AJG posts strong results driven by 60 acquisitions

Broker Arthur J Gallagher posted strong growth for 2014, as it continued to benefit from its acquisition spree.

Its brokerage segment grew 35 percent in adjusted revenues, of which 4.3 percent was organic growth.

For the full year, AJG completed 60 acquisitions with annualised revenues of $761 million. Excluding the three large acquisitions, it added 57 firms with an average of approximately $4 million of revenues, which AJG believes is a demonstration that its bolt-on M&A strategy is flourishing.

Its risk management segment posted growth of 10 percent adjusted total revenues and it surpassed its 16 percent margin target by approximately 50 basis points.

For the year, its combined brokerage and risk management segments posted 30 percent growth in adjusted revenues, of which 5.5 percent was total organic growth. Adjusted revenues hit $3.6 billion in 2014, compared with $2.8 billion in 2013.

Under the accountancy term EBITDAC, which Gallagher defines as net earnings before interest, income taxes, depreciation, amortisation and the change in estimated acquisition earnout payables, the broker made $753.9 million in 2014, compared with $578.5 in 2013.

“We had an excellent quarter to finish an outstanding year, and we are well positioned for 2015,” said J Patrick Gallagher, junior, chairman, president and chief executive officer. “In the fourth quarter, our combined brokerage and risk management segments posted 31 percent growth in adjusted revenues, of which 5.6 percent was total organic growth.”

“Finally, our culture is alive and thriving around the globe. In 2014, we added thousands of associates to the Gallagher family of professionals. They bring similar cultures and share our dedication to providing the highest quality customer service. Together, our teams are energized by our growth and excited about the vast array of resources, capabilities and risk management solutions we offer in the marketplace.”