Investment bank Macquarie posts second-highest profit
Investment giant Macquarie Group posted its second-biggest annual profit, recording $4.8 billion, up 30 percent on the previous year.
Market expectations were for a profit of $4.4 billion in the 12 months to March 31.
Half-year profit was $3.2 billion; This was a record half-year result and was almost double that of a year ago.
“Shemara, congratulations on a great result,” senior banking analyst Brian Johnson of MST Financial told Macquarie CEO Shemara Wikramanayake during a briefing on Friday.
Ms Wikramanayake said each of Macquarie’s four businesses was using specialist expertise to navigate the current environment and identify long-term growth opportunities.
Macquarie’s commodities and global markets division was the biggest growth division, with profits rising 49 per cent to $4.2 billion following the sale of British smart meter asset provider OnStream.
Macquarie Capital made a net profit of $1.5 billion, an increase of 43 percent compared to the previous year, driven by higher income from equity investments and merger and acquisition fees.
Macquarie Asset Management’s net profit increased by 27 percent to $2.6 billion, driven by higher performance fees, while the contribution of Macquarie’s banking and financial services division increased by 17 percent to $1.6 billion.
Macquarie said it would return half of its half-year profit to shareholders by paying a dividend of $4.20 per share in the second half.
That brings this year’s dividend to $7 per share, up from $6.50 per share a year ago.
Macquarie also released its annual and sustainability reports on Friday; Activist group Market Forces has cited increased funding for fossil fuel projects.
“Macquarie’s announcements confirm it is Australia’s ‘drill baby drill’ bank, having tripled its funding for oil and gas in the last four years, while its other big four peers have also reduced their funding for fossil fuels,” said Morgan Pickett, the group’s banking analyst.
Mr Pickett said the investment bank was backing Whitehaven Coal’s mine expansion plans and financing gas fracking projects in Australia’s Beetaloo Basin, south of Darwin.
By midday Friday, Macquarie Group shares were down 0.9 percent to $239.80.
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