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Marsh & McLennan Companies, Inc. MMC reported fourth-quarter 2021 adjusted earnings per share of $1.36, which outpaced the Zacks Consensus Estimate by 1.5%. The bottom line rose 14% year over year.
Results reflect growing revenues, and robust contributions from its Risk and Insurance Services and Consulting segments, partly offset by elevated costs.
MMC’s consolidated revenues improved 16% year over year (10% on an underlying basis) to $5.1 billion in the fourth quarter. The top line surpassed the consensus mark by 4.4%.
Total operating expenses of $4.2 billion increased 8% year over year on account of higher compensation and benefits, and other operating expenses.
Marsh & McLennan Companies, Inc. Price, Consensus and EPS Surprise
Marsh & McLennan Companies, Inc. price-consensus-eps-surprise-chart | Marsh & McLennan Companies, Inc. Quote
Quarterly Segmental Results
Risk and Insurance Services
Revenues rose 9% on an underlying basis to $3 billion in the quarter under review. Adjusted operating income of $557 million improved 6% year over year.
Marsh, a unit within this segment, generated revenues worth $2.9 billion. The figure grew 9% on an underlying basis. In the U.S./Canada, underlying revenues climbed 11% year over year.
Underlying revenues from international operations improved 7% year over year courtesy of 14% rise in Latin America, 10% growth in the Asia Pacific and 5% increase in EMEA.
Revenues from another unit under this segment, Guy Carpenter, climbed 5% on an underlying basis to $170 million in the fourth quarter.
Consulting
Revenues at the segment amounted to $2.1 billion, up 11% on an underlying basis. Adjusted operating income improved 6% year over year to $410 million.
A unit within this segment, Mercer, reported revenues of $1.4 billion, which grew 6% on an underlying basis. Wealth and Health revenues both rose 4% on an underlying basis. The same at Career was up 15% on an underlying basis.
Another unit under the Consulting segment — Oliver Wyman’s revenues climbed 22% on an underlying basis to $722 million.
Share Repurchase Update
Marsh & McLennan bought back shares worth $425 million in the fourth quarter.
Financial Update (as of Dec 31, 2021)
MMC exited the fourth quarter with cash and cash equivalents of $1.8 billion, which plunged 16.1% from the 2020-end level. Total assets were $34.4 billion, up 4.1% from the figure at the end of 2020.
Long-term debt amounted to $10.9 billion, which inched up 1.3% from the level as of Dec 31, 2020.
Total equity climbed 21.2% from the 2020-end level to $11.2 billion.