AMP moves back on track with 80% lift in half-year profit

By Ray Lilley

Friday 25th August 2000

AMP New Zealand yesterday unveiled an 80% lift in June half-year profit to $26.5 million despite slower economic growth.

The local performance was solidly echoed by the parent company which reported a net profit of $A525 million, up $A923 million on the same period a year ago.

Group chief executive Paul Batchelor hailed the result as putting the company back on track after the disastrous acquisition of insurer GIO resulted in a $A1.2 billion full-year loss.

The company said it aimed to achieve $A200 million of integration cost savings around the group by the end of calendar 2001 as it absorbed GIO, the UK's Henderson and NPI.

Mr Batchelor said operating margins from the group's continuing businesses improved 73%.

Assets under group management grew 7% in the six months to $A227 billion, up $A18 billion.

Earnings per share increased to 48.1 cents from minus 36.9 cents and the interim unfranked dividend of 32cps was 3cps higher than the previous period.

In the local operations AMP Asset Management increased funds under management above the $10 billion mark for the first time, while sales rose by a modest 3.3%.

The company said Ampam provided an improved 23.8% gross return for New Zealand investors for the full year ended June 30, while its new private capital investment fund raised $50 million during the half-year, double the amount sought.

Overall, the six months saw new business in retail managed funds grow 12.8% and AMP's share of retail superannuation net assets lift to 12.3% (9%), with funds flows three times larger than its closest rival.

The country's largest single sector fund, AMP's World Index NZ (WiNZ), saw investor funds increase by $700 million in just six months to top $1.7 billion by June 30.

AMP's recently established banking business increased its retail deposits by $55 million on a year earlier to reach more than $325 million in the latest six months.

Assets under management by the bank reached $2.5 billion, as it maintained its 6-7 % share of the new residential lending market.

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