Discovery Group has announced a strong financial performance for the year ended 30 June 2025 as it enters a distinct new growth phase with two well defined operational composites, in an environment characterised by increased geo-political complexities and uncertainty around global policy shifts and trade tensions.
Headline earnings and normalised headline earnings both increased by 30%, to ZAR9,625m ($554.7m) and ZAR9,781m, respectively, resulting in the normalised return on equity increasing to 15.4%, from 13.5% in the previous financial year, Discovery said in a statement.
Growth in normalised profit from operations in both composites: Discovery South Africa delivered 22% growth and Vitality generated a 70% increase.
Discovery South Africa: Increased normalised operating profit by 22% to ZAR12,005m. “The composite’s strong performance was supported by excellent levels of engagement, which drove strong claims experience and continued customer retention,” the statement said.
Vitality: Normalised operating profit increased by 70% to ZAR3,205m. Vitality now covers 10.4m lives outside of China, up 25% over the year, including more than 2m customers in the UK.
Mr Adrian Gore, group chief executive, said, “The strong performance of Discovery South Africa over the year highlights the compelling contribution from each of our businesses. And in Vitality, the performance reflects the competitive dynamics of the Vitality Shared-value Insurance model, with excellent progress made in restructuring the global operations into a single focused business over the past nine months. With the positive contributions from each composite, we have seen an excellent start to the current growth phase.
“In the year under review, economic growth remained below potential in many regions where Discovery operates, although interest rate reductions provided a better backdrop for investment markets. Risks remain elevated; however, the acceleration of technological and demographic trends underpins the relevance of the Vitality Shared-value Insurance model and unique data. This positions Discovery uniquely for continued growth.”
Discovery said it emerged strongly from its cycle of significant investment, which focused on creating new avenues for long-term growth. This has positioned the group for a new, distinct phase of scaled organic growth, with focused execution through its recently formed global composite, Vitality, and its home business, Discovery South Africa.
Shared-value Insurance model
During the period, Discovery focused on disciplined strategies, leveraging its Vitality Shared-value Insurance model, to optimise margins and returns. While new business growth was impacted in some businesses, compounded by macroeconomic challenges, the Group has made an excellent start on the ambition for profit from operations to grow between 15% to 20% on a compound basis over the next five years, from the end of 2024 to 2029.”
The Vitality Shared-value Insurance model and unique data are key value drivers in the Group’s performance, harnessing its technology assets and a rich, multi-market, longitudinal dataset that integrates behavioural and operational data.
Growth strategy
Mr Gore emphasised Discovery’s organic and global partnership growth strategy through its distinct composites, saying, “The Group is well positioned for sustained growth from our investment in our model and two composites, Discovery South Africa and Vitality. In Discovery South Africa, Discovery Bank continued to expand its innovative product solutions and quality customer base, with more than two-thirds of new customers being new to the Group, making it a key strategic platform to drive further growth. Overall, the strong performance of the focused composites makes us confident that we can achieve our established five-year ambition for growth in profit from operations.”
Discovery is a South African-founded financial services organisation that operates in the healthcare, life assurance, short-term insurance, banking, savings and investment and wellness markets.