Owners of AMP Ltd (ASX: AMP) shares can feel a bit richer today because it's dividend payday for shareholders.
The diversified ASX financial share has returned to regular dividend payments over the last couple of years, and the latest dividend will be hitting bank accounts today.
Investors will see their cash balance tick higher as long as they owned shares before the ex-dividend date of 21 August 2024.
How much is being paid?
AMP's board of directors decided on an interim dividend payment of 2 cents per share for shareholders, franked to 20%.
This payment came after the business' FY24 first-half result, which achieved an underlying net profit of $118 million, an increase of 5.4%. Controllable costs reduced 6.4% to $339 million.
This result was driven by its platforms division's growth in underlying profit by 22.7% to $54 million and the superannuation and investments segment's growth in net profit by 21.4% to $34 million. The advice segment's net loss improved by $10 million to $15 million.
While the statutory net profit declined by $158 million to $103 million, however, the HY23 result included a net gain of $209 million on the sale of AMP Capital and SuperConcepts.
AMP noted that its capital management program has returned $963 million to owners of AMP shares since August 2022. The company noted that the HY24 interim dividend, paid today, represents $52 million from tranche 3 of its capital returns for shareholders. The ongoing share buyback will continue to deliver the remaining $85 million.
Advice
The company announced with its recent HY24 result that Entireti was going to acquire AMP's financial advice licensees and its self-licensed offer Jigsaw for a total consideration of $10.2 million. Of this, 70% is cash, and 30% is AMP's equity stake in a new joint venture entity to hold the businesses that AMP is selling.
Additionally, AMP's holdings in 16 financial advice practices will be acquired by AZ NGA for $82.2 million.
Forecasts for FY24
Pleasingly, the business expects controllable costs to be around $660 million, down from $690 million, reflecting the removal of the direct cost base for advice.
The broker UBS is forecasting that in FY24, AMP could generate $298 million of revenue, earnings before interest and tax (EBIT) of $230 million, net profit of $217 million and earnings per share (EPS) of 8 cents.
UBS predicts that AMP share owners could receive an annual dividend per share of 4 cents in FY24 and then 6 cents in FY25. Excluding franking credits, at the current AMP share price, that would represent dividend yields of 3% and 4.5%, respectively.
