ROLLING
MEADOWS, Ill., Oct. 27,
2022 /PRNewswire/ -- Arthur
J. Gallagher & Co. (NYSE: AJG) today reported its
financial results for the quarter ended September 30,
2022. Management will host a webcast conference call to
discuss these results on Thursday, October 27, 2022 at
5:15 p.m. ET/4:15 p.m. CT. To listen to the call, and
for printer-friendly formats of this release and the "CFO
Commentary" and "Supplemental Quarterly Data," which may also be
referenced during the call, please visit ajg.com/IR. These
documents contain both GAAP and non-GAAP measures. Investors
and other users of this information should read carefully the
section entitled "Information Regarding Non-GAAP Measures"
beginning on page 9.
Summary of Financial
Results - Third Quarter
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Revenues
Before
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Diluted Net
Earnings
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Reimbursements
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Net Earnings
(Loss)
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EBITDAC
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(Loss) Per
Share
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Segment
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3rd Q
22
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3rd Q
21
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3rd Q
22
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3rd Q
21
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3rd Q
22
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3rd Q
21
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3rd Q
22
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3rd Q
21
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(in
millions)
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(in
millions)
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(in
millions)
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Brokerage, as
reported
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$
1,736.2
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$
1,499.7
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$
282.5
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$
253.6
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$
488.5
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$
481.2
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$
1.31
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$
1.20
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Net losses (gains) on
divestitures
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1.3
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(4.3)
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1.0
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(3.4)
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1.3
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(4.3)
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-
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(0.02)
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Acquisition
integration
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-
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-
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30.3
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4.6
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39.5
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5.8
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0.14
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0.02
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Workforce and lease
termination
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-
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-
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4.5
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3.3
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6.8
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3.9
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0.02
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0.01
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Acquisition related
adjustments
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-
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-
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(8.8)
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24.6
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24.2
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5.8
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(0.04)
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0.12
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Amortization of
intangible assets
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-
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-
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85.3
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70.1
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-
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-
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0.40
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0.33
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Levelized foreign
currency
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translation
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-
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(48.8)
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-
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(5.2)
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-
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(8.1)
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-
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(0.02)
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Brokerage, as
adjusted *
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1,737.5
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1,446.6
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394.8
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347.6
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560.3
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484.3
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1.83
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1.64
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Risk Management, as
reported
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275.5
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248.0
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26.9
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22.0
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47.3
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43.7
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0.13
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0.10
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Workforce and lease
termination
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-
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-
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1.7
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4.0
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2.2
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4.5
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0.01
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0.02
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Acquisition related
adjustments
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-
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-
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0.1
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(0.1)
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0.1
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0.1
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-
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-
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Acquisition
integration
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-
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-
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0.5
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-
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0.6
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-
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-
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-
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Amortization of
intangible assets
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-
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-
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1.0
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1.6
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-
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-
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-
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0.01
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Levelized foreign
currency
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translation
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-
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(3.6)
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-
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(0.4)
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-
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(0.7)
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-
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-
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Risk Management, as
adjusted *
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275.5
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244.4
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30.2
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27.1
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50.2
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47.6
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0.14
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0.13
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Corporate, as
reported
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0.3
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357.9
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(53.1)
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(37.0)
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(27.1)
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(51.5)
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(0.25)
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(0.24)
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Loss on extinguishment
of debt
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-
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-
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-
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12.2
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-
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-
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-
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0.06
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Transaction-related
costs
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-
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-
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5.9
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8.2
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6.3
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11.0
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0.03
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0.04
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Income tax
related
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-
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-
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(7.0)
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4.9
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-
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-
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(0.03)
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0.03
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Corporate, as
adjusted *
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0.3
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357.9
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(54.2)
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(11.7)
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(20.8)
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(40.5)
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(0.25)
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(0.11)
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Total Company, as
reported
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$
2,012.0
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$
2,105.6
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$
256.3
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$
238.6
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$
508.7
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$
473.4
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$
1.19
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$
1.06
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Total Company, as
adjusted *
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$
2,013.3
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$
2,048.9
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$
370.8
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$
363.0
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$
589.7
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$
491.4
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$
1.72
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$
1.66
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Total Brokerage
& Risk
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Management, as
reported
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$
2,011.7
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$
1,747.7
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$
309.4
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$
275.6
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$
535.8
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$
524.9
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$
1.44
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$
1.30
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Total Brokerage
& Risk
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Management, as
adjusted *
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$
2,013.0
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$
1,691.0
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$
425.0
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$
374.7
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$
610.5
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$
531.9
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$
1.97
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$
1.77
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*
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For third quarter 2022,
the pretax impact of the Brokerage segment adjustments totals
$146.3 million, with a corresponding adjustment to the provision
for income taxes of $34.0 million relating to these items.
For third quarter 2022, the pretax impact of the Risk Management
segment adjustments totals $4.4 million, with a corresponding
adjustment to the provision for income taxes of $1.1 million
relating to these items. For third quarter 2022, the pretax
impact of the Corporate segment adjustments totals $6.3 million,
with a corresponding adjustment to the benefit for income taxes of
$7.4 million relating to these items and the other tax items noted
on page 7. A detailed reconciliation of the 2022 and 2021
provision (benefit) for income taxes is shown on pages 14 and
15.
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(1 of 15)
"Our outstanding performance continued during the third
quarter! For our combined brokerage and risk management
segments, total revenues increased 15%, organic revenues increased
8.4%, we completed 6 new mergers, grew net earnings 12%, delivered
adjusted EBITDAC margins in excess of 30%, and most importantly,
our client-first culture continues to flourish," said J.
Patrick Gallagher, Jr., Chairman,
President and CEO. Through the first nine months of the
year, revenues have increased 22%, organic growth is 9.8%, net
earnings have grown 25% and adjusted EPS is up 20%.
"Our third quarter renewal premium data shows global premium
increases approximate 10.5%, a bit higher than the renewal premium
change in the first half of the year. Price increases are
mostly consistent with recent quarters across nearly all lines of
business. Client exposures, including favorable policy
endorsements, continue to increase, and new arising claim counts
moved higher year over year; these metrics are not reflective of an
economic slowdown in our clients' businesses.
"Our talented teams remain focused on what they do best;
delivering superior insurance and risk management advice through
data driven insights, our vast resources and our niche
capabilities."
Summary of Financial
Results - Nine-Months Ended September 30,
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Revenues
Before
|
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|
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|
Diluted Net
Earnings
|
|
|
|
|
|
Reimbursements
|
|
Net Earnings
(Loss)
|
|
EBITDAC
|
|
(Loss) Per
Share
|
|
Segment
|
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9 Mths
22
|
9 Mths
21
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9 Mths
22
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9 Mths
21
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9 Mths
22
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9 Mths
21
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9 Mths
22
|
9 Mths
21
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(in
millions)
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(in
millions)
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(in
millions)
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Brokerage, as
reported
|
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$
5,599.5
|
$
4,500.1
|
|
$
1,058.5
|
$
845.6
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|
$
1,781.6
|
$
1,539.6
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$
4.92
|
$
4.09
|
|
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Net gains on
divestitures
|
|
(2.9)
|
(8.9)
|
|
(2.4)
|
(7.0)
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|
(2.9)
|
(8.9)
|
|
(0.01)
|
(0.03)
|
|
|
Acquisition
integration
|
|
-
|
-
|
|
97.9
|
12.5
|
|
122.3
|
16.1
|
|
0.46
|
0.06
|
|
|
Workforce and lease
termination
|
|
-
|
-
|
|
19.1
|
11.9
|
|
21.1
|
13.2
|
|
0.09
|
0.06
|
|
|
Acquisition related
adjustments
|
|
-
|
-
|
|
(27.2)
|
41.5
|
|
37.7
|
19.6
|
|
(0.13)
|
0.20
|
|
|
Amortization of
intangible assets
|
|
-
|
-
|
|
254.1
|
230.1
|
|
-
|
-
|
|
1.19
|
1.12
|
|
|
Levelized foreign
currency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
translation
|
|
-
|
(105.4)
|
|
-
|
(17.6)
|
|
-
|
(26.0)
|
|
-
|
(0.09)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
Brokerage, as
adjusted *
|
|
5,596.6
|
4,385.8
|
|
1,400.0
|
1,117.0
|
|
1,959.8
|
1,553.6
|
|
6.52
|
5.41
|
|
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|
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|
|
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|
|
Risk Management, as
reported
|
|
802.0
|
713.3
|
|
79.4
|
64.9
|
|
140.0
|
131.1
|
|
0.37
|
0.31
|
|
|
Net gains on
divestitures
|
|
-
|
(0.1)
|
|
-
|
(0.1)
|
|
-
|
(0.1)
|
|
-
|
-
|
|
|
Workforce and lease
termination
|
|
-
|
-
|
|
2.8
|
5.0
|
|
3.6
|
5.8
|
|
0.01
|
0.03
|
|
|
Acquisition related
adjustments
|
|
-
|
-
|
|
(1.1)
|
2.0
|
|
0.3
|
0.3
|
|
(0.01)
|
0.01
|
|
|
Acquisition
integration
|
|
-
|
-
|
|
1.4
|
-
|
|
1.8
|
-
|
|
0.01
|
-
|
|
|
Amortization of
intangible assets
|
|
-
|
-
|
|
3.4
|
4.4
|
|
-
|
-
|
|
0.02
|
0.02
|
|
|
Levelized foreign
currency
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
translation
|
|
-
|
(9.7)
|
|
-
|
(1.1)
|
|
-
|
(2.0)
|
|
-
|
(0.01)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
adjusted *
|
|
802.0
|
703.5
|
|
85.9
|
75.1
|
|
145.7
|
135.1
|
|
0.40
|
0.36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
reported
|
|
23.4
|
921.6
|
|
(157.4)
|
(76.4)
|
|
(107.2)
|
(145.0)
|
|
(0.72)
|
(0.52)
|
|
|
Loss on extinguishment
of debt
|
|
-
|
-
|
|
-
|
12.2
|
|
-
|
-
|
|
-
|
0.06
|
|
|
Transaction-related
costs
|
|
-
|
-
|
|
25.6
|
16.9
|
|
27.7
|
21.2
|
|
0.11
|
0.08
|
|
|
Income tax
related
|
|
-
|
-
|
|
(19.0)
|
24.2
|
|
-
|
-
|
|
(0.09)
|
0.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
adjusted *
|
|
23.4
|
921.6
|
|
(150.8)
|
(23.1)
|
|
(79.5)
|
(123.8)
|
|
(0.70)
|
(0.27)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Company, as
reported
|
|
$
6,424.9
|
$
6,135.0
|
|
$ 980.5
|
$
834.1
|
|
$
1,814.4
|
$
1,525.7
|
|
$
4.57
|
$
3.88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Company, as
adjusted *
|
|
$
6,422.0
|
$
6,010.9
|
|
$
1,335.1
|
$ 1,169.0
|
|
$
2,026.0
|
$
1,564.9
|
|
$
6.22
|
$
5.50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Brokerage
& Risk
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management, as
reported
|
|
$
6,401.5
|
$
5,213.4
|
|
$
1,137.9
|
$
910.5
|
|
$
1,921.6
|
$
1,670.7
|
|
$
5.29
|
$
4.40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Brokerage
& Risk
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Management, as
adjusted *
|
|
$
6,398.6
|
$
5,089.3
|
|
$
1,485.9
|
$ 1,192.1
|
|
$
2,105.5
|
$
1,688.7
|
|
$
6.92
|
$
5.77
|
|
|
|
*
|
For the nine-month
period ended September 30, 2022, the pretax impact of the Brokerage
segment adjustments totals $443.4 million, with a corresponding
adjustment to the provision for income taxes of $101.9 million
relating to these items. For the nine-month period ended
September 30, 2022, the pretax impact of the Risk Management
segment adjustments totals $8.7 million, with a corresponding
adjustment to the provision for income taxes of $2.2 million
relating to these items. For the nine-month period ended
September 30, 2022, the pretax impact of the Corporate segment
adjustments totals $27.7 million, with a corresponding adjustment
to the benefit for income taxes of $21.1 million relating to these
items and the other tax items noted on page 7. A detailed
reconciliation of the 2022 and 2021 provision (benefit) for income
taxes is shown on pages 14 and 15.
