Arthur J. Gallagher Q4 2020 Earnings Report
Key Takeaways
Arthur J. Gallagher & Co. reported strong Q4 2020 results, with an increase in net earnings and adjusted EPS. The company's performance was driven by growth in both its Brokerage and Risk Management segments, as well as effective cost control measures.
Total revenue was $1,663.6 million.
Net earnings were $153.1 million, or $0.72 per share.
Adjusted EPS was $0.88, a 49% increase compared to Q4 2019.
The company continues to execute on its long-term operating priorities, including organic growth, acquisitions, and productivity improvements.
Arthur J. Gallagher
Arthur J. Gallagher
Arthur J. Gallagher Revenue by Segment
Forward Guidance
The company expects the favorable property casualty environment with rising rates and growing exposure units to continue in 2021, providing opportunities for growth.
Positive Outlook
- Property casualty rates are expected to continue rising.
- Business activity is increasing.
- The labor market is recovering.
- New risk management claims are rebounding.
- Customer retention remained at pre-pandemic levels.
Challenges Ahead
- Renewal exposure units declined.
- New consulting and special project work decreased in employee benefits.
- Covered lives on renewal business were similar to the third quarter of 2020, but not at pre-pandemic levels.
- Consulting engagements and special project work improved slightly from fourth quarter levels, but are still below pre-pandemic levels.
- Reduced U.S. electricity consumption could persist at least through the first half of 2021, and could even continue throughout all of 2021.
Revenue & Expenses
Visualization of income flow from segment revenue to net income