By Dan Reynolds, senior editor
The largest of the brokerages, Marsh & McLennan Companies Inc., is engaged in perhaps the most feverish fight.
Under new CEO Brian Duperreault, Marsh is shedding jobs, more than 500 in the first two quarters, with 900 more job cuts to come, most of them in U.S. operations, according to statements made by Marsh executives during their earnings chat with analysts on Aug. 6.
As things stand, Marsh, although revenue barreled up a total of 9 percent in the second quarter to $3 billion, saw net income of $65 million in Q2, that's a profit, of course, but it is well below the $177 million in net income the company recorded in the second quarter of 2007. Things aren't unfolding quite as dramatically at the other large brokerages.
Aon managed to keep its head well above water on a net income basis, gathering in $1.1 billion in Q2. But the Chicago-based brokerage managed most of that from the $1 billion it took in after-tax gains on the sale of CICA and Sterling. That's compared to the $240 million in net income the company recorded in the second quarter of 2007. Aon's organic numbers were most harmed by the dollar's weakness, a factor that ended up having an opposite effect on the results of rival Willis.
London-based Willis was also hit by restructuring costs, but still wound up with a net income of $39 million for the second quarter. Nonetheless, a relative decline was noted as the company did much better than that a year ago, notching $78 million in net income over the same period in 2007.
Arthur J. Gallagher
The Itasca, Ill.-based broker saw net income of $40.8 million in the second quarter of 2008, that's down slightly from the $43.8 million it took in during the second quarter of 2007. The company's dividends per share were 32 cents a share in Q2 2008 compared with 31 cents per share in Q2 2007.
September 15, 2008
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