|
(2 of 15)
Brokerage Segment Reported GAAP to Adjusted Non-GAAP
Reconciliations (dollars in millions):
Organic Revenues
(Non-GAAP)
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Base Commissions and
Fees
|
|
|
|
|
|
|
|
|
Commissions and
fees, as reported
|
|
$
1,582.9
|
|
$
1,370.0
|
|
$
5,146.1
|
|
$
4,102.1
|
Less commissions and
fees from acquisitions
|
|
(161.2)
|
|
-
|
|
(777.9)
|
|
-
|
Less divested
operations
|
|
-
|
|
(0.1)
|
|
-
|
|
(2.2)
|
Levelized foreign
currency translation
|
|
-
|
|
(45.0)
|
|
-
|
|
(96.1)
|
|
|
|
|
|
|
|
|
|
|
|
Organic base
commissions and fees
|
|
$
1,421.7
|
|
$
1,324.9
|
|
$
4,368.2
|
|
$
4,003.8
|
|
|
|
|
|
|
|
|
|
|
|
Organic change in base
commissions and fees
|
|
7.3 %
|
|
|
|
9.1 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
Revenues
|
|
|
|
|
|
|
|
|
Supplemental
revenues, as reported
|
|
$
64.7
|
|
$
61.0
|
|
$
204.7
|
|
$
183.0
|
Less supplemental
revenues from acquisitions
|
|
(0.3)
|
|
-
|
|
(1.4)
|
|
-
|
Levelized foreign
currency translation
|
|
-
|
|
(2.0)
|
|
-
|
|
(4.4)
|
|
|
|
|
|
|
|
|
|
|
|
Organic supplemental
revenues
|
|
$
64.4
|
|
$
59.0
|
|
$
203.3
|
|
$
178.6
|
|
|
|
|
|
|
|
|
|
|
|
Organic change in
supplemental revenues
|
|
9.2 %
|
|
|
|
13.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contingent
Revenues
|
|
|
|
|
|
|
|
|
Contingent revenues,
as reported
|
|
$
52.4
|
|
$
43.7
|
|
$
167.1
|
|
$
150.3
|
Less contingent
revenues from acquisitions
|
|
(0.6)
|
|
-
|
|
(2.4)
|
|
-
|
Levelized foreign
currency translation
|
|
-
|
|
(0.3)
|
|
-
|
|
(1.2)
|
|
|
|
|
|
|
|
|
|
|
|
Organic contingent
revenues
|
|
$
51.8
|
|
$
43.4
|
|
$
164.7
|
|
$
149.1
|
|
|
|
|
|
|
|
|
|
|
|
Organic change in
contingent revenues
|
|
19.4 %
|
|
|
|
10.5 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total reported
commissions, fees, supplemental
|
|
|
|
|
|
|
|
|
|
revenues and
contingent revenues
|
|
$
1,700.0
|
|
$
1,474.7
|
|
$
5,517.9
|
|
$
4,435.4
|
Less commissions, fees,
supplemental revenues
|
|
|
|
|
|
|
|
|
|
and contingent revenues
from acquisitions
|
|
(162.1)
|
|
-
|
|
(781.7)
|
|
-
|
Less divested
operations
|
|
-
|
|
(0.1)
|
|
-
|
|
(2.2)
|
Levelized foreign
currency translation
|
|
-
|
|
(47.3)
|
|
-
|
|
(101.7)
|
|
|
|
|
|
|
|
|
|
|
|
Total organic
commissions, fees, supplemental
|
|
|
|
|
|
|
|
|
|
revenues and
contingent revenues
|
|
$
1,537.9
|
|
$
1,427.3
|
|
$
4,736.2
|
|
$
4,331.5
|
|
|
|
|
|
|
|
|
|
|
|
Total organic
change
|
*
|
7.8 %
|
|
|
|
9.3 %
|
|
|
|
|
*
|
As previously
discussed, third quarter 2021 revenues were favorably impacted by
an estimate change related to revenues generated from our clients'
employment levels developing above our January 1, 2021
estimates. Leveling for such, total brokerage organic growth
would have been approximately 9% for third quarter 2022.
|
Acquisition
Activity
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Number of acquisitions
closed *
|
|
6
|
|
5
|
|
19
|
|
17
|
Estimated annualized
revenues acquired (in millions)
|
|
$
20.4
|
|
$
16.1
|
|
$
102.7
|
|
$
139.9
|
|
* In the
third quarter of 2022, Gallagher issued 91,000 shares of its common
stock in connection with acquisitions.
|
(3 of 15)
Brokerage Segment Reported GAAP to Adjusted Non-GAAP
Reconciliations (continued) (dollars in millions):
Compensation Expense
and Ratios
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
expense, as reported
|
|
$
985.8
|
|
$
827.9
|
|
$
3,061.4
|
|
$
2,423.0
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition
integration
|
|
(25.7)
|
|
(4.7)
|
|
(81.5)
|
|
(11.9)
|
Workforce and lease
termination related charges
|
|
(4.4)
|
|
(2.0)
|
|
(15.9)
|
|
(9.3)
|
Acquisition related
adjustments
|
|
(24.2)
|
|
(5.8)
|
|
(37.7)
|
|
(19.6)
|
Levelized foreign
currency translation
|
|
-
|
|
(29.8)
|
|
-
|
|
(60.6)
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
expense, as adjusted
|
|
$
931.5
|
|
$
785.6
|
|
$
2,926.3
|
|
$
2,321.6
|
|
|
|
|
|
|
|
|
|
|
|
Reported compensation
expense ratios using reported
|
|
|
|
|
|
|
|
|
|
revenues on pages 1 and
2
|
*
|
56.8 %
|
|
55.2 %
|
|
54.7 %
|
|
53.8 %
|
Adjusted compensation
expense ratios using adjusted
|
|
|
|
|
|
|
|
|
|
revenues on pages 1 and
2
|
**
|
53.6 %
|
|
54.3 %
|
|
52.3 %
|
|
52.9 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
Reported third quarter
2022 compensation ratio was 1.6 pts higher than third quarter
2021. This increase reflects increased integration
costs and a seasonally higher compensation ratio related to the
reinsurance operations acquired in December 2021, workforce related
charges, and acquisition earnout related adjustments, as well as
the resumption of merit wage increases and hiring of producers and
other roles to service and support higher organic growth, partially
offset by lower incentive compensation and foreign exchange
movements.
|
**
|
Adjusted third quarter
2022 compensation ratio was 0.7 pts lower than third quarter
2021. This decrease reflects lower incentive compensation
offset in part by a seasonally higher compensation ratio related to
the reinsurance operations acquired in December 2021, as well as
the resumption of merit wage increases and hiring of producers and
other roles to service and support higher organic
growth.
|
Operating Expense
and Ratios
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Operating expense,
as reported
|
|
$
261.9
|
|
$
190.6
|
|
$
756.5
|
|
$
537.5
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition
integration
|
|
(13.8)
|
|
(1.1)
|
|
(40.8)
|
|
(4.2)
|
Workforce and lease
termination related charges
|
|
(2.4)
|
|
(1.9)
|
|
(5.2)
|
|
(3.9)
|
Levelized foreign
currency translation
|
|
-
|
|
(10.9)
|
|
-
|
|
(18.8)
|
|
|
|
|
|
|
|
|
|
|
|
Operating expense,
as adjusted
|
|
$
245.7
|
|
$
176.7
|
|
$
710.5
|
|
$
510.6
|
|
|
|
|
|
|
|
|
|
|
|
Reported operating
expense ratios using reported
|
|
|
|
|
|
|
|
|
|
revenues on pages 1 and
2
|
*
|
15.1 %
|
|
12.7 %
|
|
13.5 %
|
|
11.9 %
|
Adjusted operating
expense ratios using adjusted
|
|
|
|
|
|
|
|
|
|
revenues on pages 1 and
2
|
**
|
14.1 %
|
|
12.2 %
|
|
12.7 %
|
|
11.6 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
Reported third quarter
2022 operating expense ratio was 2.4 pts higher than third quarter
2021. This increase reflects increased integration costs and
a seasonally higher operating expense ratio related to the
reinsurance operations acquired in December 2021, the return of
advertising, travel, entertainment and other client-related
expenses, as well as additional investments in technology.
