Marsh & Mclennan Companies Inc. Earnings Cheat Sheet: Three Straight Quarters of Rising Profit Snapped

S&P 500 (NYSE:SPY) component Marsh & Mclennan Companies Inc. (NYSE:MMC) reported its results for the third quarter. Marsh & McLennan is a global professional services firm providing advice and solutions in the areas of risk, strategy, and human capital.

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Marsh & Mclennan Companies Earnings Cheat Sheet for the Third Quarter

Results: Net income for the insurance broker fell to $130 million (24 cents per share) vs. $168 million (30 cents per share) a year earlier. This is a decline of 22.6% from the year earlier quarter.

Revenue: Rose 11.2% to $2.81 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: MMC fell in line with the mean analyst estimate of 24 cents per share. It beat the average revenue estimate of $2.74 billion.

Quoting Management: Brian Duperreault, President and CEO, said: “Third quarter results reflect our ongoing strong performance. All of our businesses continued to generate revenue growth and double-digit growth in profitability. Marsh’s high client revenue retention rates and new business development produced underlying revenue growth across all geographies. Guy Carpenter produced strong results, continuing a long-term trend of underlying revenue growth.”

Key Stats:

Revenue has risen the past four quarters. Revenue increased 12.4% to $2.93 billion in the second quarter. The figure rose 3.2% in the first quarter from the year earlier and climbed 1.9% in the fourth quarter of the last fiscal year from the year-ago quarter.

Last quarter’s profit decrease breaks a streak of three consecutive quarters of year-over-year profit increases. Net income rose 19.5% in the second quarter from the year earlier, while the figure rose 31% in the first quarter and 782.6% in the fourth quarter of the last fiscal year.

The company fell in line with estimates last quarter after beating forecasts in the previous quarter with net income of 50 cents versus a mean estimate of net income of 48 cents per share.

Looking Forward: Expectations for the company’s next quarter performance are higher than they were ninety days ago. Over the past three months, the average estimate for the fourth quarter has risen to 49 cents per share from 48 cents. At $1.79 per share, the average estimate for the fiscal year has fallen from $1.87 ninety days ago.

Competitors to Watch: Aon Corporation (NYSE:AON), Arthur J. Gallagher & Co. (NYSE:AJG), Brown & Brown, Inc. (NYSE:BRO), Willis Group Holdings PLC (NYSE:WSH), InsWeb Corporation (NASDAQ:INSW), Fortegra Financial Corp (NYSE:FRF), Verisk Analytics, Inc. (NASDAQ:VRSK), CNinsure Inc. (NASDAQ:CISG), and Life Partners Hldgs., Inc. (NASDAQ:LPHI).

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(Source: Xignite Financials)

 

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