Challenger shares jump on strong growth
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More news: Challenger shares jumped 5.56% to $6.84 by 12:33pm AEDT after the investment manager posted strong quarterly results.
It also announcedi ts full-year profit would be near the top end of its guidance range after recording strong growth in assets under management during the March quarter.
Challenger lifts expectation for full-year profit
The news: Investment manager Challenger expects full-year profit to be near the top end of its guidance range after recording strong growth in assets under management during the March quarter.
The numbers: Group assets under management rose 6% to $124 billion in the quarter. Funds under management (FUM) also rose 6% to $114 billion, while lifetime annuity sales jumped 37% to $202 million. The group now expects normalised net profit before tax to come in at the top end of its $555 million to $605 million guidance range.
The context: Challenger CEO Nick Hamilton said sales across the group’s retirement income products remained strong, supported by rising demand for guaranteed lifetime income and a growing number of Australians entering retirement and aged care.
The group expects its sale of Challenger Bank to New Zealand’s Heartland Group to be completed by 30 April, after the deal received indicative regulatory approval from the prudential regulator and the Reserve Bank of New Zealand earlier this month. The sale will generate a gain of $11 million, with another $40 million to be injected into its life business.
What they said: "We remain disciplined on pricing around shorter-term annuities as pricing dynamics in the term deposit market remain unattractive," Hamilton said.
The source: ASX announcement
