Times are still tough for Macquarie Group (ASX:MQG), despite a pickup in some of its businesses in the June quarter compared to last year.
Ahead of the AGM on Thursday, the investment bank and fund manager said its commodities and global markets' first-quarter performance improved from last year due to increased trading activity in North American gas, power, and emissions markets, as well as strong results in the agriculture and resources sectors.
However, it reported that the combined net profit contribution from its market-facing businesses for the June quarter fell from last year, mainly because of the timing of asset realizations in Macquarie Capital. (In other words, it can’t offload assets flagged for sale.)
Investors didn’t respond favorably to the update, sending the shares down 3.8% by just before 11 am Sydney time.
The company noted that its annuity-style businesses' combined quarterly contribution was broadly in line during the quarter, thanks to volume growth, lower operating expenses, and reduced credit impairment charges in banking and financial services (which have recently been a focus for growth).
Macquarie Asset Management oversaw A$915.00 billion worth of assets as of the end of June, down 2% from March-end. As usual, Macquarie did not disclose profit figures in the quarterly update but claimed its first-quarter operating group contribution was broadly in line with last year (though we have no way of verifying this).
As it has been emphasizing for some time, the company continues to maintain a cautious stance with a conservative approach to capital, funding, and liquidity, positioning itself well to respond to the current environment. Additionally, it remains "well-positioned to deliver superior performance in the medium term due to its diverse business mix across annuity-style and market-facing businesses.”
In other words, Macquarie remains a bank for all seasons and markets.