These expenses were offset in part by savings related to office
consolidations and foreign exchange movements.
|
**
|
Adjusted third quarter
2022 operating expense ratio was 1.9 pts higher than third quarter
2021. This increase reflects the return of advertising,
travel, entertainment and other client-related expenses, as well as
additional investments in technology and a seasonally higher
operating expense ratio related to the reinsurance operations
acquired in December 2021. These expenses were offset in part
by savings related to office consolidations.
|
(4 of 15)
Brokerage Segment Reported GAAP to Adjusted Non-GAAP
Reconciliations (continued) (dollars in millions):
Net Earnings to
Adjusted EBITDAC (Non-GAAP)
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings, as
reported
|
|
$
282.5
|
|
$
253.6
|
|
$
1,058.5
|
|
$
845.6
|
Provision for income
taxes
|
|
88.2
|
|
80.9
|
|
341.5
|
|
268.9
|
Depreciation
|
|
23.1
|
|
21.8
|
|
76.7
|
|
65.0
|
Amortization
|
|
111.1
|
|
90.8
|
|
332.8
|
|
300.2
|
Change in estimated
acquisition earnout payables
|
|
(16.4)
|
|
34.1
|
|
(27.9)
|
|
59.9
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
488.5
|
|
481.2
|
|
1,781.6
|
|
1,539.6
|
|
|
|
|
|
|
|
|
|
|
|
Net losses (gains) on
divestitures
|
|
1.3
|
|
(4.3)
|
|
(2.9)
|
|
(8.9)
|
Acquisition
integration
|
|
39.5
|
|
5.8
|
|
122.3
|
|
16.1
|
Workforce and lease
termination related charges
|
|
6.8
|
|
3.9
|
|
21.1
|
|
13.2
|
Acquisition related
adjustments
|
|
24.2
|
|
5.8
|
|
37.7
|
|
19.6
|
Levelized foreign
currency translation
|
|
-
|
|
(8.1)
|
|
-
|
|
(26.0)
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC, as
adjusted
|
|
$
560.3
|
|
$
484.3
|
|
$
1,959.8
|
|
$
1,553.6
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings margin, as
reported using reported
|
|
|
|
|
|
|
|
|
|
revenues on pages 1 and
2
|
|
16.3 %
|
|
16.9 %
|
|
18.9 %
|
|
18.8 %
|
EBITDAC margin, as
adjusted using adjusted
|
|
|
|
|
|
|
|
|
|
revenues on pages 1 and
2
|
|
32.3 %
|
|
33.5 %
|
|
35.0 %
|
|
35.4 %
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management Segment Reported GAAP to Adjusted
Non-GAAP Reconciliations (dollars
in millions):
Organic Revenues
(Non-GAAP)
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Fees
|
|
$
272.4
|
|
$
245.9
|
|
$
789.8
|
|
$
703.2
|
International
performance bonus fees
|
|
2.9
|
|
2.0
|
|
11.8
|
|
9.8
|
|
|
|
|
|
|
|
|
|
|
|
Fees as
reported
|
|
275.3
|
|
247.9
|
|
801.6
|
|
713.0
|
|
|
|
|
|
|
|
|
|
|
|
Less fees from
acquisitions
|
|
(1.3)
|
|
-
|
|
(10.6)
|
|
-
|
Levelized foreign
currency translation
|
|
-
|
|
(3.6)
|
|
-
|
|
(9.7)
|
|
|
|
|
|
|
|
|
|
|
|
Organic
fees
|
|
$
274.0
|
|
$
244.3
|
|
$
791.0
|
|
$
703.3
|
|
|
|
|
|
|
|
|
|
|
|
Organic change in
fees
|
|
12.2 %
|
|
|
|
12.5 %
|
|
|
Acquisition
Activity
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Number of acquisitions
closed
|
|
-
|
|
-
|
|
1
|
|
2
|
Estimated annualized
revenues acquired (in millions)
|
|
$
-
|
|
$
-
|
|
$
2.5
|
|
$
50.0
|
(5 of 15)
Risk Management Segment Reported GAAP to Adjusted Non-GAAP
Reconciliations (continued) (dollars in millions):
Compensation Expense
and Ratios
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
expense, as reported
|
|
$
169.3
|
|
$
148.9
|
|
$
487.1
|
|
$
428.9
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition
integration
|
|
(0.3)
|
|
-
|
|
(0.3)
|
|
-
|
Workforce and lease
termination related charges
|
|
(0.7)
|
|
(0.7)
|
|
(1.5)
|
|
(1.5)
|
Acquisition related
adjustments
|
|
(0.1)
|
|
(0.1)
|
|
(0.3)
|
|
(0.3)
|
Levelized foreign
currency translation
|
|
-
|
|
(2.3)
|
|
-
|
|
(6.2)
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
expense, as adjusted
|
|
$
168.2
|
|
$
145.8
|
|
$
485.0
|
|
$
420.9
|
|
|
|
|
|
|
|
|
|
|
|
Reported compensation
expense ratios using reported
|
|
|
|
|
|
|
|
|
|
revenues (before
reimbursements) on pages 1 and 2
|
*
|
61.5 %
|
|
60.0 %
|
|
60.7 %
|
|
60.1 %
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted compensation
expense ratios using adjusted
|
|
|
|
|
|
|
|
|
|
revenues (before
reimbursements) on pages 1 and 2
|
*
|
61.1 %
|
|
59.7 %
|
|
60.5 %
|
|
59.8 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
Reported third quarter
2022 compensation ratio was 1.5 pts higher than third quarter
2021. Adjusted third quarter 2022 compensation ratio was 1.4
pts higher than third quarter 2021. Both of these increases
reflect the resumption of merit wage increases and additional claim
adjusters to support a large new client and other higher organic
growth.
|
Operating Expense
and Ratios
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Operating expense,
as reported
|
|
$
58.9
|
|
$
55.4
|
|
$
174.9
|
|
$
153.3
|
|
|
|
|
|
|
|
|
|
|
|
Workforce and lease
termination related charges
|
|
(1.5)
|
|
(3.8)
|
|
(2.1)
|
|
(4.3)
|
Acquisition
integration
|
|
(0.3)
|
|
-
|
|
(1.5)
|
|
-
|
Levelized foreign
currency translation
|
|
-
|
|
(0.6)
|
|
-
|
|
(1.5)
|
|
|
|
|
|
|
|
|
|
|
|
Operating expense,
as adjusted
|
|
$
57.1
|
|
$
51.0
|
|
$
171.3
|
|
$
147.5
|
|
|
|
|
|
|
|
|
|
|
|
Reported operating
expense ratios using reported
|
|
|
|
|
|
|
|
|
|
revenues (before
reimbursements) on pages 1 and 2
|
*
|
21.4 %
|
|
22.3 %
|
|
21.8 %
|
|
21.5 %
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating
expense ratios using reported
|
|
|
|
|
|
|
|
|
|
revenues (before
reimbursements) on pages 1 and 2
|
**
|
20.7 %
|
|
20.9 %
|
|
21.4 %
|
|
21.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*
|
Reported third quarter
2022 operating expense ratio was 0.9 pts lower than third quarter
2021. This decrease reflects lower workforce and lease
termination related charges, as well as savings from office
consolidations and professional fees, partially offset by the
return of travel, entertainment and other client-related
expenses.
|
**
|
Adjusted third quarter
2022 operating ratio was 0.2 pts lower than third quarter 2021.
This decrease reflects savings from office consolidations and
professional fees partially offset by the return of travel,
entertainment and other client-related expenses.
|
Net Earnings to
Adjusted EBITDAC (Non-GAAP)
|
|
3rd Q
2022
|
|
3rd Q
2021
|
|
9 Mths
2022
|
|
9 Mths
2021
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings, as
reported
|
|
$
26.9
|
|
$
22.0
|
|
$
79.4
|
|
$
64.9
|
Provision for income
taxes
|
|
9.7
|
|
7.5
|
|
28.3
|
|
22.1
|
Depreciation
|
|
9.0
|
|
12.0
|
|
28.8
|
|
35.1
|
Amortization
|
|
1.5
|
|
2.1
|
|
4.7
|
|
5.9
|
Change in estimated
acquisition earnout payables
|
|
0.2
|
|
0.1
|
|
(1.2)
|
|
3.1
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
47.3
|
|
43.7
|
|
140.0
|
|
131.1
|
|
|
|
|
|
|
|
|
|
|
|
Net gains on
divestitures
|
|
-
|
|
-
|
|
-
|
|
(0.1)
|
Workforce and lease
termination related charges
|
|
2.2
|
|
4.5
|
|
3.6
|
|
5.8
|
Acquisition related
adjustments
|
|
0.1
|
|
0.1
|
|
0.3
|
|
0.3
|
Acquisition
integration
|
|
0.6
|
|
-
|
|
1.8
|
|
-
|
Levelized foreign
currency translation
|
|
-
|
|
(0.7)
|
|
-
|
|
(2.0)
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC, as
adjusted
|
|
$
50.2
|
|
$
47.6
|
|
$
145.7
|
|
$
135.1
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings margin, as
reported using reported
|
|
|
|
|
|
|
|
|
|
revenues (before
reimbursements) on pages 1 and 2
|
|
9.8 %
|
|
8.9 %
|
|
9.9 %
|
|
9.1 %
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC margin, as
adjusted using adjusted
|
|
|
|
|
|
|
|
|
|
revenues (before
reimbursements) on pages 1 and 2
|
|
18.2 %
|
|
19.5 %
|
|
18.2 %
|
|
19.2 %
|
|
|
|
|
|
|
|
|
|
|
|
(6 of 15)
Corporate Segment Reported GAAP
Information (dollars in millions):
|
|
|
|
|
2022
|
|
|
|
|
|
2021
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
|
|
|
|
Net
Earnings
|
|
|
|
|
|
|
|
(Loss)
|
|
|
|
|
|
(Loss)
|
|
|
|
|
|
Income
|
|
Attributable
to
|
|
|
|
Income
|
|
Attributable
to
|
|
|
|
Pretax
|
|
Tax
|
|
Controlling
|
|
Pretax
|
|
Tax
|
|
Controlling
|
3rd
Quarter
|
|
Loss
|
|
Benefit
|
|
Interests
|
|
Loss
|
|
Benefit
|
|
Interests
|
Components of
Corporate Segment, as reported
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and banking
costs
|
|
$ (65.0)
|
|
$ 16.9
|
|
$
(48.1)
|
|
$ (77.3)
|
|
$ 19.3
|
|
$
(58.0)
|
Clean energy related
(1)
|
|
(3.0)
|
|
0.8
|
|
(2.2)
|
|
(37.8)
|
|
68.6
|
|
30.8
|
Acquisition costs
(2)
|
|
(8.6)
|
|
0.6
|
|
(8.0)
|
|
(13.0)
|
|
2.5
|
|
(10.5)
|
Corporate (3)
(4)
|
|
(15.0)
|
|
20.9
|
|
5.9
|
|
(16.8)
|
|
5.2
|
|
(11.6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported 3rd
quarter
|
|
(91.6)
|
|
39.2
|
|
(52.4)
|
|
(144.9)
|
|
95.6
|
|
(49.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment
of debt (2)
|
|
-
|
|
-
|
|
-
|
|
16.2
|
|
(4.0)
|
|
12.2
|
Transaction-related
costs (2)
|
|
6.3
|
|
(0.4)
|
|
5.9
|
|
11.0
|
|
(2.8)
|
|
8.2
|
Income tax related
(3)
|
|
-
|
|
(7.0)
|
|
(7.0)
|
|
-
|
|
4.9
|
|
4.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of
Corporate Segment, as adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and banking
costs
|
|
(65.0)
|
|
16.9
|
|
(48.1)
|
|
(61.1)
|
|
15.3
|
|
(45.8)
|
Clean energy related
(1)
|
|
(3.0)
|
|
0.8
|
|
(2.2)
|
|
(37.8)
|
|
68.6
|
|
30.8
|
Acquisition
costs
|
|
(2.3)
|
|
0.2
|
|
(2.1)
|
|
(2.0)
|
|
(0.3)
|
|
(2.3)
|
Corporate
(4)
|
|
(15.0)
|
|
13.9
|
|
(1.1)
|
|
(16.8)
|
|
10.1
|
|
(6.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted 3rd
quarter
|
|
$ (85.3)
|
|
$ 31.8
|
|
$
(53.5)
|
|
$
(117.7)
|
|
$ 93.7
|
|
$
(24.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine
Months
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of
Corporate Segment, as reported
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and banking
costs
|
|
$
(194.7)
|
|
$ 50.6
|
|
$
(144.1)
|
|
$
(183.7)
|
|
$ 45.9
|
|
$
(137.8)
|
Clean energy related
(1)
|
|
(8.8)
|
|
2.3
|
|
(6.5)
|
|
(94.7)
|
|
179.7
|
|
85.0
|
Acquisition costs
(2)
|
|
(34.4)
|
|
2.6
|
|
(31.8)
|
|
(26.3)
|
|
4.2
|
|
(22.1)
|
Corporate (3)
(4)
|
|
(63.3)
|
|
89.8
|
|
26.5
|
|
(65.8)
|
|
33.2
|
|
(32.6)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported nine
months
|
|
(301.2)
|
|
145.3
|
|
(155.9)
|
|
(370.5)
|
|
263.0
|
|
(107.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment
of debt (2)
|
|
-
|
|
-
|
|
-
|
|
16.2
|
|
(4.0)
|
|
12.2
|
Transaction-related
costs (2)
|
|
27.7
|
|
(2.1)
|
|
25.6
|
|
21.2
|
|
(4.3)
|
|
16.9
|
Income tax related
(3)
|
|
-
|
|
(19.0)
|
|
(19.0)
|
|
-
|
|
24.2
|
|
24.2
|
Components of
Corporate Segment, as adjusted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and banking
costs
|
|
(194.7)
|
|
50.6
|
|
(144.1)
|
|
(167.5)
|
|
41.9
|
|
(125.6)
|
Clean energy related
(1)
|
|
(8.8)
|
|
2.3
|
|
(6.5)
|
|
(94.7)
|
|
179.7
|
|
85.0
|
Acquisition
costs
|
|
(6.7)
|
|
0.5
|
|
(6.2)
|
|
(5.1)
|
|
(0.1)
|
|
(5.2)
|
Corporate
(4)
|
|
(63.3)
|
|
70.8
|
|
7.5
|
|
(65.8)
|
|
57.4
|
|
(8.4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted nine
months
|
|
$
(273.5)
|
|
$ 124.2
|
|
$
(149.3)
|
|
$
(333.1)
|
|
$ 278.9
|
|
$
(54.2)
|
|
|
(1)
|
Pretax loss for the
third quarter is presented net of amounts attributable to
noncontrolling interests of $(0.7) million in 2022 and $12.3
million in 2021. Pretax loss for the nine-month periods ended
September 30, is presented net of amounts attributable to
noncontrolling interests of $(1.5) million in 2022 and $31.1
million in 2021.
