Discovery Group delivers strong annual performance as it enters a distinct new growth phase with two well defined operational composites

Johannesburg, 11 September 2025 – Discovery today presented its annual financial results for the year ended 30 June 2025 to the investor community.

Salient features:

· Normalised operating profit of R15 210 million, up 29%.

· Significant growth in cash conversion, now at 77%.

• Headline earnings and normalised headline earnings both increased by 30%, to R9 625 million and R9 781 million, respectively, resulting in the normalised return on equity increasing to 15.4%, from 13.5% in the previous year.
• Growth in normalised profit from operations in both composites: Discovery South Africa delivered 22% growth and Vitality generated 70%.

Adrian Gore, Group Chief Executive, commented on the Group’s all-round strong performance in an environment characterised by increased geo-political complexities and uncertainty around global policy shifts and trade tensions. “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 underpin the relevance of the Vitality Shared-value Insurance model and unique data. This positions Discovery uniquely for continued growth.”

Discovery has 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.

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.”

Business-specific performance

Discovery South Africa: Increased normalised operating profit by 22% to R12 005 million. The composite’s strong performance was supported by excellent levels of engagement, which drove strong claims experience and continued customer retention.

Discovery Bank: Reached monthly break-even at the end of H1 and generated its first profitable period during the second half of the financial year, ahead of plan.

Discovery Health: Operating profit grew by 7% while continuing to invest in technology and artificial intelligence.

Discovery Life: Operating profit increased by 14% to R5 525 million. Both the Individual Life (+11%) and Corporate and Employee Benefits (+71%) businesses delivered exceptional claims performances.

Discovery Invest: Increased operating profit by 29%. Assets under management grew by 18% and assets under administration grew by 15%.

Discovery Insure: Sustained its positive trajectory over the year, delivering an operating profit of R739 million.

Vitality: Normalised operating profit increased by 70% to R3 205 million. Vitality now covers 10.4 million lives outside of China, up 25% over the year, including more than two million customers in the UK.

VitalityHealth: Operating profit rose by 174% to £50.6 million (173% to R1 188 million), driven by effective pricing actions, a stabilising claims environment and claims and expense management.

VitalityLife: Operating profit recovered strongly, increasing 70% to £27.1 million (70% to R637 million), with stable lapse and claims experience reflecting sustained engagement in the Vitality programme.

Vitality Network: Normalised operating profit increased by 7% to US$30.5 million (4% to R554 million). Membership increased by 27% to 6.7 million demonstrating the strong global relevance of the Vitality Shared-value Insurance model.

Ping An Health Insurance (PAHI): The Group’s share of PAHI’s after-tax operating profit increased by 7% to R1 206 million.

Vitality Health International (VHI) Other: Losses improved 25% to R291 million, following lower losses in Vitality USA and the successful integration of WellSpark Health, a personalised coaching business acquired in November 2024.

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.

Over the period, the Group leveraged artificial intelligence (AI) to not only drive efficiency, but also to transform risk and engagement. “We are able to deliver measurable improvements in health outcomes, service delivery, and profitability through our unique model and dataset. In Discovery Bank, we recently introduced Discovery AI, and Vitality AI was launched as Personal Health Pathways (PHP) in Discovery South Africa. These capabilities allow for a more precise understanding of health risks and hyper-personalised product experiences to encourage healthier behaviour. So far, both Discovery AI and Vitality AI have driven excellent engagement,” said Gore.

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,” said Gore.

The Group has declared its final ordinary dividend for the period at 201 cents per share, representing an annual cover ratio of five times.

ENDS