(Reuters) - Australian fund manager Challenger Ltd said on Thursday it expected annual profit before tax at the lower end of its guidance range, sending its shares to more than three-year lows.
The company said it now expected to achieve the bottom end of the full-year 2019 normalized net profit before tax guidance range of A$545 million to A$565 million, matching market expectations of A$544 million ($376.9 million).
Challenger further signaled little growth in fiscal 2020 due to a “low interest rate environment”, forecasting profit before tax in the range of A$500 million to A$550 million.
The company’s shares plunged 12% to A$6.72 after the announcement, hitting more than three-year lows. The broader market was flat.
Annuities, one of Challenger’s main products, have become less attractive after a recent cut in the benchmark rate, and the company is finding it harder to provide previously committed fixed returns to customers.
Reporting by Shanima A in Bengaluru; Editing by Stephen Coates