Marsh McLennan Reports Second Quarter 2024 Results

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Marsh & McLennan Companies, Inc. Consolidated Statements of Income (In millions, except per share data) (Unaudited)

	Three Months Ended June 30,						Six Months Ended June 30,
		2024			2023			2024			2023
Revenue	$	6,221		$	5,876		$	12,694		$	11,800
Expense:
Compensation and benefits		3,454			3,337			6,924			6,544
Other operating expenses		1,125			1,082			2,203			2,073
Operating expenses		4,579			4,419			9,127			8,617
Operating income		1,642			1,457			3,567			3,183
Other net benefit credits		66			60			133			118
Interest income		12			10			49			24
Interest expense		(156	)		(146	)		(315	)		(282	)
Investment income		1			3			2			5
Income before income taxes		1,565			1,384			3,436			3,048
Income tax expense		425			337			872			749
Net income before non-controlling interests		1,140			1,047			2,564			2,299
Less: Net income attributable to non-controlling interests		15			12			39			29
Net income attributable to the Company	$	1,125		$	1,035		$	2,525		$	2,270
Net income per share attributable to the Company:
- Basic	$	2.28		$	2.09		$	5.13		$	4.59
- Diluted	$	2.27		$	2.07		$	5.08		$	4.55
Average number of shares outstanding:
- Basic		492			495			492			495
- Diluted		496			499			497			499
Shares outstanding at June 30		492			494			492			494

									Components of Revenue Change*
	Three Months Ended June 30,						% Change GAAP Revenue*		Currency Impact		Acquisitions/ Dispositions/ Other Impact**		Non-GAAP Underlying Revenue
		2024			2023		% Change GAAP Revenue*		Currency Impact		Acquisitions/ Dispositions/ Other Impact**		Non-GAAP Underlying Revenue
Risk and Insurance Services
Marsh	$	3,265		$	3,038		8	%	(1	)%	2	%	7	%
Guy Carpenter		632			576		10	%	(1	)%	—		11	%
Subtotal		3,897			3,614		8	%	(1	)%	2	%	7	%
Fiduciary interest income		125			108
Total Risk and Insurance Services		4,022			3,722		8	%	(1	)%	2	%	7	%
Consulting
Mercer		1,379			1,374		—		(1	)%	(3	)%	5	%
Oliver Wyman Group		837			798		5	%	—		2	%	3	%
Total Consulting		2,216			2,172		2	%	(1	)%	(1	)%	4	%
Corporate Eliminations		(17	)		(18	)
Total Revenue	$	6,221		$	5,876		6	%	(1	)%	1	%	6	%

							Components of Revenue Change*
	Three Months Ended June 30,				% Change GAAP Revenue*		Currency Impact		Acquisitions/ Dispositions/ Other Impact**		Non-GAAP Underlying Revenue
		2024		2023	% Change GAAP Revenue*		Currency Impact		Acquisitions/ Dispositions/ Other Impact**		Non-GAAP Underlying Revenue
Marsh:
EMEA	$	912	$	858	6	%	—		—		7	%
Asia Pacific		391		357	9	%	(4	)%	6	%	7	%
Latin America		137		137	1	%	(10	)%	3	%	8	%
Total International		1,440		1,352	7	%	(2	)%	2	%	7	%
U.S./Canada		1,825		1,686	8	%	—		2	%	6	%
Total Marsh	$	3,265	$	3,038	8	%	(1	)%	2	%	7	%
Mercer:
Wealth	$	612	$	637	(4	)%	(1	)%	(6	)%	3	%
Health		547		518	6	%	(1	)%	(2	)%	9	%
Career		220		219	1	%	(3	)%	1	%	2	%
Total Mercer	$	1,379	$	1,374	—		(1	)%	(3	)%	5	%

									Components of Revenue Change*
	Six Months Ended June 30,						% Change GAAP Revenue*		Currency Impact		Acquisitions/ Dispositions/ Other Impact**		Non-GAAP Underlying Revenue
		2024			2023		% Change GAAP Revenue*		Currency Impact		Acquisitions/ Dispositions/ Other Impact**		Non-GAAP Underlying Revenue
Risk and Insurance Services
Marsh	$	6,268		$	5,782		8	%	(1	)%	2	%	7	%
Guy Carpenter		1,780			1,647		8	%	—		(1	)%	9	%
Subtotal		8,048			7,429		8	%	(1	)%	1	%	8	%
Fiduciary interest income		247			199
Total Risk and Insurance Services		8,295			7,628		9	%	(1	)%	1	%	8	%
Consulting
Mercer (a)		2,804			2,718		3	%	(1	)%	(1	)%	6	%
Oliver Wyman Group		1,626			1,485		9	%	—		2	%	8	%
Total Consulting		4,430			4,203		5	%	(1	)%	—		6	%
Corporate Eliminations		(31	)		(31	)
Total Revenue	$	12,694		$	11,800		8	%	(1	)%	1	%	8	%

