10-QPeriod: Q2 FY2023

MARSH & MCLENNAN COMPANIES, INC. Quarterly Report for Q2 Ended Jun 30, 2023

Filed July 20, 2023For Securities:MRSHMMC

Summary

Marsh & McLennan Companies, Inc. (MRSH) reported strong financial performance for the second quarter and first half of 2023. Revenue increased by 9% to $5.9 billion for the quarter and 8% to $11.8 billion for the half-year, driven by robust growth in the Risk and Insurance Services segment, which saw revenue climb 12% and 11% respectively, and solid performance in Consulting. Net income attributable to the company rose to $1.035 billion ($2.07 per diluted share) for the quarter and $2.270 billion ($4.55 per diluted share) for the half-year, marking an 8% and 13% increase respectively compared to the prior year. The company also continued its share repurchase program and declared a quarterly dividend, demonstrating a commitment to returning value to shareholders while investing in strategic acquisitions, such as the Westpac transaction in the Consulting segment.

Financial Highlights

49 data points
Beta

Revenue

$5.88B

Net Income

$1.03B

17.6% Net Margin

EPS (Diluted)

$2.07

Total Assets

$46.57B

Cash & Equivalents

$1.17B

Free Cash Flow

$1.38B

Financial Statements
Beta
Revenue$5.88B
Operating Expenses$4.42B
Operating Income$1.46B
Interest Expense$146.00M
Net Income$1.03B
EPS (Basic)$2.09
EPS (Diluted)$2.07
Shares Outstanding (Basic)495.00M
Shares Outstanding (Diluted)499.00M

Key Highlights

  • 1Consolidated revenue grew by 9% to $5.9 billion for Q2 2023 and 8% to $11.8 billion for the first six months of 2023.
  • 2Risk and Insurance Services segment revenue increased by 12% to $3.7 billion in Q2 2023 and 11% to $7.6 billion for the first six months, driven by strong renewals and new business.
  • 3Consulting segment revenue saw a 4% increase to $2.2 billion in Q2 2023 and a 3% increase to $4.2 billion for the first six months, with underlying growth of 8% and 6% respectively.
  • 4Net income attributable to the company increased by 8% to $1.035 billion for Q2 2023 and by 13% to $2.270 billion for the first six months.
  • 5Diluted Earnings Per Share (EPS) grew to $2.07 for Q2 2023 and $4.55 for the first six months, representing an 8% and 13% increase respectively.
  • 6The company repurchased $600 million of its common stock in the first six months of 2023 and announced a quarterly dividend of $0.71 per share.
  • 7Operating income increased by 7% to $1.5 billion for Q2 2023 and by 13% to $3.2 billion for the first six months, reflecting strong revenue growth and disciplined expense management.

Frequently Asked Questions

For the three months ended June 30, 2023, Marsh & McLennan reported consolidated revenue of $5.9 billion, an increase of 9% compared to the prior year's second quarter. This growth was driven by strong performance in the Risk and Insurance Services segment, which increased by 12%.

For the six months ended June 30, 2023, net income attributable to the company increased by 13% to $2.3 billion, resulting in diluted earnings per share of $4.55, up from $4.01 in the prior year's comparable period. This improved profitability reflects strong revenue growth and effective expense management.

Marsh & McLennan continues to demonstrate a commitment to shareholder returns through its share repurchase program and dividend payments. In the first six months of 2023, the company repurchased $600 million of its common stock. Additionally, the Board of Directors declared a quarterly dividend of $0.71 per share, payable in August 2023, indicating consistent dividend payouts.

The robust revenue growth in the Risk and Insurance Services segment, up 12% in Q2 2023, was primarily driven by strong client retention, solid growth in renewals and new business, and higher insurance and reinsurance rates. The segment also benefited from increased fiduciary income due to higher interest rates.