Macquarie shares fall on flat Q1, profit fall
Make us a preferred source
Make us a preferred source on Google
More news: Shares in Macquarie were down 4.09% to $200.2 by 11:30am AEST, off the back of reporting flat earnings for 1Q25.
Macquarie CEO Shemara Wikramanayake said the bank's Q1 performance was consistent with expectations with the operating group contribution broadly in line with the prior corresponding period.
Its markets-facing businesses — commodities and global markets (CGM) and Macquarie Capital — saw a combined first-quarter net profit contribution decline from the previous year due to the timing of asset realisations in Macquarie Capital. This decline was partially offset by contributions from CGM.
The bank also posted a profit of $3.5 billion for FY24, a 32% drop from FY23.
Macquarie posts profit fall, lowers dividend
The news: Macquarie Group said its operating performance in the first quarter of 2025 was "broadly in line" with the prior corresponding period, but reiterated a "cautious stance" and a conservative approach to capital, funding and liquidity.
The numbers: Macquarie posted a profit of $3.5 billion for FY24, a 32% drop from FY23. Chair Glenn Stevens said it was a decline from the "exceptional results of the previous two years".
However, financial group posted a capital surplus of $8.2 billion at 30 June, down 23.4% from $10.7 billion at 31 March, and $10.8 billion a year earlier. The company said the drop was primarily driven by the payment of its FY24 second-half dividend, employee equity awards, business capital requirement growth and its $2 billion share buyback.
Macquarie Asset Management (MAM) posted assets under management (AUM) of $915 billion at 30 June, down 2% on 31 March, but up on last year's total of $864.2 billion. The fall in AUM was primarily due to net flows and "unfavourable foreign exchange movements".
Macquarie's Banking and Financial Services (BFS) business recorded deposits of $145.3 billion at 30 June, up 2% on 31 March.
The company also lowered its dividend to $3.85 from $4.50.
The context: Macquarie said that its Q1 performance met expectations, with the operating group contribution broadly in line with the prior corresponding period.
Its annuity-style businesses — MAM and BFS — saw a net profit contribution consistent with Q1 2024, driven by volume growth, lower operating expenses, and reduced credit impairment charges in BFS. This was offset by margin compression in BFS and the timing of performance fees in MAM, the company said.
Combined Q1 net profit from Macquarie's markets-facing businesses — Commodities and Global Markets (CGM) and Macquarie Capital — was down year on year, primarily due to the timing of asset realisations in Macquarie Capital, partly offset by a continued contribution across the platform in CGM.
Macquarie noted that it remains “well-positioned to deliver superior performance in the medium term,” but flagged several factors that may influence the company’s short-term outlook. These include market conditions, the completion of period-end reviews and transactions, the geographic composition of income and the impact of foreign exchange, as well as potential tax or regulatory changes and tax uncertainties.
What they said: "The volatility in global energy markets that had previously increased customer demand for services and presented trading opportunities gave way to much quieter conditions, and hence lower earnings for the commodities and global markets business," Stevens said.
"For much of the year, less active financial markets also constrained other areas of the group's business, particularly in MAM. However, as long-term investments in growth paid off, banking and financial services and Macquarie capital both generated higher profits than last year."
The source: ASX announcement