							Components of Revenue Change*
	Six Months Ended June 30,				% Change GAAP Revenue*		Currency Impact		Acquisitions/ Dispositions/ Other Impact**		Non-GAAP Underlying Revenue
		2024		2023	% Change GAAP Revenue*		Currency Impact		Acquisitions/ Dispositions/ Other Impact**		Non-GAAP Underlying Revenue
Marsh:
EMEA	$	1,937	$	1,790	8	%	—		—		8	%
Asia Pacific		727		669	9	%	(4	)%	6	%	7	%
Latin America		262		252	4	%	(7	)%	3	%	8	%
Total International		2,926		2,711	8	%	(1	)%	2	%	8	%
U.S./Canada		3,342		3,071	9	%	—		2	%	7	%
Total Marsh	$	6,268	$	5,782	8	%	(1	)%	2	%	7	%
Mercer:
Wealth (a)	$	1,284	$	1,218	5	%	—		2	%	4	%
Health (a)		1,085		1,063	2	%	(1	)%	(6	)%	10	%
Career		435		437	—		(2	)%	—		2	%
Total Mercer	$	2,804	$	2,718	3	%	(1	)%	(1	)%	6	%

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*		Rounded to whole percentages. Components of revenue may not add due to rounding.
**		Acquisitions, dispositions, and other includes the impact of current and prior year items excluded from the calculation of non-GAAP underlying revenue for comparability purposes. Details on these items are provided in the reconciliation of non-GAAP revenue to GAAP revenue tables included in this release.

(a)		Acquisitions, dispositions and other in 2024 includes a net gain of $21 million from the sale of the U.K. pension administration and U.S. health and benefits administration businesses, that comprised of a $66 million gain in Wealth, offset by a $45 million loss in Health.

*		Rounded to whole percentages. Components of revenue may not add due to rounding.
**		Acquisitions, dispositions, and other includes the impact of current and prior year items excluded from the calculation of non-GAAP underlying revenue for comparability purposes. Details on these items are provided in the reconciliation of non-GAAP revenue to GAAP revenue tables included in this release.

	Risk & Insurance Services			Consulting			Corporate/ Eliminations			Total
Three Months Ended June 30, 2024
Operating income (loss)	$	1,297		$	410		$	(65	)	$	1,642
Operating margin		32.2	%		18.5	%		N/A			26.4	%
Add (deduct) impact of noteworthy items:
Restructuring (a)		29			5			10			44
Changes in fair value of contingent consideration		7			2			—			9
Acquisition related costs (b)		11			9			—			20
Operating income adjustments		47			16			10			73
Adjusted operating income (loss)	$	1,344		$	426		$	(55	)	$	1,715
Total identified intangible amortization expense	$	77		$	12		$	—		$	89
Adjusted operating margin		35.3	%		19.8	%		N/A			29.0	%

Three Months Ended June 30, 2023
Operating income (loss)	$	1,157		$	388		$	(88	)	$	1,457
Operating margin		31.1	%		17.9	%		N/A			24.8	%
Add (deduct) impact of noteworthy items:
Restructuring (a)		31			7			27			65
Changes in fair value of contingent consideration		10			—			—			10
Acquisition related costs (b)		—			10			—			10
Disposal of businesses		—			(2	)		—			(2	)
Operating income adjustments		41			15			27			83
Adjusted operating income (loss)	$	1,198		$	403		$	(61	)	$	1,540
Total identified intangible amortization expense	$	73		$	14		$	—		$	87
Adjusted operating margin		34.2	%		19.2	%		N/A			27.7	%

(a)		Costs primarily include severance and lease exit charges for activities focused on workforce actions, rationalization of technology and functional resources, and reductions in real estate.
(b)		Primarily reflects one-time acquisition related costs.

