CHAIRMAN’S STATEMENT
It is my pleasure to present the operational and financial performance of the Group for the half year ended 30 June 2025.
ECONOMIC OVERVIEW
During the first half of 2025, the Reserve Bank of Zimbabwe (RBZ) maintained its tight monetary policy stance in pursuit of macroeconomic stability with indications that this would continue for the remainder of the year. The Bank Policy Rate for the Zimbabwe Gold (ZWG) was held at a significantly positive level of 35%, well above both inflation and exchange rate movements on the official and alternative market rates. Statutory reserve requirements were also maintained at elevated levels i.e. 15% for savings and time deposits and 30% for call and demand deposits for both local and USD currencies. The Central Bank continued to mop up excess liquidity through the issue of Non-Negotiable Certificates of Deposit (NNCD) instruments. The tenor of NNCDs was adjusted from multiple maturities of 7, 14, 21 and 30 days and restricted to only 30 days from May 2025.
These measures collectively supported a relatively stable macroeconomic environment during H1 2025, which was favourable for the financial services industry. The resulting stability brought greater predictability and improved the ability of businesses to plan and allocate resources more effectively.
Despite these gains, structural challenges persist. According to a report issued by the Zimbabwe National Statistics Agency during the period, the informal sector contributed 76% of economic activity. The financial services sector continues to be one of the most formalised segments of the economy. The rapid expansion of the informal sector poses risks to formal businesses, particularly through reduced revenue visibility and weakened tax collection efficiency. This informality is believed to be a major contributor to the Government of Zimbabwe’s inability to meet its revenue and expenditure targets in H1 2025.
We are encouraged by the recently announced Government policy to review and update regulatory frameworks with a view to reducing bureaucratic red tape and lowering the compliance costs as this will enhance the ease of doing business. These measures are essential for incentivising informal operators to integrate into the formal economy, broadening the tax base and improving overall economic efficiency.
Sustained macro-stability will enhance prospects for consistent revenue and reduce investment portfolio volatility. The current environment also enables the Group to pursue additional opportunities, including further diversification into real assets to manage both local and regional risk over the medium to long term. FMHL remains committed to engaging in constructive policy advocacy and community initiatives that contribute meaningfully to the growth and performance of the Zimbabwean economy.
FIRST MUTUAL LIFE SETTLEMENT AGREEMENT
First Mutual Life Assurance Company (Private) Limited (FML) is continuing to work with the Insurance and Pensions Commission (IPEC) to bring finality to the issues that arose during the forensic audit. Following the withdrawal of the Corrective Order, FML and IPEC entered into a settlement agreement and undertook to take certain steps to resolve the outstanding issues, including the appointment of independent experts to consider some aspects. These tasks were concluded. IPEC subsequently asked FML to resubmit some information that had already been supplied and to provide some additional information. This was done and parties are conducting some reconciliations ahead of the anticipated conclusion of the matter.
FINANCIAL HIGHLIGHTS
FINANCIAL PERFORMANCE
The Group adopted the United States Dollar (USD) as its functional and reporting currency with effect from 1 January 2024. Following an assessment of the operating environment during the reporting period, the Group has retained the USD as its functional currency. Accordingly, the financial results for the period are presented in USD, together with comparative figures for the prior year. Special purpose financial statements presented in ZWG are also included to comply with statutory requirements.
Insurance contract revenue for the period grew by 19% compared to 2024, primarily driven by increased uptake of the Group’s insurance policies and upward reviews of sums insured on ZWG-denominated policies, implemented as a mitigatory response to value erosion.
Net interest and other fee income declined by 4% year-on-year, largely due to the softening of lending rates, which negatively affected interest margins and lower fee-based income generation during the period under review.
Net investment return amounted to $0.5 million for the six months ended 30 June 2025, reflecting a 199% increase from the prior year. This growth was supported by relative stability in official exchange rates and the positive performance of the Group’s VFEX-listed investments portfolios.
The Group also recorded fair value gains on Investment Property of $1 million, representing a 102% improvement from a loss position in the prior period. The contrasting performance
between the two periods is attributed to significant valuation distortions on 1 January 2024 (effective date for transition to a USD functional currency), arising from compliance with functional currency transition guidelines under IAS 21 – The Effects of Changes in Foreign Exchange Rates.