|
|
|
(2)
|
Gallagher incurred
transaction-related costs, which include legal, consulting,
employee compensation and other professional fees primarily
associated with our acquisition of the Willis Towers Watson treaty
reinsurance brokerage operations. In third quarter 2021,
Gallagher redeemed $650 million of 2031 Senior Notes and incurred a
loss on early extinguishment of $16.2 million.
|
|
|
|
(7 of 15)
|
|
|
(3)
|
In second and third
quarters 2022, Gallagher recognized a net favorable U.K. tax impact
related to earnout liability adjustments. In second quarter
2022, Gallagher recognized a one-time U.S. state tax benefit that
resulted from legal entity restructuring. In first quarter
2022, Gallagher increased its state effective income tax rate,
which resulted in the overall U.S. effective income tax rate
increasing from 25% to 26% and caused Gallagher to have additional
income tax benefit during the quarter and recognized a one-time
benefit related to the revaluation of certain deferred income tax
assets. In third quarter 2021, Gallagher incurred additional
U.K. income tax expense related to the non-deductibility of some
acquisition related adjustments made in the quarter. In
second quarter 2021, the U.K. government enacted tax legislation
that increases the corporate income tax rate from 19% to 25%
effective in 2023. Gallagher incurred additional income tax
expense in the quarter to adjust certain deferred income tax
liabilities to the higher income tax rate.
|
|
|
(4)
|
Corporate pretax loss
includes a net unrealized foreign exchange remeasurement gain of
$16.9 million in third quarter 2022 and a net unrealized foreign
exchange remeasurement gain of $3.0 million in third quarter
2021. Corporate pretax loss includes a net unrealized foreign
exchange remeasurement gain of $33.6 million in the nine-month
period ended September 30, 2022 and a net unrealized foreign
exchange remeasurement loss of $2.2 million in the nine-month
period ended September 30, 2021.
|
Interest and banking costs and debt - At
September 30, 2022, Gallagher had
$1,600.0 million of borrowings
from public debt, $4,248.0 million of borrowings from private
placements and $190.0 million of
short-term borrowings under its line of credit facility. In
addition, Gallagher had $245.4 million outstanding under a revolving
loan facility that provides funding for premium finance
receivables, which are fully collateralized by the underlying
premiums held by insurance carriers, and as such are excluded from
our debt covenant computations.
Clean energy - Consists of the operating results
related to our investments in clean coal production plants and
royalty income from clean coal licenses related to Chem-Mod
LLC. The production of IRC Section 45 clean energy tax
credits ceased in December 2021,
which reduced the royalty income received by Chem-Mod LLC and net
earnings generated by our investments in clean coal production
plants. Additional information regarding these results is
available in the "CFO Commentary" at ajg.com/IR.
Acquisition costs - Consists mostly of external
professional fees and other due diligence costs related to
acquisitions. On occasion, Gallagher enters into forward
currency hedges for the purchase price of committed, but not yet
funded, acquisitions with funding requirements in currencies other
than the U.S. dollar. The gains or losses, if any, associated
with these hedge transactions are also included in acquisition
costs.
Corporate - Consists of overhead allocations mostly
related to corporate staff compensation, other corporate level
activities, and net unrealized foreign exchange
remeasurement. In addition, it includes the tax expense
related to partial taxation of foreign earnings, nondeductible
executive compensation and entertainment expenses and the tax
benefit from vesting of employee equity awards.
Income Taxes - Gallagher allocates the provision for
income taxes to its Brokerage and Risk Management segments using
the local country statutory rates. Gallagher's consolidated
effective tax rate for the quarters ended September 30, 2022
and 2021 were 18.6% and (3.1)%, respectively. In first
quarter of 2022, Gallagher increased its state effective income tax
rate, which resulted in the overall U.S. effective income tax rate
increasing from 25% to 26% and caused Gallagher to incur additional
income tax expense during the quarter and recognized a one-time
benefit related to the revaluation of certain deferred income tax
assets to the higher income tax rate. In addition, the
production of IRC Section 45 clean energy tax credits ceased
in December 2021.
Webcast Conference Call - Gallagher will host a
webcast conference call on Thursday, October 27, 2022 at
5:15 p.m. ET/4:15 p.m. CT. To listen to this call,
please go to ajg.com/IR. The call will be available for
replay at such website for at least 90 days.
About Arthur J. Gallagher
& Co.
Arthur J. Gallagher
& Co., a global insurance brokerage, risk management and
consulting services firm, is headquartered in Rolling Meadows, Illinois. Gallagher
provides these services in approximately 130 countries around the
world through its owned operations and a network of correspondent
brokers and consultants.
(8 of 15)
Cautionary Information
This press release contains
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. When used in this
press release, the words "anticipates," "believes," "contemplates,"
"see," "should," "could," "will," "estimates," "expects,"
"intends," "plans" and variations thereof and similar expressions,
are intended to identify forward-looking statements. Examples
of forward-looking statements include, but are not limited to,
statements regarding changes in our expenses in the next several
quarters; anticipated future results or performance of any segment
or the Company as a whole; the premium rate environment and the
state of insurance markets; and the economic environment.
Gallagher's actual results may differ materially from those
contemplated by the forward-looking statements. Readers are
therefore cautioned against relying on any of the forward-looking
statements, which are neither statements of historical fact nor
guarantees or assurances of future performance.
Important factors that could cause actual results to differ
materially from those in the forward-looking statements include
changes in worldwide and national economic conditions, including
the onset of a recession or economic downturn; our actual
acquisition opportunities; integration risks in our reinsurance
brokerage business; or other factors like the Ukraine/Russia conflict, trade wars or tariffs;
political unrest in the U.S. or other countries around the world;
changes in premium rates and in insurance markets generally; and
changes in the insurance brokerage industry's competitive
landscape.
Please refer to Gallagher's filings with the SEC, including Item
1A, "Risk Factors," of its Annual Report on Form 10-K for the
fiscal year ended December 31, 2021, its subsequently filed
Quarterly Reports on Form 10-Q for a more detailed discussion of
these and other factors that could impact its forward-looking
statements. The COVID-19 pandemic currently amplifies, and in
the future could continue to amplify, the risks, uncertainties and
assumptions, reflected in such risk factors. Any
forward-looking statement made by Gallagher in this press release
speaks only as of the date on which it is made. Except as
required by applicable law, Gallagher does not undertake to update
the information included herein or the corresponding earnings
release posted on Gallagher's website.
Information Regarding Non-GAAP Measures
In addition to
reporting financial results in accordance with GAAP, this press
release provides information regarding EBITDAC, EBITDAC margin,
adjusted EBITDAC, adjusted EBITDAC margin, diluted net earnings per
share, as adjusted (adjusted EPS), adjusted revenue, adjusted
compensation and operating expenses, adjusted compensation expense
ratio, adjusted operating expense ratio and organic
revenue. These measures are not in accordance with, or an
alternative to, the GAAP information provided in this press
release. Gallagher's management believes that these
presentations provide useful information to management, analysts
and investors regarding financial and business trends relating to
Gallagher's results of operations and financial condition or
because they provide investors with measures that our chief
operating decision maker uses when reviewing the company's
performance. See further below for definitions and additional
reasons each of these measures is useful to investors.
Gallagher's industry peers may provide similar supplemental
non-GAAP information with respect to one or more of these measures,
although they may not use the same or comparable terminology and
may not make identical adjustments. The non-GAAP information
provided by Gallagher should be used in addition to, but not as a
substitute for, the GAAP information provided. As disclosed
in its most recent Proxy Statement, Gallagher makes determinations
regarding certain elements of executive officer incentive
compensation, performance share awards and annual cash incentive
awards, partly on the basis of measures related to adjusted
EBITDAC.
Adjusted Non-GAAP presentation - Gallagher believes
that the adjusted non-GAAP presentations of the current and prior
period information presented in this earnings release provide
stockholders and other interested persons with useful information
regarding certain financial metrics of Gallagher that may assist
such persons in analyzing Gallagher's operating results as
they develop a future earnings outlook for Gallagher. The
after-tax amounts related to the adjustments were computed using
the normalized effective tax rate for each respective period.
See page 14 and 15 for a reconciliation of the adjustments
made to income taxes.
