AMP (ASX:AMP) share price higher despite cancelled dividend

AMP won’t be paying an interim dividend…
The post AMP (ASX:AMP) share price higher despite cancelled dividend appeared first on The Motley Fool Australia. –

The AMP Limited (ASX: AMP) share price is pushing higher on Thursday morning following the release of its first half results.

At the time of writing, the financial services company’s shares are up 2% to $1.10.

What happened in the first half?

For the six months ended 30 June, AMP reported an 8% increase in Australian wealth management assets under management to $121 billion.

Combined with a 6% reduction in controllable costs, excluding AMP Capital, this led to a 57% jump in net profit after tax to $181 million.

Taking some of the shine off the result, and potentially holding back the AMP share price a touch, was news that no interim dividend was declared.

Why is there no AMP dividend?

According to the release, AMP has decided against paying a dividend at this stage.

This is due to the Board wanting to maintain a conservative approach to capital management and its dividend until the requirements for the AMP Capital Private Markets demerger and future strategies are finalised.

Though, it has been returning funds to shareholders in other ways. This morning the company confirmed that its previously announced on-market share buy-back of up to A$200 million is now complete. It concluded on 30 June, with the deployment of $196 million of capital to repurchase and cancel 170.5 million shares.

When will its dividends return?

As mentioned above, AMP is holding back from paying a dividend until its strategies and demerger plans are finalised.

In respect to the latter, the demerger of the AMP Capital private Markets is progressing well. For example, the company notes that in June, internationally respected asset management executive, Shawn Johnson, joined as AMP Capital CEO to set its international growth strategy and lead its demerger.

Furthermore, a number of workstreams have been established to deliver internal operational separation in FY 2021. After which, a demerger and ASX listing is expected to occur in the first half of FY 2022, following shareholder approval.

Based on this, it is conceivable that there will be an AMP dividend in the second half. But time will tell if that is the case.

The post AMP (ASX:AMP) share price higher despite cancelled dividend appeared first on The Motley Fool Australia.

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More reading

AMP (ASX:AMP) share price on watch as net profit jumps 57%
How did the AMP share price respond last earnings season?

The AMP (ASX:AMP) share price is trading on a forecast 9.4% dividend yield
If you invested $1000 in AMP (ASX:AMP) shares a decade ago, this is how much it would be worth now
The AMP (ASX:AMP) share price is down 6% over the past month. Here’s why

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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