Gallagher reports 31.6% revenue increase in Q1
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Arthur J. Gallagher & Co. on Thursday reported $2.38 billion in total revenue for the first quarter of 2022, a 31.6% increase over the same period a year earlier.
The broker reported $638.9 million in net income for the quarter, a 34.4% increase over the 2021’s first quarter.
Its core brokerage unit reported $2.12 billion in revenue for the quarter, a 33.3% increase over 2021’s first quarter.
The broker closed five acquisitions in the quarter, with estimated annualized revenues of $32.2 million.
“We had a fantastic start to the year,” with more than 10% in organic growth, J. Patrick Gallagher Jr., chairman, president and CEO of Gallagher, said on a conference call with analysts late Thursday.
Insurers “will continue their cautious underwriting stance, due to rising loss costs and increases and reinsurance pricing,” he said. “This comes at a time when the conflict in Ukraine is elevating geopolitical uncertainty, courts are reopening and global monetary policy is tightening.”
It looks like insurers “will continue to push for rates, and I don't see a dramatic change in the near term,” Mr. Gallagher said.
He said the Ukraine-Russia conflict’s impact has been small, accounting for about $5 million of revenues in the first quarter, and is expected to cost another $5 million in revenue over the next three quarters.
He praised the success of Gallagher’s Willis Re acquisition, whose completion was announced five months ago. “We are not losing people, we are not losing clients. Our renewals have been fantastic,” he said.
Clients are “very clear with us that the reason that the business held together over the years of discussion as to where this business was going to land was because of the people handling their business.
“And those people are still in place. Our losses in terms of people out the door are minimal to zero,” Mr. Gallagher said.
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