Amp Limited · ASX:AMP
Amp — Macquarie Securities Conference 2006
18 slides from Amp's conference presentation, May 5, 2006
Slide 1: ASX Announcement
ASX Announcement 05 May 2006 Manager Manager Company Announcements Office Market Information Services Section Australian Stock Exchange New Zealand Stock Exchange Level 4, 20 Bridge Street Level 9, ASB Tower, 2 Hunter Street Sydney NSW 2000 Wellington New Zealand Announcement No: 22/06 Part One: AMP
Slide 2: AMP announces increased first quarter net cashflows
5 May 2006 AMP announces increased first quarter net cashflows AMP Financial Services (AFS) has reported robust cashflows for the first quarter of 2006, with cash inflows rising by 29 per cent and net cashflows of A$341 million compared with A$115 million in the first quarter of 2005. Releasing the
Slide 3: Table 1: Cashflows by Business Line
“Overall, AMP remains well placed to deliver on the goal announced last year to double the value of an investment in AMP between mid 2005 and mid 2010.” Table 1: Cashflows by Business Line Q1 06 Q1 05 Inflows | Outflows Net Inflows | Outflows Net A$m A$m A$m Ag$m A$m Ag$m Australian 2,313 1,677 636]
Slide 4: AMP — well positioned to deliver strong, sustainable growth
AMP — weil positioned to deliver strong, sustainable growth Andrew Mohi Chief Executive Officer 5 May. 2006 AMP's positioning, strategy and goal AMP is a free-standing Australian wealth management group, operating across the value chain, ina high growth industry Strategy of operational excellence is
Slide 5: Outline
Outline =» Market overniew = Business update &» Cashflows Costs > Capital 7 Growth opportunities = VVrap up Overview — Australian private pension market to triple in 10 years and exceed all of Asia em bee ‘ f Total USS1/452 billion Total: i$$3;744 billion ‘Oth counties furst au ‘Other:countiles Aust
Slide 6: AMP holds leading market positions across the industry value chain
Overview — AMP holds leading market positions across the industry value chain a Pure wealth manager operating across the industry value chain * Strongly positioned in each area’ >» Market leader in AUM terms in both retail and corporate: Superannuation and 2" ranking in retirement incomes = the fast
Slide 7: Cashflows
Cashflows Strong cashflows in Q1 06 Cash inflows and outflows inflated by 4% due to ‘over 65s’ project Cash inflows up 29% to $2. 7b ® AMPEP up 31% fo $1.5b 2: Australian contemporary up:33% to $23b Cash outflows up 19% to $2.3b > Persistency down 0.8 percentage points 10:85:4%.breadly flatin underl
Slide 8: Cashflow growth by channel
Cashflow growth by channel Ot 06 G4 08 Ot G6 net Q1 06 net inftows inflows Change cashflows tashfiows Change AMP: Financial: Planning: 45534 HIG: Corporate Super=: ae Son direct: sales force: Customer care centre other AIM (97) (62). $35m AMP has ranked first in net retail annual cashflows since Q3
Slide 9: Strong cashflows across lowest unit cost base
Strong cashflows across lowest unit cost base 3:500 3,000 2,500 2,005 #500 4,000 00: FY02*: Controliabis:costs. mom Cast to-income ratio
Slide 10: Underlying contribution per FTE — substantial gains in productivity
Underlying contribution per FTE — substantial gains in productivity and business efficiency 226,000 454,000 Naior financial: 2001°*: 20G2* m= Underiying contribution pec PTE tend period) Process excellence is our next initiative to achieve a step change in unit cost base » Process excellence initiat
Slide 11: Capital
Capital Capital management — update First capital return of $746 million or $0.40 a share was implemented in: 2005: Second capital return of $750 million is proposed in 2006 »: Sublect to sharehoider approval at May:18 AGM. a second payment of $0.40 a share willbe made: in: Jane 2006 eo ATO Das rule
Slide 12: Underlying RoE will rise strongly as full impact of capital initiatives is realised
Underlying RoE will rise strongly as full impact of capital initiatives is realised ‘40 35 36. FYOS modelling full impact of 2008 arid:2006: ‘gapital returns Growth opportunities
Slide 13: Growth focus is on core business
Growth focus is on core business Financial planning Retail and corporate superannuation Retirement income streams Risk insurance Asset management Financial planning — increasing productivity and improving quality of advice Largest planner network across Australia and New Zealand Priority 8 to embed,
Slide 14: Financial planning — progress to date
Financial planning — progress to date = Strong cashtlows ® 22% increase in 2005 net cashflows through this channel during transformation program » Momentum maintained in O7 06 * Positive feedback from clients » 97% of new clients rate planner service as excellent » Brand campaign educating Australia
Slide 15: Retail super — progress to date
Retail super — progress to date Market leader in retail super - 17% market share Strategic pricing critical fo protecting and growing margins » Drivers for pricing ere different by customer segment Cash inflows increased 15% in FY 05; strong momentum in Q1 06 Focus on maintaining growth by capturing
Slide 16: Risk — progress to date
Risk — progress to date « Ranked 3° in individual risk market — 11.4% market share” ® Annual premium income growth of 11% in FYOS > Industry leading lapse rates Strong market growth projected >» loforce annual premiums forecast to grow by 9.6%. per annum to 2014" Focus on upgrading individual risk b
Slide 17: AMPCI — growth initiatives on four fronts
AMPCI — growth initiatives on four fronts « Deepening presence in domestic, high growth markets > Secured representation on product tists: and plattorms of major financial planning dealer groups Launching retail offering speciically targeting private clents « Expanding offshore in selected Asian mar
Slide 18: Wrap up
Wrap up = AMP is well positioned to deliver strong, sustainable growth » Leading position in market projected to grow by 10%+ over next decade » Strategy of operational excellence delivering strong Inflows from lowest unit cost base with high free cashflows to shareholders » Pursuing attractive grow