Pepkor’s in-house insurance offering, Abacus, has shown impressive growth by extending its products across various group brands, including Capfin, PEP, Ackermans, Dunns, PAXI, and recently, FoneYam.
The group announced that over one million new customers were added through policies sold during the financial year ending September 2024.
Abacus provides simple and affordable insurance solutions through selected Pepkor group companies such as Incredible Connection and HiFi Corp, offering products like funeral cover, credit insurance, and single-asset insurance.
FinTech and insurance growth
Pepkor’s FinTech segment, which includes Abacus, reported significant growth:
- Revenue increased by 26.8% to R12.7 billion.
- Gross profit margin expanded by 129 basis points to 48.0%.
- Operating profit surged by 55.2% to R1.4 billion.
The group’s Flash business also demonstrated strong performance, with revenue rising 20.2% to R8 billion, while operating profit grew by 38.0% to R617 million, reflecting a seven-year CAGR of 22%.
Capfin, another key player in the FinTech portfolio, expanded its loan base to 320,000 loans, with its gross unsecured credit loan book growing to R3.3 billion compared to R2.5 billion in the previous year. The provisioning rate improved to 17% versus 18% in 2023, and nonperforming loans decreased to 8% compared to 23: 9% the same period last year.
Consistent and sustainable performance
For the financial year ended 30 September 2024, Pepkor reported robust overall growth:
- Group revenue increased by 7.8% to R85.1 billion, despite FY23 including an additional 53rd trading week. On a comparable 52-week basis, revenue rose by 9.2%.
- The group gross profit margin expanded by 190 basis points to 38.3%, driven by higher full-price sales and growth in fintech contributions.
- Ongoing revenue from mobile network operators grew by 4.1% to R2.0 billion.
Operating expenses were well-managed, increasing by 8.4%, reflecting strategic execution costs. Excluding Pepkor’s Avenida business in Brazil, operating expenses rose by 7.1%.
Positioned for future growth
Pepkor’s FinTech and insurance solutions, spearheaded by Abacus, have strengthened its diversified revenue streams while promoting accessible and affordable products for customers. The group’s ability to sustain growth while expanding margins highlights its resilience and strategic focus in a challenging economic environment.
