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AMP posts 14.9% YOY decline in H1 net profit, raises dividend

AMP Ltd.'s first-half net profit declined 14.9% year over year due to market adjustment and accounting mismatches.

The company said net profit attributable to shareholders dropped to A$445 million, or 15.3 cents per share, from A$523 million, or 17.9 cents per share, in the prior-year period. Profit before market adjustments and accounting mismatches rose to A$481 million from A$456 million.

AMP's underlying profit rose 3.9% year over year to A$533 million, or 18.1 cents per share, from A$513 million, or 17.3 cents per share, on the back of strong operating earnings growth from units AMP Capital Investors Ltd., AMP Bank Ltd., as well as the group's New Zealand financial services business.

The S&P Capital IQ consensus estimate for the company's first-half normalized EPS was 17 cents, with four analysts reporting.

The company's total operating earnings for the half climbed to A$509 million from A$485 million in the year-ago period.

AMP's board declared a 90% franked interim dividend of 14.5 cents per share, up from the prior-year's 90% franked interim dividend of 14 cents per share. The dividend will be paid Sept. 29 to shareholders on record as of Aug. 24.

The company also announced a number of new reinsurance deals, with about A$500 million in capital to be released from unit AMP Life Ltd., subject to regulatory approval. The new arrangements include a quota share agreement and a new surplus cover deal with General Reinsurance Life Australia Ltd., as well as an extension of the agreement with Munich Reinsurance Co. of Australasia Ltd. to cover 60% of AMP Life's retail portfolio, from 50%.

The deals are set to commence Nov. 1.

As of Aug. 9, US$1 was equivalent to A$1.27.