Marsh (MRSH) Q3 2024 earnings summary

Executive summary

• Achieved 6% GAAP revenue growth and 5% underlying revenue growth in Q3 2024, with strong execution in Risk & Insurance Services and Consulting.

• Adjusted operating income grew 12% and adjusted operating margin expanded by 110 basis points year-over-year.

• Announced $7.75 billion acquisition of McGriff Insurance Services, expected to close by year-end and be modestly accretive to adjusted EPS in year one.

• Year-to-date, nearly $10 billion of capital committed to acquisitions, marking the largest M&A year in company history.

• Achieved $23.9 billion in revenue for the 12 months ended 9/30/2024, with operations in 130 countries and over 85,000 employees.

Financial highlights

• Q3 consolidated revenue increased 6% to $5.7 billion; underlying growth was 5%.

• Q3 operating income was $1.1 billion, up 11%; adjusted operating income was $1.2 billion, up 12%.

• Adjusted EPS for Q3 was $1.63, up 4% year-over-year, or 11% excluding a discrete tax benefit last year.

• For the first nine months, underlying revenue grew 7%, adjusted operating income grew 12% to $4.9 billion, and adjusted EPS increased 10% to $6.93.

• Free cash flow reached $3.8 billion for the last twelve months ended Q3 2024.

Outlook and guidance

• Expect mid-single-digit or better underlying revenue growth, margin expansion, and strong adjusted EPS growth for full year 2024, assuming current macro conditions persist.

• Plan to deploy approximately $4.2 billion of capital in 2024 across dividends, acquisitions, and share repurchases.

• Plan to pause share repurchases in Q4 due to the McGriff acquisition, but expect to maintain a balanced capital management approach in 2025.