The work done by Discovery over the past two years in restructuring and scaling its Vitality composite onto one platform based on the shared value model, has yielded positive results, with the composite reporting a 41% surge in normalised profit to R2.1bn for the six months to end-December.
In 2024, the Discovery Group merged its Vitality UK and Vitality Global into one business.
The unit previously comprised three business composites: Discovery South Africa, Vitality UK, and Vitality Global.
The group, worth R179bn on the JSE, on Tuesday said the Vitality composite also reported 16% growth in new business.
“Vitality now covers 11.2-million lives outside China, up 15% over the year, including more than 2-million customers in the UK, and lives in China increased 17%, exceeding 34-million,” the company said.
Growth across all composites saw the group report a 29% increase in headline earnings to R5.7bn, with the strong performance culminating in the group’s embedded value increasing to R135.8bn, a 17.3% return on embedded value.
The group acknowledged green shoots that were starting to emerge in South Africa’s economy after a sustained period of collaboration between private and public sectors in key areas of service delivery.
The group said its Vitality shared-value model has positioned it uniquely for continued growth.
“The group has invested in Vitality AI and launched its partnership with Google over the reporting period, which is anticipated to drive increased engagement in the Vitality programmes globally, accelerating traction in existing partnerships and enhancing the value from new partnerships,” it said.
“Vitality Health performed ahead of plan, with a substantial increase in operating margin from the focused execution of the SV model through rigorous pricing and claims actions, as well as effective expense management. New business production was robust in a challenging economic environment.”
Discovery’s South Africa business reported a 19% increase in normalised profit from operations to R6.7bn.
Discovery Health‘s normalised profit increased 5% to R2.1bn, while that of Discovery Life surged 16% to R3bn.
Discovery Bank, which is snapping up 1,500 clients a day, is continuing to grow into a key cog in the group’s growth blueprint.
“Discovery Bank continued to expand its capabilities, innovative product solutions, and quality customer base, with more than 70% of new bank clients now also being new to the group, demonstrating the bank’s expanding relevance beyond the core Discovery client base,” the company said.
“Discovery Bank is a key strategic platform, powered by data, technology, and AI, to drive further growth through Discovery South Africa’s 6.5-million client base, which increased 7% compared with the previous period.
“The composite delivered a strong improvement in central and Vitality programme costs and improved customer engagement levels.”
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