Arthur J. Gallagher (AJG) Q4 2024 earnings summary

Executive summary

• Achieved 16th consecutive quarter of double-digit revenue growth, with 12% Q4 revenue growth and 7% organic growth in core brokerage and risk management segments.

• Completed 20 mergers in Q4, totaling 48 for the year and $387M in estimated annualized revenue; announced a transformative $2.9B revenue AssuredPartners acquisition.

• Adjusted EBITDA grew 17% with margin expansion to 31.4%, and adjusted EPS rose 15% year-over-year to $2.51.

• Global P/C insurance market remains strong, with Q4 and January 2025 renewal premium increases above 5%.

• Maintained strong client activity and no signs of a global economic slowdown, supported by a robust U.S. labor market.

Financial highlights

• Q4 2024 total revenues before reimbursements: $2.68B, up from $2.39B in Q4 2023; adjusted net earnings: $491.2M vs. $402.4M.

• Full year 2024 total revenues before reimbursements: $11.4B, up from $9.93B in 2023; adjusted net earnings: $2.28B vs. $1.91B.

• Q4 2024 adjusted EPS: $2.13, up from $1.82; full year adjusted EPS: $10.09, up from $8.70.

• Q4 2024 adjusted EBITDAC: $805M, up 21% year-over-year; full year adjusted EBITDAC: $3.57B, up 19%.

• Q4 reported net earnings margin was 13.5%; adjusted EBITDAC margin: 31.4%.

Outlook and guidance

• Brokerage and risk management segments guided to 6%-8% organic growth for 2025, with brokerage margins expected to expand 50-100 basis points depending on growth.

• Risk management segment margins expected around 20.5% for 2025.

• M&A pipeline remains robust, with $3.5B available for deals in 2025 and nearly $5B in 2026.

• No significant impact from AssuredPartners expected on 2025 margin guidance.

• January 2025 renewal premium increases are trending higher than Q4, especially in casualty classes.