What drove Macquarie’s (ASX:MQG) profit 56% higher

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What drove Macquarie’s (ASX:MQG) profit 56% higher

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 What drove Macquarie’s (ASX:MQG) profit 56% higher
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Highlights

  • Macquarie maintained a cautious stance amid heightened levels of volatility across regions.

  • The company’s board announced a final ordinary dividend of AU3.50 per share.

  • The company didn’t provide any specific fiscal guidance.

Financial services provider Macquarie Group Ltd (ASX:MQG) on Monday announced full-year net profit rise of over 50%, however, the group maintained a cautious stance amid heightened levels of volatility across the markets in which it operates.

For the year ended 31 March 2022 (FY22), Macquarie announced a net profit after tax (NPAT) of AU$4.7 billion, a 56% spike compared to FY21. The group’s profit for the half year ended 31 March 2022 (2H22) was AU$2.6 billion, up 30% on the half year ended 30 September 2021 (1H22) and up 31% on the half year ended 31 March 2021 (2H21), Macquarie said in its latest ASX filing.

By 10:15 AM (AEST, the stock was trading at AU$191.02, down 5.74%. In the past year, the stock is up over 20%.

The company’s board also announced a final ordinary dividend of AU3.50 per share (40% franked), FY22 ordinary dividend of AU$6.22 per share (40% franked), representing a 2H22 payout ratio of 50% and FY22 payout ratio of 50%.

MQG boosts Assets Under Management

Macquarie further informed that the acquisitions of Waddell & Reed Financial, AMP Capital’s public investments business and Central Park Group have boosted its assets under management (AUM) by 37% to AU$774.8 billion.

  • Annuity-style activities delivered a combined net profit of AU$4.1 billion, up 25% on FY21.
  • Markets-facing activities delivered a net profit of AU$5.3 billion, up 92% on FY21.

Macquarie’s common equity tier 1 capital ratio stood at 11.5%. The total customer deposits surged to AU$101.5 billion, from AU$84 billion from a year ago.

Fund raises

Macquarie has raised AU$48.3 billion in term funding in the past year. It includes AU$9.5 billion drawn from the Reserve Bank of Australia (RBA) Term Funding Facility. The company also raised AU$2.8 billion of equity capital through AU$1.5 billion institutional placement and a AU$1.3 billion share purchase plan.

Guidance

The company didn’t provide any specific fiscal guidance. "We continue to maintain a cautious stance, with a conservative approach to capital, funding and liquidity that positions us well to respond to the current environment,” said Macquarie Group’s Managing Director and Chief Executive Officer, Shemara Wikramanayake.

 “Macquarie remains well-positioned to deliver superior performance in the medium term. This is due to our deep expertise in major markets; strength in business and geographic diversity and ability to adapt the portfolio mix to changing market conditions,” added Wikramanayake.

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