Macquarie's FY profit surges

Dividend lower than expected despite surging profit, Moore notes improved global conditions.

Macquarie Group has lifted its full-year net profit by 49%, exceeding analyst expectations.

In the year to March 31, Macquarie delivered a net profit attributable to shareholders of $1.265 billion, a 49% increase on the $851 million recorded in the previous year.

Analysts had expected Macquarie's full-year profit to come in at $1.22bn.

In the same period, net operating income came to $8.132bn, a 22% increase on the $6.657bn posted in the previous year.

Macquarie announced a final ordinary dividend of $1.60 per share, 40% franked, which will be paid to shareholders on the register at May 16 on July 2.

The dividend came in below analyst expectations of $1.75 per share.

This brings the group's full-year ordinary dividend to $2.60, an increase on the $2 dividend paid in 2013 and representing a 67% dividend payout ratio.

A previously paid special dividend of $1.16 per share relating to the Sydney Airport distributions to eligible shareholders was also noted in the report.

Macquarie said it had assets under management at the end of March of $427bn, a 23% increase year-on-year, due largely to the favourable impact of the Australian dollar.

Macquarie chief executive Nicholas Moore said global market conditions continued to improve in fiscal 2014, which had contributed to a significant increase in the group's operating income and profit.

Mr Moore said international income accounted for 68% of the group’s total income for fiscal 2014, with the Americas accounting for 35% of total income, compared with 32% from Australia.

"This reflects the favourable impact of foreign exchange movements, the organic growth of the group’s operations in the Americas, as well as a number of successful acquisitions in the region in recent years, including Delaware Investments and Constellation Energy’s downstream gas business," he said.

"The Americas also became Macquarie Capital’s largest income contributor for the first time, exceeding its very successful Australian business."

Operating expenses in fiscal 2014 came to $6bn, a 15% increase on fiscal 2013, while employment expenses grew 14% year-on-year to $3.7bn.