05/06/2020
Ameriprise announced that it raised its quarterly dividend 7 percent to $1.04 per share

Earnings Per Diluted Share

 

Return on Equity, ex. AOCI

First Quarter 2020:

 

 

First Quarter 2020:

 

GAAP

$15.88

 

GAAP

59.5%

Adjusted Operating

$5.41

 

Adjusted Operating(1)

39.7


Perspective from Jim Cracchiolo, Chairman and Chief Executive Officer
 
“The global pandemic has caused a healthcare and economic crisis, as well as significant equity market declines, extreme volatility and record low interest rates. During this time, we have focused on our clients as well as protecting the health and safety of our employees and advisors. Ameriprise has remained strong.
 
“The strength of our first quarter results reflects the commitment of our team, as well as the power of our diversified business, advice value proposition and highly effective technology infrastructure. We had a good start to the year despite the challenging operating environment. Even with the vast majority of our employees and advisors working from home, we remained focused and delivered strong growth in client flows and near record levels of gross sales in Asset Management.
 
“With our excellent balance sheet and risk management, we have been able to absorb considerable market impacts. We completed the quarter with a sizable excess capital position that provides important flexibility, and we also have ample liquidity. Both our financial strength and ability to generate free cash flow across market cycles differentiate Ameriprise. We are able to continue executing our long-term strategy and return capital to shareholders. This includes raising our regular quarterly dividend 7 percent, the 16th increase over the last 15 years.
 
“While market conditions and the operating environment remain fluid, Ameriprise is in a strong position.”
 
  • First quarter adjusted operating earnings per diluted share was $5.41,
    up 46 percent(1) reflecting strong business performance in a challenging environment and a tax benefit(2) from a projected net operating loss (NOL).
     
  • In the quarter, the sizable difference between the company’s GAAP and adjusted operating results was driven by the severity of the market dislocation in March, primarily related to widening in our credit spread and the valuation of derivatives used to hedge the company’s variable annuity living benefit guarantees(3). Management believes adjusted operating results best reflect underlying performance.
     
  • Adjusted operating net revenue grew 4 percent to $3.0 billion(1) from strong client activity, net inflows and higher average equity markets, partially offset by lower interest rates.
 
  • The company’s risk management approach resulted in balance sheet fundamentals remaining strong in a challenging operating environment. Parent company liquidity was approximately $2 billion with significant additional liquidity available in the business segments. Excess capital was $1.7 billion after implementing VM-21, hedging strategies were 99 percent effective and the investment portfolio remains high quality with a net unrealized gain of $0.6 billion and limited impairments.
 
  • Advice & Wealth Management and Asset Management generated approximately 74 percent of the company’s revenue and 76 percent
    of pretax adjusted operating earnings in the quarter.
     
  • Total pretax adjusted operating margin was 22.1 percent, which was in line with last year. Advice & Wealth Management margin was 22.3 percent and Asset Management net adjusted margin was 37.9 percent, reflecting excellent business fundamentals and well-managed expenses.
     
  • The company maintained its strong track record of capital return and
    free cash flow, returning $512 million to shareholders in the quarter,
    with 2.5 million shares repurchased.
     
  1. Excluding the Auto & Home insurance business, which was sold in 2019.
  2. See page 2 for additional detail.
  3. See page 8 for reconciliation.

The full press release is available for download below. Earnings materials are also available on the Investor Relations site at ir.ameriprise.com.
 

Click to Download

Contact(s)

Paul Johnson

Email: paul.w.johnson@ampf.com
Phone: 612-671-0625