Macquarie shares slide on 'satisfactory' performance

Thursday, 4 Feb 2016 09:48:20 | Stephen Letts

Venus Williams (L) and Serena Williams (R) embrace each other during their 2015 US Open Women's Singles Quarterfinals match at the USTA Billie Jean King National Tennis Center September 8, 2015 in New York.

Investment bank Macquarie Group said it is satisfied with its third quarter results and is still on track to beat last year's $1.6 billion profit despite challenging conditions.

However, weakness was evident in a number of key businesses.

Macquarie's annuity business saw a fall in earnings from the September quarter, while the important capital markets division - which includes securities, commodities and financial market operations - fell compared to the third quarter last year, but was up on the September quarter's result.

Macquarie CEO Nicholas Moore said the short term outlook remains subject to a range of challenges and recent trading conditions reflect current market uncertainty.

Mr Moore's trading update noted that volatile market conditions, currency fluctuations impact, the cost of a continued conservative approach to funding and capital, and potential regulatory changes and tax uncertainties made guidance tricky.

"While the impact of future market conditions makes forecasting difficult, Macquarie currently expects the financial year 2016 combined net profit contribution from operating groups to be up on financial year 2015," Mr Moore said in a statement to the ASX.

Macquarie's guidance noted that an earlier-than-expected flow of performance fees meant that its second half results will be down on the first half, although still stronger than the previous year's efforts.

Prior to today's update, analysts had forecast Macquarie would deliver a record full-year profit in excess of $2 billion.

The market was consequently unimpressed and, at 10:45am (AEDT) Macquarie shares had dropped 5 per cent to $64.83.

AustraliaPlus

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Macquarie shares slide on 'satisfactory' performance

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