AJ Gallagher’s broking benefits from an increase in rates across the board, and sees further modest rate increases through the remainder of the year
AJ Gallagher reported higher broking revenues and profits for the second quarter, boosted by higher rates, and said it sees further “modest” rate increases in the remainder of the year.
The US-based multinational saw broking revenues rise to $1.00bln in the three months to June, compared with $994m a year ago, boosted by higher premium rates across the board. The broking division’s net earnings rose to $128m from $82.4m.
For the first half, broking revenues rose to $2.2bn from 2.0bn, while broking net earnings rose to $373m from $285m.
Total group revenues for the first half, including risk management and corporate, rose to $3.4bn from $3.1bn a year ago, while group net earnings rose to $416m from $356m.
“We delivered another outstanding quarter of operating performance and are optimistic about the remainder of the year,” said chairman, president and chief executive Patrick Gallagher Jr.
“During the second quarter, we generated double digit revenue growth, organic revenue growth of 6.6% within our core brokerage and risk management segments, completed 12 mergers for nearly $150m in annualized revenues, expanded
margins and grew total company earnings per share,” he said.
Gallagher said that property and casualty pricing is up on nearly all lines and in most geographies, with three quarters of the company’s survey respondents expecting to see modest rate increases continuing through the rest of 2018.
“Modest rate increases, combined with global exposure unit growth, continues to be a favorable back drop for our talented production team to outperform,” he said.
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