Results, page-3

CGF is one of the few large caps I like. This result has me considering taking a position if it can get the share price trending higher. Don't expect it will ever trade on a high teens PE as the market has never been confident around the future liabilities risk.
From Bell Potter this morning:
Challenger's COE Margin, despite some concerns, actually went up by 10bps from 1H15 to 2H15. They have reintroduced a Care Annuity product called CarePlus, which we noted in a recent report as a major key catalyst for the company given its strong sales potential. In addition to new CarePlus product, there is the new VicSuper white label, and Colonial Platform annuity product – which should add to growth in the September quarter. DRP introduced given move to 100% franking and strong growth rates in business. Funds Management FY15 EBIT of $44m, vs our $45m estimate.
Outlook: Life COE guidance for FY16 is strong. The company guidance is for FY16 range of $585m - $595m Life COE. However, this includes a reduced normalised growth assumption for equities from 6.0% to 4.5% which reduced guidance by ~$13m. Despite this, it still compares well to consensus. On a like for like basis excluding the revised normalised growth assumption, consensus was at $589m, company guidance would be at ~$602m and our top of the market estimate was $607m. This implies that the company expects book growth and margins to remain strong in FY16. Overall a strong result, a lot to be happy about. In reinforces our view that CGF remains a top pick in the space. Don’t expect much change to our top of the market estimates.