AMP's NZ financial services lift first half earnings 5% on KiwiSaver flows
AMP's New Zealand [NZX: AMP] financial services unit lifted first-half earnings as it increased KiwiSaver cashflows and boosted funds under management, while improving its margins.
Operating profit rose 5 percent to $59.4 million in the six months ended June 30 from the same period a year earlier, while a strong New Zealand dollar fattened the return to the Australian parent, delivering earnings of A$55 million from A$46 million, AMP said in a statement. The New Zealand business trimmed controllable costs by $8 million to $45 million, while increasing assets under management 6 percent to $13.5 billion led by growth in KiwiSaver funds.
"In a highly competitive market, the New Zealand business has had a strong start to the year which has been driven by our continued focus on controllable costs and an increase in assets under management," New Zealand managing director Jack Regan said. "Cost savings for the first half of the year have stemmed from the streamlining of duplicate wealth management product sets, including the 2013 merger of the AMP and former Axa KiwiSaver schemes and from reduced employment costs."
The Australian parent reported a 3 percent fall in net profit to A$382 million in the half, as its restructuring costs, the amortisation of Axa assets and a revaluation of Treasury stock weighed on the bottom line. The underlying profit gained 16 percent to A$510 million.
The board declared an interim dividend of 12.5 Australian cents per share, payable on Oct. 10 with a Sept. 5 record date.
The New Zealand unit's life insurance income was flat in the half, which it said was consistent with the industry, with rising insurance costs weighing on demand.
Cashflows were bolstered by AMP New Zealand switching new advisers and their clients on to its financial services platforms, with its WealthView platform growing 71 percent to hold almost $1 billion under management as at June 30.
AMP New Zealand cut its adviser numbers to 581 as at June 30 from 606 a year earlier.
The dual-listed shares were unchanged at $6.10 on the NZX, and last traded at A$5.52 on the ASX.