Large brokers produce mixed results

The world’s largest insurance brokers have each produced very different yearend results in the wake of September 11 and a hardening insurance market.Giant Marsh & McLennan held the line, with revenues of US$2.5 billion in the fourth quarter, equal to the same period in 2000. For the year, revenues were down 2% from 2000, to US$9.9 billion. However, net income was up 4% to US$1.2 billion and earnings per share rose 3% to $4.24, as compared to the year prior.Much of the growth was in the company’s risk and insurance services portfolio, where revenues rose 8% in 2001, to US$5.2 billion. The company forsees increased demand for these services in the trouble post-September 11 environment, as clients face rising premiums and new exclusions.Number two broker Aon saw its profits decline in the final quarter of the year, with net income down to US$83 million (or $0.30 per share) versus fourth quarter 2000’s US$90 million (or $0.33 per share). Even excluding the impact of September 11 events, the company saw an operating profit of $0.33 per share, down from $0.52 the year prior.But it was number three brokerage Willis who saw net profits rise in the fourth quarter of 2001, to US$27 million (or $0.16 per share) from US$5 million (or $0.04 per share) for the same period last year. Operating earnings doubled to $0.30 per share from $0.15 in 2000.Willis attributes the growth to, among other factors, the rise in demand for insurance following the September 11 terrorist attacks.