Hub Boosts 2-Q Revenue; Buys CBUS

Broker consolidator Hub Inter-national Ltd. (TSX: HBG) increased second quarter revenue by 29% year-on-year to US$74.1 million, while net earnings fell to US$10.1 million for the same period compared with the US$10.7 million reported at the end of June 2002. As a result, earnings saw a modest decline to 31 a share for second-quarter 2003 (2002 2-Q: 41 a share).

Hub’s revenue growth for the second quarter of this year was partly on the strengthening of the Canadian dollar, accounting for about US$3 million of total revenue. Revenue from U.S. operations rose by 33% to US$44.7 million for the second quarter of this year (2002 2-Q: US$33.6 million), while Canadian revenue increased by 24% to US$29.5 million (2002 2-Q: US$23.7 million). Hub’s pre-tax earnings for the latest reporting period rose by 6% to US$15.6 million (2002 2-Q: $14.8 million).

The company’s revenue for the first half of this year jumped 34% year-on-year to US$143 million compared with the US$106.8 million reported at 2002’s half-year. Pre-tax earnings for the first half of this year increased by 37% to US$29.9 million against the US$21.8 million posted for the same period in 2002. Net earnings for the latest six-month period rose by 21% to US$19 million from the US$15.7 million recorded at 2002 half-year.

The company recently acquired all of the stock of wholesale brokerage Cross Border Underwriting Services Inc. (CBUS) from KRG Insurance Brokers Inc. for an undisclosed amount. CBUS, which places cross-border risk exposures, generates annual revenue of about $400,000. Hub also recently withdrew from previously announced talks to buy the brokerage operations troubled Chicago-based Near North National Group.