MMC, 1Q2020: Net income went up to USD 754 million

4 May 2020 — press.release
Marsh & McLennan Companies (MMC) ended the first quarter of 2020 with a net income (attributable to the company) of USD 754 million, 5% more year-on-year. This results translates into USD 1.48 per diluted share (+6%) and USD 1.64 adjusted earnings per share (+8%).

Consolidated revenue in the first quarter of 2020 was USD 4.7 billion, an increase of 14%, or 5% on an underlying basis, compared with the first quarter of 2019. Underlying revenue growth is calculated as if Marsh & McLennan and Jardine Lloyd Thompson were a combined company a year ago, but excludes the impact of currency, other acquisitions, dispositions, and transfers among businesses.

Operating income was USD 1.1 billion compared with USD 938 million in the prior year. Adjusted operating income, which excludes noteworthy items as presented in the attached supplemental schedules, rose 15% to USD 1.2 billion.


MMC 1Q2020 preliminary figures, y-o-y changes

  • Revenue: USD 4,651 million (+14%), of which:
    • Risk & Insurance Services: USD 2,911 million (+20%), of which:
      • Marsh EMEA: USD 754 million (+19%)
      • Marsh Asia Pacific: USD 238 million (+44%)
      • Marsh Latin America: USD 91 million (+16%)
      • Marsh US / Canada: USD 978 million (+14%)
      • Guy Carpenter: USD 827 million (+25%)
    • Consulting: USD 1,762 million (+5%), of which:
      • Mercer Wealth: USD 592 million (+9%)
      • Mercer Health: USD 486 million (+10%)
      • Mercer Career: USD 173 million (+2%)
      • Oliver Wyman: USD 511 million (-1%)
  • Expenses: USD 3,581 million (+14%)
  • Net income: USD 754 million (+5%)


Risk & Insurance Services

Risk & Insurance Services revenue was USD 2.9 billion in the first quarter of 2020, an increase of 20% compared with the first quarter 2019, or 5% on an underlying basis. Operating income of USD 854 million increased 17% from the prior year. Adjusted operating income rose 20% to USD 932 million compared with USD 775 million in the prior year.

Marsh's revenue in the first quarter was USD 2.1 billion, an increase of 5% on an underlying basis. In U.S./Canada, underlying revenue also rose 5%. International operations produced underlying revenue growth of 4%, reflecting growth of 6% in Asia Pacific, 4% in EMEA and 3% in Latin America.

Guy Carpenter's revenue in the first quarter was USD 827 million, an increase of 7% on an underlying basis.


Consulting

Consulting revenue in the first quarter was USD 1.8 billion, an increase of 5%, or 3% on an underlying basis. Operating income increased 1% to USD 282 million compared with USD 279 million in the prior year. Adjusted operating income declined 1% to USD 289 million compared with USD 291 million in the prior year.

Mercer's revenue was USD 1.3 billion in the first quarter, an increase of 5% on an underlying basis. Health, with revenue of USD 486 million, rose 8% on an underlying basis. Wealth revenue of USD 592 million increased 3% on an underlying basis, and Career revenue of USD 173 million increased 2% on an underlying basis.

Oliver Wyman's revenue was USD 511 million, flat with the first quarter of 2019 on an underlying basis.


Other Items

In January, Marsh & McLennan Agency (MMA) closed the acquisitions of Ironwood Insurance Services, LLC and Momentous Insurance Brokerage. On April 1, 2020, MMA announced the acquisition of Assurance Holdings, Inc., one of the leading independent agencies in the U.S.

During the first quarter of 2020, the Company repaid USD 500 million of senior notes.


Dan Glaser, President and CEO, said:

"Marsh & McLennan had an excellent first quarter. We marked the one-year anniversary of our acquisition of JLT and are realizing the benefits of the combination. (...) Although the COVID-19 pandemic will affect all businesses in 2020, Marsh & McLennan has proven to be a resilient firm with unique capabilities, talent and expertise that will allow us to help our clients in this time of need."



More financial information about Marsh & McLennan Companies can be found at https://irnews.mmc.com.


Source: mmc.com

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