Challenger's 'excellent' half-year result
Challenger has announced a record normalised interim net profit of $127 million on the back of record annuity product sales during the six months ended 31 December 2011.
In an announcement released on the Australian Securities Exchange (ASX) today, the company said annuity product sales had increased 74 per cent to $1.27 billion, with funds under management (FUM) up 27 per cent $27.7 billion - a level not seen since before the global financial crisis.
The company said that statutory net profit after tax had been $20 million due to negative investment experience following a further dislocation of debt and equity markets during the latter part of last year.
Commenting on the result, Challenger's newly appointed chief executive officer and managing director, Brian Benari said it had been "excellent".
"Challenger continues to benefit from demographic tail winds as well as today's consumer-driven 'back to basics' approach to investment which favours simple, regulated and guaranteed products," he said.
Benari said Challenger was also starting to reap the full benefit of re-invigorated distribution, advertising and marketing efforts with annuities increasingly being used as a tool in retiree portfolios, enabling client and adviser to build on age pension entitlements with a 'bedrock' level of income.
Reflecting Challenger's bullish attitude, Benari said the company had decided to increase its full-year retail annuity sales growth target to 30 per cent, adding that "even at these levels there remains enormous long-term upside for those able to capture and keep a leadership position in the retirement incomes market".
Challenger's ASX announcement said that its funds management operations - including equity partnerships with ten independently branded boutique funds - recorded a 27 per cent increase in FUM to $27.7 billion.
Benari said this had seen FUM returned to pre-GFC levels.
Recommended for you
In this week’s episode of Relative Return Insider, AMP chief economist Shane Oliver joins the show to discuss Australia’s stagnating productivity ahead of the government’s economic reform roundtable, and how picking all the “low-hanging fruit” for reform in the ’90s helped kick off a surge that has since stalled out.
In this episode of Relative Return Insider, host Keith Ford is joined by Cyber Daily deputy editor David Hollingworth to take you inside the evolving landscape of cyber crime, how even huge companies can be at risk of breaches, and what that means for anyone trying to understand the risks.
The latest episode of Relative Return sees host Laura Dew chat with Richard Ivers and Mike Younger, co-portfolio managers at Prime Value Asset Management, on their newly launched Microcap Fund and opportunities in small and mid-cap shares.
In this week’s episode of Relative Return Insider, hosts Maja Garaca Djurdjevic and Keith Ford dive into the week's top news, from investors remaining blasé about tariff announcements to bitcoin surging and unemployment numbers.
