10-KPeriod: FY2008

AMERIPRISE FINANCIAL INC Annual Report, Year Ended Dec 31, 2008

Filed March 2, 2009For Securities:AMP

Summary

Ameriprise Financial Inc. (AMP) reported a net loss of $38 million on net revenues of $7.0 billion for the fiscal year ended December 30, 2008. This marks a significant downturn from the $814 million net income reported in the prior year, largely driven by unprecedented market volatility and credit crises that impacted all segments of the business, particularly net investment income which saw a 59% decline. Despite the challenging economic environment, Ameriprise maintained strong client and advisor retention rates, with 94% and 92% respectively. The company also completed strategic acquisitions of H&R Block Financial Advisors, J. & W. Seligman & Co., and Brecek & Young Advisors, Inc. during the fourth quarter of 2008, aiming to strengthen its retail distribution and asset management capabilities. However, the company temporarily suspended its stock repurchase program due to prevailing market conditions. Investors should note the significant decline in total owned, managed, and administered assets from $479.8 billion to $372.1 billion, reflecting market depreciation.

Financial Highlights

36 data points
Beta

Revenue

$7.10B

Net Income

-$36.00M

-0.5% Net Margin

EPS (Diluted)

$-0.16

Total Assets

$95.58B

Cash & Equivalents

$6.23B

Free Cash Flow

$2.06B

Financial Statements
Beta
Revenue$7.10B
Operating Expenses$7.34B
Net Income-$36.00M
EPS (Basic)$-0.16
EPS (Diluted)$-0.16
Shares Outstanding (Basic)222.30M
Shares Outstanding (Diluted)224.90M

Key Highlights

  • 1Net loss of $38 million in 2008, a substantial decrease from $814 million net income in 2007.
  • 2Net revenues decreased by 19% to $7.0 billion, significantly impacted by market volatility and credit crises.
  • 3Total owned, managed, and administered assets declined by 22% to $372.1 billion due to market depreciation.
  • 4Completed acquisitions of H&R Block Financial Advisors, J. & W. Seligman & Co., and Brecek & Young Advisors to bolster distribution and asset management.
  • 5Maintained strong client retention (94%) and advisor retention (92%).
  • 6Temporarily suspended stock repurchase program due to market conditions.
  • 7Significant increase in amortization of deferred acquisition costs (DAC) by 69% due to market impacts.

Frequently Asked Questions

Ameriprise Financial reported a net loss of $38 million for the fiscal year ended December 30, 2008, a significant decline from a net income of $814 million in 2007. This was primarily due to adverse market conditions, including equity market declines and credit crises, which reduced net revenues by 19% to $7.0 billion.

The company's total owned, managed, and administered assets decreased by 22% from $479.8 billion at the end of 2007 to $372.1 billion at the end of 2008. This decline was largely attributed to an 38% decrease in the S&P 500 Index and widened credit spreads.

Ameriprise Financial completed several strategic acquisitions in the fourth quarter of 2008, including H&R Block Financial Advisors, J. & W. Seligman & Co., and Brecek & Young Advisors, to expand its retail distribution and asset management businesses. The company also stated it had temporarily suspended its stock repurchase program due to the challenging market environment.

The company acknowledged the persistent challenging business climate. Its strategic objectives remain focused on leadership in financial planning for mass affluent and affluent clients, strengthening its advisor platform, and capturing greater assets and protection in force. However, the company cautioned that its financial condition and results could continue to be adversely affected by market fluctuations and economic factors.