Challenger firms on 10% NPAT growth

Challenger Limited has strengthened its expectation of 10% growth in net profit after tax for the 2025 financial year in a third quarter update which revealed a 5% decline in funds under management but a solid lift in annuity sales.

The update, released to the Australian Securities Exchange (ASX) said the company had tightened its FY25 normalised net profit after tax guidance to a range of between $450 million and $465 million, with the mid-point of the range representing 10% growth on FY24.

Commenting on the update, Challenger managing director and chief executive, Nick Hamilton said the business had maintained momentum through the third quarter.

He said Challenger saw continued sales growth across domestic lifetime annuities and Japanese annuities, “supporting our focus on longer tenor and more valuable sales”.

Hamilton also welcomed TAL Dai-ichi Life as a material shareholder in Challenger which he said recognised the strength of Challenger’s strategic position, unique capabilities and the long-term tailwinds in the Australian retirement market.

The company’s summary of the quarter pointed to:

• Total Life sales of $1.4 billion supported by longer tenor annuity sales
• Retail lifetime annuity sales up 22% to $246 million.
• Japanese sales up 33% to $240 million
• Fixed term annuity sales up 15% to $505 million