AMP’s share price was up almost 5 per cent at 11:30am Thursday, notching up the biggest gain on the ASX 200 as investors reacted to an impressive result.
The company recorded an underlying profit of $1.04 billion for the 2017 calendar year (up from $486 million in 2016).
AMP’s net profit after tax for 2017 was $848 million, compared with a $344 million loss in 2016.
A large part of the 2016 result were write-offs of $668 million in AMP’s wealth protection business.
AMP secured reinsurance deals with Gen Re and Munich Re to release approximately $500 million of capital in August 2017.
In 2017, the wealth protection business has seen its earnings recover to $110 million (compared with a $415 million loss in 2016).
Aside from wealth protection, AMP Bank and AMP Capital also performed strongly in 2017, with earnings up 17 per cent and 8 per cent, respectively.
Commenting on the result, AMP chief executive Craig Meller said the company has “stablised and reinsured” its life insurance business.
“We’ve met our targets on reducing costs, driving new revenue from our advice and SMSF businesses and managing margin compression in wealth management,” Mr Meller said.
“Our growing global capability in infrastructure and real estate investment has driven record external cash flows into AMP Capital, including a major contribution from one of our Chinese partnerships, China Life AMP Asset Management.
“AMP Capital has also partnered with US real estate investor, PCCP, which will further accelerate the growth of our real assets business.
“In wealth management, we’ve delivered the next phase of our Goals 360 advice platform – the goals modelling engine – enabling advisers to show customers the achievability of their goals during the advice session.
“We’ve driven double-digit growth in AMP Bank’s operating earnings while responding to tightening market regulation. We remain on track to double the value of the bank by full-year 2021.”
