Shares in AMP experienced a dip in trading following the release of its first-half results. The company reported an underlying net profit of $131 million, approximately 5 per cent below UBS and market expectations. This shortfall was attributed to weaker performance in its Super & Investments division, compounded by increased costs. AMP is a financial services company that provides superannuation and investment products, as well as banking and advice services to individuals and businesses in Australia and New Zealand.
Despite the earnings miss, there were positive elements in the report. AMP Bank’s net interest margin (NIM) exceeded expectations, reaching 130 basis points compared to the anticipated 126 basis points. UBS analyst Shreyas Patel noted that this upside was driven by the rollover of fixed-rate to variable-rate loans and the repricing of deposits. Notably, the company reported no impairments during the first half.
Looking ahead, AMP has maintained its revenue and cost guidance for the full fiscal year 2025. UBS anticipates that the market will largely focus on the potential for a stronger second-half performance, driven by an improved margin outlook for AMP Bank, rather than dwelling on the weaker first-half figures. UBS has reiterated a “neutral” rating on AMP shares with a price target of $1.70.
