The after-tax amount is $68 million, AMP said in its statement to the ASX. While it would affect statutory earnings, AMP said the impairments would not affect net profit after tax (NPAT), its preferred measure of profitability.
AMP added that the financial impairments would not have a material impact on its capital position or liquidity.
AMP shares fell 0.22 percent to $1.34 in afternoon trading.
AMP shares have grown 52.84 percent over the past year, but are still down about 74 percent over the past five years, after the financial services company bled financial advisers and clients after Hayne’s royal commission.
Barrenjoey analyst Andrew Adams said the impairments have minimal capital impact. It cut its statutory NPAT and statutory earnings per share by 16 percent, but maintained a neutral rating.
Mr Adams said Barrenjoey is looking to upcoming 2022 full-year results for information on AMP’s planned asset divestments. AMP is currently seeking to transfer its domestic real estate and infrastructure equity businesses to Dexus Funds Management and its international infrastructure equity businesses to DigitalBridge Group.
AMP will announce full year 2022 results on February 16.
“AMP remains focused on further building a robust balance sheet. Our strategic priorities to simplify and reposition the business require us to recognize a number of impairments,” said CEO Alexis George.
“These items do not impact underlying NPAT or materially impact AMP’s capital position or liquidity. This action will help ensure we are well positioned for the future to deliver on our strategy as a focused wealth management and retail banking company in Australia and New Zealand.”
In its September 2022 quarterly update, the group said assets fell nearly $4 billion due to cash outflows and lower investment markets. However, Ms. George said the company was making strong progress.
“While challenging investment markets continued to impact assets under management, we’ve seen a significant improvement in our cash flow as more clients choose to join or stay with AMP.”