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Marsh & McLennan (MMC) Q4 Earnings Beat, Revenues Up Y/Y
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Marsh & McLennan Companies, Inc. (MMC - Free Report) reported fourth-quarter 2021 adjusted earnings per share of $1.36, which outpaced the Zacks Consensus Estimate by 1.5%. The bottom line rose 14% year over year.
Results reflect growing revenues, and robust contributions from its Risk and Insurance Services and Consulting segments, partly offset by elevated costs.
MMC’s consolidated revenues improved 16% year over year (10% on an underlying basis) to $5.1 billion in the fourth quarter. The top line surpassed the consensus mark by 4.4%.
Total operating expenses of $4.2 billion increased 8% year over year on account of higher compensation and benefits, and other operating expenses.
Marsh & McLennan Companies, Inc. Price, Consensus and EPS Surprise
Revenues rose 9% on an underlying basis to $3 billion in the quarter under review. Adjusted operating income of $557 million improved 6% year over year.
Marsh, a unit within this segment, generated revenues worth $2.9 billion. The figure grew 9% on an underlying basis. In the U.S./Canada, underlying revenues climbed 11% year over year.
Underlying revenues from international operations improved 7% year over year courtesy of 14% rise in Latin America, 10% growth in the Asia Pacific and 5% increase in EMEA.
Revenues from another unit under this segment, Guy Carpenter, climbed 5% on an underlying basis to $170 million in the fourth quarter.
Consulting
Revenues at the segment amounted to $2.1 billion, up 11% on an underlying basis. Adjusted operating income improved 6% year over year to $410 million.
A unit within this segment, Mercer, reported revenues of $1.4 billion, which grew 6% on an underlying basis. Wealth and Health revenues both rose 4% on an underlying basis. The same at Career was up 15% on an underlying basis.
Another unit under the Consulting segment — Oliver Wyman’s revenues climbed 22% on an underlying basis to $722 million.
Share Repurchase Update
Marsh & McLennan bought back shares worth $425 million in the fourth quarter.
Financial Update (as of Dec 31, 2021)
MMC exited the fourth quarter with cash and cash equivalents of $1.8 billion, which plunged 16.1% from the 2020-end level. Total assets were $34.4 billion, up 4.1% from the figure at the end of 2020.
Long-term debt amounted to $10.9 billion, which inched up 1.3% from the level as of Dec 31, 2020.
Total equity climbed 21.2% from the 2020-end level to $11.2 billion.
Net cash provided by operations stood at $3.5 billion at the end of 2021, up 4% from figure at 2020-end.
In the fourth quarter, Marsh & McLennan repaid senior notes worth $500 million due in January 2022.
Full-Year Results
For 2021, revenues of MMC improved 15% year over year (10% on an underlying basis) to $19.8 billion. Adjusted earnings per share rose 24% year over year to $6.17.
Business Update
In 2021, MMC’s arm Marsh McLennan Agency (MMA) completed 11 transactions, which fetched combined revenues of around $170 million.
In December 2021, the Marsh unit of Marsh & McLennan enhanced its shareholding percentage from 49% to 92% in Marsh India Insurance Brokers Pvt. Ltd.
Of the insurance industry players that have reported fourth-quarter results so far, The Travelers Companies Inc. (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and Brown & Brown, Inc. (BRO - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and improved 6% year over year. TRV’s total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion. Net written premiums of Travelers increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 basis points (bps) year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from a year-ago loss of $1.59 per share. Total revenues of RNR dipped 0.1% year over year to $1.39 billion in the fourth quarter. Gross premiums written surged 40.4% year over year to $1.3 billion. RenaissanceRe’s combined ratio improved 3530 basis points (bps) year over year to 79.4.
Brown & Brown reported an adjusted earnings of 42 cents per share, which outpaced the Zacks Consensus Estimate by 10.5% and increased 31.2% from the year-ago figure. BRO's adjusted revenues of $739 million beat the Zacks Consensus Estimate by 1.5% and improved 15.1% year over year. Commissions and fees of Brown & Brown grew 15.3% year over year to $737.9 million.