(9 of 15)
- Adjusted measures - Revenues (for the Brokerage
segment), revenues before reimbursements (for the Risk Management
segment), net earnings, compensation expense and operating expense,
respectively, each adjusted to exclude the following, as
applicable:
-
- Net gains (losses) on divestitures, which are primarily net
proceeds received related to sales of books of business and other
divestiture transactions, such as the disposal of a business
through sale or closure.
- Acquisition integration costs, which include costs related to
certain large acquisitions (including Willis Re), outside the scope of the usual
tuck-in strategy, not expected to occur on an ongoing basis in the
future once Gallagher fully assimilates the applicable acquisition.
These costs are typically associated with redundant workforce,
compensation expense related to amortization of certain retention
bonus arrangements, extra lease space, duplicate services and
external costs incurred to assimilate the acquisition into our IT
related systems.
- Transaction-related costs primarily associated with our
acquisition of the Willis Towers Watson treaty reinsurance
brokerage operations. These include costs related to regulatory
filings, legal, accounting services, insurance and incentive
compensation.
- Workforce related charges, which primarily include severance
costs (either accrued or paid) related to employee terminations and
other costs associated with redundant workforce.
- Lease termination related charges, which primarily include
costs related to terminations of real estate leases and abandonment
of leased space.
- Acquisition related adjustments, which include change in
estimated acquisition earnout payables adjustments and acquisition
related compensation charges.
- Amortization of intangible assets reflects the amortization of
customer/expiration lists, non-compete agreements, trade names and
other intangible assets acquired through the company's merger and
acquisition strategy, the impact to amortization expense of
acquisition valuation adjustments to these assets as well as
non-cash impairment charges.
- The impact of foreign currency translation, as applicable. The
amounts excluded with respect to foreign currency translation are
calculated by applying current year foreign exchange rates to the
same period in the prior year.
- Income tax related, which represents the impact of a one-time
U.S. state tax benefit that resulted from legal entity
restructuring in second quarter 2022 and a net favorable U.K. tax
impact related to earnout liability adjustments in second and third
quarters of 2022. This represents the impact in first quarter 2022
of a one-time income tax benefit related to the revaluation of
certain deferred income tax assets as a result of a change in our
state effective income tax rate. The 2021 values represent the
impact in second quarter 2021 of one-time income tax expense
associated with the change in the U.K. effective income tax rate
from 19% to 25% that is effective in 2023. It also includes the
impact of additional U.K. income tax expense related to the
non-deductibility of some acquisition related adjustments made in
third quarter 2021.
- Loss on extinguishment of debt represents costs incurred on the
early redemption of the $650 million
of 2031 Senior Notes, which included the redemption price premium,
the unamortized discount amount on the debt issuance and the
write-off of all the debt acquisition costs.
- Adjusted ratios - Adjusted compensation expense and
adjusted operating expense, respectively, each divided by adjusted
revenues.
Non-GAAP Earnings Measures
- EBITDAC and EBITDAC margin - EBITDAC is net
earnings before interest, income taxes, depreciation, amortization
and the change in estimated acquisition earnout payables and
EBITDAC margin is EBITDAC divided by total revenues (for the
Brokerage segment) and revenues before reimbursements (for the Risk
Management segment). These measures for the Brokerage and Risk
Management segments provide a meaningful representation of
Gallagher's operating performance for the overall business and
provide a meaningful way to measure our financial performance on an
ongoing basis.
- Adjusted EBITDAC and Adjusted EBITDAC Margin -
Adjusted EBITDAC is EBITDAC adjusted to exclude net gains (losses)
on divestitures, acquisition integration costs, workforce related
charges, lease termination related charges, acquisition related
adjustments, transaction related costs, legal and income tax
related costs and the period-over-period impact of foreign currency
translation, as applicable and Adjusted EBITDAC margin is Adjusted
EBITDAC divided by total adjusted revenues (defined above). These
measures for the Brokerage and Risk Management segments provide a
meaningful representation of Gallagher's operating performance, and
are also presented to improve the comparability of our results
between periods by eliminating the impact of the items that have a
high degree of variability.
(10 of 15)
- Adjusted EPS and Adjusted Net Earnings - Adjusted net
earnings have been adjusted to exclude the after-tax impact of net
gains (losses) on divestitures, acquisition integration costs, the
impact of foreign currency translation, workforce related charges,
lease termination related charges, acquisition related
adjustments, transaction related costs, amortization of intangible
assets, legal and income tax related costs and effective income tax
rate impact, as applicable. Adjusted EPS is Adjusted Net
Earnings divided by diluted weighted average shares
outstanding. This measure provides a meaningful
representation of Gallagher's operating performance (and as such
should not be used as a measure of Gallagher's liquidity), and for
the overall business is also presented to improve the comparability
of our results between periods by eliminating the impact of the
items that have a high degree of variability. This is the
third quarter that we have excluded amortization of intangible
assets from adjusted EPS, and as such, we have provided the same
adjustment for the prior period for comparability.
Organic Revenues (a non-GAAP measure) - For the
Brokerage segment, organic change in base commission and fee
revenues, supplemental revenues and contingent revenues exclude the
first twelve months of such revenues generated from acquisitions
and such revenues related to divested operations in each year
presented. These revenues are excluded from organic revenues
in order to help interested persons analyze the revenue growth
associated with the operations that were a part of Gallagher in
both the current and prior period. In addition, organic
change in base commission and fee revenues, supplemental revenues
and contingent revenues excludes the period-over-period impact of
foreign currency translation to improve the comparability of our
results between periods by eliminating the impact of the items that
have a high degree of variability. For the Risk Management
segment, organic change in fee revenues excludes the first twelve
months of fee revenues generated from acquisitions in each year
presented.
In addition, change in organic growth excludes the
period-over-period impact of foreign currency translation to
improve the comparability of our results between periods by
eliminating the impact of the items that have a high degree of
variability.
These revenue items are excluded from organic revenues in order
to determine a comparable, but non-GAAP, measurement of revenue
growth that is associated with the revenue sources that are
expected to continue in the current year and beyond.
Gallagher has historically viewed organic revenue growth as an
important indicator when assessing and evaluating the performance
of its Brokerage and Risk Management segments. Gallagher also
believes that using this non-GAAP measure allows readers of our
financial statements to measure, analyze and compare the growth
from our Brokerage and Risk Management segments in a meaningful and
consistent manner.
Reconciliation of Non-GAAP Information Presented to GAAP
Measures - This press release includes tabular
reconciliations to the most comparable GAAP measures, as follows:
for EBITDAC (on pages 12 and 13), for adjusted revenues,
adjusted EBITDAC and adjusted diluted net earnings per share (on
pages 1 and 2), for organic revenue measures (on pages 3
and 5, respectively, for the Brokerage and Risk Management
segments), for adjusted compensation and operating expenses and
adjusted EBITDAC margin (on pages 4, 5 and 6, respectively,
for the Brokerage and Risk Management segments).
(11 of 15)
Arthur J. Gallagher
& Co.
|
Reported Statement of
Earnings and EBITDAC - 3rd Quarter and 9 Months Ended September
30,
|
(Unaudited - in
millions except per share, percentage and workforce
data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd Q Ended
|
|
3rd Q Ended
|
|
9 Mths Ended
|
|
9 Mths Ended
|
Brokerage Segment
|
|
|
|
|
|
|
|
|
Sept 30, 2022
|
|
Sept 30, 2021
|
|
Sept 30, 2022
|
|
Sept 30, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commissions
|
|
|
|
|
|
|
|
$
1,186.9
|
|
$
1,016.2
|
|
$
4,034.6
|
|
$
3,118.7
|
Fees
|
|
|
|
|
|
|
|
396.0
|
|
353.8
|
|
1,111.5
|
|
983.4
|
Supplemental
revenues
|
|
|
|
|
|
|
|
64.7
|
|
61.0
|
|
204.7
|
|
183.0
|
Contingent
revenues
|
|
|
|
|
|
|
|
52.4
|
|
43.7
|
|
167.1
|
|
150.3
|
Investment income and
net gains on divestitures
|
|
|
|
|
|
36.2
|
|
25.0
|
|
81.6
|
|
64.7
|
Total
revenues
|
|
|
|
|
|
|
|
1,736.2
|
|
1,499.7
|
|
5,599.5
|
|
4,500.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
|
|
|
|
|
|
|
|
985.8
|
|
827.9
|
|
3,061.4
|
|
2,423.0
|
Operating
|
|
|
|
|
|
|
|
261.9
|
|
190.6
|
|
756.5
|
|
537.5
|
Depreciation
|
|
|
|
|
|
|
|
23.1
|
|
21.8
|
|
76.7
|
|
65.0
|
Amortization
|
|
|
|
|
|
|
|
111.1
|
|
90.8
|
|
332.8
|
|
300.2
|
Change in estimated
acquisition earnout payables
|
|
|
|
|
|
(16.4)
|
|
34.1
|
|
(27.9)
|
|
59.9
|
Expenses
|
|
|
|
|
|
|
|
1,365.5
|
|
1,165.2
|
|
4,199.5
|
|
3,385.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before income
taxes
|
|
|
|
|
|
|
|
370.7
|
|
334.5
|
|
1,400.0
|
|
1,114.5
|
Provision for income
taxes
|
|
|
|
|
|
|
|
88.2
|
|
80.9
|
|
341.5
|
|
268.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
|
|
|
|
|
|
|
|
282.5
|
|
253.6
|
|
1,058.5
|
|
845.6
|
Net earnings
attributable to noncontrolling interests
|
|
|
|
|
|
1.2
|
|
1.2
|
|
3.3
|
|
5.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings attributable to controlling
interests
|
|
|
|
|
|
$
281.3
|
|
$
252.4
|
|
$
1,055.2
|
|
$
840.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
|
|
|
|
|
|
|
|
$
282.5
|
|
$
253.6
|
|
$
1,058.5
|
|
$
845.6
|
Provision for income
taxes
|
|
|
|
|
|
|
|
88.2
|
|
80.9
|
|
341.5
|
|
268.9
|
Depreciation
|
|
|
|
|
|
|
|
23.1
|
|
21.8
|
|
76.7
|
|
65.0
|
Amortization
|
|
|
|
|
|
|
|
111.1
|
|
90.8
|
|
332.8
|
|
300.2
|
Change in estimated
acquisition earnout payables
|
|
|
|
|
|
(16.4)
|
|
34.1
|
|
(27.9)
|
|
59.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
|
|
|
|
|
|
$
488.5
|
|
$
481.2
|
|
$
1,781.6
|
|
$
1,539.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd Q Ended
|
|
3rd Q Ended
|
|
9 Mths Ended
|
|
9 Mths Ended
|
Risk Management Segment
|
|
|
|
|
|
|
|
Sept 30, 2022
|
|
Sept 30, 2021
|
|
Sept 30, 2022
|
|
Sept 30, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fees
|
|
|
|
|
|
|
|
$
275.3
|
|
$
247.9
|
|
$
801.6
|
|
$
713.0
|
Investment
income
|
|
|
|
|
|
|
|
0.2
|
|
0.1
|
|
0.4
|
|
0.3
|
Revenues before
reimbursements
|
|
|
|
|
|
|
|
275.5
|
|
248.0
|
|
802.0
|
|
713.3
|
Reimbursements
|
|
|
|
|
|
|
|
32.0
|
|
32.6
|
|
97.4
|
|
101.7
|
Total
revenues
|
|
|
|
|
|
|
|
307.5
|
|
280.6
|
|
899.4
|
|
815.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
|
|
|
|
|
|
|
|
169.3
|
|
148.9
|
|
487.1
|
|
428.9
|
Operating
|
|
|
|
|
|
|
|
58.9
|
|
55.4
|
|
174.9
|
|
153.3
|
Reimbursements
|
|
|
|
|
|
|
|
32.0
|
|
32.6
|
|
97.4
|
|
101.7
|
Depreciation
|
|
|
|
|
|
|
|
9.0
|
|
12.0
|
|
28.8
|
|
35.1
|
Amortization
|
|
|
|
|
|
|
|
1.5
|
|
2.1
|
|
4.7
|
|
5.9
|
Change in estimated
acquisition earnout payables
|
|
|
|
|
|
0.2
|
|
0.1
|
|
(1.2)
|
|
3.1
|
Expenses
|
|
|
|
|
|
|
|
270.9
|
|
251.1
|
|
791.7
|
|
728.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before income
taxes
|
|
|
|
|
|
|
|
36.6
|
|
29.5
|
|
107.7
|
|
87.0
|
Provision for income
taxes
|
|
|
|
|
|
|
|
9.7
|
|
7.5
|
|
28.3
|
|
22.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
|
|
|
|
|
|
|
|
26.9
|
|
22.0
|
|
79.4
|
|
64.9
|
Net earnings
attributable to noncontrolling interests
|
|
|
|
|
|
-
|
|
-
|
|
-
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings attributable to controlling
interests
|
|
|
|
|
|
$
26.9
|
|
$
22.0
|
|
$
79.4
|
|
$
64.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
|
|
|
|
|
|
|
|
$
26.9
|
|
$
22.0
|
|
$
79.4
|
|
$
64.9
|
Provision for income
taxes
|
|
|
|
|
|
|
|
9.7
|
|
7.5
|
|
28.3
|
|
22.1
|
Depreciation
|
|
|
|
|
|
|
|
9.0
|
|
12.0
|
|
28.8
|
|
35.1
|
Amortization
|
|
|
|
|
|
|
|
1.5
|
|
2.1
|
|
4.7
|
|
5.9
|
Change in estimated
acquisition earnout payables
|
|
|
|
|
|
0.2
|
|
0.1
|
|
(1.2)
|
|
3.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
|
|
|
|
|
|
$
47.3
|
|
$
43.7
|
|
$
140.0
|
|
$
131.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See "Information
Regarding Non-GAAP Measures" beginning on page 9 of 15.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(12 of 15)
|
Arthur J. Gallagher
& Co.
