AMP reports profit drop amid 'solid' result
AMP Wealth Management has reported a 16% profit drop in the first half of its 2020 financial year, which it said was due to the proactive closure of two legacy schemes, the conclusion of cost-sharing arrangements with AMP Life and the impacts of Covid-19.
Friday, August 14th 2020, 6:00AM 
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It made $19 million in the six months.
Its assets under management dropped 3% compared to the previous financial year. That was driven by an investment fall of $377 million offset by $21 million in cash inflows.
“Net cash inflows of $21 million in 1H 20 have improved from net cash outflows of $262 million in 1H 19, largely due to improved KiwiSaver business performance. Overall, KiwiSaver generated net cash inflows of $156 million for 1H 20, while net cash outflows on platforms and other investments amounted to $135 million.”
Controllable costs were up 8% to $20 million.
Jeff Ruscoe, acting chief executive, AMP Wealth Management New Zealand, said it was a solid performance across all key business measures.
“As a result of Covid-19, we saw an uplift in the number of clients seeking financial and retirement advice, which we believe is a positive sign for the long-term retirement prospects of more Kiwis. We responded by increasing the frequency of our regular communications to provide helpful guidance for clients during this period of heightened uncertainty and recruited new team members to respond to demand from clients seeking support, while innovating processes to enable clients to interact remotely such as completing statutory declarations over video chat to ensure those who needed hardship support could access it easily.
“At the same time, we ceased plans to divest our AMP Wealth Management New Zealand business and completed the separation of AMP Life. Our intent remains to continue to localise our business to allow us to grow and respond to the New Zealand market with a key focus on the ongoing transformation of our client experience through the regular deployment of new technology, like the frequent updates to our MyAMP app.
“This included the introduction in May of our interactive projections tool, enabling clients to see their projected weekly KiwiSaver and New Zealand Retirement Trust incomes at retirement and understand the impacts of potential changes, helping them take control of their retirement journey.”
He said the impact of the Covid-19 pandemic had been negative in some ways but positive in others – such as the wellbeing benefits that staff had experienced working remotely.
The company has moved to a fully flexible working environment and is shifting into smaller premises outside the Auckland and Wellington city centres, with most staff working from home.
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