Johannesburg - South Africa's second-biggest insurer Sanlam increased first-half headline earnings per share by 35% but did not expect a similar performance in the second-half, the company said on Thursday.

Headline EPS - which excludes non-trading, capital and certain extraordinary items - was 138.4 cents per share while core earnings rose marginally to R1.582bn, Sanlam said in a statement.

But the group said it was unlikely to repeat the first-half performance in the second part of the year due to potential equity and currency market volatility, increasing interest rates and competitive risk-underwriting conditions.

"The strong overall result in the six months under review is testimony to the success of our strategy of product diversification, enhanced distribution and capital management," Sanlam Chief Executive Officer Johan van Zyl said in a statement.

On a per share basis, core earnings rose 18% to 69.9c. The group defines core earnings as the net result from financial services and net investment income, including dividends received from associates.

For an insurer, embedded value gives an indication of the value of the existing insurance portfolio and comprises the net asset value plus the net present value of estimated future profits.

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