Macquarie lifts profit but outlook softens

Macquarie Group beat full-year profit guidance but the company’s share price has slumped in early trade after it warned of a more subdued performance over the next 12 months.

Macquarie announced a 17 per cent lift in full-year net profit to a record $2.98 billion on Friday, but its share price dipped 5.65 per cent to $128.50 by 1015 AEST.

Net profit from the Macquarie Capital unit rose 89 per cent to $1.35 billion for the 12 months to March 31, while net profit from commodities and global markets jumped 65 per cent to $1.51 billion as the group’s soaring market-facing unit offset a slight dip across its annuity-style businesses.

Combined profit from Macquarie Asset Management, corporate and asset finance, and banking services fell four per cent to $3.29 billion.

Managing director and chief executive officer Shemara Wikramanayake said on Friday the company’s fiscal year 2020 result would likely be softer as the company awaits further regulatory change and grapples with tax uncertainties.

Foreign exchange impacts, the completion rate of transactions, and changing market conditions could also weigh in the short term, she said.

“Macquarie remains well positioned to deliver superior performance in the medium term due to our deep expertise in major markets, strength in diversity and ability to adapt the portfolio mix to changing market conditions,” Ms Wikramanayake said in a note.

Assets under management rose 11 per cent to $551.3 billion for the year to March 31 and the group lifted its final dividend 40 cents to $3.60, partially franked.

In February Macquarie told investors to expect a 15 per cent lift in net profit from 2017/18.

Shares in Macquarie Group were worth a near-record $136.20 before trade on Friday, up from $107.50 a year ago.

MACQUARIE’S FY RESULTS

* Net profit up 17pct to $2.98b

* Income up 17pct to $12.75b

* Final dividend up 40 cents to $3.60, partially franked.

AAP

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