Challenger Reports 13% Increase in Full-Year Net Profit

Challenger, Australia's leading provider of annuities, has announced a 13% rise in net profit for the 12 months ending June 30. The company reported a net profit of 287.5 million Australian dollars ($186.5 million), surpassing the consensus forecast of A$236.6 million.

Strong Growth in Annuity Sales

The increase in net profit can be attributed to a boost in annuity sales, particularly in the longer duration business segment. Challenger's normalized net profit before tax also rose by 10% to A$521 million, exceeding its guidance range of A$485 million to A$535 million.

Positive Outlook for FY 2023

During an investor day in May, Challenger expressed optimism about its future performance. The company anticipates its normalized net profit before tax for FY 2023 to surpass the midpoint of its guidance range.

Focus on Customer Expansion and Growth Initiatives

Chief Executive Nick Hamilton commented on the strong performance, stating, "Challenger has delivered a solid performance this year as we prioritize expanding our customer base and driving growth initiatives." He further highlighted the growing demand for guaranteed income among customers seeking financial security during retirement.

Dividend Increase

Directors of Challenger have declared a final dividend of 12.0 Australian cents per share, representing an increase from the previous year's 11.5 Australian cents.

Outlook for FY 2024

Challenger has set a target for normalized net profit before tax in fiscal year 2024 to range between A$555 million and A$605 million. This projection reflects an 11% increase compared to FY 2023. However, the guidance range excludes Challenger Bank due to its expected sale completion in the first half of that financial year.