Australia's Challenger flags 97 pct profit drop after challenging first half
(Adds fiscal year 2019 guidance, context)
Jan 23 (Reuters) - Investment manager Challenger Ltd
said on Wednesday it expects its interim net profit to
plummet 97 percent following a tumultuous first half marked by
increased market volatility.
The company said it expects statutory net profit of A$6
million ($4.27 million) for the six months to Dec. 31, compared
with A$195.4 million in the prior corresponding period.
The large drop is driven primarily by its annuity business'
exposure to equity markets, Challenger said in a statement. The
company expects its normalized net profit, which disregards
extraneous items, to drop by roughly A$7.9 million for the six
The company also said it now expects normalized net profit
before tax for fiscal 2019 in the range of A$545 million to
A$565 million, compared with A$547.3 million in 2018. Challenger
was initially targeting growth of about 8 percent to 12 percent.
Equities were battered by a slew of factors in 2018, ranging
from trade tensions between the world's largest economies, as
well as concerns over a slowdown in global economic growth.
The Australian benchmark index lost nearly 7 percent
in 2018, its worst year since 2011.
Challenger will report its interim results on Feb. 12.
($1 = 1.4039 Australian dollars)
(Reporting by Ambar Warrick in Bengaluru
Editing by James Dalgleish and Lisa Shumaker)
First Published: 2019-01-23 00:41:33
Updated 2019-01-23 01:03:43
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