There is nothing for local investors in mainstream banks to read into the solid full year profit reported this morning by investment bank and global fund manager, Macquarie (MQG).
Macquarie Group reported a 27% jump in full year earnings, and encouraged investors with a forecast for a slightly stronger result for the year which started on April 1.
Macquarie earned a net profit of $1.604 billion in the year to March, up sharply from the solid $1.265 billion earned in 2013-14, and better than market forecasts which were for around $1.5 billion.
The 27% rise was also much stronger than the 10% to 20% growth forecast by Macquarie in February when the banks said full-year earnings would print at the "upper end" of its forecast range of $1.4 billion to $1.52 billion.
Net operating income rose 14% to $9.293 billion, from $8.132 billion in the previous year
Macquarie will pay a final dividend of $2 (40% franked) a share on July 20. That takes the full year payout to shareholders to $3.30 a share, up significantly on the previous year’s full year payout of $2.60 per share.
Macquarie said it expects the 2015-16 group result to be slightly up on the one reported this morning.
MQG 1Y – Macquarie beats forecasts
Directors warned the group’s short-term outlook remained subject to a range of challenges including market conditions, the impact of foreign exchange movements, the cost of a sustained conservative approach to funding and capital, as well as potential regulatory changes and tax uncertainties.
“Macquarie remains well positioned to deliver superior performance in the medium term due to its deep expertise in major markets, strength in diversity and ability to adapt our portfolio mix to changing market conditions, the ongoing benefits of continued cost initiatives, a strong and conservative balance sheet, and a proven risk management framework and culture," chief executive Nicholas Moore said.
Mr Moore said while Macquarie continued to build on the strength of its Australian franchise, international income accounted for 70 per cent of the group’s total income in fiscal 2015.
“This reflects the growth of our international operations, particularly in the Americas, which was the largest contributing region with 36 per cent of total income, as well as the favourable impact of foreign exchange movements,” he said in this morning’s statement.
Macquarie shares closed at $76.50 last night on the ASX.
Macquarie’s assets under management at March 31, 2015 were $A486.3 billion, up 14% from $A426.9 billion a year earlier, largely due to additional investments and favourable foreign exchange and market movements.
