AXA on the hunt for dealer groups
AXA is on the prowl for dealer groups to boost its distribution network, group chief executive Les Owen has confirmed.
"We want to grow the number of advisers and intend purchasing stakes in independent dealer groups," he says. "We are talking to firms about joining our dealer groups."
It is understood that the focus is on dealer groups outside the company's Victorian base.
The number of advisers with AXA has fallen during the past financial year to 1465, compared to 1514 in the 1999 financial year, which ended on September 30.
AXA's Australian and New Zealand business has reported a flat year with the pre-tax operating profit only up 2 per cent to $169.6 million. After taking out restructuring costs and the write-off of ACL's goodwill, the Australasian operating after tax profit was down 18 per cent to $131.7 million.
Owen says the drop in profits was countered by a significant rise in new business.
The boost in sales has come from health insurance, up 198 per cent and wholesale investment, up 163 per cent.
Another star performer was the Summit master trust, which has been a life saver to the old National Mutual group in past years. New business for the trust reached $789 million, giving Summit a funds under administration figure of $2.1 billion at the year end.
Owen says the improved sales for the Australian operations are the first sign of the turnaround for the company.
"This is the first time for many years that there ha been clarity about our direction," he says. "We have introduced segmented distribution for the first time at AXA."
Owen has a five point plan for turning AXA around and this is the end of year one of the three year program.
The ratio of inflows versus outflows is one target and Owen reports for the first time for many years, the company had more money coming in than going out.
Inflows for the 2000 year were $2.5 billion compared to just under that figure in outflows.
AXA is also driving down the management expense ratio which this financial year is down to 19 per cent compared to 22 per cent last financial year. The target is 10 per cent by 2003.
Owen says there has been good progress in getting the right people, structure and capability into place during the 2000 financial year.
He sees the current year as being one of building relationships to ensure there is strong revenue growth at the end of 2003, the final year of his restructuring operation.
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