AMP (AMP) H2 2023 earnings summary

Executive summary

• FY 23 underlying NPAT rose 6.5% to $196m; underlying EPS increased 19.3% to 6.8cps.

• Portfolio simplification advanced through major business sales and resolution of significant legacy legal matters; net debt fell $337m.

• FY 23 capital returns reached $750m since August 2022; a further $350m Tranche 3 return is planned.

Financial highlights

• Revenue was $1,308m, down 3.0% YoY; gross profit was $988m, down 1.4%, and EBIT was $244m, down 0.4%.

• Underlying NPAT was $196m versus $184m in FY 22; statutory NPAT was $265m versus $387m.

• Controllable costs fell 1.7% to $744m, at the lower end of guidance of $745m–$755m.

• Investment income increased 56.6% to $83m; interest expense was broadly flat as lower debt offset higher funding costs.

Outlook and guidance

• FY 24 controllable costs are expected to be ~$690m; FY 24 simplification spend is forecast at $60m–$75m pre-tax.

• FY 24 cost target remains $620m–$640m by FY 25, with $120m–$150m of one-off spend across FY 24 and FY 25.

• FY 24 AMP Bank NIM is expected at 1.10%–1.15%; Platforms and Master Trust AUM revenue margins are expected broadly in line with FY 23.

• Strategic partnerships target a combined ~10% p.a. return on investment through the cycle; guidance is subject to market conditions.