Sygnia CEO Magda Wierzycka said the group was entering the new financial year with excitement about SA’s future for the first time in over a decade, thanks to the country’s improved electricity supply and new coalition government.
In the group’s latest annual results, released on Wednesday, Wierzycka called 2024 “a year of political renewal” for SA, pointing to renewed optimism instilled by the formation of a government of national unity, “that for the first time in 30 years represents many political voices and opinions”.
“It is unfortunate that the GNU still includes members of the ‘rogue’s gallery’ that engineered state capture, but this cabal is now a shadow of its former self,” said Wierzycka.
Added to this was the end of load-shedding — another notable and unexpected development this year, she said.
With Eskom’s energy availability factor exceeding 60% for the sixth consecutive month in October, various local sectors — particularly manufacturing, mining and small businesses — as well as tourism and foreign investment are expected to benefit from the more stable electricity supply.
Outside these local factors, SA’s future prosperity — as well as the rand and equity and bond markets — is also closely tied to that of economies such as that of the US, which has shown signs of resilience this year, with interest rate cuts boosting markets on the back of lower inflation — “a welcome change from the AI boom being the only driver of equity returns”, said Wierzycka.
However, she warned that the recent US election outcome of a Republican victory poses a significant challenge for SA, saying: “As we know from his [most recent] administration, Trump has little time for Africa generally, and he will have no time for SA”.
She warned that suspending SA from the benefits of the African Growth & Opportunity Act (Agoa) would tarnish the country’s international standing — particularly if combined with its greylisting status.
“It is time to choose our allies carefully,” she said.
“A decade ago, when growth and demand for commodities boosted our economy, an alignment with China made economic sense,” but, while SA is “squarely in the original Brics camp”, China’s ongoing struggle with economic recovery means the benefits of aligning with the country are less tangible.
“With Trump in charge of the world’s largest economy, it is fair to say that we should expect the unexpected, but I hope that 2025 is a pivotal year in shaping SA’s economic recovery and growth trajectory for the coming years,” said the CEO.
After a year characterised by sentiment-driven volatility, Sygnia’s latest annual results reflected an improved financial performance, with revenue increasing 12.1% year on year to R946m for the year to end-September.
The group reported a 9.9% increase in expenses, driven by increased investment in staff, while after-tax profit was at R347.2m, up 15.6% from the previous year. Headline earnings per share increased to 229.1c, up by 15.2%.
Sygnia’s institutional administration business recorded more than R70bn in appointments in the period, taking the group’s institutional assets under management and administration to R275.4bn, up from R256.6bn previously.
The Sygnia Umbrella Retirement Fund also saw significant growth in its assets and number of participants and, with assets under management and administration of R17.4bn, is SA’s sixth-largest umbrella fund.
The group’s retail business, a key growth driver, recorded R3.1bn in net inflows for the period, with Sygnia’s retail assets under management growing to R74.7bn, compared with R61.1bn in the previous year.
“We are extremely pleased with this result given the difficult market conditions, in which the high cost of living is eroding savings,” said the group.
Sygnia’s ETF product range, Itrix, ended the year with assets under management of R43.9bn, making Sygnia SA’s second-largest ETF provider.
With R350.1bn in assets under management and administration and R70bn more in secured assets under administration, Sygnia said it was poised to exceed R400bn, a huge milestone for the group.
Due to strong results, Sygnia declared a final dividend of 127c, with a total dividend of 217c for the year, up from 210c in the previous comparable period.
Looking ahead, Wierzycka said: “For the first time in over a decade, we enter the new financial year excited about SA’s future.”
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