MQG -3.69%: Reported a strong 1H27 profit, with an uplift in Commodities & Global Markets earnings offset by softer Macquarie Capital performance. Shares fell despite the earnings beat, with investors weighing the mixed outlook and APRA’s review of its non-bank capital requirements.
Key details:
- Net profit rose 50% to A$2.48bn, 7% above consensus.
- Commodities & Global Markets profit contribution surged 83% to A$2.03bn, benefiting from increased trading activity and volatility.
- Macquarie Capital net operating income fell 32%, with transaction activity and investment income expected to remain weak.
- Interim dividend increased to A$3.25 per share, below the A$3.50 consensus.
- APRA identified a breach relating to Macquarie’s non-bank capital requirements. Macquarie has addressed the understatement and introduced a A$100m governance overlay.
MM’s view: The headline profit beat was encouraging, but performance remains heavily reliant on commodities and market volatility. The commodities outlook has become somewhat mixed, particularly around AI-related demand over the past week, although we view this as temporary noise. With the 1H result benefiting from unusually strong trading conditions and asset realisations, we’re cautious of whether this can be sustained through the back-end of the year.
MM is neutral towards MQG
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