The wealth giant reported an almost 30 per cent drop in first-half statutory net profit to $146 million, down from $203 million in the first half of 2020, and said it would not pay a dividend to shareholders until it finalised its demerger of AMP Capital.
Both AMP Capital and the wealth management arm of AMP suffered over the first half, recording 18 per cent and 17 per cent decreases respectively in underlying net profit after tax.
However taking into account the adjustment from the sale of AMP Life in 2020, the group’s overall underlying profit recorded an increase of 57 per cent to $181 million, up from $115 million in the first half of 2020.
New AMP CEO Alexis George said despite being only a week and a half into the job, completing the demerger was her first and key priority.
“The benefits of the demerger are clear in helping to create two streamlined businesses that can focus on opportunities in our respective markets,” Ms George told a media call.
“We have committed to operational separation by the end of this year and I’ve really enjoyed working with Shawn [Johnson] so far – we are shaping the perimeter of the business to be demerged and starting the transition of our multi asset group to AMP Australia.
“As we move toward that, I need to lay down what this company is going to look like in the future.”
Ms George conceded AMP had seen “mixed performance” across its business units, with $2.7 billion of outflows across its wealth management arm in the first half of the year, and said it had been “disappointing” for the wealth giant to lose super mandates as a result of its cultural issues in 2020.
“Restoring the faith in this brand is a top priority, and making sure that we are driving a purpose-led culture,” she said.
“We’re going to work hard but I’m optimistic with the plans and the team that we now have in place.”
The wealth giant’s board said it would “maintain a conservative approach” until the demerger of its private markets business and “future strategies” were finalised, opting not to declare an interim dividend for 2021.
The group said it had completed all file reviews for its customer remediation program and would accelerate customer refunds in the third quarter, and expected to complete the demerger of AMP Capital in the first half of 2022.
“Our business has had a stronger first half financially – we have demonstrated our commitment to deliver our strategic priorities of reshaping and simplifying the business and focusing AMP Capital on private markets,” Ms George said.
“We are starting to see some positive signs of growth and innovation, particularly in our bank and platforms businesses where we are introducing new services that our clients want.”
