AMP shares jump after better-than-expected FY result
Make us a preferred source
Make us a preferred source on Google
More news: Shares in AMP jumped more than 8% to $1.05 in early trading on the ASX after the wealth management giant posted a lower-than-expected 32% decline in full year profit.
Investors also seemed to welcome AMP's clarity on its capital return plans, with $750 million already returned to shareholders since August 2022. AMP said $350 million of tranche 3 capital return was in progress with the combination of FY23 final dividend (totalling $55 million) and further dividends and/or an on-market share buyback of up to $295 million.
AMP full-year profit drops 32%
More news: AMP has reported a slide in its full-year statutory profit amid lower earnings from strategic partnerships and high remediation related costs. Statutory net profit for the year to December fell 32% to $265 million. However, on an underlying basis, the company widened its net loss to $27 million, from $1 million a year ago. It will pay a partly-franked final dividend of 2.0 cents a share.
AMP’s financial advice business narrowed underlying loss for the year to $47 million, while the investments business and the banking arm posted profits of $90 million and $93 million respectively. The beleaguered wealth management giant has struggled to recover since its financial services scandal was revealed in 2018.
AMP chair Debra Hazelton steps down, to be replaced by Mike Hirst
The news: AMP has announced chair Debra Hazelton will retire from the board and will be replaced by non-executive director Mike Hirst.
The numbers: Hazelton will step down on 12 April 2024 after AMP’s annual general meeting. She has been chair since August 2020 and served as a non-executive director for five years. She was also a non-executive director of the AMP Capital board between 2018 and 2022.
Hirst has over 40 years of board and executive experience, including nine years as chief executive of Bendigo and Adelaide Bank, as well as experience in senior executive roles across banking and financial services.
He has been a non-executive director at AMP since July 2021 and was appointed chair of the risk and compliance committee in October 2022.
The context: Following the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services, AMP sold AMP Life insurance in 2020 to Resolution Life and then sold AMP Capital in 2022 to Dexus and Macquarie Asset Management, in separate deals, to focus on its core businesses in banking and wealth management.
The Royal Commission found AMP had charged clients millions of dollars in fees without providing a service in return.
AMP said Hazelton steered the company through a successful transformation, including stabilising the business through culture improvement and governance, renewal of the executive leadership team, portfolio simplification and strategic reset, and the return of over $750 million in capital to shareholders.
What they said: “We have a strong CEO [Alexis George] and management team in place, the board has been renewed, the business repositioned, the strategy reset, the AMP portfolio is simplified, the capital base is strong, and substantive legacy issues are resolved,” Hazelton said.
The sources: ASX announcement, ASX announcement
