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Rising operating expenses did not put a dampener on Macquarie Group’s (ASX: MQG) full year results, with the company posting a $4.7 billion profit in FY22, representing a rise of 56 per cent.
The results come despite operating expenses rising by 22 per cent to $10.8 billion for Macquarie’s full year ending 31 March 2022.
Cost rises were partly due to the acquisition of US wealth management firm Waddell & Reed Financial by subsidiary Macquarie Asset Management, with the bulk coming from a 22 per cent jump in employment expenses, as well as rises for brokerage expenses (17 per cent), technology investments (19 per cent) and other operating costs (25 per cent).
“While many of the regions and markets in which Macquarie operates saw heightened levels of volatility this year, our longstanding strategy to address key areas of unmet need in the community is unchanged,” said MQG CEO Shemara Wikramanayake, who took home $25.8 million in remuneration this financial year.
“Over time, this has seen us build deep and differentiated franchises in each of our areas of activity, all of which delivered sound outcomes and strong performance in FY22.”
As of 31 March, Macquarie boasts $774.8 billion in assets under management, up 37 per cent from the prior year largely due to the Waddell & Reed Financial acquisition.
The company says it will maintain a “cautious stance” approaching capital, funding and liquidity conservatively in order to position itself well to respond to the current environment.
MQG points to a number of factors that may influence its short-term outlook, including volatility in global inflation and interest rates, the impact of geopolitical events and potential tax or regulatory changes.
“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.”
Today's results were announced alongside a final ordinary dividend of $3.50 per share, bringing the full year disbursement to shareholders to $6.22 per share.
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