Marsh & McLennan Q3 Profit Down 23%, Revenues Rose

Insurance brokerage Marsh & McLennan News on Wednesday reported a 23 percent decline in profit for the third quarter from last year, when results include a gain on the sale of Kroll. Revenues for the quarter rose 11 percent, reflecting higher revenues at both its risk and insurance as well as consulting segments. Both adjusted earnings and revenue topped analysts' expectations.

Published on November 3, 2011

The company's net income for the third quarter was $130 million or $0.24 per share, lower than $168 million or $0.30 per share in the year-ago period.
Adjusted earnings per share in the quarter was also $0.24. On average, 16 analysts polled by Thomson Reuters expected the company to report earnings of $0.23 per share for the quarter. Analysts' estimates typically exclude special items.

However, income from continuing operations, which includes a charge of $72 million related to the early extinguishment of debt, increased to $133 million or $0.23 per share from $128 million or $0.22 per share in the same period last year.

Quarterly revenues rose 11 percent to $2.81 billion from $2.52 billion in the year-ago period and topped analysts' consensus estimate of $2.74 billion.

Total risk and insurance services segment revenue increased 11 percent from the year-ago period to $1.48 billion, reflecting a 12 percent rise in revenues at the Marsh insurance brokerage business and 8 percent growth in revenues at reinsurance intermediary Guy Carpenter. Revenues grew 5 percent on an underlying basis.

Consulting segment revenue also grew 11 percent from last year to $1.34 billion, aided by an 11 percent increase in revenues at the consulting and outsourcing solutions provider Mercer and 13 percent increase in revenues at Oliver Wyman. Revenues increased 6 percent on an underlying basis.