Macquarie continues strong run
(30 October 2017 – Australia) Macquarie Group has reported a record profit for the first half of its 2017-2018 financial year, exceeding analysts’ expectations and upgrading its full-year earnings forecast.
Australia’s so-called “fifth pillar” benefited from a strong performance from its “annuity-style” businesses that generate recurring income, which enabled the group to report a 19 percent year-on-year increase in net profit after tax to A$1.24 billion in the six months to the end of September.
Macquarie said it expected its combined net profit for the full year 2018 to be slightly up on the previous year’s record of A$2.2 billion, although it said profits in the second half of 2018 would be slightly lower than in the first half.
“Macquarie is well positioned to deliver superior performance in the medium term,” said Nicholas Moore, Macquarie chief executive.
“The group remains well positioned, with a strong and diverse global platform and deep expertise across a range of products and asset classes.”
The group’s earnings were driven by its wealth management and banking services arms that totaled around 80 percent of net profits in the first half.
Macquarie’s asset management unit brought in performance fees worth A$537 million in the first half, compared with A$170 million a year earlier. The combined profit contribution from its capital markets facing businesses, which include commodities and deal advisory, fell 18 percent to A$568m, reflecting lower M&A fee income in the US, reduced income from energy asset sales and lower commodity trading.
In its senior executive ranks, Macquarie has appointed Glenn Stevens, former governor of the Reserve Bank of Australia, as an independent director from 1 November.
Stephen Allen, Macquarie’s chief risk officer, will step down from December 31 and be replaced by Patrick Upfold, chief financial officer. Alex Harvey, head of transactions at Macquarie Capital, will succeed Upfold as chief financial officer.
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