Arthur J. Gallagher & Co. reported adjusted revenue for the first quarter of $ 2.13 billion, an increase of 13.6%, as the company's insurance brokerage unit benefited from higher interest rates and acquisitions, but lower employee compensation claims held back growth at its third party administration unit.
Leader of the brokerage declined to comment on speculation that it could buy assets likely to be sold to secure approval of Aon PLC's purchase of rival Willis Towers Watson PLC, but noted that Gallagher has significant funds available for "tuck"
Insurance rates continue to rise and Gallagher's core brokerage business benefited from the "tailwind" of rising prices, said J. Patrick Gallagher Jr., President, President and CEO of Gallagher in a conference call with analysts late. Thursday.
“We have been a couple of years now in some hardening numbers so I think it will moderate over time, but we see no lack of discipline. on the market at this point and insurers continue to ask for increases, he says.
The company's insurance brokers reported $ 1
Organic revenue from US retail brokers increased by 5%, the wholesale program's organic Revenues increased by 6%, open brokerage increased by 15% and the handling of general agents increased by 4%. only slightly during the quarter.
Gallagher's damages business, managed through its Gallagher Bassett Services Inc. unit, reported 0.6% organic growth.
Workers' compensatory activity increases after a decrease during the COVID-19 pandemic. , Said Gallagher.
"Traditional workers' compensation claims are returning and we are seeing fewer and fewer COVID-related claims," he said.
Gallagher reported a net profit of $ 393.7 million for
The agency completed five acquisitions during the first quarter, corresponding to approximately $ 89.7 million in total revenue.
Gallagher has been cited by analysts and others as a potential buyer of assets expected to be sold for safe regulatory approval of the Aon-Willis deal. Gallagher acquired Jardine Lloyd Thompson PLC's aerospace industry in 2019 after regulators demanded the unit's sale before Marsh & McLennan Cos. Inc .: purchase of JLT.
Douglas K. Howell, CFO, declined to comment on speculation about Aon-Willis' merger but noted that Gallagher has extensive funds available for mergers and acquisitions.
"We have $ 2.5 billion and we like our concentration strategy involved," he said.
More insurance, news about risk management and compensation to workers about the coronavirus crisis here .