Third-quarter net income for Chicago-based insurance broker Hub International hit more than $7 million, rebounding from a loss in the period last year.
“Despite the traditional third-quarter slowdown, we had an excellent quarter,” said Martin P. Hughes, chairman and chief executive officer.
For the third quarter, net income increased $7.9 million, from a loss of $741,000, or 2 cents a share in 2005, to $7.2 million, or 18 cents a share. Revenues grew 29 percent, or more than $28 million, from $98 million to $126.5 million.
Last year, Hub paid $16.4 million in cash to employees of Talbot, the insurance brokerage firm Hub acquired from Safeco in 2004. The payments, or earnouts, reflect the acquired firm's value, or performance. The earnout is expected to be completed next year.
During the past nine months, net income has increased 100 percent, or $20 million, going from $20 million, or 59 cents a share, to $40 million, or $1.07 a share. Revenues have increased 24 percent, or $78 million, going from $329 million to $407 million during the period.
Organic growth stood at 3 percent for commissions in the third quarter and 5 percent for the nine months.
Mr. Hughes said that performance is being affected by the current soft market and that softening trend is expected to continue through 2007.
Hub also announced it would pay a quarterly dividend of 7 cents a share on Dec. 31 to shareholders of record as of Dec. 15.
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