Marsh & McLennan Companies, Inc. Reconciliation of Non-GAAP Measures Six Months Ended June 30 (Millions) (Unaudited)

	Risk & Insurance Services			Consulting			Corporate/ Eliminations			Total
Six Months Ended June 30, 2024
Operating income (loss)	$	2,862		$	842		$	(137	)	$	3,567
Operating margin		34.5	%		19.0	%		N/A			28.1	%
Add (deduct) impact of noteworthy items:
Restructuring (a)		51			16			19			86
Changes in contingent consideration		12			3			—			15
Acquisition and disposition related costs (b)		12			30			—			42
Disposal of businesses (c)		—			(21	)		—			(21	)
Operating income adjustments		75			28			19			122
Adjusted operating income (loss)	$	2,937		$	870		$	(118	)	$	3,689
Total identified intangible amortization expense	$	156		$	23		$	—		$	179
Adjusted operating margin		37.3	%		20.3	%		N/A			30.5	%

Six Months Ended June 30, 2023
Operating income (loss)	$	2,552		$	799		$	(168	)	$	3,183
Operating margin		33.5	%		19.0	%		N/A			27.0	%
Add (deduct) impact of noteworthy items:
Restructuring (a)		63			16			39			118
Changes in contingent consideration		16			1			—			17
Acquisition related costs (b)		—			27			—			27
Disposal of businesses (c)		—			17			—			17
JLT legacy legal charges (d)		—			(51	)		—			(51	)
Operating income adjustments		79			10			39			128
Adjusted operating income (loss)	$	2,631		$	809		$	(129	)	$	3,311
Total identified intangible amortization expense	$	147		$	25		$	—		$	172
Adjusted operating margin		36.4	%		19.8	%		N/A			29.5	%

(a)		Costs primarily include severance and lease exit charges for activities focused on workforce actions, rationalization of technology and functional resources, and reductions in real estate.
(b)		Primarily reflects exit costs for the disposition of the Mercer U.K. pension administration and U.S. health and benefits administration businesses and one-time acquisition related costs. 2023 includes integration costs related to the Westpac superannuation fund transaction.
(c)		Net gain on sale of the Mercer U.K. pension administration and U.S. health and benefits administration businesses. In 2023, the amount reflects a loss on sale of a small individual financial advisory business in Canada. These amounts are included in revenue in the consolidated statements of income and excluded from non-GAAP revenue and adjusted revenue used in the calculation of adjusted operating margin.
(d)		Insurance and indemnity recoveries for a legacy JLT E&O matter relating to suitability of advice provided to individuals for defined benefit pension transfers in the U.K.

	Three Months Ended June 30, 2024							Three Months Ended June 30, 2023
	Amount					Adjusted EPS		Amount					Adjusted EPS
Net income before non-controlling interests, as reported				$	1,140						$	1,047
Less: Non-controlling interest, net of tax					15							12
Subtotal				$	1,125	$	2.27				$	1,035	$	2.07
Operating income adjustments	$	73						$	83
Investments adjustment		(1	)						(1	)
Pension settlement		1							—
Income tax effect of adjustments (a)		(4	)						(17	)
					69		0.14					65		0.13
Adjusted income, net of tax				$	1,194	$	2.41				$	1,100	$	2.20

	Six Months Ended June 30, 2024							Six Months Ended June 30, 2023
	Amount					Adjusted EPS		Amount					Adjusted EPS
Net income before non-controlling interests, as reported				$	2,564						$	2,299
Less: Non-controlling interest, net of tax					39							29
Subtotal				$	2,525	$	5.08				$	2,270	$	4.55
Operating income adjustments	$	122						$	128
Investments adjustment		(2	)						1
Pension settlement adjustment		2							—
Income tax effect of adjustments (a)		(15	)						(33	)
					107		0.22					96		0.19
Adjusted income, net of tax				$	2,632	$	5.30				$	2,366	$	4.74

Marsh & McLennan Companies, Inc. Supplemental Information Three and Six Months Ended June 30 (Millions) (Unaudited)

	Three Months Ended June 30,				Six Months Ended June 30,
		2024		2023		2024		2023
Consolidated
Compensation and benefits	$	3,454	$	3,337	$	6,924	$	6,544
Other operating expenses		1,125		1,082		2,203		2,073
Total expenses	$	4,579	$	4,419	$	9,127	$	8,617

Depreciation and amortization expense	$	87	$	91	$	186	$	175
Identified intangible amortization expense		89		87		179		172
Total	$	176	$	178	$	365	$	347

Risk and Insurance Services
Compensation and benefits (a)	$	2,108	$	1,965	$	4,226	$	3,896
Other operating expenses (a)		617		600		1,207		1,180
Total expenses	$	2,725	$	2,565	$	5,433	$	5,076

Depreciation and amortization expense	$	46	$	49	$	92	$	86
Identified intangible amortization expense		77		73		156		147
Total	$	123	$	122	$	248	$	233

Consulting
Compensation and benefits (a)	$	1,314	$	1,336	$	2,628	$	2,571
Other operating expenses (a)		492		448		960		833
Total expenses	$	1,806	$	1,784	$	3,588	$	3,404

