MMC - Earnings call 3 2023 | Marsh & McLennan Companies, Inc.

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Operator

Welcome to Marsh & McLennan's earnings conference call. Today's call is being recorded.

Third quarter 2023 financial results and supplemental information were issued earlier this morning. They are available on the company's website at marshmclennan.com. Please note that remarks made today may include forward-looking statements.

Forward-looking statements are subject to risks and uncertainties, and a variety of factors may cause actual results to differ materially from those contemplated by such statements.

most discussion for factors, our on this SEC including detailed our refer most the more all filings, release XX-K, earnings quarter our Marsh a McLennan of are please those to recent of website. For which Form available recent and to

non-GAAP the During certain today, may we measures. call discuss also financial

a of these today's comparable refer please measures, schedule reconciliation measures in closely For to release. earnings Instructions] [Operator GAAP to the the most

CEO to over McLennan. John this of turn and Marsh President now I'll Doyle,

John Doyle

Good I'm morning, for you Marsh joining us quarter results to third and thank President of discuss reported John CEO our earlier and today. McLennan. Doyle,

Guy Joining Studer morning CEOs me businesses: Investor Marsh, is Also Martin Oliver Mark McGivney, the of of Relations. of is of Wyman. this of Martine and Mercer, our Carpenter, CFO; of with Ferland Nick our Sarah call and us South Head the Klisura Dewitt, on Dean

our comment colleagues, in and take Gaza. into acts events hatred. to unfolding along results, Israel like violent get and terror of and all tragic reject Israel our with the I on We, on Before the I'd to condemn and moment violence a attacks

they is Aviv with who friends of and the ensuring colleagues in grapple the and Gaza. the conflict. our Israel in challenges this our Tel focus safety as have supporting primary and Our clients around on colleagues and of supporting well-being world family also We're

revenue operating top continued EPS. very quarter reported the momentum of growth ago. over versus pleased and run We third I'm a X X% Adjusted our with line income in adjusted year. year XX% on third quarterly Top growth our our growth of grew of XX% results. in significant to last in revenue Turning best with growth, quarter extended underlying underlying performance. decades

Adjusted repurchases operating grew $XXX the of quarter. of expanded to and share million third points during XXX we XX%, compared basis Our XXXX. the EPS adjusted margin completed quarter

focus consistent while growth our near These on sustained results delivering the investing term, reflect for the over term. in long

in and see investments of high-quality We are capabilities, acquisitions. made the continue benefit to we've talent our and seeing opportunities to add we

clients quarter, will Graham U.S. Mid-Atlantic. a third revenue benefits MMA's This insurance now billion business of benefits is risk XXX early and Agency the is MMA $X In attracting broker for in transactions. Company, XXX in another management acquisition $XX provide employee top acquired the McLennan best the employees we two Graham expertise insurance a consultancy significant and million August, us agencies and During over example U.S. announced and in revenue. significant with Marsh business. the

employee deal over an and market the across the and In risk acquire our Honan Insurance business same specializes Pacific Marsh Asia. XX,XXX middle in month, Group. Honan corporate and This clients. our expands to and announced position agreement region serves Australian benefits

acquisitions, Beyond strategies. continue operations targeted we talent, make go-to-market and to investments sales in

We are technologies and to also our Marsh of best to solutions McLennan bring the investing clients. new in

to help analytics new GC tool drive risk manage landscape. is example, generation clients For recently catastrophe launched exposure our next Carpenter platform, a quickly the and AdvantagePoint. evolving in of profitable selection The platform a catastrophe risk critical Guy

access midsized threat as environment. the this tools insurance that capabilities small volatile integrated program and a helps to can as cybersecurity as U.S. and grow announced in security an businesses of resilience solution Earlier Pathway, Cyber well key the for our launch Marsh year, clients enhance and evolve. The insurance provides coverage that

a LenAI data to is of internal for technologies enhance that safe Marsh in colleagues. available ChatGPT and power offers internal secure clients McLennan's and colleague And LenAI, and our we in investing productivity, example One improve assistant. all experience. are insights is AI environment the

own their helping also it's in developing capabilities. AI Developed by center, innovation our Wyman Oliver clients support

balancing Our deliver for approach new performance clients. growth investment and solutions well us and insights consistent our to drives and shareholders to for positions exceptional

The initiatives. of lines continues in strategic proposition business. our of to especially combined industries our traction value Turning certain businesses and with to clients, gain

example, we risks care focused on for enterprise clients. are health For

emerging are Our labor teams and Marsh and coming workforce together liability from and to Mercer respond as such challenges, risks to AI. and actions health safety,

and In due combining create transactions and can benefits the equity help providing diligence, stop-loss solutions. and and transformations, M&A Marsh are advisory This to close and Wyman on private value. include deals space, Oliver Mercer, post-transaction large capabilities clients health carve-out

the solution, our Carpenter insurance is clients. partnering is is partner Mercer to and balance This in balance sheet. portfolio solutions collaborative insurers OCIO. insurance that with offering Guy aligns has in sector, for insurer's a several return already And to risk sheet Mercer choosing which advanced management example across One resulted with regional to approach provide an

