Exhibit 99.1

 

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NEWS RELEASE

ARTHUR J. GALLAGHER & CO. ANNOUNCES

THIRD QUARTER 2018 FINANCIAL RESULTS

ROLLING MEADOWS, IL, October 25, 2018 — Arthur J. Gallagher & Co. (NYSE: AJG) today reported its financial results for the quarter ended September 30, 2018. Management will host a webcast conference call to discuss these results on Thursday, October 25, 2018 at 5:15 p.m. ET/4:15 p.m. CT. To listen to the call, and for printer-friendly formats of this release and the “Supplemental Quarterly Data” and “CFO Commentary,” which may also be referenced during the call, please visit

ajg.com/IR. These documents contain both GAAP and non-GAAP measures. Investors and other users of this information should read carefully the section entitled “Information Regarding Non-GAAP Measures” beginning on page 10. A new revenue recognition accounting standard was adopted as of January 1, 2018, using the full retrospective method to restate each prior reporting period presented. Accordingly, all 2017 amounts have been restated from previously reported information.

Summary of Financial Results – Third Quarter

Reconciliations of non-GAAP measures begin on page 2

 

(Dollars in millions, except per share data)    3rd Q 2018     3rd Q 2017     Change  
     Reported
GAAP
    Adjusted
Non-GAAP
    Reported
GAAP
    Adjusted
Non-GAAP
    Reported
GAAP
    Adjusted
Non-GAAP
 

Brokerage Segment

            

Revenues

   $ 1,049.4     $ 1,048.8     $ 938.7     $ 928.0       12     13

Organic revenues

     $ 965.8       $ 908.3         6.3

Net earnings

   $ 122.2       $ 94.0         30  

Net earnings margin

     11.6       10.0       +163 bpts   

Adjusted EBITDAC

     $ 277.3       $ 243.4         14

Adjusted EBITDAC margin

       26.4       26.2       +21 bpts 

Adjusted EBITDAC margin (before acquisitions)

       27.0       26.2       +81 bpts 

Diluted net earnings per share

   $ 0.65     $ 0.74     $ 0.52     $ 0.59       25     25

Risk Management Segment

            

Revenues before reimbursements

   $ 199.1     $ 199.1     $ 190.6     $ 188.1       4     6

Organic revenues

     $ 195.7       $ 188.1         4.0

Net earnings

   $ 16.5       $ 16.3         1  

Net earnings margin (before reimbursements)

     8.3       8.6       -26 bpts   

Adjusted EBITDAC

     $ 35.9       $ 33.9         6

Adjusted EBITDAC margin (before reimbursements)

       18.0       18.0       +1 bpts 

Diluted net earnings per share

   $ 0.09     $ 0.10     $ 0.09     $ 0.09       0     11

Corporate Segment

            

Diluted net earnings per share

   $ (0.06   $ (0.06   $ —       $ 0.02      

Total Company

            

Diluted net earnings per share

   $ 0.68     $ 0.78     $ 0.61     $ 0.70       11     11

“We delivered another excellent quarter of operating performance,” said J. Patrick Gallagher, Jr., Chairman, President and CEO. “During the third quarter, our core brokerage and risk management segments combined to post over 21% growth in earnings per share; 11% growth in revenues, of which 5.9% was organic revenue growth; net earnings margin improved by 134 basis points; and adjusted EBITDAC margins (before acquisitions) expanded by 67 basis points. During the quarter, we also completed 10 tuck-in mergers with approximately $75 million of annualized revenues, bringing our first nine months total to 29 mergers with approximately $250 million of annualized revenues.”

“My recent meetings with insurance carriers, and our business leaders around the globe, confirmed that we continue to operate in an increasing P&C rate environment. Our internal data indicates modest P&C rate increases and continued growth in exposures units and payrolls across almost all geographies. Our teams are hitting on all cylinders, excited about our growth, and delivering the best insurance and risk management advice by leveraging our vast array of resources and capabilities. An excellent third quarter and first nine months positions us for a strong finish to 2018.”

 

(1 of 15)


The following information was filed by Gallagher Arthur J Co (AJG) on Thursday, October 25, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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