Arthur J. Gallagher & Co. Quarterly Report for Q1 Ended Mar 31, 2017

Summary

Arthur J. Gallagher & Co. (AJG) reported strong first-quarter 2017 results, with total revenues increasing 9% year-over-year to $1.41 billion. Net earnings attributable to controlling interests rose 20% to $55.7 million, and diluted EPS grew 19% to $0.31. This growth was primarily driven by the brokerage segment, which saw a 6% increase in total revenues and a significant improvement in adjusted EBITDAC margin. The company's strategic acquisitions continued to contribute positively, with $143.3 million in cash paid for acquisitions during the quarter, alongside the issuance of common stock. Despite these investments, AJG maintained a healthy cash flow from operations of $169.7 million. The company also reiterated its commitment to shareholder returns, declaring a dividend of $0.39 per share. Overall, the filing indicates robust performance and continued execution of AJG's growth strategy.

Key Highlights

• 1Total revenues increased by 9% to $1.41 billion for the three-month period ended March 31, 2017, compared to $1.30 billion in the prior year period.
• 2Net earnings attributable to controlling interests increased by 20% to $55.7 million, up from $46.5 million in the same period last year.
• 3Diluted earnings per share (EPS) rose by 19% to $0.31 for the quarter, compared to $0.26 in the prior year.
• 4The Brokerage segment demonstrated strong performance with total revenues up 6% to $878.5 million and adjusted EBITDAC increasing by 14% to $215.7 million.
• 5The company completed 12 acquisitions in the first quarter of 2017, with cash paid for acquisitions totaling $143.3 million.
• 6Cash flow from operating activities was strong, totaling $169.7 million for the period, an increase from $100.0 million in the prior year.
• 7The company declared a quarterly dividend of $0.39 per common share, representing a 3% increase over the prior year's dividend.

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