Marsh & McLennan Q4 Profit Up 1%; Full-Year Profit Rose 18% to $1.18B

February 12, 2013

Marsh & McLennan Cos. Inc. reported this morning $259 million for the 2012 fourth quarter net income attributable to the company, a 1.2 percent increase from $256 million income reported during the fourth quarter of 2011.

The full-year profit showed a bigger increase. For the full-year 2012, Marsh & McLennan reported $1.176 billion net income attributable to the company, up 18.4 percent from $993 million profit reported for the full-year 2011.

Total revenue in the 2012 fourth quarter was $3.002 billion, a 3.2 percent increase, on both a reported and underlying basis, from $2.908 billion reported during the fourth quarter of 2011. For the full-year 2012, total revenue was $11.924 billion, up 3.5 percent, or 4 percent on an underlying basis, from the full-year 2011.

Looking at individual divisions, insurance brokerage unit Marsh’s revenue in the 2012 fourth quarter was $1.4 billion, an increase of 4 percent, or 3 percent on an underlying basis, compared to the fourth quarter of 2011. For the full-year 2012, Marsh’s revenue was $5.5 billion, an increase of 5 percent on both a reported and underlying basis, compared to the full-year 2011.

Reinsurance brokerage unit Guy Carpenter & Co. reported $198 million revenue for the 2012 fourth quarter, an increase of 3 percent, on both a reported and underlying basis, from the fourth quarter of 2011. For the full-year 2012, Guy Carpenter’s revenue was $1.1 billion, an increase of 4 percent, or 6 percent on an underlying basis, from the full-year 2011.

Human resources consulting unit Mercer’s revenue increased 7 percent to $1 billion in the fourth quarter of 2012, an increase of 6 percent on an underlying basis. For the full-year 2012, Mercer’s revenue was $3.9 billion, an increase of 4 percent on both a reported and underlying basis.

Management consulting unit Oliver Wyman’s revenue was $378 million in the fourth quarter of 2012, or a decrease of 3 percent on an underlying basis. For the year, revenue was $1.5 billion, or an increase of 3 percent on an underlying basis.

“We are pleased with Marsh & McLennan Companies’ performance,” Marsh & McLennan CEO Dan Glaser said in a statement. “Adjusted operating income rose 10 percent in the fourth quarter. For the third consecutive year, both Risk and Insurance Services and Consulting achieved double-digit growth in adjusted operating income, contributing to overall growth of 12 percent.”

“Marsh’s results in 2012 were excellent. Underlying revenue grew 5 percent. This performance was driven by growth in new business and continued high client revenue retention rates,” CEO Glaser said.

“Guy Carpenter’s underlying revenue growth of 6 percent marked its highest increase in several years. In Consulting, both Mercer and Oliver Wyman contributed to the segment’s growth in revenue and profitability in 2012.”

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