Macquarie shares lower as analysts forecast FY25 rebound
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More news: Macquarie shares lowered at the start of trading after the banking group posted a 32% dive in net profit for the 2024 financial year.
Macquarie shares were down 0.5% to $187.09 by 11:00am AEST.
Jefferies analysts said that second-half statutory NPAT of $2.1 billion, which was up 5% half on half but represented a 27% decrease compared to the prior corresponding period, was in line with consensus due to the low tax rate and write-backs.
They noted that FY24 was a "trough year" with activity set to rebound in FY25.
Macquarie posts 32% net profit drop for FY24
The news: Macquarie Group reported a 32% net profit drop for the 2024 financial year, as the banking group maintained a "cautious stance" amid economic uncertainty and subdued market conditions.
The numbers: Net profit fell 32% year on year to $3.5 billion. While Macquarie's second-half net profit result of $2.1 billion was up 49% on the first half, it came in 27% lower compared to the prior corresponding period.
Earnings per share also fell 32% to $9.17, despite lifting 48% in the second half compared to the first-half period.
However, assets under management rose 7% to $938.3 billion, which the bank attributed to favourable market movements, investments made by private markets-managed funds, and favourable foreign exchange movements.
Macquarie said that as part of its $2 billion on-market share buyback announced in November last year, $644 million of ordinary shares have been acquired at an average price of $183.26 per share.
It declared a second-half dividend of $3.85 per share on a 40% franked basis, up from the interim dividend of $2.55 announced six months ago.
However, the dividend announced today was 14.4% lower than its $4.50 dividend a year ago.
The context: Macquarie CEO Shemara Wikramanayake noted that despite ongoing economic uncertainty and subdued market conditions in many parts of the world, the bank's client franchises remained resilient over the last year, with continued client growth, fundraising and new business organisation across the group.
Macquarie said it continues to maintain a cautious stance, with a conservative approach to capital, funding and liquidity, to respond to the current environment.
In February, Macquarie reported a sharp profit drop in the first half after an exceptionally strong FY23.
The source: ASX announcement
