Discovery CEO on SA vaccine rollout, why he’s pleased with earnings performance

Discovery CEO, Adrian Gore, recently shared insights on the ongoing vaccine acquisition efforts in South Africa and the company's financial performance amidst the challenges posed by the COVID-19 pandemic. In a recent interview with CNBC Africa, Gore highlighted the progress made in vaccine rollout efforts in the country. As the chairman of the vaccine acquisition task team, he expressed optimism about the work being done to vaccinate priority groups in Phases One and Two by the upcoming winter season. Gore acknowledged the challenges posed by the pandemic but highlighted the country's efforts to secure a significant amount of vaccines to support the rollout. He emphasized the importance of avoiding super-spreader events to mitigate the risk of a potential third wave. Gore's optimism stemmed from the country's existing immunity levels and adherence to preventive measures like social distancing and mask-wearing. However, he cautioned against complacency and reiterated the importance of continued vigilance to manage the pandemic effectively. During the interview, Gore also discussed Discovery's financial performance amidst the pandemic. While the company reported a decline in headline earnings per share for the six months ending December 2020, Gore expressed satisfaction with their operating earnings, which only saw a modest decrease. He attributed the challenges faced by the company to external factors like interest rate movements and currency volatility. Gore mentioned that Discovery had set aside provisions amounting to 3.4 billion rand for potential future pandemic-related claims, showcasing their proactive approach to risk management. When questioned about how the company handles compensation claims related to COVID-19 infections, Gore outlined the process for members seeking medical or life insurance benefits for illness or death resulting from the virus. He emphasized Discovery's commitment to supporting its members during difficult times and highlighted the significance of insurance coverage in such situations. Additionally, Gore provided insights on Discovery's banking segment, noting that the growth and deposit gathering activities had met expectations despite the challenging economic environment. He highlighted the cautious approach taken in credit management to ensure stability and performance in the face of market fluctuations. Regarding Discovery's operations in China, Gore discussed the immense potential of the health insurance market in the country and the company's strategic focus on growth within the region. He emphasized the importance of scale and profitability in expanding their presence in the Chinese market. Gore also touched upon the significance of wellness initiatives like Vitality in promoting preventive healthcare measures in China. During the interview, the recent budget announcement by Finance Minister Tito Mboweni was discussed, with Gore expressing support for the budget's focus on vaccination funding and business encouragement. He commended the government's efforts to navigate the tough economic landscape and viewed the corporate rate cut as a positive step towards improving the country's business environment. Gore noted the symbolic importance of such measures in shaping perceptions about South Africa as an investment destination. Overall, Gore's insights shed light on Discovery's proactive approach to managing the pandemic's impact on both healthcare and financial fronts, showcasing resilience and adaptability in uncertain times.