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AMP back to black with $848m profit

Simone Ziaziaris  |  08 Feb 2018Text size  Decrease  Increase  |  
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SYDNEY – [AAP] Wealth manager AMP Limited (ASX: AMP) has swung back to profit from a $344 million loss a year ago, following strong earnings momentum from its AMP Capital and AMP Bank businesses.

The company has reported a statutory net profit of $848 million, a year after recording its first loss since 2003 on the back of a restructure of its wealth protection arm undertaken to counter a downturn in the income protection business.

AMP's wealth protection business suffered an earnings loss of $415 million a year ago, following $485 million in capitalised losses from an operational "reset".

The losses weighed on the company's group underlying profit which slid to $486 million a year ago, from a $1.1 billion profit in the previous year.

On Thursday, AMP reported underlying profit--its preferred measure of performance--had risen to $1 billion from $486 million the previous year.

Chief executive Craig Meller said the company had met its targets in reducing costs, driving new revenue from its Advice and SMSF businesses and managing margin compression in its wealth management division.

"We've stabilised and reinsured our life insurance business and we've stepped up our international growth, particularly in AMP Capital," he said in a statement on Thursday.

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"Overall, a solid result that shows the strong headway we're making in delivering our strategy."

Group revenue for the 12 months to December 31 grew 24 per cent to $18.4 billion, from $14.8 billion a year ago, while earnings rose to $1.1 billion, from $527 million.

AMP Capital and AMP Bank delivered the strongest earnings growth among the six divisions, up 8.3 per cent and 16.7 per cent, respectively, but the Australian wealth management segment contributed the most, despite growth slowing on the previous year.

Operating earnings in Australian wealth management were $391 million, 2.5 per cent lower than full-year 2016's $401 million.

AMP RETURNS TO PROFIT:

* Profit of $848m, vs $344m loss

* Revenue of $18.4bn, up from $14.8bn

* Final dividend of 14.5cps, 90pc franked, up from 14 cents

 

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is an AAP journalist.

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© 2021 Australian Associated Press Pty Limited (AAP) or its Licensors. This is the Morningstar service with content provided by AAP where indicated. AAP reserves all rights, including copyright, in services provided by it. The information in the service is for personal use only, does not constitute financial product advice (whether general or personal) and may not be re-written, copied, re-sold or re-distributed, framed, linked or otherwise used whether for compensation of any kind or not, without the prior written permission of AAP. You should seek advice from a professional financial adviser before making decision to acquire or dispose of a financial product.

This service is published for general information purposes only without assuming a duty of care. AAP is not in the business of providing financial product advice (whether personal or general advice), and gives no warranty, guarantee or other representation about the accuracy of the information or images contained in this service. AAP is not liable for errors, omissions in, delays or interruptions to or cessation of the services through negligence or otherwise. The globe symbol and "AAP" are registered trademarks.

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