Marsh & McLennan Companies (MMC) witnessed strong growth and improved profits in the second quarter of 2014, with its reinsurance unit enjoying 3 percent growth despite market challenges.
MMC, the parent of broker Marsh and reinsurance broker Guy Carpenter, reported consolidated revenue in Q2 2014 of $3.3 billion, an increase of 7 percent, or 5 percent on an underlying basis, compared with the second quarter of 2013. Its operating income rose by 12 percent to $647 million, compared with $577 million in the prior year.
Net income attributable to the company in the second quarter was $431 million compared with $388 million in the prior year. For the six months ended June 30th, 2014, net income attributable to the company was $874 million compared with $801 million in 2013.
Its risk and insurance services unit posted revenue of $1.8 billion in the second quarter of 2014, an increase of 6 percent, or 4 percent on an underlying basis. Its operating income rose 6 percent to $448 million.
Marsh's revenue in the second quarter of 2014 was $1.5 billion, an increase of 7 percent or 4 percent on an underlying basis. Its international operations produced underlying revenue growth of 5 percent, reflecting growth of 16 percent in Latin America; 9 percent in Asia Pacific; and 1 percent in EMEA. In the US/Canada division, underlying revenue was up 3 percent. Guy Carpenter's second quarter revenue was $295 million, an increase of 3 percent from the prior year, or 2 percent on an underlying basis.
Dan Glaser, president and CEO, says: "The company delivered another quarter of excellent financial results. We produced revenue growth of 7 percent with underlying revenue growth of 5 percent. This was our strongest quarterly revenue performance in two years, with all operating companies contributing.
Glaser continues: “Adjusted operating income grew 11 percent, with margin expansion of 60 basis points to 19.8 percent. For the six months of 2014, we achieved outstanding results, with 4 percent underlying revenue growth, an 11 percent increase in adjusted operating income and margin improvement of 100 basis points to 20.4 percent."
Guy Carpenter, Marsh, Marsh & McLennan, Q2, results, Dan Glaser