Macquarie Group has announced to the Australian Securities Exchange (ASX) a net profit after tax of $985 million for the half year ended 30 September, 2020, down 32% on 1H20, and down 23% to 2H20, mostly due to credit and impairment charges.
Macquarie’s managing director and chief executive, Shemara Wikramanayake, said the human and economic consequences of the COVID-19 pandemic impacted its results, most notably in credit and other impairment charges in relation to the pandemic, and delays to realising assets from its balance sheet and funds.
Credit and other impairment charges for 1H21 was at $447 million, up from $139 million in 1H20.
Macquarie’s assets under management at 30 September, 2020, was at $556.3 billion, down 7% largely due to foreign exchange impacts and a reduction in contractual insurance assets in Macquarie Investment Management.
The firm also announced a 1H21 interim ordinary dividend of $1.35 per share (40% franked), down on the 1H20 interim dividend of $1.80 per share.
The firm noted that it was unable to provide meaningful earnings guidance for FY21, as the extent to which COVID-19 would adversely impact its FY21 profitability was uncertain.
“While the economic impacts of the COVID-19 pandemic continue to be felt in the short term, Macquarie remains well-positioned to deliver superior performance in the medium term,” Wikramanayake said.
“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; an ongoing program to identify cost saving initiatives and efficiency; a strong and conservative balance sheet; and a proven risk management framework and culture.”