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  • AMP (AMP) opens the trading day red after announcing another $325 million in impairment charges ahead of its AMP Capital demerger
  • The ASX 200-lister says the charges, which are mainly non-cash, reflect a comprehensive review of its balance sheet
  • AMP’s expects post-tax charges include a $100 million partial impairment of deferred tax assets and a $75 million charge for reducing its office space, among others
  • AMP says the impairments will not impact underlying full-year net profit after tax
  • Shares in AMP are down 2.39 per cent to $1.02 at 10:15 am AEDT

Wealth management giant AMP (AMP) has opened the trading day red after announcing another $325 million in impairment charges ahead of its AMP Capital demerger.

The ASX 200-lister today said the charges, which were mainly non-cash, reflect a comprehensive review of its balance sheet.

Specifically, AMP’s expected post-tax charges include a $100 million partial impairment of deferred tax assets and a $75 million charge for reducing its office space as its gears up to spin off its AMP Capital private markets business.

The company will also write down $95 million of intangibles.

AMP chief Alexis George said the company was looking to make sure all recorded assets are in line with the future strategic direction of a post-merger business.

“The charges are mainly non-cash and related to legacy issues, and our action will ensure that both businesses are in a stronger position to take advantage of opportunities in the future,” Ms George said.

AMP said the charges would be recognised as a significant item against its statutory net profit for the 2021 financial year, but the impairments would not impact underlying full-year net profit after tax.

AMP added that its cash position remains “sound” despite the charges, with a proforma June 30 surplus of roughly $440 million.

The company is slated to demerge its AMP Capital’s private markets business and list it as a separate entity in 2022 as part of its simplification strategy for the wider group. The demerged entity will include AMP’s currently-unlisted infrastructure and property management arm.

It seems some investors may have gotten ahead of the curve for AMP when the company’s shares declined almost 5 per cent yesterday despite no news surfacing from the wealth manager.

Following today’s announcement, the share price dip has continued, with AMP shares down 2.39 per cent to $1.02 at 10:15 am AEDT. The company has a $3.3 billion market cap.

AMP by the numbers
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