Ameriprise Financial Reports Second Quarter 2017 Results
Operating EPS increased 26 percent to $2.80
Second quarter 2017 return on equity excluding AOCI was 23.0 percent
Operating ROE excluding AOCI was 25.2 percent or 27.7 percent before annual unlocking(1)
MINNEAPOLIS – July 25, 2017 – Ameriprise Financial, Inc. (NYSE: AMP) today reported second quarter 2017 net income of $393 million, up 17 percent compared to a year ago, or $2.50 per diluted share, up 27 percent. Operating earnings were $441 million, up 16 percent compared to a year ago, with operating earnings per diluted share of $2.80, up 26 percent.
GAAP Results – Second quarter
Net revenues of $3.0 billion increased 4 percent, or $114 million, from a year ago, primarily due to strong revenue growth in Advice & Wealth Management. Normalizing for the net impacts of transitioning advisory accounts to share classes without 12b-1 fees, net revenues increased 6 percent due to strong net revenue growth in Advice & Wealth Management from growth in client assets.
Expenses of $2.5 billion increased 1 percent, or $13 million, from a year ago, reflecting increased distribution expense from higher advisor productivity, as well as the market impact on variable annuity guaranteed benefits. General and administrative expenses declined 3 percent reflecting ongoing expense discipline.
Operating Results – Second quarter
Normalizing for the net impacts of transitioning advisory accounts to share classes without 12b-1 fees, operating net revenue increased 5 percent due to strong 13 percent net revenue growth in Advice & Wealth Management from growth in client assets. In total, operating net revenues of $3.0 billion increased 3 percent, or $94 million.
Operating expenses of $2.4 billion decreased 1 percent, or $14 million, from a year ago. General and administrative expenses declined 3 percent reflecting ongoing expense discipline.
The company continued to deliver a strong return to shareholders through share repurchases and dividends of $481 million in the quarter.
“Ameriprise delivered strong results in the second quarter led by significant gains in wealth management,” said Jim Cracchiolo, chairman and chief executive officer. “We’re generating good growth that reflects the value of the advice and the solutions we provide our clients. In this low volatility environment, clients are putting their money to work, which fueled a record quarter for net inflows in fee-based investment advisory accounts at $4.5 billion and nice gains in advisor productivity.”
“We remain focused on serving our clients and supporting our advisors while we execute our strategy for growth and long-term value creation. As our fee-based businesses become even larger contributors of our earnings, we’re generating strong free cash flow that we invest for business growth and return to shareholders. In 2017, we’ve returned nearly $1 billion to shareholders and our return on equity remains among the highest in the industry.”
1. Unlocking represents the company’s annual review of insurance and annuity valuation assumptions and model changes and the long term care review conducted in the third quarter.
The full press release is available for download below. Earnings materials are also available on the Investor Relations site at ir.ameriprise.com.