Illinois-based global insurance broker Arthur J. Gallagher & Co. reported 20 percent growth in total revenues for its brokerage and risk management units combined along with four percent growth in organic commissions and fees in the first quarter.
The broker said it has already announced 10 mergers in 2014 with annualized revenues of more than $150 million. They include Spataro Agency in New York, L&R Benefits in Connecticut, Kent Kent & Tingle in Louisiana, Tudor Risk Services in Massachusetts and Benefit Development Group in Alabama.
“We are off to an excellent start in 2014,” said J. Patrick Gallagher Jr., chairman, president and CEO.
In the quarter AJG also improved its adjusted margins by 120 basis points, and we delivered 28 percent growth in adjusted EBITDAC and 22 percent growth in adjusted net earnings per share.
For the brokerage segment, adjusted total revenues were up 24 percent, while base organic commission and fee revenues grew 3.3 percent. Adjusted EBITDAC was up 34 percent and adjusted EBITDAC margin was up 150 basis points compared to the first quarter of 2013.
For the risk management segment, adjusted total revenues were up 7 percent, while base organic fee revenues grew 6 percent. Adjusted EBITDAC was up 8 percent, adjusted EBITDAC margin was up 10 basis points compared to the first quarter of 2013 and bettered its 16 percent margin target by 30 basis points.
“The rate environment remains steady with insurance carriers continuing to focus on profitable underwriting,” Gallagher said. “We believe they are quoting rational prices on a line-by-line basis which allows us to demonstrate our expertise and high-quality value-added service. In addition, we are seeing our clients slowly expand their businesses and payrolls. Our global team is energized and well positioned for 2014.”