Amp Limited · ASX:AMP
Amp — JP Morgan Australia Investment Forum 2017
30 slides from Amp's conference presentation, Sep 4, 2017
Slide 1: JP Morgan Australia Investment Forum 2017 announcement
For personal use only 4 September 2017 Manager Client and Market Services Team ASX Market Announcements NZX Limited Australian Securities Exchange Level 1, NZX Centre, 11 Cable Street Level 4, 20 Bridge Street PO Box 2959 Sydney NSW 2000 Wellington, New Zealand Announcement No: 29/2017 AMP Limited (
Slide 2: JP Morgan Australia Investment Forum 2017
For personal use only JP Morgan Australia Investment Forum 2017 4 September 2017
Slide 3: AMP – Australia's leading wealth manager
AMP – Australia’s leading wealth manager For personal use only Notes 1.Fund Market Overview Retail – Marketer, Strategic Insight (Plan For Life), March 2017. 2.Planner Numbers, Money Management Top 100 Dealer Groups, October 2016. 3.Insurance claims paid to customers in Australia in 1H 17. 2 AMP Lim
Slide 4: About AMP
About AMP For personal use only AMP is the leading Key facts independent wealth – Largest financial advice network in Australia and New Zealand – with 3,370 management company aligned and employed financial advisers and planners in Australia and New – Around 4 million retail customers Zealand – More
Slide 5: AMP strategy
AMP strategy For personal use only 4 AMP Limited
Slide 6: Delivering on strategy
Delivering on strategy Delivering on strategy For personal use only Tilt investment to higher growth, less capital – Comprehensive program of reinsurance delivering significant capital release; retail book will be intensive businesses effectively 65% reinsured for claims incurred from 1 November 201
Slide 7: AMP tomorrow
AMP tomorrow For personal use only 6 AMP Limited
Slide 8: New reinsurance arrangements – deal structure
New reinsurance arrangements – deal structure For personal use only Delivers capital release from Existing Munich Re arrangement on AMP Life Australian retail book increased from 50% to 60% quota share AMP Life and New open-ended 60% quota share arrangement with Gen Re 1 on the NMLA Australian r
Slide 9: AMP's growth ambitions
AMP’s growth ambitions For personal use only AMP group – 15% RoE in FY 18 – 3% cost reduction in FY 17 (ex AMP Capital) – Flat costs (ex AMP Capital) in FY 18 Wealth Management – Targeting 5% revenue growth through the cycle including new growth contribution from Advice and SMSF AMP Capital – Double
Slide 10: For personal use only
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Slide 11: 1H profit summary
1H 17 profit summary For personal use only A$m 1H 17 1H 16 % Australian wealth management 193 195 (1.0) AMP Capital¹ 92 83 10.8 AMP Bank 65 59 10.2 Australian wealth protection 52 47 10.6 New Zealand financial services 65 62 4.8 Australian mature 75 69 8.7 BU operating earnings 542 515 5.2 Group Off
Slide 12: AMP – a balanced, diversified business
AMP – a balanced, diversified business For personal use only Contribution of business units to 1H 17 operating earnings AMP Bank 12% Insurance Wealth Mgt 9% 36% AUM-driven businesses represented 53% of Mature total 1H 17 BU 14% operating earnings New Zealand 12% AMP Capital 17% 11 AMP Limited
Slide 13: Driving revenue growth in wealth management – Advice and SMSF
Driving revenue growth in wealth management – Advice and SMSF For personal use only Wealth management - Targeting 5% revenue growth through the cycle from 2018 in normal markets Other revenue1 growth - Other revenue to grow by 10% in 2017 as Advice and SMSF strategies deliver additional revenue grow
Slide 14: Driving new economics in wealth management
Driving new economics in wealth management1 For personal use only Targeting 5% revenue growth through the cycle from 2018 in normal markets Growth as % of average AUM Investment markets +8% Customer fees -1% Margin compression -4% Targeting growth in other revenue from Advice and SMSF Net cashflow +
Slide 15: AMP's Advice Network
AMP’s Advice Network For personal use only Mortgage AUM per As at June 2017 Target market Advisers Total AUM ($bn) consultants1 adviser ($m) AMP Advice Goals-based 227 20 9 42 AMP Financial Planning2 1,465 431 64 43 Core licensee Charter Financial Planning 760 39 22 29 offer Hillross 319 22 14 44 To
Slide 16: Adviser register acquisitions