|
Reported Statement of
Earnings and EBITDAC - 3rd Quarter and 9 Months Ended September
30,
|
(Unaudited - in
millions except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd Q
Ended
|
|
3rd Q
Ended
|
|
9 Mths
Ended
|
|
9 Mths
Ended
|
Corporate
Segment
|
|
|
|
|
|
|
|
Sept 30,
2022
|
|
Sept 30,
2021
|
|
Sept 30,
2022
|
|
Sept 30,
2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from
consolidated clean coal facilities
|
|
|
|
|
|
$
-
|
|
$
337.3
|
|
$
22.3
|
|
$
865.7
|
Royalty income from
clean coal licenses
|
|
|
|
|
|
|
-
|
|
21.0
|
|
0.7
|
|
55.3
|
Loss from
unconsolidated clean coal facilities
|
|
|
|
|
|
-
|
|
(0.7)
|
|
-
|
|
(1.8)
|
Other net
revenues
|
|
|
|
|
|
|
|
0.3
|
|
0.3
|
|
0.4
|
|
2.4
|
|
Total
revenues
|
|
|
|
|
|
|
|
0.3
|
|
357.9
|
|
23.4
|
|
921.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues from
consolidated clean coal facilities
|
|
|
|
|
|
-
|
|
366.1
|
|
22.9
|
|
944.0
|
Compensation
|
|
|
|
|
|
|
|
26.7
|
|
23.7
|
|
76.4
|
|
61.3
|
Operating
|
|
|
|
|
|
|
|
0.7
|
|
19.6
|
|
31.3
|
|
61.3
|
Interest
|
|
|
|
|
|
|
|
64.4
|
|
60.3
|
|
192.9
|
|
164.6
|
Loss on extinguishment
of debt
|
|
|
|
|
|
|
|
-
|
|
16.2
|
|
-
|
|
16.2
|
Depreciation
|
|
|
|
|
|
|
|
0.8
|
|
4.6
|
|
2.6
|
|
13.6
|
|
Expenses
|
|
|
|
|
|
|
|
92.6
|
|
490.5
|
|
326.1
|
|
1,261.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes
|
|
|
|
|
|
|
|
(92.3)
|
|
(132.6)
|
|
(302.7)
|
|
(339.4)
|
Benefit for income
taxes
|
|
|
|
|
|
|
|
(39.2)
|
|
(95.6)
|
|
(145.3)
|
|
(263.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
|
|
|
|
|
(53.1)
|
|
(37.0)
|
|
(157.4)
|
|
(76.4)
|
Net loss attributable
to noncontrolling interests
|
|
|
|
|
|
(0.7)
|
|
12.3
|
|
(1.5)
|
|
31.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
attributable to controlling interests
|
|
|
|
|
|
$
(52.4)
|
|
$
(49.3)
|
|
$
(155.9)
|
|
$
(107.5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
|
|
|
|
|
$
(53.1)
|
|
$
(37.0)
|
|
$
(157.4)
|
|
$
(76.4)
|
Benefit for income
taxes
|
|
|
|
|
|
|
|
(39.2)
|
|
(95.6)
|
|
(145.3)
|
|
(263.0)
|
Interest
|
|
|
|
|
|
|
|
64.4
|
|
60.3
|
|
192.9
|
|
164.6
|
Loss on extinguishment
of debt
|
|
|
|
|
|
|
|
-
|
|
16.2
|
|
-
|
|
16.2
|
Depreciation
|
|
|
|
|
|
|
|
0.8
|
|
4.6
|
|
2.6
|
|
13.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
|
|
|
|
|
|
$
(27.1)
|
|
$
(51.5)
|
|
$
(107.2)
|
|
$
(145.0)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd Q
Ended
|
|
3rd Q
Ended
|
|
9 Mths
Ended
|
|
9 Mths
Ended
|
Total
Company
|
|
|
|
|
|
|
|
Sept 30,
2022
|
|
Sept 30,
2021
|
|
Sept 30,
2022
|
|
Sept 30,
2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commissions
|
|
|
|
|
|
|
|
$
1,186.9
|
|
$
1,016.2
|
|
$
4,034.6
|
|
$
3,118.7
|
Fees
|
|
|
|
|
|
|
|
671.3
|
|
601.7
|
|
1,913.1
|
|
1,696.4
|
Supplemental
revenues
|
|
|
|
|
|
|
|
64.7
|
|
61.0
|
|
204.7
|
|
183.0
|
Contingent
revenues
|
|
|
|
|
|
|
|
52.4
|
|
43.7
|
|
167.1
|
|
150.3
|
Investment income and
net gains on divestitures
|
|
|
|
|
|
36.4
|
|
25.1
|
|
82.0
|
|
65.0
|
Revenues from clean
coal activities
|
|
|
|
|
|
|
|
-
|
|
357.6
|
|
23.0
|
|
919.2
|
Other net revenues -
Corporate
|
|
|
|
|
|
|
|
0.3
|
|
0.3
|
|
0.4
|
|
2.4
|
|
Revenues before
reimbursements
|
|
|
|
|
|
|
|
2,012.0
|
|
2,105.6
|
|
6,424.9
|
|
6,135.0
|
Reimbursements
|
|
|
|
|
|
|
|
32.0
|
|
32.6
|
|
97.4
|
|
101.7
|
|
Total
revenues
|
|
|
|
|
|
|
|
2,044.0
|
|
2,138.2
|
|
6,522.3
|
|
6,236.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
|
|
|
|
|
|
|
|
1,181.8
|
|
1,000.5
|
|
3,624.9
|
|
2,913.2
|
Operating
|
|
|
|
|
|
|
|
321.5
|
|
265.6
|
|
962.7
|
|
752.1
|
Reimbursements
|
|
|
|
|
|
|
|
32.0
|
|
32.6
|
|
97.4
|
|
101.7
|
Cost of revenues from
clean coal activities
|
|
|
|
|
|
-
|
|
366.1
|
|
22.9
|
|
944.0
|
Interest
|
|
|
|
|
|
|
|
64.4
|
|
60.3
|
|
192.9
|
|
164.6
|
Loss on extinguishment
of debt
|
|
|
|
|
|
|
|
-
|
|
16.2
|
|
-
|
|
16.2
|
Depreciation
|
|
|
|
|
|
|
|
32.9
|
|
38.4
|
|
108.1
|
|
113.7
|
Amortization
|
|
|
|
|
|
|
|
112.6
|
|
92.9
|
|
337.5
|
|
306.1
|
Change in estimated
acquisition earnout payables
|
|
|
|
|
|
(16.2)
|
|
34.2
|
|
(29.1)
|
|
63.0
|
|
Expenses
|
|
|
|
|
|
|
|
1,729.0
|
|
1,906.8
|
|
5,317.3
|
|
5,374.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings before income
taxes
|
|
|
|
|
|
|
|
315.0
|
|
231.4
|
|
1,205.0
|
|
862.1
|
Provision (benefit) for
income taxes
|
|
|
|
|
|
|
|
58.7
|
|
(7.2)
|
|
224.5
|
|
28.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
|
|
|
|
|
|
|
256.3
|
|
238.6
|
|
980.5
|
|
834.1
|
Net earnings
attributable to noncontrolling interests
|
|
|
|
|
|
0.5
|
|
13.5
|
|
1.8
|
|
36.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
attributable to controlling interests
|
|
|
|
|
|
$
255.8
|
|
$
225.1
|
|
$
978.7
|
|
$
797.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net earnings
per share
|
|
|
|
|
|
|
|
$
1.19
|
|
$
1.06
|
|
$
4.57
|
|
$
3.88
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends declared per
share
|
|
|
|
|
|
|
|
$
0.51
|
|
$
0.48
|
|
$
1.53
|
|
$
1.44
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
earnings
|
|
|
|
|
|
|
|
$
256.3
|
|
$
238.6
|
|
$
980.5
|
|
$
834.1
|
Provision (benefit) for
income taxes
|
|
|
|
|
|
|
|
58.7
|
|
(7.2)
|
|
224.5
|
|
28.0
|
Interest
|
|
|
|
|
|
|
|
64.4
|
|
60.3
|
|
192.9
|
|
164.6
|
Loss on extinguishment
of debt
|
|
|
|
|
|
|
|
-
|
|
16.2
|
|
-
|
|
16.2
|
Depreciation
|
|
|
|
|
|
|
|
32.9
|
|
38.4
|
|
108.1
|
|
113.7
|
Amortization
|
|
|
|
|
|
|
|
112.6
|
|
92.9
|
|
337.5
|
|
306.1
|
Change in estimated
acquisition earnout payables
|
|
|
|
|
|
(16.2)
|
|
34.2
|
|
(29.1)
|
|
63.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDAC
|
|
|
|
|
|
|
|
$
508.7
|
|
$
473.4
|
|
$
1,814.4
|
|
$
1,525.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See "Information
Regarding Non-GAAP Measures" beginning on page 9 of 15.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(13 of 15)
|
Arthur J. Gallagher
& Co.
