Financial services group Discovery presented its interim financial results for the six-months ended December 2024 to the investor community, highlighting a strong set of numbers.
The period was marked by ongoing global uncertainties, including geopolitical tensions, inflation moderation, and fluctuating interest rates, which impacted consumers and economic growth in many regions.
Despite this, normalised profit from operations increased by 27% to R7.02 billion, and headline earnings surged by 34%.
The normalised return on equity (RoE) reached 15%, up from 12.6% for the same period last year, indicating improved profitability, leading to a cash dividend per share of 87 cents, up 34% from the prior period.
Discovery Bank’s losses were also significantly reduced, to R145 million for the period, down from R339 million in 2023.
It delivered a 42% increase in revenue to R1.1 billion during the period, while the number of accounts more than doubled to 2.6 million, and it “has now achieved monthly operational profitability with continued excellent performance across all key metrics”. It is well positioned to leverage its scale, data and capabilities to drive growth across the composite.
Deposits increased by 27%, and advances grew by 37%, thanks in part to its growing home loans book with the value of home loans disbursed reaching R1.039 billion by January 2025, up from R149 million in September 2024.
As at December 2024: Discovery Bank’s market share for home loans was 2%, with a switching market share of 9%
Markedly, the digital bank surpassed one million customers, ahead of schedule.
Business Units
-Discovery Health reported an 8% increase in operating profit, amounting to R2.02 billion, while new business API decreased by 31%.
-Discovery Life posted a 15% increase in operating profit, amounting to R2.61 billion, and continued to show strong cash generation.
-Discovery Invest saw a significant 46% increase in operating profit, driven by strong market performance and one-off gains.
-Discovery Insure delivered a robust recovery, with operating profit increasing by over 100%, benefiting from favourable weather conditions and business actions.
Group chief executive, Adrian Gore, said: “We have emerged from a cycle of significant investment, which focused on creating new avenues for long-term growth, through globalising our capabilities and footprint, and building new ventures, most notably Discovery Bank.
“The bank, in this period, achieved monthly profitability in December and returned its first profit ahead of plan. The current strong in-period performance across the Group, shows that we are well-positioned for a phase of scaled organic growth,” he said.
Gore highlighted that Discovery’s growth strategy is based on the efficacy, repeatability, and scalability of its model through organic growth and global partnerships. The Group’s strong performance demonstrates the effective deployment of the model and its applicability across the different industries and markets.
The model’s evolution to hyper-personalisation, leveraging the Group’s data and technology assets, will continue to improve key value drivers. The Vitality AI platform and its capabilities will allow greater and more precise understanding of people’s health risks and determine the exact actions to improve health outcomes, quantifying the impact on health and mortality.
“Following the emergence from a period of sustained investment, we have seen a strong performance, which is expected to result in further growth in profit from operations in 2025, exceeding our medium-term ambition of 15% to 20%, driven, in particular, by a second-half recovery in the UK.”
