In sticking close to its traditional business formulas in 2012, Arthur J. Gallagher & Co. experienced significant growth.

Gallagher posted brokerage revenue of $2.39 billion in 2012, a 14.0% increase from 2011, making it fourth in Business Insurance's annual ranking of the world's largest brokers.

“The two issues that stand out in significance are their recovery of organic growth in the past two years and the subsequent favorable impact on margins,” said Meyer Shields, managing director at Keefe, Bruyette & Woods Inc. in Baltimore.

J. Patrick Gallagher Jr., chairman, president and CEO of the Itasca, Ill.-based brokerage, said 2012 was “a great year for us, a record year.”

“Framing that year were a couple of things that were really, really important for us,” he said. “One was the continuing integration and finalizing of that integration of the Heath acquisition in the U.K.”

The company's 2011 acquisition of U.K. broker Heath Lambert Ltd. is performing as intended, Mr. Gallagher said, “giving us a retail platform in the U.K. that we can bolt other acquisitions onto.”

In addition, “2012 was a banner year for acquisitions. We did over 60 acquisitions bringing in over $230 million in additional revenue to the company,” he said. “That's an acquisition every five working days, so I'm very proud of the team that was able to do that.”

“It seems they're benefitting both from a better rate climate and a better economy, which is pushing out some organic growth,” said Timothy J. Cunningham, managing director at Optis Partners L.L.C. in Chicago. “It also appears their sales focus is bearing fruit.”

In addition to growth produced by acquisitions, Gallagher experienced solid organic growth in 2012, Mr. Gallagher said. “When you get a market that is firming slightly and not having rates drop out from under you precipitously, we can grow very nicely,” he said.

“We really feel like the company was firing on all cylinders last year,” he said. “That continued into the first quarter of this year.

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“Rate increases only accounted for about 1% or less of our top-line growth, but nonetheless a flattening to rising economy and good, hard sales efforts brings our organic growth to about 4.6% in the brokerage space last year, which I think is very, very good, very healthy,” he said.

In addition to its U.K. operations, Gallagher's international business “is growing very nicely both through acquisition and through organic recruiting,” Mr. Gallagher said. In December, it completed its acquisition of 21.3% of Mexico City-based broker and risk management firm Grupo CP.

The company's Gallagher Bassett Services Inc. third-party administration operation had an “outstanding” year as well in 2012, Mr. Gallagher said, as did its Risk Placement Services Inc. global wholesale brokerage.

“The wholesale business had a fantastic year last year,” Mr. Gallagher said. “Just a bit of change in the market and their submission rate jumped and they started closing more deals.”

Of Gallagher's 2012 acquisitions, half were in the health care space, Mr. Gallagher said, as the company positions itself to take advantage of opportunities presented by the nation's health care changes.

The Patient Protection and Affordable Care Act “is so complicated and the compliance issues alone are so complex that the smaller brokers simply can't compete,” Mr. Gallagher said. “That's why we were able to do 30 transactions with some great firms last year.”

John W. Wicher, principal at John Wicher & Associates Inc. in San Francisco, said, “They continue to be very acquisitive, particularly in the benefits space.''

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“What we're trying to do to differentiate ourselves is to be very focused on areas where we can provide a real benefit to the client that is greater than insurance,” Mr. Gallagher said. “Our differentiator on the brokerage side is the fact that we think in about 24 areas. We bring way more value than just an insurance quote and a policy to the table, when we're sitting there talking to these folks about bigger issues.

“So I think the story is one of continuing to stick to our knitting. We're very niche focused,” he said. “I think that niche focus works to our advantage.”

It remains to be seen if Gallagher will acquire Short Hills, N.J.-based Bollinger Inc. In June, Business Insurance reported that the firms were in advanced talks on what would be Gallagher's largest acquisition. When asked about the deal, Mr. Gallagher had no comment.