Marsh's 2009 revenue drops

Marsh has reported revenue of $4.3bn, a decline of 5% on the same period last year, or a 1% fall on an underlying basis, in its full year results for 2009.

Marsh’s Q4 revenue increased 4% to $1.2bn on the same period last year, but declined 1% on an underlying basis.

The broker posted full year underlying revenue growth of 2% in international operations, which was led by Latin America with 9% growth and Asia Pacific with 5% growth. Underlying revenue was flat in EMEA and declined 4% in the US/Canada region.

It said the agreement to acquire HSBC Insurance Brokers, announced in December, is expected to close early in Q2.

Guy Carpenter’s Q4 2009 revenue increased 23% to $180m, including the acquisitions of Collins and Rattner Mackenzie in 2009. Revenue increased 4% on an underlying basis.

For the year, Guy Carpenter’s revenue increased to $911m from $803m, an increase of 13%, or 8% on an underlying basis.

Parent company Marsh & McLennan Companies' (MMC) consolidated revenue in Q4 2009 was $2.7bn, an increase of 3% from Q4 2008, or a decline of 2% on an underlying basis. Underlying revenue measures the change in revenue before the impact of acquisitions and dispositions, using consistent currency exchange rates. For 2009, MMC’s consolidated revenue was $10.5bn, a decline of 9% from $11.5bn in 2008, or 5% on an underlying basis.

Due to the settlement in Q4 2009 of the securities and ERISA class action lawsuits filed in 2004, MMC’s net income declined 53% to $38m, or $.07 per share, compared with net income of $80m, or $.15 per share, in 2008.

MMC recorded $435m in charges tied to settling the cases that alleged the company steered business to certain insurance carriers in exchange for kickbacks. The company did not admit any wrongdoing when settling the cases.

However earnings per share on an adjusted basis, increased 6% to $.38, compared with $.36 in 2008. For the year, net income was $242m, compared with a net loss of $73m in 2008. Adjusted earnings per share increased 13% to $1.58, compared with $1.40 in 2008.

Brian Duperreault, MMC president and chief executive said: “I am very pleased with our company’s performance in 2009 and the excellent progress we made executing our goals for the year. MMC is much stronger today than it was a year ago. Our marked improvement in adjusted operating income in 2009 was driven by very strong performance in Risk and Insurance Services, with substantial margin improvement.

“I am particularly pleased with our fourth quarter results since each of our operating segments achieved double-digit growth in adjusted operating income.

“Marsh had an outstanding year, implementing operational improvements to enhance profitability. Guy Carpenter also had an excellent year, as solid new business development and expense discipline resulted in strong growth in revenue and profitability."

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