How did Arthur J. Gallagher & Co.'s revenue perform in the third quarter and first nine months of 2015?

Arthur J. Gallagher & Co. reported a 5% increase in total revenues for the three-month period ended September 30, 2015, and a 9% increase for the nine-month period ended September 30, 2015, compared to the same periods in the prior year. This growth was attributed to a combination of organic revenue expansion and contributions from recent acquisitions.

What was the impact of acquisitions on the company's performance?

The company continued to execute its acquisition strategy, completing multiple acquisitions during the period. These acquisitions contributed to revenue growth and expanded the company's market reach and service offerings. The annualized revenues from acquisitions completed in the nine-month period ending September 30, 2015, totaled approximately $184.5 million.

How is the company managing its debt and liquidity?

Arthur J. Gallagher & Co. maintains a robust liquidity position, supported by strong operating cash flows and significant availability under its Credit Agreement. The company was in compliance with all its debt covenants as of September 30, 2015, and continued to make regular dividend payments to shareholders. The company expects to use a combination of cash from operations, debt, and equity to fund future activities.

What is the company's outlook regarding its clean energy investments?

The company's clean energy investments, particularly those related to clean coal production plants eligible for IRC Section 45 tax credits, are a significant contributor to its financial performance. For 2015, the company anticipated net earnings from these investments to be between $102.5 million and $104.5 million, which are expected to support its mergers and acquisition strategy.

AJG 10-Q Quarterly Report Q3 FY2015 — Revenue, Net Income, EPS

Summary

Arthur J. Gallagher & Co. (AJG) reported solid top-line growth in the third quarter and first nine months of 2015, driven by a combination of organic growth and strategic acquisitions. Total revenues increased by 5% and 9% for the three-month and nine-month periods ending September 30, 2015, respectively. The company demonstrated strong performance in its core Brokerage and Risk Management segments, with adjusted EBITDAC up 10% and 15% respectively for the third quarter. Despite a slight decrease in net earnings for the Brokerage segment in Q3, overall adjusted EBITDAC for the combined Brokerage and Risk Management segments saw an 11% increase, highlighting operational efficiency gains. The company continues to execute its acquisition strategy, completing multiple acquisitions during the period to expand its geographic reach and service offerings. The Corporate segment benefited significantly from clean energy investments, contributing substantial net earnings. AJG's financial position remains robust, supported by consistent operating cash flows and ample availability under its credit facilities. The company maintained compliance with its debt covenants and continued its dividend payments to shareholders. While facing an ongoing IRS investigation into its micro-captive advisory services, the company remains confident in its defense and its ability to navigate potential challenges. The company's strategic focus on growing its core businesses through organic development and targeted acquisitions, coupled with disciplined cost management, positions it well for continued performance.

Financial Highlights

44 data points

Beta

Revenue

$1.45B

Net Income

$133.30M

0.1% Net Margin

EPS (Diluted)

$0.75

Total Assets

$10.51B

Cash & Equivalents

$369.70M

Free Cash Flow

$211.70M

Financial Statements

Beta

Revenue	$1.45B
Operating Expenses	$1.35B
Interest Expense	$25.60M
Net Income	$133.30M
EPS (Basic)	$0.76
EPS (Diluted)	$0.75
Shares Outstanding (Basic)	176.00M

Key Highlights

1Total revenues increased by 5% for Q3 2015 and 9% for the first nine months of 2015, driven by organic growth and acquisitions.
2Adjusted EBITDAC increased by 10% in the Brokerage segment and 15% in the Risk Management segment for Q3 2015, indicating strong operational performance.
3The company actively pursued its acquisition strategy, completing multiple acquisitions to expand its market presence.
4Clean energy investments generated substantial net earnings, significantly contributing to the Corporate segment's financial results.
5Operating cash flow remained strong, providing ample resources to fund operations and strategic initiatives.
6AJG maintained compliance with debt covenants and continued dividend payments, demonstrating financial stability.
7The company reported a significant pre-tax gain of $31.0 million from settling litigation related to former U.K. executives.

Arthur J. Gallagher & Co. Quarterly Report for Q3 Ended Sep 30, 2015

Summary

Financial Highlights

Key Highlights

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