AXAhas reported a 28 per cent profit growth in its wealth protection business despite a decline in retirement product inflows.
The wealth management business made a $77 million after tax profit for the year ending December 2002. Results for its financial protection business were stronger with a 104 per cent jump in profits to $49 million for the 2002 year end.
AXA group chief executive Les Owen says the results are due to the re-positioning of the business in the last couple of years.
This has resulted in the sale of the company’s health business and the acquisition of financial planning groupIpac.
“In Australia and New Zealand we have seen a 50 per cent increase in operating earnings in our core wealth management and financial protection business as the steps we have taken to refocus continue to deliver encouraging results,” Owen says.
“Our strategy stands up well and we remain committed to it.”
Inflows into AXA’s fund management and risk products were a mixed bag. Income protection products were down 19 per cent with inflows of $21 million, while total and permanent disability (TPD) products were up 11 per cent, with inflows of $31 million.
Superannuation product inflows were down 4 per cent to $1.6 billion, while investment product inflows were up 15 per cent to $1.2 billion.
Outflows were also up for most retail products, with superannuation products suffering outflows of $464 million, an increase of 38 per cent. Investment product outflows only rose 2 per cent during the 2002 financial year.
Inflows into the Summit and Sterling Grace master trusts, excluding inflows from the Merrill Lynch master trust which AXA administered, were up 30 per cent to $1.3 billion. The loss of the Merrill Lynch business, due to the closure of the master trust, reduced inflows by $187 million.
Summit has secured an additional 70 independent advisers using the master trust to give a total of 350. An additional 36 aligned advisers are also using the service.
AXA funds under management were up 7 per cent for the 12 months to $30.4 billion. The largest jump was achieved by AXA’s Alliance funds management subsidiary, which was up 8 per cent to $26.7 billion.
Owen says the fund manager has won a number of retail and wholesale mandates which has pushed up inflows. All have come from Australian sources such as theMLCmaster trust.
“None of these new mandates are from overseas institutions, all are coming from Australian sources such as master trusts,” he says.
