Ameriprise Financial, Inc. (AMP) reported 3Q22 results with adjusted Earnings Per Share (EPS), excluding unlocking, of $6.43, up 9% from 3Q2021. Here are five things you should know about this call.
- Total assets under management and administration (AUMA) declined to $1.1 trillion, down 9% from the prior year. Despite new business growth and additional client flows, there was a significant hurdle from depreciating markets. Equity, fixed income, and the euro (amongst other foreign currencies) foreign exchange markets were down 19%, 14% and 15%, respectively. Adjusted operating earnings, excluding unlocking, was up 3% to $725 million. Net revenue grew 1% to $3.5 billion, despite higher volatility and decreases in market conditions.
- Wealth Management sector saw small growth in operating revenue, but significantly larger growth in operating margin. This is attributed to an increase from higher interest earnings and new client flows that offset market depreciation and lower transactional activity. AMP believes there is an opportunity to increase this even more with rates rising and their cash balances at elevated levels. AMP expects interest rate benefits will continue to offset market decline moving into the next quarter and throughout 2023.
- Asset Management sector experienced a decrease in adjusted operating total net revenue and pretax adjusted earnings of 10% and 33%, respectively. This decline is consistent within the industry and is the result of general market weakening and softening foreign currency. The BMO Financial Group acquisition increased geographic diversification, which is normally a good thing, but in this instance has led to a larger negative impact from foreign exchange. AMP was able to somewhat mitigate the margin decline by decreasing their operating expenses.
- Retirement & Protection Solutions sector had relatively stable earnings and growth. Pretax adjusted operating earnings increased from $192 million to $203 million, a 5.7% increase year-over-year. AMP is attempting to enhance yield by repositioning the investment portfolio within their risk tolerances by extending duration out.
- AMP continues to invest in its talent base and bring in additional resources to help fuel growth. Results in Q3 2022 demonstrate the resiliency of their diversified business model, with higher interest rates and positive business momentum offsetting impacts from the softening market. In Q3 2022, AMP returned $632 million to shareholders and is on track to return 90% of adjusted operating earnings to shareholders in 2022.
To learn more visit – Ameriprise Financial Reports Third Quarter 2022 Results
Investment banking services offered through MarshBerry Capital, LLC, Member FINRA and SIPC, and an affiliate of Marsh, Berry & Company, LLC, 28601 Chagrin Blvd, Suite 400, Woodmere, OH 44122 (440) 354-3230
This earnings summary has been prepared by Marsh, Berry & Co., LLC. and is not intended to provide investment recommendations on any company. It is not a research report, as such term is defined by applicable laws and regulations, and it does not contain sufficient information upon which to make an investment decision. It is not to be construed as an offer to buy or sell or a solicitation of an offer to buy or sell any securities, financial instruments or to participate in any particular trading strategy. These materials are based solely on information contained in publicly available documents and Marsh, Berry & Co., LLC has not independently attempted to investigate or to verify such information.