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Marsh & McLennan (MMC) Q4 Earnings Beat, Revenues Up Y/Y
Marsh & McLennan Companies, Inc. (MMC - Free Report) reported fourth-quarter 2021 adjusted earnings per share of $1.36, which outpaced the Zacks Consensus Estimate by 1.5%. The bottom line rose 14% year over year.
Results reflect growing revenues, and robust contributions from its Risk and Insurance Services and Consulting segments, partly offset by elevated costs.
MMC’s consolidated revenues improved 16% year over year (10% on an underlying basis) to $5.1 billion in the fourth quarter. The top line surpassed the consensus mark by 4.4%.
Total operating expenses of $4.2 billion increased 8% year over year on account of higher compensation and benefits, and other operating expenses.
Marsh & McLennan Companies, Inc. Price, Consensus and EPS Surprise
Marsh & McLennan Companies, Inc. price-consensus-eps-surprise-chart | Marsh & McLennan Companies, Inc. Quote
Quarterly Segmental Results
Risk and Insurance Services
Revenues rose 9% on an underlying basis to $3 billion in the quarter under review. Adjusted operating income of $557 million improved 6% year over year.
Marsh, a unit within this segment, generated revenues worth $2.9 billion. The figure grew 9% on an underlying basis. In the U.S./Canada, underlying revenues climbed 11% year over year.
Underlying revenues from international operations improved 7% year over year courtesy of 14% rise in Latin America, 10% growth in the Asia Pacific and 5% increase in EMEA.
Revenues from another unit under this segment, Guy Carpenter, climbed 5% on an underlying basis to $170 million in the fourth quarter.
Consulting
Revenues at the segment amounted to $2.1 billion, up 11% on an underlying basis. Adjusted operating income improved 6% year over year to $410 million.
A unit within this segment, Mercer, reported revenues of $1.4 billion, which grew 6% on an underlying basis. Wealth and Health revenues both rose 4% on an underlying basis. The same at Career was up 15% on an underlying basis.
Another unit under the Consulting segment — Oliver Wyman’s revenues climbed 22% on an underlying basis to $722 million.
Share Repurchase Update
Marsh & McLennan bought back shares worth $425 million in the fourth quarter.
Financial Update (as of Dec 31, 2021)
MMC exited the fourth quarter with cash and cash equivalents of $1.8 billion, which plunged 16.1% from the 2020-end level. Total assets were $34.4 billion, up 4.1% from the figure at the end of 2020.
Long-term debt amounted to $10.9 billion, which inched up 1.3% from the level as of Dec 31, 2020.
Total equity climbed 21.2% from the 2020-end level to $11.2 billion.
Net cash provided by operations stood at $3.5 billion at the end of 2021, up 4% from figure at 2020-end.
In the fourth quarter, Marsh & McLennan repaid senior notes worth $500 million due in January 2022.
Full-Year Results
For 2021, revenues of MMC improved 15% year over year (10% on an underlying basis) to $19.8 billion. Adjusted earnings per share rose 24% year over year to $6.17.
Business Update
In 2021, MMC’s arm Marsh McLennan Agency (MMA) completed 11 transactions, which fetched combined revenues of around $170 million.
In December 2021, the Marsh unit of Marsh & McLennan enhanced its shareholding percentage from 49% to 92% in Marsh India Insurance Brokers Pvt. Ltd.
Zacks Rank
Marsh & McLennan currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Some Other Insurers
Of the insurance industry players that have reported fourth-quarter results so far, The Travelers Companies Inc. (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and Brown & Brown, Inc. (BRO - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and improved 6% year over year. TRV’s total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion. Net written premiums of Travelers increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 basis points (bps) year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from a year-ago loss of $1.59 per share. Total revenues of RNR dipped 0.1% year over year to $1.39 billion in the fourth quarter. Gross premiums written surged 40.4% year over year to $1.3 billion. RenaissanceRe’s combined ratio improved 3530 basis points (bps) year over year to 79.4.
Brown & Brown reported an adjusted earnings of 42 cents per share, which outpaced the Zacks Consensus Estimate by 10.5% and increased 31.2% from the year-ago figure. BRO's adjusted revenues of $739 million beat the Zacks Consensus Estimate by 1.5% and improved 15.1% year over year. Commissions and fees of Brown & Brown grew 15.3% year over year to $737.9 million.