The freshly cut-down ASX-listed financial services firm, AMP, has set a modest “maintain” target for its NZ wealth operation amid mixed fortunes in Australia.
Announcing the group’s 2023 annual results last week, AMP chief, Alexis George, said the NZ strategy was to “maintain current performance and continue to diversify revenue”.
Year-on-year the NZ wealth arm reported a A$2 million increase in net profit after tax to reach A$34 million, underpinned by a markets-driven bump in assets under management across its KiwiSaver and superannuation funds. The NZ business booked asset-based net profits of A$22 million last year against A$20 million in 2022 with advice contributing a further A$12 million to the bottom-line (a repeat performance).
Investment returns of A$554 million countered net outflows across the AMP NZ fund suite of A$160 million during 2023, bringing total assets under management above A$10.8 billion (about A$10.5 billion at the end of 2022).
However, the AMP KiwiSaver scheme eked out positive net flows of A$144 million over the 12-month period, up $8 million on the previous period. But both the NZ superannuation and retail investment products saw net outflows of A$147 million and A$157 million, respectively, for the year.
Despite flatlining profits, the AMP NZ advisory division reported strong revenue growth, led by a $5.8 million boost from the wholly owned AdviceFirst brand as it absorbed new acquisition, Enableme.
Following the Enableme deal, AMP NZ adviser numbers, including AdviceFirst and in-house, jumped to 68 as at the end of last year versus 54 at the same time in 2022.
AMP also offloaded two ‘legacy’ superannuation funds last year to the Ralph Stewart-run, Lifetime Income group, with collective funds under management of almost NZ$500 million.
NZ contributed just over 17 per cent of the total AMP group annual net profit after tax of A$196 billion.
The result represented a year-on-year increase of A$12 million, flattered by the Australian platform business that grew profits to A$90 million from A$65 million in 2022: profits held steady for the master trust division at A$53 million, fell A$10 million at the bank (A$93 million) while the Australian advice arm lost A$47 million in 2023.
Last year the troublesome AMP Australian advice network reported a A$68 million loss but is looking to rebuild under new boss, Matt Lawler.
The group also settled a long-running legal dispute with former and current advisers over unilateral changes to buyer-of-last-resort agreements. Under the deal finalised last November, AMP will stump up A$100 million to settle claims.
Regardless of the lingering concerns, investors cheered AMP plans to complete its capital return program with A$350 million in dividends slated for this year: the firm has paid out A$750 million to investors since August 2022 after divesting the funds management unit, AMP Capital, and life insurance business.
The AMP share price rose more than 15 per cent last week from just under $1 to close at almost A$1.13.