new operate, We impact. organize for are complexity also and finding ways to reduce

real now these to We workforce. savings continue cost and we technology, achieve by estate $XXX of As total our actions, identified our savings execute additional restructuring expect $XXX rationalize to realign on reduce we've opportunities achieve of to million. total roughly million footprint to with million our XXXX, to $XXX

drive seeing momentum clients more businesses efficient opportunities higher connected. increasingly growth serve are the offers efforts, as together, deliver value to our restructuring enhanced our for and and Overall, combined we with clients, be

the positioned interest periods. across faster Despite perform to an and has expenses grow environment. market returned remain volatility Now situation turn well environment, we good in business and rise the geopolitical The revenues tightening are cycles trajectory well, challenging volatile. as we have and remains our manage the track We than perform central The remains record open as further let in question and outlook resilience. to continued a macro bank economic well the of of uncertain. we rates. continue me Capital to with believe to inflation

rates low second rates to reinsurance overall, X% Insurance with insurance second the Property after liability single-digit of increase pricing the and to in XX% professional slightly, X% while increases. Now insurance let in quarter. pricing Workers' Global increased conditions. compensation increased insurance and years market up digits. turn mid-single with line down to Index Marsh rates financial several compared were quarter. me range. Primary Casualty insurance decreased the up was Market in continue the Cyber modestly

our political consistent and In faced and social This inflation challenges instability. continued core elevated clients XXXX. losses, throughout have includes cat reinsurance,

we continue. to look we January X, As but last the to appears orderly market than to more underwriting year, discipline be expect

casualty, with capacity cautious year is On stable the but loss property with market appetite. inflation. adequate development more pricing, reinsurers the more assessing side, we increased and a expect firm and In reinsurer market prior

stable. We expect to remain capacity

preparation strategy proactive need thorough a outcomes. to clients will Overall, and achieve desired

navigate to dynamic market conditions. clients these positioned We are well help our

turn Consulting. grew We grew third up in and Wyman XX%. EPS of RIS operating an was basis adjusted adjusted in and $X.XX, Underlying saw performance. grew adjusted Marsh our year-over-year. XX% up financial me our year XXX XX% basis, to revenue XX% the Oliver of a quarter let and On X% revenue Guy points underlying third income expanded XX%. Now from quarter ago. generated is operating X%, X%, Mercer Overall, Carpenter X%, growth margin which

we up our adjusted XX% ago. operating consolidated basis underlying Adjusted grew XXX outlook quarter For year basis. growth the outstanding on market on Adjusted X% income assuming year-to-date, months, today revenue conditions we persist, revenue a expect year XX% was on to With third margin underlying to in now points. XX% current year. operating results expanded $X.XX, the our EPS remain and track XX%. grew and for and full an a our from X be terrific Based

year EPS. strong We the for growth in also adjusted full continue to and expect margin expansion

retire global responsibility want wealth I Martine will and and of and a Mercer, succeed provide Mercer, career next he will to Finally, upon on practices. as her year. changes. an recently our transition CEO of Mercer's announced retirement. of update will Martine March work where health, for has with Pat appointed Tomlinson on leadership XX CEO closely Martine through Mercer President been of Ferland, period have President Pat

I'm last excited at business. President Pat and track knowledge McLennan our as industry of leader to years and role. Canada XX leadership brings roles serves the X in years experience, U.S. as work CEO strong outstanding Pat of currently U.S. including Mercer. Canada. a He Mercer in his and record an of and He new with has Marsh

In and on her I she clients. talent X also announcement is This delivered Martine another our built of for our for succession want of years cultivated Mercer, strong CEO of growth, and example her as leadership. focus depth to and talent our thank delivered impact exceptional planning.

strategy Overall, third and proud am and continued demonstrates execution performance, our colleagues the to I'm our to their and focus our our our clients, of across grateful deliver momentum they shareholders value determination business. which I and for continued communities. quarter of

detailed to Mark let that, our it With over results. for review more of me a turn

Mark McGivney

morning. good Thank you, John, and

margin continued outstanding, growth were results double-digit underlying strong significant quarter in third and EPS growth, Our momentum adjusted expansion.

million XX% increased adjusted operating growth $X.X a to of year with was XX%. Our from was billion, Operating $XXX underlying and revenue XX% $X.X up consolidated billion, ago. income income

the Our discrete last the operating the that over grew allowance tax in XX.X%. year. up EPS benefit, basis Note was and Even of to margin included release XXX assets. valuation XX% adjusted quarter our on foreign EPS was $X.XX adjusted the $X.XX, XX% from GAAP deferred points a third increased adjusted quarter. EPS this adjusted tax $X.XX without in EPS benefit

billion. Adjusted operating underlying was to For of XX%. first months XX% X XXXX, the revenue growth $X.X grew income

XX% margin to operating basis points adjusted XXX increased $X.XX. and adjusted EPS Our increased

Risk continues the underlying underlying in at XX% and an or $X.X best quarter Insurance billion, a RIS XX% higher on the up This Services, stretch year result Looking basis. tenth and consecutive was X of revenue ago quarter growth X% of third nearly in or decades. growth from marks

increased points million million. income expanded XX.X%. $XXX Adjusted operating to $XXX XX% Operating and XXX XX% to our margin basis adjusted income operating to increased