|
Consolidated Balance
Sheet
|
(Unaudited - in
millions except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sept 30,
2022
|
|
Dec 31,
2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
|
|
|
|
|
|
|
|
|
$
553.7
|
|
$
402.6
|
Restricted
cash
|
|
|
|
|
|
|
|
|
|
|
|
4,723.1
|
|
4,063.7
|
Premiums and fees
receivable
|
|
|
|
|
|
|
|
|
|
|
|
16,956.0
|
|
11,753.1
|
Other current
assets
|
|
|
|
|
|
|
|
|
|
|
|
1,563.8
|
|
1,451.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current
assets
|
|
|
|
|
|
|
|
|
|
|
|
23,796.6
|
|
17,670.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed assets -
net
|
|
|
|
|
|
|
|
|
|
|
|
561.4
|
|
500.8
|
Deferred income taxes
(includes tax credit carryforwards of $936.6 in 2022 and $1,074.0
in 2021)
|
|
|
|
|
|
|
|
|
|
|
|
1,138.0
|
|
1,228.5
|
Other noncurrent
assets
|
|
|
|
|
|
|
|
|
|
|
|
934.4
|
|
966.5
|
Right-of-use
assets
|
|
|
|
|
|
|
|
|
|
|
|
347.8
|
|
358.6
|
Goodwill
|
|
|
|
|
|
|
|
|
|
|
|
8,837.2
|
|
8,666.2
|
Amortizable intangible
assets - net
|
|
|
|
|
|
|
|
|
|
3,052.4
|
|
3,954.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
|
|
|
|
|
|
|
|
$
38,667.8
|
|
$
33,345.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Premiums payable to
underwriting enterprises
|
|
|
|
|
|
|
|
|
|
|
|
$
19,273.4
|
|
$
13,845.6
|
Accrued compensation
and other current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
1,972.8
|
|
1,895.1
|
Deferred revenue -
current
|
|
|
|
|
|
|
|
|
|
|
|
525.0
|
|
520.9
|
Premium financing
debt
|
|
|
|
|
|
|
|
|
|
|
|
245.4
|
|
228.4
|
Corporate related
borrowings - current
|
|
|
|
|
|
|
|
|
|
|
|
440.0
|
|
245.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
22,456.6
|
|
16,735.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate related
borrowings - noncurrent
|
|
|
|
|
|
|
|
|
|
|
|
5,562.2
|
|
5,810.2
|
Deferred revenue -
noncurrent
|
|
|
|
|
|
|
|
|
|
|
|
62.8
|
|
58.7
|
Lease liabilities -
noncurrent
|
|
|
|
|
|
|
|
|
|
|
|
301.9
|
|
309.3
|
Other noncurrent
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
1,655.2
|
|
1,871.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities
|
|
|
|
|
|
|
|
|
|
|
|
30,038.7
|
|
24,784.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock - issued
and outstanding
|
|
|
|
|
|
|
|
|
|
|
|
210.8
|
|
208.5
|
Capital in excess of
par value
|
|
|
|
|
|
|
|
|
|
|
|
6,305.5
|
|
6,143.7
|
Retained
earnings
|
|
|
|
|
|
|
|
|
|
|
|
3,536.2
|
|
2,882.3
|
Accumulated other
comprehensive loss
|
|
|
|
|
|
|
|
|
|
|
|
(1,478.7)
|
|
(726.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total controlling
interests stockholders' equity
|
|
|
|
|
|
|
|
|
|
8,573.8
|
|
8,508.4
|
Noncontrolling
interests
|
|
|
|
|
|
|
|
|
|
|
|
55.3
|
|
51.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total stockholders'
equity
|
|
|
|
|
|
|
|
|
|
|
|
8,629.1
|
|
8,560.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and
stockholders' equity
|
|
|
|
|
|
|
|
|
|
$
38,667.8
|
|
$
33,345.0
|
Arthur J. Gallagher
& Co.
|
|
Other
Information
|
|
(Unaudited - data is
rounded where indicated)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd Q
Ended
|
|
3rd Q
Ended
|
|
9 Mths
Ended
|
|
9 Mths
Ended
|
|
OTHER
INFORMATION
|
|
|
|
|
|
|
|
Sept 30,
2022
|
|
Sept 30,
2021
|
|
Sept 30,
2022
|
|
Sept 30,
2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average
shares outstanding (000s)
|
|
|
|
|
|
210,673
|
|
206,988
|
|
209,971
|
|
200,975
|
*
|
Diluted weighted
average shares outstanding (000s)
|
|
|
|
|
|
214,965
|
|
211,498
|
|
214,275
|
|
205,477
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of common shares
outstanding at end of period (000s)
|
|
|
|
|
|
|
|
210,840
|
|
207,278
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Workforce at end of
period (includes acquisitions):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage
|
|
|
|
|
|
|
|
|
|
|
|
32,061
|
|
26,877
|
|
|
Risk
Management
|
|
|
|
|
|
|
|
|
|
|
|
8,297
|
|
7,108
|
|
|
Total
Company
|
|
|
|
|
|
|
|
|
|
|
|
42,805
|
**
|
35,911
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Gallagher
completed a follow-on public offering of 10,350,000 shares of its
common stock on May 17, 2021 and used the net proceeds to fund a
portion of the
|
|
|
acquisition of Willis Towers
Watson treaty reinsurance brokerage operations that was completed
in December 2021.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
** The
acquisition of the Willis Towers Watson's treaty reinsurance
brokerage operations added approximately 2,200 employees in
December 2021.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Non-GAAP Measures - Pre-tax Earnings and Diluted Net Earnings per
Share (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited - in
millions except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
|
|
|
|
|
|
|
Earnings
|
|
Provision
|
|
|
|
Net
Earnings
|
|
(Loss)
|
|
Diluted
Net
|
|
|
|
|
|
|
(Loss)
|
|
(Benefit)
|
|
|
|
Attributable
to
|
|
Attributable
to
|
|
Earnings
|
|
|
|
|
|
|
Before
Income
|
|
for
Income
|
|
Net
Earnings
|
|
Noncontrolling
|
|
Controlling
|
|
(Loss)
|
|
|
|
|
|
|
Taxes
|
|
Taxes
|
|
(Loss)
|
|
Interests
|
|
Interests
|
|
per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd Q Ended
September 30, 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage, as
reported
|
|
|
|
$
370.7
|
|
$
88.2
|
|
$
282.5
|
|
$
1.2
|
|
$
281.3
|
|
$
1.31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net losses on
divestitures
|
|
|
|
1.3
|
|
0.3
|
|
1.0
|
|
-
|
|
1.0
|
|
-
|
|
Acquisition
integration
|
|
|
|
39.5
|
|
9.2
|
|
30.3
|
|
-
|
|
30.3
|
|
0.14
|
|
Workforce and lease
termination
|
|
|
|
5.8
|
|
1.3
|
|
4.5
|
|
-
|
|
4.5
|
|
0.02
|
|
Acquisition related
adjustments
|
|
|
|
(11.4)
|
|
(2.6)
|
|
(8.8)
|
|
-
|
|
(8.8)
|
|
(0.04)
|
|
Amortization of
intangible assets
|
|
|
|
111.1
|
|
25.8
|
|
85.3
|
|
-
|
|
85.3
|
|
0.40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage, as
adjusted
|
|
|
|
$
517.0
|
|
$
122.2
|
|
$
394.8
|
|
$
1.2
|
|
$
393.6
|
|
$
1.83
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
reported
|
|
|
|
$
36.6
|
|
$
9.7
|
|
$
26.9
|
|
$
-
|
|
$
26.9
|
|
$
0.13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Workforce and lease
termination
|
|
|
|
2.2
|
|
0.5
|
|
1.7
|
|
-
|
|
1.7
|
|
0.01
|
|
Acquisition related
adjustments
|
|
|
|
0.1
|
|
-
|
|
0.1
|
|
-
|
|
0.1
|
|
-
|
|
Acquisition
integration
|
|
|
|
0.6
|
|
0.1
|
|
0.5
|
|
-
|
|
0.5
|
|
-
|
|
Amortization of
intangible assets
|
|
|
|
1.5
|
|
0.5
|
|
1.0
|
|
-
|
|
1.0
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
adjusted
|
|
|
|
$
41.0
|
|
$
10.8
|
|
$
30.2
|
|
$
-
|
|
$
30.2
|
|
$
0.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
reported
|
|
|
|
$
(92.3)
|
|
$
(39.2)
|
|
$
(53.1)
|
|
$
(0.7)
|
|
$
(52.4)
|
|
$
(0.25)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction-related
costs
|
|
|
|
6.3
|
|
0.4
|
|
5.9
|
|
-
|
|
5.9
|
|
0.03
|
|
Income tax
related
|
|
|
|
-
|
|
7.0
|
|
(7.0)
|
|
-
|
|
(7.0)
|
|
(0.03)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
adjusted
|
|
|
|
$
(86.0)
|
|
$
(31.8)
|
|
$
(54.2)
|
|
$
(0.7)
|
|
$
(53.5)
|
|
$
(0.25)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See "Information
Regarding Non-GAAP Measures" beginning on page 9 of 15.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(14 of 15)
|
|
Reconciliation of
Non-GAAP Measures - Pre-tax Earnings and Diluted Net Earnings per
Share (Unaudited) - Continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited - in
millions except share and per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
|
|
|
|
|
|
Earnings
|
|
Provision
|
|
|
|
Net
Earnings
|
|
(Loss)
|
|
Diluted
Net
|
|
|
|
|
|
(Loss)
|
|
(Benefit)
|
|
|
|
Attributable
to
|
|
Attributable
to
|
|
Earnings
|
|
|
|
|
|
Before
Income
|
|
for
Income
|
|
Net
Earnings
|
|
Noncontrolling
|
|
Controlling
|
