HUB: Quarterly Profit Up 80 Percent
By Mark E. Ruquet
NU Online News Service, May 1, 3:12 p.m. EDT?HUB International, Ltd. reported first-quarter net profits grew 80 percent over the same period last year as revenue increased 39 percent.
For the first quarter ending March 31, the Chicago-based insurance broker reported net profits rose $3.97 million, going from $4.99 million for the first quarter of 2002 to $8.9 million for 2003. Earnings per share rose 7 cents in the first quarter, from 21 cents to 28 cents. Revenues rose $19.4 million, from $49.5 million to $68.9 million in first quarter 2003.
During an analyst's conference call today, executives attributed the increase to growth in commissions and acquisitions. Canadian operations were noted as especially strong with commission income growing 18 percent, or U.S.$2.97 million, and contingent commissions rising 34 percent, or U.S.$889,000.
Martin P. Hughes, the firm's chairman and chief executive officer, said that the Canadian business is benefiting from lack of capacity there, where HUB has access to markets other brokers do not. He added that the gains were being made at the expense of the larger brokerage firms.
He added that Canada's premium increases are 6 months behind the U.S. and while U.S. customers are seeing a moderation in rates, Canadian clients are still seeing increases ranging between 15 and 20 percent.
The firm also announced it would pay a quarterly stock dividend of 5 cents a share on June 30 to shareholders of record of common stock as of June 16.
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