AJG revenues jump in Q2
Broker Arthur J Gallagher (AJG) posted a strong set of results for the second quarter of 2015, driven by acquisitions and strong growth in its brokerage and risk management segments.
Total revenues jumped to $1.4 billion in the second quarter of 2015, compared with $1.2 billion in the second quarter of 2014.
AJG’s combined brokerage and risk management segments posted 22 percent growth in adjusted revenues to $1.1 billion in the second quarter of 2015, compared with $878.9 million in the prior year quarter. The brokerage segment grew by 24 percent and the risk management segment by 13 percent.
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 $294.8 million in the second quarter of 2015, a jump of 27 percent compared with $232.2 million in the same period of the prior year.
During the second quarter, AJG’s brokerage segment completed 11 acquisitions with annualised revenues of over $82 million while its risk management segment completed two acquisitions with annualised revenues of nearly $8 million.
J Patrick Gallagher, chairman, president and chief executive officer of AJG, said: “We had another excellent quarter, reflecting our strong organic and acquisition growth as well as our productivity- improvement efforts.
“In the second quarter, our combined brokerage and risk management segments posted 22 percent growth in adjusted revenues, of which 5.8 percent was total organic growth, adjusted EBITDAC increased 27 percent and our adjusted EBITDAC margin improved 109 basis points. Total company adjusted net earnings per share grew 18 percent.
“We believe the current rate and exposure environment is rational and still healthy. In aggregate across our global book, renewal rates appear to be flat to slightly down in most lines, yet we are seeing some modestly increasing exposures. This continues to be an environment in which our professionals can demonstrate our expertise and high-quality value-added service capabilities.”