|
(Loss)
|
|
|
|
|
|
Taxes
|
|
Taxes
|
|
(Loss)
|
|
Interests
|
|
Interests
|
|
per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3rd Q Ended
September 30, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage, as
reported
|
|
|
|
$
334.5
|
|
$
80.9
|
|
$
253.6
|
|
$
1.2
|
|
$
252.4
|
|
$
1.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains on
divestitures
|
|
|
|
(4.3)
|
|
(0.9)
|
|
(3.4)
|
|
-
|
|
(3.4)
|
|
(0.02)
|
Acquisition
integration
|
|
|
|
5.8
|
|
1.2
|
|
4.6
|
|
-
|
|
4.6
|
|
0.02
|
Workforce and lease
termination
|
|
|
|
4.2
|
|
0.9
|
|
3.3
|
|
-
|
|
3.3
|
|
0.01
|
Acquisition related
adjustments
|
|
|
|
32.0
|
|
7.4
|
|
24.6
|
|
-
|
|
24.6
|
|
0.12
|
Amortization of
intangible assets
|
|
|
|
90.8
|
|
20.7
|
|
70.1
|
|
-
|
|
70.1
|
|
0.33
|
Levelized foreign
currency translation
|
|
|
|
(6.7)
|
|
(1.5)
|
|
(5.2)
|
|
-
|
|
(5.2)
|
|
(0.02)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage, as
adjusted
|
|
|
|
$
456.3
|
|
$
108.7
|
|
$
347.6
|
|
$
1.2
|
|
$
346.4
|
|
$
1.64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
reported
|
|
|
|
$
29.5
|
|
$
7.5
|
|
$
22.0
|
|
$
-
|
|
$
22.0
|
|
$
0.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Workforce and lease
termination
|
|
|
|
5.4
|
|
1.4
|
|
4.0
|
|
-
|
|
4.0
|
|
0.02
|
Acquisition related
adjustments
|
|
|
|
(0.1)
|
|
-
|
|
(0.1)
|
|
-
|
|
(0.1)
|
|
-
|
Amortization of
intangible assets
|
|
|
|
2.1
|
|
0.5
|
|
1.6
|
|
-
|
|
1.6
|
|
0.01
|
Levelized foreign
currency translation
|
|
|
|
(0.6)
|
|
(0.2)
|
|
(0.4)
|
|
-
|
|
(0.4)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
adjusted
|
|
|
|
$
36.3
|
|
$
9.2
|
|
$
27.1
|
|
$
-
|
|
$
27.1
|
|
$
0.13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
reported
|
|
|
|
$
(132.6)
|
|
$
(95.6)
|
|
$
(37.0)
|
|
$
12.3
|
|
$
(49.3)
|
|
$
(0.24)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment
of debt
|
|
|
|
16.2
|
|
4.0
|
|
12.2
|
|
-
|
|
12.2
|
|
0.06
|
Transaction-related
costs
|
|
|
|
11.0
|
|
2.8
|
|
8.2
|
|
-
|
|
8.2
|
|
0.04
|
Income tax
related
|
|
|
|
-
|
|
(4.9)
|
|
4.9
|
|
-
|
|
4.9
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
adjusted
|
|
|
|
$
(105.4)
|
|
$
(93.7)
|
|
$
(11.7)
|
|
$
12.3
|
|
$
(24.0)
|
|
$
(0.11)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
|
|
|
|
|
|
Earnings
|
|
Provision
|
|
|
|
Net
Earnings
|
|
(Loss)
|
|
Diluted
Net
|
|
|
|
|
|
(Loss)
|
|
(Benefit)
|
|
|
|
Attributable
to
|
|
Attributable
to
|
|
Earnings
|
|
|
|
|
|
Before
Income
|
|
for
Income
|
|
Net
Earnings
|
|
Noncontrolling
|
|
Controlling
|
|
(Loss)
|
|
|
|
|
|
Taxes
|
|
Taxes
|
|
(Loss)
|
|
Interests
|
|
Interests
|
|
per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9 Mths Ended
September 30, 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage, as
reported
|
|
|
|
$
1,400.0
|
|
$
341.5
|
|
$
1,058.5
|
|
$
3.3
|
|
$
1,055.2
|
|
$
4.92
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains on
divestitures
|
|
|
|
(2.9)
|
|
(0.5)
|
|
(2.4)
|
|
-
|
|
(2.4)
|
|
(0.01)
|
Acquisition
integration
|
|
|
|
122.3
|
|
24.4
|
|
97.9
|
|
-
|
|
97.9
|
|
0.46
|
Workforce and lease
termination
|
|
|
|
23.6
|
|
4.5
|
|
19.1
|
|
-
|
|
19.1
|
|
0.09
|
Acquisition related
adjustments
|
|
|
|
(32.4)
|
|
(5.2)
|
|
(27.2)
|
|
-
|
|
(27.2)
|
|
(0.13)
|
Amortization of
intangible assets
|
|
|
|
332.8
|
|
78.7
|
|
254.1
|
|
-
|
|
254.1
|
|
1.19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage, as
adjusted
|
|
|
|
$
1,843.4
|
|
$
443.4
|
|
$
1,400.0
|
|
$
3.3
|
|
$
1,396.7
|
|
$
6.52
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
reported
|
|
|
|
$
107.7
|
|
$
28.3
|
|
$
79.4
|
|
$
-
|
|
$
79.4
|
|
$
0.37
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Workforce and lease
termination
|
|
|
|
3.7
|
|
0.9
|
|
2.8
|
|
-
|
|
2.8
|
|
0.01
|
Acquisition related
adjustments
|
|
|
|
(1.5)
|
|
(0.4)
|
|
(1.1)
|
|
-
|
|
(1.1)
|
|
(0.01)
|
Acquisition
integration
|
|
|
|
1.8
|
|
0.4
|
|
1.4
|
|
-
|
|
1.4
|
|
0.01
|
Amortization of
intangible assets
|
|
|
|
4.7
|
|
1.3
|
|
3.4
|
|
-
|
|
3.4
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
adjusted
|
|
|
|
$
116.4
|
|
$
30.5
|
|
$
85.9
|
|
$
-
|
|
$
85.9
|
|
$
0.40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
reported
|
|
|
|
$
(302.7)
|
|
$
(145.3)
|
|
$
(157.4)
|
|
$
(1.5)
|
|
$
(155.9)
|
|
$
(0.72)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction-related
costs
|
|
|
|
27.7
|
|
2.1
|
|
25.6
|
|
-
|
|
25.6
|
|
0.11
|
Income tax
related
|
|
|
|
-
|
|
19.0
|
|
(19.0)
|
|
-
|
|
(19.0)
|
|
(0.09)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
adjusted
|
|
|
|
$
(275.0)
|
|
$
(124.2)
|
|
$
(150.8)
|
|
$
(1.5)
|
|
$
(149.3)
|
|
$
(0.70)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Earnings
|
|
|
|
|
|
|
|
Earnings
|
|
Provision
|
|
|
|
Net
Earnings
|
|
(Loss)
|
|
Diluted
Net
|
|
|
|
|
|
(Loss)
|
|
(Benefit)
|
|
|
|
Attributable
to
|
|
Attributable
to
|
|
Earnings
|
|
|
|
|
|
Before
Income
|
|
for
Income
|
|
Net
Earnings
|
|
Noncontrolling
|
|
Controlling
|
|
(Loss)
|
|
|
|
|
|
Taxes
|
|
Taxes
|
|
(Loss)
|
|
Interests
|
|
Interests
|
|
per
Share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9 Mths Ended
September 30, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage, as
reported
|
|
|
|
$
1,114.5
|
|
$
268.9
|
|
$
845.6
|
|
$
5.6
|
|
$
840.0
|
|
$
4.09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains on
divestitures
|
|
|
|
(8.9)
|
|
(1.9)
|
|
(7.0)
|
|
-
|
|
(7.0)
|
|
(0.03)
|
Acquisition
integration
|
|
|
|
16.1
|
|
3.6
|
|
12.5
|
|
-
|
|
12.5
|
|
0.06
|
Workforce and lease
termination
|
|
|
|
15.3
|
|
3.4
|
|
11.9
|
|
-
|
|
11.9
|
|
0.06
|
Acquisition related
adjustments
|
|
|
|
53.9
|
|
12.4
|
|
41.5
|
|
-
|
|
41.5
|
|
0.20
|
Amortization of
intangible assets
|
|
|
|
300.2
|
|
70.1
|
|
230.1
|
|
-
|
|
230.1
|
|
1.12
|
Levelized foreign
currency translation
|
|
|
|
(22.9)
|
|
(5.3)
|
|
(17.6)
|
|
-
|
|
(17.6)
|
|
(0.09)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Brokerage, as
adjusted
|
|
|
|
$
1,468.2
|
|
$
351.2
|
|
$
1,117.0
|
|
$
5.6
|
|
$
1,111.4
|
|
$
5.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
reported
|
|
|
|
$
87.0
|
|
$
22.1
|
|
$
64.9
|
|
$
-
|
|
$
64.9
|
|
$
0.31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gains on
divestitures
|
|
|
|
(0.1)
|
|
-
|
|
(0.1)
|
|
-
|
|
(0.1)
|
|
-
|
Workforce and lease
termination
|
|
|
|
6.7
|
|
1.7
|
|
5.0
|
|
-
|
|
5.0
|
|
0.03
|
Acquisition related
adjustments
|
|
|
|
2.6
|
|
0.6
|
|
2.0
|
|
-
|
|
2.0
|
|
0.01
|
Amortization of
intangible assets
|
|
|
|
5.9
|
|
1.5
|
|
4.4
|
|
-
|
|
4.4
|
|
0.02
|
Levelized foreign
currency translation
|
|
|
|
(1.5)
|
|
(0.4)
|
|
(1.1)
|
|
-
|
|
(1.1)
|
|
(0.01)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk Management, as
adjusted
|
|
|
|
$
100.6
|
|
$
25.5
|
|
$
75.1
|
|
$
-
|
|
$
75.1
|
|
$
0.36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
reported
|
|
|
|
$
(339.4)
|
|
$
(263.0)
|
|
$
(76.4)
|
|
$
31.1
|
|
$
(107.5)
|
|
$
(0.52)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on extinguishment
of debt
|
|
|
|
16.2
|
|
4.0
|
|
12.2
|
|
-
|
|
12.2
|
|
0.06
|
Transaction-related
costs
|
|
|
|
21.2
|
|
4.3
|
|
16.9
|
|
-
|
|
16.9
|
|
0.08
|
Income tax
related
|
|
|
|
-
|
|
(24.2)
|
|
24.2
|
|
-
|
|
24.2
|
|
0.11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate, as
adjusted
|
|
|
|
$
(302.0)
|
|
$
(278.9)
|
|
$
(23.1)
|
|
$
31.1
|
|
$
(54.2)
|
|
$
(0.27)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See "Information
Regarding Non-GAAP Measures" on page 9 of 15.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contact:
Ray Iardella
Vice President - Investor Relations
630-285-3661 or ray_iardella@ajg.com
(15 of 15)
View original
content:https://www.prnewswire.com/news-releases/arthur-j-gallagher--co-announces-third-quarter-2022-financial-results-301661686.html
SOURCE Arthur J. Gallagher &
Co.