Depreciation and amortization expense	$	26	$	27	$	63	$	48
Identified intangible amortization expense		12		14		23		25
Total	$	38	$	41	$	86	$	73

Marsh & McLennan Companies, Inc. Consolidated Balance Sheets (Millions)

	(Unaudited) June 30, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	1,653	$	3,358
Cash and cash equivalents held in a fiduciary capacity		11,497		10,794
Net receivables		7,739		6,418
Other current assets		1,133		1,178
Total current assets		22,022		21,748

Goodwill and intangible assets		20,154		19,861
Fixed assets, net		879		882
Pension related assets		2,187		2,051
Right of use assets		1,468		1,541
Deferred tax assets		285		357
Other assets		1,596		1,590
TOTAL ASSETS	$	48,591	$	48,030

LIABILITIES AND EQUITY
Current liabilities:
Short-term debt	$	1,267	$	1,619
Accounts payable and accrued liabilities		3,205		3,403
Accrued compensation and employee benefits		2,086		3,346
Current lease liabilities		304		312
Accrued income taxes		505		321
Fiduciary liabilities		11,497		10,794
Total current liabilities		18,864		19,795

Long-term debt		12,278		11,844
Pension, post-retirement and post-employment benefits		715		779
Long-term lease liabilities		1,586		1,661
Liabilities for errors and omissions		322		314
Other liabilities		1,261		1,267

Total equity		13,565		12,370
TOTAL LIABILITIES AND EQUITY	$	48,591	$	48,030

Reconciliation of cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity to the Consolidated Balance Sheets
Balance at June 30,		2024		2023
(In millions)
Cash and cash equivalents	$	1,653	$	1,171
Cash and cash equivalents held in a fiduciary capacity		11,497		11,564
Total cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity	$	13,150	$	12,735

	2024											2023
Three Months Ended June 30,	GAAP Revenue			Currency Impact		Acquisitions/ Dispositions/ Other Impact			Non-GAAP Revenue			GAAP Revenue			Acquisitions/ Dispositions/ Other Impact			Non-GAAP Revenue
Risk and Insurance Services
Marsh	$	3,265		$	33	$	(64	)	$	3,234		$	3,038		$	(1	)	$	3,037
Guy Carpenter		632			6		—			638			576			—			576
Subtotal		3,897			39		(64	)		3,872			3,614			(1	)		3,613
Fiduciary interest income		125			1		—			126			108			—			108
Total Risk and Insurance Services		4,022			40		(64	)		3,998			3,722			(1	)		3,721
Consulting
Mercer		1,379			17		(26	)		1,370			1,374			(68	)		1,306
Oliver Wyman Group		837			3		(19	)		821			798			—			798
Total Consulting		2,216			20		(45	)		2,191			2,172			(68	)		2,104
Corporate Eliminations		(17	)		—		—			(17	)		(18	)		—			(18	)
Total Revenue	$	6,221		$	60	$	(109	)	$	6,172		$	5,876		$	(69	)	$	5,807

	2024												2023
Six Months Ended June 30,	GAAP Revenue			Currency Impact			Acquisitions/ Dispositions/ Other Impact			Non-GAAP Revenue			GAAP Revenue			Acquisitions/ Dispositions/ Other Impact			Non-GAAP Revenue
Risk and Insurance Services
Marsh	$	6,268		$	39		$	(103	)	$	6,204		$	5,782		$	(1	)	$	5,781
Guy Carpenter		1,780			4			(3	)		1,781			1,647			(12	)		1,635
Subtotal		8,048			43			(106	)		7,985			7,429			(13	)		7,416
Fiduciary interest income		247			1			(1	)		247			199			—			199
Total Risk and Insurance Services		8,295			44			(107	)		8,232			7,628			(13	)		7,615
Consulting
Mercer (a)		2,804			25			(54	)		2,775			2,718			(92	)		2,626
Oliver Wyman Group		1,626			(1	)		(29	)		1,596			1,485			(1	)		1,484
Total Consulting		4,430			24			(83	)		4,371			4,203			(93	)		4,110
Corporate Eliminations		(31	)		—			—			(31	)		(31	)		—			(31	)
Total Revenue	$	12,694		$	68		$	(190	)	$	12,572		$	11,800		$	(106	)	$	11,694

(a)		Acquisitions, dispositions and other in 2024 includes a net gain of $21 million from the sale of the U.K. pension administration and U.S. health and benefits administration businesses, that comprised of a $66 million gain in Wealth, offset by a $45 million loss in Health.

		Note: Amounts in the tables above are rounded to whole numbers.