• Total Life sales $1.4 billion, supported by longer tenor annuity sales
• Retail lifetime annuity sales up 22%, Japanese sales up 33%, fixed term annuity sales up 15%
• Challenger Life strongly capitalised with a PCA ratio of 1.62 times

Challenger Limited (ASX:CGF) reported its third quarter AUM, annuity sales and net flows. The company saw continued sales growth across domestic lifetime annuities and Japanese annuities, supporting its focus on longer tenor and more valuable sales. Annuity sales increased by 20% to $1.0 billion, with strong growth in long duration retail lifetime (up 22%) and MS Primary Japanese annuities (up 33%). Fixed term annuity sales also grew 15%. Reflecting the sales remix strategy, maturities moderated to 5% in the quarter, with the FY25 maturity rate expected to be 24%. Challenger Life remains strongly capitalised with a PCA ratio of 1.62 times. Funds Management FUM was $115.2 billion, a decrease of $5.9 billion or 5% for the quarter, with $3.7 billion due to negative investment market movements, net outflows of $1.9 billion and client distributions of $0.3 billion. Challenger has 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.

Challenger has 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.

Challenger is strongly supportive of the government and regulatory focus to deliver a retirement system for the millions of Australians approaching and in retirement. The company looks forward to APRA's forthcoming changes to insurance capital standards, which will support significant growth in the lifetime income market and step change balance sheet resilience.