Adviser register acquisitions For personal use only – Largest financial advice network in Australia and New Zealand – with 3,370 aligned and employed financial advisers – AMP has historically maintained a strategy of buying and re-selling between $80-$100m worth of adviser registers per annum – typi
Slide 17: Financial overview – balance sheet and regulatory capital
Financial overview – balance sheet and regulatory capital For personal use only A$m 1H 17 FY 16 Change Shareholder equity1 7,296 7,489 (193) Total corporate subordinated debt1 951 951 0 Total corporate senior debt1 668 611 57 Total capital resources 8,915 9,051 (136) Level 3 eligible capital 3,358 3
Slide 18: Financial overview – 1H movement in regulatory capital above MRR
Financial overview – 1H 17 movement in regulatory capital above MRR For personal use only 3,000 533 2,500 145 2,340 2,195 (414) 2,000 (200) (180) 1,887 (52) (140) 1,500 1,000 500 0 Reduction in Level 3 eligible capital above MRR is due to: $140m of other impacts, including tax adjustments relating
Slide 19: Level Eligible Capital above MRR
Level 3 Eligible Capital above MRR For personal use only 2500 3 Surplus above MRR 2,322 MRR Ratio 2.6 1,943 2.5 2.4 2000 1,917 1,887 2.3 2.2 1,703 2.1 2 1500 $ millions $ millions 1.5 1000 1 500 0.5 0 0 1H13 1H14 1H15 1H16 1H17 1H13 1H14 1H15 1H16 1H17 18 AMP Limited
Slide 20: Strong capital management return profile
Strong capital management return profile For personal use only 30 28c 28c Interim Dividend Final Dividend 26c 25 23c 14.0 14.0 20 13.5 11.5 $ millions 15 10 14.0 14.0 14.5 40 40 12.5 40 5 11.5 40 40 0 2013 2014 2015 2016 2017 40 40 – Since demutualisation in 1998, AMP has paid out over $14.4b to sha
Slide 21: Underlying EPS and ROE
Underlying EPS and ROE For personal use only 25.0 15.0 Earnings per share Return on Equity 14.5 14.5 20.0 19.3 14.0 18.1 17.2 17.3 13.5 13.5 15.0 15.0 13.0 % Percentage $ millions 12.5 12.5 10.0 12.0 11.9 11.5 11.2 5.0 11.0 10.5 0.0 10.0 1H13 1H14 1H15 1H16 1H17 1H13 1H14 1H15 1H16 1H17 20 AMP Limit
Slide 22: For personal use only
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Slide 23: Guidance summary
Guidance summary For personal use only Costs Mature – On track for FY 17 controllable cost outcome of A$950m (ex AMP Capital) – Expected to run off at around 6% per annum; in volatile investment – Controllable costs for FY 18 (ex AMP Capital) not to exceed A$950m markets this run-off rate can vary s
Slide 24: AMP Group - strong history of cost control
AMP Group - strong history of cost control For personal use only AMP Group (excl AMP Capital) AMP Capital Cost to income ratio1 1100 66% 65.2% 1000 60 64% 900 63.0% 800 62% 62.1% 489 494 483 700 470 61.1% 60% Percentage $ millions 600 500 58% 400 56.6% 300 56% 494 490 484 471 473 200 54% 100 0 52% 2
Slide 25: AMP's growth businesses
AMP’s growth businesses For personal use only AMP Australian Wealth Management AMP Capital 140 215 200 100 120 195 80 175 150 100 155 60 80 100 135 60 40 115 50 40 95 20 20 75 0 0 1H14 1H15 1H16 1H17 1H14 1H15 1H16 1H17 Average AUM - $ billion (LHS) Operating Earnings - $ million (RHS) Average AUM -
Slide 26: AMP's value businesses
AMP’s value businesses For personal use only Australian Wealth Protection (Life Insurance) 1950 120 100 1900 80 1850 60 40 1800 20 1750 0 1H14 1H15 1H16 1H17 Total API - $ million (LHS) Operating Earnings - $ million (RHS) Australian Mature New Zealand financial services 23 100 20 66 23 64 80 15 62
Slide 27: AMP Group Leadership Team
AMP Group Leadership Team AMP Group Leadership Team For personal use only 26 AMP Limited
Slide 28: Our history
Our history For personal use only AMP and the National Mutual Life Association (which became AXA) were founded on similar principles, with financial advice at the heart of both businesses. While the two companies began their operations independently, they joined forces in 2011. AMP demutualises and
Slide 29: Sponsored ADR Program
Sponsored ADR Program For personal use only AMP Limited maintains a sponsored Level 1 ADR program in the US. The ADRs trade on the over-the-counter market in the US (OTC Markets). ADR program details are as follows: Ticker symbol AMLYY CUSIP 0017EP202 Ratio 1 ADR : 4 Ordinary Shares ADR depositary D
Slide 30: Important disclaimer
Important disclaimer For personal use only Forward-looking statements in this presentation are based on AMP’s current views and assumptions and involve known and unknown risks and uncertainties, many of which are beyond AMP’s control and could cause actual results, performance or events to differ ma