Arthur J. Gallagher & Co (AJG) has reported 52.65 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $95.10 million, or $0.53 a share in the quarter, compared with $62.30 million, or $0.35 a share for the same period last year. On an adjusted basis, earnings per share were at $0.66 for the quarter compared with $0.59 in the same period last year. Revenue during the quarter grew 3.75 percent to $1,385 million from $1,334.90 million in the previous year period.
Total expenses move up marginally
Operating income for the quarter was $68.80 million, compared with $28.40 million in the previous year period. However, the adjusted EBITDA for the quarter stood at $228.20 million compared with $209.50 million in the prior year period. At the same time, adjusted EBITDA margin improved 78 basis points in the quarter to 16.48 percent from 15.69 percent in the last year period.
Net investment income was at $18.80 million for the quarter, up 22.08 percent or $3.40 million from year-ago period. Meanwhile, income from fees and commission for the quarter moved up marginally by 1.14 percent or $6.70 million to $596.80 million.
“We had a terrific quarter to finish an excellent 2016. For both the quarter and the full year, we delivered strong growth in revenue, improvement in our margin and disciplined execution of our tuck-in M&A strategy,” said J. Patrick Gallagher, Jr., Chairman, President and Chief executive officer. “We are well positioned for 2017. Our unique Gallagher culture is as strong as ever, our integration efforts are largely complete and we have a robust M&A pipeline. We continue to see an environment where our talented production and claims staff can drive growth.”
Liabilities outpace assets growth
Total assets increased 5.28 percent or $575.80 million to $11,489.60 million on Dec. 31, 2016. On the other hand, total liabilities were at $7,833.80 million as on Dec. 31, 2016, up 8.42 percent or $608.20 million from year-ago. Return on assets stood at 1.13 percent in the quarter, up 0.26 from 0.86 percent in the last year period. At the same time, return on equity was at 2.60 percent in the quarter, up 0.91 from 1.69 percent in the last year period.
Net premiums and other receivables increased 6.39 percent or $110.80 million over the year to $1,844.80 million on Dec. 31, 2016.
Total debt was at $2,848.20 million as on Dec. 31, 2016, up 16.08 percent or $394.50 million from year-ago. Shareholders equity stood at $3,655.80 million as on Dec. 31, 2016, down 0.88 percent or $32.40 million from year-ago. As a result, debt to equity ratio went up 11 basis points to 0.78 percent in the quarter from 0.67 percent in the last year period.
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