Australian financial services giant Macquarie Group (ASX: MCQ) has announced a net profit of A$1.61 billion for the six months ended September 30, 14% higher than the same period a year earlier, but the shares slipped as the result was below expectations.
Macquarie said annuity-style activities by Macquarie Asset Management (MAM), Banking and Financial Services (BFS) and some businesses in Commodities and Global Markets (CGM) generated a combined net profit contribution of $1.614 billion.
The net profit contribution, which is before unallocated corporate items, profit share and income tax, was up 25% on the previous corresponding period (pcp) a year earlier.
However the net profit contribution from the markets-facing activities of Macquarie Capital and most CGM businesses fell 10% from the first half of the 2023/24 year to $1,407 million.
Net operating income rose 4% to $8,216 million while operating expenses of $5,919 million were in line with the pcp.
The Board announced an interim ordinary dividend of $2.60 per share (35% franked), compared with $2.55 (40% franked) a year earlier, to be paid on 17 December to shareholders on record on 12 November.
“Macquarie's improved performance this half year was underpinned by improved realisations in Macquarie Asset Management and further progress in the digitalisation programme in Banking and Financial Services, reflecting the ongoing benefits of our diverse business mix,” Managing Director and Chief Executive Officer Shemara Wikramanayake said in a statement.
International income accounted for 65% of the total income of the asset management, commodities and investment banking group.
Income tax increased 17% to $686 million as the effective tax rate rose to 29.9% from 29.3% due mainly due to the geographic composition and nature of earnings.
As of 1.15 pm (AEDT) Macquarie stock was trading at $222.42, down $9.10 (3.93%) from Thursday's close of $231.51.
The stock reached a day low of $220.61 and a day high of $223.09. Macquarie's market capitalisation is $84.8 billion.
Analysts had expected Macquarie to post an interim profit of $1.7 billion.
Wikramanayake did not provide detailed guidance about earnings for the full year ended March 31, 2025.