Rolling Meadows, IL – Arthur J. Gallagher & Co. (NYSE: AJG) recently reported its financial results for the quarter ended March 31, 2022.
“We had a fantastic start to 2022!” said J. Patrick Gallagher, Jr., Chairman, President and CEO. “Our core brokerage and risk management segments combined to post 30% growth in revenue, including more than 10% organic revenue growth and $380 million of acquired rollover revenues. Our bottom line results were equally as strong with net earnings growth of 28%, adjusted EBITDAC growth of 34% and adjusted EBITDAC margin expansion of 55 basis points.
“During the quarter, we completed 5 new tuck-in mergers with approximately $32 million of annualized revenue, and we were recognized by the Ethisphere Institute as one of the World’s Most Ethical Companies for the 11th year in a row!
“Overall, first quarter rate and exposure increases were broad-based, driven by firm global P/C rates across nearly all geographies and lines of business, and our clients’ continued growth. First quarter 2022 global P/C renewal premium increases of 8% were consistent with fourth quarter levels adjusting for line of coverage seasonality. Additionally, the extremely tight labor market is favorably impacting our benefits and HR consulting business, resulting in more project work and higher covered lives as well as contributing to increased new arising claims for our risk management business.
“Looking ahead, we see robust demand for our services continuing as clients look to manage their risk and human capital challenges. Our team has the expertise, the service capabilities, and the desire to help clients and prospects navigate the current environment!”
Impact Related to Ukraine/Russia Conflict
Gallagher does not have any offices or direct operations within Ukraine or Russia. While we had a small number of clients that were based in or had operations within Russia, we have suspended those relationships and are no longer providing services to these clients. We have also implemented robust procedures designed to ensure that we are in compliance with all applicable sanctions laws.
We currently estimate these actions will adversely impact full year 2022 brokerage segment annual revenues by up to $10 million and full year 2022 net after tax earnings by up to $0.03 per share, with a $0.01 adverse impact in first quarter of 2022. The indirect impact of the ongoing conflict is difficult to estimate, but we currently believe it will not be significant to our full year 2022 financial results.
The complete results release is available here: Arthur J. Gallagher & Co. First Quarter 2022 Financial Results (PDF)