Marsh reports revenues up 3% as Guy Carp revenues fall
Marsh & McLennan (MMC) reported consolidated revenue of $2.8 billion in the third quarter ended 30 September, up 5 percent from the third quarter of 2007.
Revenue growth was 2 percent on an underlying basis, which measures the change in revenue before the impact of acquisitions and dispositions.
For the nine months ended September 30, consolidated revenue was $8.9 billion, an increase of 8 percent, or 3 percent on an underlying basis, from the comparable period in 2007.
In the third quarter of 2008, MMC's net loss was $8 million, compared with net income of $1.9billion last year.
Income from continuing operations in the third quarter of 2008, net of tax, was $18 million, compared with $80 million last year.
The third quarter 2008 results included an increase in professional liability reserves of $33 million, due to a recent adverse decision affecting Marsh, the company said.
Brian Duperreault, president and chief executive officer of MMC, said: “I am pleased with MMC's solid performance, not only in the third quarter but also throughout the year.
Results for the quarter were driven by continued improvement at Marsh. Guy Carpenter's alignment of expenses with revenue levels enabled it to maintain profitability on a year-over-year basis.
Looking at our progress to date, I am encouraged by MMC's operating results, and optimistic about the future.”
Marsh's revenue in the third quarter was $1.1 billion, an increase of 3 percent from last year, or 1 percent on an underlying basis.
The strongest underlying growth was in Asia Pacific, with 11 percent growth; EMEA, with 4 percent growth; and Latin America, with 3 percent growth, the company said.
“Marsh's client revenue retention in the quarter improved on a year-over-year basis, continuing the trend seen throughout the year. New business remained strong in the current quarter, at levels consistent with the year-ago period,” it said.
“Marsh's third quarter results were achieved in an environment of continued price competition in the global commercial property and casualty insurance marketplace.”
Guy Carpenter's third quarter revenue declined 9 percent to $205 million, compared with the prior year's quarter.
“Reinsurance premium rates continued to decline globally in the third quarter across most coverages, with clients' risk retention levels remaining high,” MMC said.
“Restructuring efforts and continuing cost discipline have better aligned revenue and expense levels, allowing Guy Carpenter's profitability on an adjusted basis to remain unchanged compared with the third quarter of 2007.”
MMC reported an investment loss in the third quarter of 2008 of $23 million, primarily due to mark-to-market declines in private equity investments.
