Challenger has reported a first half 2015-2016 normalised profit after tax of $182 million, up from $155 million in the prior corresponding period.
Total assets under management (AUM) across the life and funds management divisions of Challenger were $57.6 billion at 31 December 2015, up 1 per cent on the previous period.
Once the July 2015 sale of Kapstream Capital is taken into account, Challenger's AUM was up 10 per cent for the first half.
Statutory net profit after tax was $234 million for Challenger, up 80 per cent due to "normalised profit growth, positive investment experience of $30 million and significant one-off items of $22 million, including profit on the sale of Kapstream", according to a statement by the company.
Challenger chief executive Brian Benari said: "These are strong results with double-digit growth in every key financial metric, which influences shareholder value."
"This has been supported by AUM growth, margin expansion and an improved cost to income ratio.
"Underlying annuity sales continue to rise and are up 10 per cent on the first half of 2015. We are seeing encouraging early signs from the recent launch of annuities on platform, which already account for 5 per cent of total annuity sales," Mr Benari said.
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