Macquarie Announces Strong Aggregate First Half Performance, Despite Cautious Undertone

by Stewart Douglas

Story link: Macquarie Announces Strong Aggregate First Half Performance, Despite Cautious Undertone

Australian investment outfit Macquarie today announced its strong performance for the first half of the year, surpassing previous records to buck the trend for investment banks following the sub-prime mortgage sector fallout in the US in terms of revenue and overall profitability.

The Australian investment bank today announced its profit figures for the first six months to the end of September, uncovering results of $950 million, up over 45% on the same period last year despite its exposure to sub-prime linked securities, whilst reporting an increase of 70% in its international divisions.

However the firm did manage to dent investor confidence by urging caution for the second half of the year, suggesting that it could be forced to downgrade its final dividend rate to reflect consistent profits with last year’s figures, causing the value of its shares to fall by over 3.5% on the day.

It is thought that the predicted downturn may be as a result of a traditional seasonal slowdown over the period and prolonged unrest within traditionally strong markets as a result of sub-prime exposure across the industry, thus the bank decided to warn investors of the potential for somewhat disappointing results.

Speaking today on the results, group chief executive Allan Moss suggested that the issue of transparency would continue to play a key role in the industry over the coming months, and indeed with the value of investment securities in open trade. Whilst he expressed delight with the strong performance over the first half he remained realistic about the possibilities for the second six month period of the year.

Macquarie have announced that they will set the interim ordinary dividend for the first six months at A$1.45, up from A$1.25 over the same period in 2006, whilst it remains cautious about the outlook over the immediately proceeding period.