What is the primary strategic development impacting Marsh & McLennan Companies in this filing period?

The most significant strategic development is the announced sale of Putnam Investments for $3.9 billion. This transaction is expected to close in the second quarter of 2007, and Putnam's financial results are being reported as discontinued operations.

How did the company's core operating segments perform in the first quarter of 2007?

The Consulting segment showed strong performance with a 13% increase in revenue. The Risk and Insurance Services segment saw a 1% revenue increase, while Risk Consulting & Technology revenue was flat on an underlying basis. Overall, continuing operations demonstrated revenue growth.

What is the company's cash flow situation, and are there any significant cash outflows?

The company used $383 million in cash for operations in the first quarter of 2007. This is a common trend for the first quarter due to the payment of incentive compensation. Additionally, the company paid $105 million in dividends and used $325 million for financing activities, which included the payment of maturing debt.

What is the outlook for restructuring initiatives?

Marsh & McLennan Companies is actively implementing its 2006 restructuring plan, which aims for annualized savings of approximately $350 million by the end of 2008. In the first quarter of 2007, restructuring costs were $4 million, and the company expects further savings as the plan progresses.

MRSH/MMC 10-Q Quarterly Report Q1 FY2007 — Revenue, Net Income, EPS

Summary

Marsh & McLennan Companies, Inc. (MMC) reported its first quarter 2007 financial results, showing a 5% increase in total revenue to $2.81 billion, driven primarily by a 13% surge in its Consulting segment. Operating income also saw a healthy 15% increase to $387 million. A significant strategic event during the quarter was the announcement of the sale of Putnam Investments for $3.9 billion, with the results of Putnam being classified as discontinued operations. While the core business demonstrated growth, the company is actively managing its restructuring initiatives, which are expected to yield substantial long-term savings. Despite the positive revenue and operating income trends in continuing operations, investors should note that diluted earnings per share from continuing operations were $0.41, a slight increase from $0.36 in the prior year, but considerably lower than the previous year's overall net income per share of $0.75. This is largely due to the classification of Putnam as discontinued operations and a gain on the sale of other businesses in the prior year. The company also reported negative operating cash flows, a typical trend for the first quarter, influenced by incentive compensation payments.

Key Highlights

1Total revenue increased by 5% to $2.81 billion in Q1 2007, compared to $2.67 billion in Q1 2006.
2Operating income rose by 15% to $387 million in Q1 2007, up from $337 million in Q1 2006.
3The company announced the sale of its Investment Management segment, Putnam, for $3.9 billion, with results classified as discontinued operations.
4Consulting segment revenue grew by 13% to $1.13 billion, leading the growth across business segments.
5Diluted earnings per share from continuing operations were $0.41, an increase from $0.37 in the prior year.
6The company incurred $4 million in restructuring costs in Q1 2007 related to its 2006 restructuring plan.
7Cash used for operating activities was $383 million in Q1 2007, compared to $517 million used in Q1 2006, reflecting typical first-quarter outflows.

MARSH & MCLENNAN COMPANIES, INC. Quarterly Report for Q1 Ended Mar 31, 2007

Summary

Key Highlights

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