Australia's Macquarie FY profit slumps as commodity windfall fades

By Sameer Manekar

(Reuters) -Australia's top investment bank Macquarie said its annual profit slumped by a third, the sharpest in 15 years, as a stabilisation in energy markets hammered its commodities trading division and it made less money selling green energy assets.

The Sydney-listed financial giant said on Friday profits in the year to March were impacted by a normalisation in commodity prices from a year earlier, lower asset realisations in green investments, and increased investment expense in green energy portfolios.

The firm's commodities and global markets (CGM) business - its top profit-generating arm that offers financing and lending services to clients dealing in commodity and financial markets - recorded an annual profit of A$3.21 billion, 47% lower than last year.

Its asset management business' profit contribution also nearly halved to A$1.21 billion.

As a result, the global infrastructure investor's profit attributable came in at A$3.52 billion ($2.31 billion), sharply below last year's A$5.18 billion. This was the company's steepest decline in annual profit since 2009.

However, it was largely in line with a Visible Alpha consensus of A$3.51 billion, according to UBS.

"Net net, headlines show an inline result albeit quality looks soft," analysts at Jarden wrote in a client note.

Macquarie continues to maintain a cautious stance, the financial conglomerate said, with inflation, interest rates, "significant volatility events", and impact of geopolitical events affecting its short-term outlook.

However, CEO Shemara Wikramanayake said the group remained "well-positioned to deliver superior performance in the medium term", relying on its mix portfolio of annuity-style and markets-facing businesses.

Macquarie's assets under management grew 7%, to A$938.3 billion at the end of the fiscal year, helped by favourable market and foreign exchange movements. It posted a capital surplus of A$10.7 billion, above regulatory requirements.

The company declared a final dividend of A$3.85 per share, down from A$4.50 per share last year.

($1 = 1.5228 Australian dollars)

(Reporting by Sameer Manekar and John Biju in Bengaluru and Byron Kaye in Sydney; Editing by Pooja Desai and Subhranshu Sahu)