Marsh & McLennan Companies has announced its second quarter financial results, reporting an underlying revenue increase of 3%, boosted by a strong performance in Risk & Insurance Services, which achieved 5% underlying growth in the quarter.
Consolidated revenue in Q2 of 2018 was US$3.7 billion (CA$4.96 billion), an increase of 7% compared with the second quarter of 2017. Total net income for the company was US$531 million and operating income was US$691 million.
"We’re pleased with our performance in the first half of the year,” said Dan Glaser, president and CEO of Marsh & McLennan Companies. “For the first six months of 2018, we achieved 4% underlying revenue growth on a consolidated basis and 11% adjusted EPS growth excluding the impact of the new revenue standard. In the second quarter, we delivered underlying revenue growth of 3%, highlighted by strong underlying growth of 5% in Risk & Insurance Services with 1% growth in Consulting.”
For the first half of the year, consolidated revenue was US$7.7 billion, an increase of 11% and 4% on an underlying basis. Operating income was US$1.6 billion, which went up 10% from the prior year period.
“With a solid first half of 2018, we believe the company is well positioned to deliver underlying revenue growth in the 3-5% range, margin expansion and strong growth in adjusted earnings per share in 2018,” Glaser added.
The Risk & Insurance Services sector performed well in Q2, recording revenue of US$2.1 billion at an increase of 9% or 5% on an underlying basis. Operating income dropped by 2% to US$472 million, and adjusted operating income rose 9% to US$532 million. For the first six months of the year, revenue was US$4.4 billion, rising 14%, or 4% on an underlying basis. Operating income went up 13% to US$1.2 billion and adjusted operating income rose 20% to US$1.3 billion.
Insurance brokerage giant Marsh reported Q2 revenue of US$1.7 billion, an increase of 5% on an underlying basis. Operations in every region produced underlying revenue growth, with the US and Canada leading the way with 8%, followed by Asia Pacific with 6%, Latin America with 3%, and EMEA with 1% growth. For the first half of the year, Marsh’s underlying revenue growth was 3%. Likewise, Guy Carpenter presented underlying growth in Q2, with revenue of US$332 million. Over six months, Guy Carpenter’s underlying revenue growth was 6%.
Consulting revenue was also strong, at US$1.7 billion in Q2 and US$3.3 billion for the first six months of the year. Mercer’s revenue was US$1.2 billion in the quarter and US$$2.3 billion in the half, while Oliver Wyman Group’s revenue was US$492 million in Q2 and $989 million in the first half of 2018.