AMP Ltd shares climbed 5.5% to $2.30 after the wealth manager reported a sharp increase in first-half profit and announced a $150 million share buyback.
Statutory net profit rose 57% to $154 million, while underlying group profit increased 33% to $174 million.
Revenue for the half was 4% higher at $1.43 billion, supported by continued growth across AMP’s wealth management and retirement businesses.
Assets under management increased to $167.6 billion, while platform net cashflows rose 33% to $3.1 billion.
AMP’s Superannuation & Investments division recorded its first positive half-year net cashflow result since 2017, marking a turnaround for a business that has experienced several years of outflows.
Barrenjoey head of diversified financials Andrew Adams said the result presented upside risk to market expectations, with positive developments in AMP’s China operations also likely to support investor sentiment.
“AMP has upgraded its medium-term China return assumptions, which will be well received, with the Platform revenue margin sitting slightly above the guidance range currently and combined flows continuing to increase,” Adams said.
AMP Bank recorded underlying profit of $20 million, down from $30 million in the previous corresponding period.
The company said its strategy to release capital from AMP Bank was progressing, with the division reporting a surplus capital position of $89 million at the end of the half.
Chief executive Blair Vernon said the release of capital from the bank and the disposal of non-core assets remained central to the group’s capital management plans.
“Releasing capital from AMP Bank and non-strategic assets remains a key priority in our capital management strategy,” Vernon said.
Alongside the $150 million share buyback, AMP declared an interim dividend of 3 cents per share, 20% franked.
The dividend is scheduled to be paid on September 25.