AMP, Australia’s largest wealth manager, has more than doubled its full-year underlying earnings for 2017, a 114 per cent rise for the year ended December 2017.
The company posted a net profit of $848 million, beating analysts’ expectations and markedly improving on their 2016 net loss of $344 million– AMP’s worst posted result in over a decade.
The result was driven by a strong boost in earnings from the banking division and the markets division. This was reflected in strong earnings momentum in AMP Bank (up 17 per cent) and AMP Capital (up 8 per cent).
In afternoon trading, AMP shares were changing hands at $5.20 up 3.48 per cent.
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"In 2017, we delivered a strong recovery in underlying profits and solid operating performances across the business,” AMP chief executive officer Craig Meller said.
"Our growing global capability in infrastructure and real estate investment has driven record external cashflows into AMP Capital, including a major contribution from one of our Chinese partnerships, China Life AMP Asset Management.
The group has also partnered with US real estate investor, PCCP, which Meller says will further accelerate the growth of AMP’s real assets business.
The company said the positive performance of AMP Bank was driven by a 14 per cent rise in residential lending to $18.9 billion underpinned by a conservative credit policy. Loan growth moderated as expected in the second half as the market adjusted to new regulatory requirements.
AMP has maintained its final dividend at 14.5 cents a share, franked at 90 per cent. The total 2017 dividend is 29 cents a share and is within AMP's stated target range of 70 to 90 per cent of underlying profit.
In November it was revealed that AMP Capital had acquired a 50 per cent share in Brisbane’s Indooroopilly Shopping Centre split across two of its funds and assuming management of the super-regional centre on behalf of investors.
AMP Capital has also taken a 21 per cent stake in a $1 billion state-of-the-art cancer research centre in Victoria.
Construction will soon begin on the cornerstone residential component of Circular Quay’s $3 billion Quay Quarter development following AMP Capital’s appointment of Richard Crookes Constructions as contractor.