The AMP Ltd (ASX: AMP) share price is lifting higher as we walk through afternoon trade.
AMP shares are on the move after the company posted its half-year results. Let's investigate further.
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What did AMP announce?
In a positive for the AMP share price, the company recognised a 57% year-on-year increase in net profit, reaching $181 million.
Moreover, its Australian wealth management assets under management (AUM) grew 8% also.
This carried through to surplus capital of $452 million above target requirements. As a result, the group's underlying return on equity was 8.3%, up from 6% the year prior.
In contrast to these results, AMP decided against paying a dividend, as the board seeks to ring-fence capital budgeting, which is consistent with previous language on its balance sheet. For instance, AMP has other drains and pulls on liquidity in its AMP Capital Private Markets demerger to consider.
However, AMP authorised a share repurchase program of $200 million on 30 June, to offset this cancelled dividend. Little colour was given in the report on when investors can expect the dividend to be reinstated.
AMP did however give colour on FY21 guidance expectations. It sees controllable costs of $775 million, in line with previous guidance.
Moreover, AMP estimates the cadence of loan growth for AMP Bank will remain strong into the second half, whereas AMP Capital FY21 earnings are tipped for a down-step from the year prior.
Investors have rallied the AMP share price as we walk through afternoon trade, on heavy volume.
Shares in the financial services giant are now exchanging hands at $1.12 apiece, a 3.89% gain on the day, and nearly a 2% gain from midday.
AMP share price snapshot
The AMP share price has posted a year-to-date loss of 28%, extending the previous 12 month's loss of 19%.
These results have lagged the S&P/ASX 200 Index (ASX: XJO)'s return of around 25% over the past year.