The Group posted a consolidated profit after tax of $6.2 million for the six-months ending 30 June 2025, recovering from a loss of $32.7 million in the prior year. The 2024 loss was largely non-operational in nature, driven by artificial losses on investment property. Specifically, valuations by independent experts on 1 January 2024 did not fully adopt the official exchange rate due to its limited applicability in actual market transactions, leading to inflated opening balances that did not reflect true market asset values.
SUSTAINABILITY
Sustainability remains central to the Group’s operations, influencing everything from value creation and optimisation to regulatory compliance and our responsibility as a corporate citizen. Environmental, Social, and Governance (ESG) principles are deeply embedded in the Group’s strategic framework. Our systems and processes are designed to ensure that sustainability extends well beyond core business functions, impacting all facets of our operations.
During 2024, the Group has embarked on a journey to fully comply with the IFRS Sustainability Disclosure Standards—S1 and S2, marking a significant advancement in enhancing the transparency, consistency, and comparability of our sustainability reporting. IFRS S1 facilitates more robust disclosures on how sustainability-related risks and opportunities impact our strategic direction and long-term value creation, while IFRS S2 enhances our climate related reporting by addressing key areas such as governance, risk management, and emissions data. Together with our continued alignment to the Global Reporting Initiative (GRI) guidelines, this integrated approach underscores our commitment to international best practices and provides stakeholders with a comprehensive view of both our financial and non-financial performance.
FIRST MUTUAL IN THE COMMUNITY
First Mutual Foundation, through the First Mutual Holdings Limited Scholarship Fund has supported vulnerable children through the provision of educational assistance since 2014. The scholarship enables academically talented but financially disadvantaged children to pursue their education across primary, secondary, and tertiary levels.
The scholarship programme is designed to promote school attendance, retention, and smooth transitions from primary to secondary school, and from secondary school to tertiary education. The support goes beyond payment of school fees, levies, examination fees, and provision of stationery and uniforms. At the tertiary level, it also covers tuition, accommodation, food, and upkeep, ensuring that students receive holistic support throughout their academic journey.
Since its inception, the Scholarship Fund has made a significant impact in transforming the educational landscape for vulnerable students. By providing critical resources and wraparound support, the programme has led to marked improvements in attendance, retention, and transition rates at all levels of education. Notably, several scholarship beneficiaries have gone onto excel in competitive academic programmes, including Actuarial Science, Data Science, and Computer Engineering. In addition to academic achievements, the programme has nurtured students’ personal development and professional readiness, as demonstrated by successful placements in industrial attachments and internships.
Building on this success, First Mutual Holdings Limited expanded the scholarship programme in 2025 to include additional state-owned universities. Under the expanded initiative, the Fund will support three students at each of the following five institutions:
- University of Zimbabwe (UZ)
- Chinhoyi University of Technology (CUT)
- National University of Science and Technology (NUST)
- Midlands State University (MSU)
- Bindura University of Science Education (BUSE)
Among the new tertiary-level beneficiaries are students who have progressed through the scholarship programme from primary and secondary school, achieved outstanding academic results, and are now transitioning into tertiary education in 2025.
DIVIDEND
On 10 September 2025 the Board resolved that an interim dividend of $0.65 million be declared from the reserves of the Company for the period ended 30 June 2025. The dividend will be payable in the split of $0.52 million (USD0.071 cents per share) in United States Dollars and the balance of $0.13 million (ZWG0.479 cents per share) in local currency. Further details on the payment of the dividend will be communicated in a separate dividend announcement.
APPRECIATION
On behalf of the Board, I would like to express my sincere gratitude to our clients and stakeholders for their continued trust and support. I also extend heartfelt appreciation to First Mutual Holdings Limited’s employees and management for their unwavering dedication to serving our clients and ensuring that our businesses continue to adapt and thrive amid environmental changes.
To my fellow Board members, thank you for your steadfast support, valuable insights, and strategic guidance. Your collective expertise has been instrumental in steering the Group towards the successful execution of our long-term strategy.
Together, these contributions have laid a strong foundation for sustainable growth and resilience as we continue to navigate an evolving landscape.
Amos Manzai
Chairman
10 September 2025
Related Downloads
FMHL – Abridged Unaudited Financial Results For the Half Year ended 30 June 2025
FMHL – Short Form Abridged Unaudited Financial Results For the Half Year ended 30 June 2025
