The recently re-listed holding company Macquarie Group (MQG), fell by as much as 5.1 percent today after it said its full-year earnings may come in lower than expected, based on its second-half earnings forecast.
While Australia's biggest investment bank reported a 45 percent rise in first-half profit, it said the second-half may only be in line with the prior year's second-half result of A$733 million, lower than its first-half results.
Net profit for the first six months (ending September 30) was $1.06 billion, up from $730 million in the same period last year.
This was up from Macquarie Group's forecast of a 40 per cent gain.
Macquarie Group CEO Allan Moss said equity market conditions may not continue to be as favourable in the second half of the financial year, noting that the first half had benefited from a high number of asset sales.
"We don't have a strongly negative view on equity markets but you'd just have to say that equity markets have been very strong, particularly in Australia and Asia, in the first half," said Mr Moss.
"That just makes us think that there might be some degree of mean reversion. And if that were to be the case then a number of our businesses would be affected by that."
The outlook was also based on the fact that fewer deals are done over Christmas and the New Year as well as an expected decline in assets sales in the second half.
"There might be some modest asset sales, but we're not planning substantial asset sales in the second half."
Mr Moss said the forecast also took into account the ongoing global crisis.
"Market conditions are generally volatile and frankly somewhat nervous, so we've built all those considerations into making those sorts of comments."
However, despite the doom and gloom, Mr Moss commented that it was still too early to make a definitive forecast for the full year.
Amongst all this, Macquarie Group did say it is expecting transaction levels to remain "satisfactory" for the remainder of the 2008/09 financial year.
This message seemed to get lost amongst the less-than-positive second half outlook, with shares in Macquarie Group falling by $3.01 to close at $79.
