Macquarie Group Announces Senior Leadership Change And 3Q19 Update

  • Mar 27, 2019 AEDT
  • Team Kalkine
Macquarie Group Announces Senior Leadership Change And 3Q19 Update

The blue-chip financial major, Macquarie Group Limited (ASX: MQG) released its investor presentation and management update to the exchange.

MQG’s Mr. Andrew Downe has decided to step down as Group Head of Commodities and Global Markets (CGM) and also from the Executive committee, effective 31 March 2019. He has served the company for 37 years and was on the Executive Committee for 22 years. However, Mr. Downe will continue to head the Cash Equities business globally and continue to hold leadership for CGM in Asia. The current head of Commodity Markets and Finance (CMF) Mr. Nicholas O’Kane would replace Mr Downe and become the Group head of CGM as reported in the press release.

In February 2019, the company had released its 1HFY19 results update. Today the company released its 3Q19 overview. The company has been in a consistent growth trajectory, it has reported an EPS 5-year CAGR of 25 percent and at the same time has a consistent dividend growth of 21 percent (5-year CAGR). The company’s ROE stood at 16.3 percent in 1H19 which has also seen improvement as compared to 15.2 percent reported in FY17. The company is geographically well diversified and is truly a global player with ~67 percent of its revenue coming from its international operations. The groups, Macquarie Bank Ltd, has maintained its S&P rating for 27 years.

On the 3Q19 update, the company reported satisfactory trading conditions with major realisations in 3Q19 across the group. MQG’s Annuity business witnessed an uptick in its combined 3Q19 net profit contribution on pcp 3Q18. Further, the strong performance of the commodities platform in CGM contributed to Macquarie’s markets-facing businesses to report a significant uptick in net profit contribution. Corporate and Asset finance saw additions of $A 0.6 billion in 3Q19.

On the outlook front, the company’s presentation highlighted that on the short-term outlook front the company expects an increase of up to 15 percent in FY19 results as compared to FY18 result.

On the Medium-term front, the management believes that they are well positioned to deliver superior performance. The management expects ongoing benefits of continued cost initiatives to aid the company, also supported by a strong and conservative balance sheet.

Further, on the outlook of various business verticals within MQG, the management believes that the Macquarie Asset Management is set for organic growth, Corporate and Asset Finance group is well positioned for further asset acquisitions and realisations and they are targeting a tailored finance and asset management solutions to clients. On the medium term for Banking and Financial services vertical, the management sees strong growth opportunities through intermediary and direct retail client distribution, platform and client service. The commodities and Global markets business is witnessing opportunities to grow through acquisitions and organically. The Macquarie Capital business is well positioned to benefit from possible improvement in the M&A and capital market activity.

Stock Information:

The stock has been in an uptrend in the recent past. The stock has moved by 18.35%, -1.10%, and 17.45%, in the past three months, six months and YTD respectively.

The shares of MQG are trading at A$126.325 on ASX, marginally up by 0.657%, (As at 3:40 PM,27 March 2019).

Macquarie Group Limited’s (ASX: MQG) market capitalization stands at circa $42.72 billion. The Stock has noted the 52-week high price of A$130.880 and 52-week low price of A$100.600. As per the latest ASX declaration the, company EPS stood at 7.761 AUD, PE stood at 16.17 and dividend yield of 4.26%.


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