Marsh & McLennan Companies reports 2014 Q2 net income attributable to the company of $431 million, up from $388 million in 2013’s second quarter, as the firm experienced 7% revenue growth.
Risk and Insurance Services revenue was $1.8 billion, or growth of 6%, including 7% growth at Marsh and 3% at reinsurance broker Guy Carpenter.
Consulting revenue was $1.5 billion, or 8% growth, including 3% growth at Mercer and 23% growth at Oliver Wyman Group.
President and CEO Dan Glaser says in a statement, “This was our strongest quarterly revenue performance in two years, with all operating companies contributing. Adjusted operating income grew 11%, with margin expansion of 60 basis points to 19.8%.”
In a conference call with analysts, Marsh executives touched on Guy Carpenter and the reinsurance market during the Q&A session, acknowledging that rates are under pressure in general. But Glaser said while it won't be a "banner top-line year" for Guy Carpenter, he does expect to see growth over the entire year.
He added Marsh & McLennan as a whole has a team that is used to operating in competitive markets with downward pressure on rates.
An analyst asked how Guy Carpenter was able to achieve organic growth in the quarter. Guy Carpenter President and CEO Alexander S. Moczarski indicated the reinsurance broker saw "very good new business” in the quarter by offering the right products and finding the right clients. He added retention has been good, noting Guy Carpenter has not lost clients. "I can name maybe one we lost in the last quarter," he said.
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