Marsh & McLennan Companies, Inc. (MMC), has reported 13% revenue growth and 5% underlying revenue growth in the third quarter of 2019, supported by a strong performance from its reinsurance broking subsidiary, Guy Carpenter.
Consolidated revenue came to $4.0 billion in Q3, an increase of 13% compared with the same period in 2018.
Underlying revenue growth was calculated as if JLT, which was acquired by Marsh & McLennan in Q2 2019, had been combined with the company a year ago.
Marsh & McLennan’s net income was recorded at $303 million, versus $276 million last year, although its operating income decreased to $467 million, compared with $541 million in the prior year.
These results were lifted by 27% increase in revenue for Guy Carpenter in Q3 (totalling $273 million), as well as an 11% increase in underlying revenue.
The Risk & Insurance Services segment more broadly (which includes Marsh) also performed well with revenue of $2.2 billion last quarter, representing an increase of 18%, or 6% on an underlying basis. Operating incoming, however, declined 26% to $218 million.
Looking at the first nine months of the year, Marsh & McLennan also saw positive results, with consolidated revenue increasing 10% to $12.4 billion, or 4% on an underlying basis.
In contrast, net income decreased 9% to $1.4 billion, but adjusted operating income rose 13% to $2.5 billion.
For the nine-month period, the Risk & Insurance Services segment posted a 14% increase in revenue to $7.2 billion, or 4% on an underlying basis. Operating income declined 1% to $1.5 billion, and adjusted operating income rose 12% to $1.7 billion.
Guy Carpenter recorded a 12% increase in revenue for this period (totalling $1.3 billion), or 4% on an underlying basis.
“We are pleased with our third quarter results, which reflect excellent performance across the Company,” said Dan Glaser, President and CEO of Marsh & McLennan.
“In the quarter, we produced 13% revenue growth, 5% underlying revenue growth including growth across both segments, and 10% adjusted operating income growth,” he explained. For the nine months of 2019, we achieved 4% underlying revenue growth, adjusted operating income grew 13%, and the adjusted operating margin increased 110 basis points to 22.0%.”
“Our year-to-date results position us well for a solid year,” Glaser concluded.
