourself in the question queue. The next question comes from Baron Nkomo of JP Morgan. Yeah. Hi, guys. Just two quick questions from me. Just on the discretionary capital, can I just confirm if you intend to use the entire ZAR 1.4 billion that's remaining for the Two Mountains equity acquisition, or will that only be part of it? Secondly, are you able to give any commentary or guidance around your actual operating profits or results from operations? Thanks. Casper, can I hand those ones to you? No, I see the Two Mountains transaction, you know, won't be more than a third of that discretionary capital, and probably a little bit less than that. It's only a portion. Obviously, the rest is, you know, rest will be used for growth initiatives for the time being. We'll give you an update on discretionary capital at the half year. We don't normally comment on profitability at quarter end. In this quarter in particular, we just firmly up on our IFRS 17 numbers. We'll give you, we'll give you more color on the IFRS 17 comparatives, as we said at the half year. We'll obviously give you an update on our, you know, where we land. We will need to, as part of the trading update, once we've had approval from our audit committee on the results. We're not giving any guidance on operating profit at this stage. Thanks, Casper. Thanks so much. Thank you. Ladies and gentlemen, just a final reminder. If you'd like to ask a question, you will with press star and then one. The next question comes from Chris Logan of Opportune. Yes. Iain, thanks very much for the update. Obviously, the elephant in the room is how the SA economy pans out and, you know, how amenable government becomes in enacting necessary changes. Did I catch you right, in that you said you were trying to engage with government on a host of things, and it was proving very difficult? Yeah, look, it's not just us. Yeah, sure. There's an extensive amount of goodwill in the business sector towards trying to assist. There's actually an initiative that's been going for some time, where, you know, essentially organized business has identified some priorities to assist with, and they include energy, logistics, and crime and corruption, essentially, if I've seen it. There is some traction on getting it moving. There have been meetings with the president and cabinet and what have you. You know, there has been a little bit of traction, but it is frustratingly slow, and it is very difficult. You know, essentially, you get a lot of willingness from particular ministers and from particular individual actors in the conversation. Once it gets into the collective, it just gets. It seems to just get bogged down. It's that's the best way I can describe it, is it's difficult, and I don't think that, you know, I think there's a combination of ideology, ideological issues and different camps, that just make it difficult to navigate through decisively. I do think that if the political will can be solved, then actually things could move a lot faster than people realize. I think we know what the solutions are, we know what needs to be done. It requires a certain amount of political will to kind of, you know, remove the barriers to those things getting moved ahead. Yeah, sure. Thanks for that. It fits in with the... I'm sure you saw The Economist article about a couple of days ago, where CEOs have realized that running the country cannot be left to the ANC, that was its title. You know, obviously in trying to assess SA assets at the moment, it's very difficult until the decline's arrested. Very good luck. Yeah, thanks. Thank you. It appears we have no further questions in the question queue. I will now hand over back to Iain Williamson for closing remarks. Okay, thanks very much. Nothing really further to say from me, guys, other than, I am actually really, really encouraged by the performance and the resilience of the business in the first quarter. As I said in my opening remarks, it is tough out there, but we seem to have a knack of thriving in this kind of an environment. You know, look forward to updating you again at the Investor Day in July and then at our interim results. Until then, you know, best of luck to everybody out there. Thanks for the time this evening. Thank you, sir. Ladies and gentlemen, that concludes today's event. Thank you for joining us, and you may now disconnect your lines.