Marsh & McLennan Companies (MMC), the name behind the likes of Marsh and Guy Carpenter, is the latest to shine a spotlight on the impact COVID-19 has had on its operations with the unveiling of its second quarter 2020 results. It was revealed that its Q2 operating income has risen 30% to US$885 million (approx. NZ$1.33 billion), and its adjusted operating income jumped by 10% to US$984 million (approx. NZ$1.48 billion).
Consolidated revenue for MMC in Q2 2020, was US$4.2 billion (approx. billion NZ$6.33 billion), a decrease of 4%, or a 2% decline on an underlying basis, compared with the second quarter of 2019. During this period, MMC also recognised a US$36 million (approx. NZ$54.3 million) reduction to previously recorded revenue, the vast majority in Marsh, reflecting the estimated impact of the economic crisis on exposure units. This reduction is reflected in underlying revenue growth and adjusted earnings for the second quarter.
The following outline shows how each respective revenue steam of MMC fared during the Q2 period:
- Group – US$4.2 billion (approx. NZ$6.33 billion), a 2% decline on an underlying basis.
Risk and insurance services
- Marsh – US$2.2 billion (approx. NZ$3.31 billion), an increase of 1% on an underlying basis.
- Guy Carpenter – US$433 million (approx. NZ$653.3 million), an increase of 9% on an underlying basis.
- Mercer – US$1.1 billion (approx. NZ$1.65 billion), a decrease of 3% on an underlying basis.
- Oliver Wyman – US$467 million (approx. NZ$704.4 million), a decrease of 13% on an underlying basis.
Discussing the results for the second quarter, ended June 30 2020, Dan Glaser, president and CEO, noted that, even in the midst of the pandemic, the group has delivered another strong quarter reflecting outstanding execution and the resilience of the business.
“In the second quarter, despite a modest decline in underlying revenue due to the global impact of COVID-19, we generated 10% adjusted operating income growth and 12% growth in adjusted EPS,” he said. “For the first six months of 2020, we achieved 2% underlying revenue growth and 10% adjusted EPS growth.
“I am humbled by our colleagues’ exceptional support of our clients and one another during these tumultuous times.”