Margin rises seen across UK broker’s segments
Gallagher’s UK business saw a 6% rise in organic growth in the fourth quarter of last year, group chief executive Pat Gallagher said in an investor call following the release of the firm’s annual results.
In the same call, Gallagher said UK retail was up 3.5% with continued upward pressure on professional liability, which rose 7%. London specialty was up 5-10% in many classes, he added.
Gallagher’s UK chief executive Simon Matson has heralded “another exceptional year” for the group, with margins up across all four UK trading units - Retail broking, Specialty broking, Pen Underwriting and Capsicum Re, which was bought by Gallagher earlier this year.
“On the M&A front we had an extremely busy year, successfully integrating acquired businesses including Stackhouse Poland, Rentguard, Vasek, and landing the former JLT Aerospace business into Gallagher in record time.
”We now turn our attention to integrating Capsicum Re, which is a great complement to our existing businesses,” Matson said.
“From a people perspective, we now employ more than 5,000 people in our UK business, with around 1,400 of those colleagues joining us over the past year through a blend of acquisitions and organic hires.
”Our workforce is now made up of 46% millennials, demonstrating a strong track record for bringing younger talent into the industry.
“Looking ahead, 2020 presents further organic and inorganic growth opportunities and we will continue on our mission to attract and retain the most talented individuals in the sector to take care of the insurance and risk management needs of our growing client base.”
Meanwhile, the group recorded ”an outstanding” set of fourth quarter results ”to cap off an excellent full year 2019”, Pat Gallagher said.
Total revenue for the last quarter was $1.68bn (£1.28bn), slightly up on the $1.66bn reported for last year.
In brokerage, net earnings were $118.7m in Q4, up from $84.3m in the corresponding quarter of the previous year.
For the risk management segment, the business saw net earnings of $18m in Q4, a slight fall on the $20.4m posted for the same quarter of 2019.
Corporate saw a net loss of $31.4m for the quarter.
Gallagher added: ”Our 2019 momentum should continue in 2020. Almost without exception, property and casualty rates around the world continue to trend higher in most lines and geographies.
”Our clients’ businesses are growing. Unemployment is at historically low levels nearly everywhere.
”This is an environment where our professionals combine their creativity and knowledge with our vast capabilities to help clients manage risk and attract and retain talent.
”Further, our unique culture, guided by The Gallagher Way, continues to encourage colleagues worldwide to seek excellence for themselves, their clients, carrier partners and one another. I am extremely pleased with our 2019 performance and excited about our future.”
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