However, investing cash flows in acquisitions set the firm back $5.5m
Marsh & McLennan has reported a $16.7bn (£12.7bn) year-end revenue for 2019, reflecting an 11% increase since 2018.
The global firm published in its 2019 fourth quarter and full-year results yesterday, and recorded a year-end operating income of $2.7bn, while adjusted operating income rose by 14% to reach $3.4bn.
Net income attributable to the company was $1.7bn for 2019, and earnings per share increased by 6% to be $3.41 - adjusted earnings per share were $4.66 compared to $4.35 in 2018.
In terms of quarter four of 2019, the organisation reported a consolidated revenue of $4.3bn, which is a 15% increase compared with Q4 in 2018.
Operating income hit $592m, versus $621m last year, while adjusted operating income was $856m – a 17% increase from 2018’s Q4. Net income attributable to Marsh in 2019’s quarter four was $391m.
Marsh’s Risk and Insurance Services arm reported a $2.4bn revenue for quarter four of 2019, showing a 24% increase since Q4 in 2018. Operating income for this quarter was $365m, compared to $383m at the same point last year; adjusted operating income rose by 315 to $550m.
For the year end, the Risk and Insurance Services division reported a $9.6bn revenue – this is a 17% increase since 2018. Operating income as at 31 December 2019 was $1.8bn, versus $1.9bn at the end of 2018, and adjusted operating income reached $2.3bn, which is another 17% increase.
Marsh saw $2.2bn in revenue for quarter four of 2019, which is a 23% increase since 2018’s quarter four. For the year-end, revenue growth amounted to 17%, or 4% on an underlying basis.
Guy Carpenter, the group’s global risk and reinsurance business, reported fourth quarter revenue of $152m for 2019, up 10% on an underlying basis. For the year, Guy Carpenter’s underlying revenue growth was 5%.
Marsh and McLennan acquired broker Jardine Lloyd Thompson (JLT) in April last year – integration and restructuring costs around this at 2019’s year-end amounted to $229m for the Risk and Insurance Services division. This includes costs incurred for staff reductions, lease related exit costs and consulting costs.
Acquisition related costs, which reflects retention costs in the Risk and Insurance Services segment relating to the closing of the JLT transaction, were $97m at the end of 2019.
In terms of financing cash flows, acquisition-related derivative payments were recorded at a $337m loss at year-end, while investing cash flows in acquisitions was reported at a $5.5m loss.
Dan Glaser, president and chief executive at Marsh and McLennan, said: “2019 was a historic year for Marsh and McLennan.
“We closed the largest transaction in our company’s history, maintained our momentum through the integration and met our key milestones.
“We grew total revenue 11% and generated 4% underlying growth. We increased our adjusted operating income by 14%, adjusted margin by 110 basis points and adjusted EPS by 7%.
“With a solid fourth quarter, we enter 2020 well positioned for continued growth.”
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