Alexis George

Financial losses for AMP Advice are expected to be halved as the company continues to the “reshape and transition to a contemporary service model”.

Announcing its 1H22 results on Thursday, underlying net profit after tax (NPAT) was a loss of $30 million (compared to a loss of $85 million in 1H21) which it attributed to the scale of the advice business and impairments not being repeated.

AMP chief executive Alexis George told Professional Planner this is part of the commitment to deliver a sustainable business.

“Matt [Lawler, AMP Advice CEO) and the team have done a lot of work in the advice space and you can see we’re on track to halving the loss we delivered last year, around $150 million.”

George says the proposition of the business is important and she wants “to be here to support” advisers.

“We’re a service licensee. It’s important to have a group like ours that’s going to stand behind the advisers when things go well or don’t go well. We have to convince people in the market that’s who we are now,” George said.

George says she doesn’t want to make grandiose promises the 170-year-old organisation can’t deliver.

“I know that’s what Matt’s approach is and certainly what my approach is.”

During a conference call with investors on Thursday morning and chief financial officer James Georgeson, George said AMP has moved the advice business into a “contemporary advice business” where advisers are prepared to pay for services.

“We’ll offer both a standard package as well as additional ones. Revenue per adviser is starting to improve. Adviser numbers are down but that is to be expected as we go through this transitionary period.”

George reiterated her position that an easier regulatory environment would help achieve break-even for the advice business by FY24.

“We’ve seen a real preparedness from regulators, government and the industry to lean into this problem,” she said. “It’s not like our retirement system has become more simplified. Advice is clearly something many of our customers need.”

Georgeson added that the loss in advice reduced materially following the sale of the employed advice business at the end of 2021.

Advice revenue increased $7 million to $30 million with revenue growth in portfolio of equity investments in 1H22 and impairments in 1H21 not repeated, offset by the impact of the employed advice sale, and costs were reduced from $101 million to $66 million (1H22).