X year, billion. growth revenue $X.X in XX%, increased to billion. first underlying of XXX operating the income RIS to XX.X%. increased was For $XX.X With basis of Margin points XX% months adjusted the

X% U.S. or $X.X the year. quarter on comes X% a reflected on growth led X% for quarter the retention. third ago underlying the was new third At Marsh, quarter, in the in Growth X% quarter revenue This of Canada, MMA. billion, of underlying strong and solid by from growth basis. an year strong top last up business was In growth in in and

International, XX%. of XX% top in comes on year. was underlying last America Latin of up third growth and quarter was XX% In the

grew EMEA and up Asia XX% X%. Pacific was

revenue was first the Marsh's U.S. X%. up growth For grew and year, X% and of XX%. months the Canada X billion, with was $X.X underlying of International

and X% revenue basis, million $XXX up specialties quarter, X% Carpenter's in underlying an was strong global growth on regions. Guy by the our across or driven

X revenue growth. Carpenter generated of first the months of with year, $X billion XX% underlying For the Guy

increased segment, XX% an income XX.X%. ago or Consulting XXX quarter year Consulting In a operating from basis was $XXX on XX% billion, to income operating and to revenue Adjusted X% $XXX million. up points expanded basis. third the margin was million, operating $X.X adjusted the underlying

billion, the on operating X of This revenue of growth underlying Adjusted points with quarter, XX% consulting $X.X billion XX adjusted the underlying basis was years. Mercer's $X.X months X% income $X.X revenue up operating Mercer's the best increased expanded XXXX, was margin growth in XX.X%. was to to For and quarter XX first billion, in basis. underlying X%. an of

and Wealth consulting growth benefits grew X%, driven investment by continued in management. demand defined in higher

assets at quarter, rebound driven of down $XXX capital of to net our in growth and Westpac, with the Year-over-year third Our management markets compared under XX% quarter and flows. were was up million positive X% a last sequentially. the transaction by year the third end

all was of segments the revenue growth growth in regions. X% in last strength quarter X%, underlying increased third of year. and Health XX% and top reflected on Career

see We in rewards strategy. talent to growth continue and

Wyman's was $X.X quarter in with year, was X Mercer first of revenue that at underlying months XX% of $XXX an the in Oliver X% growth. the Europe. underlying East billion, and million, basis reflected increase strength an the Middle For the revenue on

Oliver the billion, of at Wyman of was underlying $X.X months X an increase an first the X% For revenue on basis. year,

quarter. headwind Foreign the EPS exchange was a $X.XX in to third

exchange remain effect at Assuming will fourth current rates on immaterial quarter FX earnings. have an levels, expect we

efficiencies the program the streamlining million of costs program, restructuring in costs under of announced severance, million $XX our in this our quarter, reported pursue exits charges fourth related which These $XX include relates savings technology quarter and increased. We has the continued We've outlook year. last environment. we lease to total for to approximately to and

XXXX. roughly $XXX $XXX be total which we approximately charges savings noted, million in $XXX million expect John of and of million to total As of expect $XXX million, will realized now

XXXX. bulk To $XXX savings the this of the of date, We expect million the incur to approximately remaining in the of XXXX and program. we have currently remaining by majority incurred realize the under charges end of to charges

benefit net was $XX other million credit quarter. Our in the

the about our be full expect year we $XXX benefit million. For net will XXXX, other credit

on quarter in and the from basis. $X million, $X $XXX was on in basis Interest $XXX quarter a the GAAP third up on higher fourth adjusted $XXX debt interest income million expense of was million our quarter. of levels third forecast, quarter expense third we million the and in Investment million current of an higher interest reflecting rates. XXXX, the in approximately expect Based

the the quarter tax with third third Our quarter last XX.X% XX.X% in rate compared year. in effective adjusted of was

in both allowance rate favorable The item million on tax tax assets. this discrete valuation Our benefited was release deferred a discrete foreign largest periods quarter from items. of $XX a

reasonable Based guidance not is we XXXX. the Excluding around XX.X% adjusted XX.X%. project discrete assume approximately effective rate, items, tax be or of environment, our can negative. give current our When forward discrete tax to it which rate items, was do we for a rate on around tax positive

Turning and billion with billion. quarter issued sheet. We notes of to our September. senior $X.X total includes in balance the $XX.X management the ended we debt of capital This

Our notes next in senior due. mature scheduled notes in and million debt of XXXX, March when $XXX maturities come when another of May, senior $X are billion

April This the a renewed step significant facility funding our since last X.X $X.X to was recently extending facility, access credit capacity to business we term by our increase also under billion the the in the given of our of the years to increasing the and took facility We billion XXXX. size to the from growth to opportunity increase $X.X borrowing prudent short-term XXXX. in facility

We pleased unsecured rating Moody's in our senior that are September. to debt also upgraded AX

expect to approximately across to XXXX continue billion capital in deploy We acquisitions share and $X of repurchases. dividends,

Uses million $X.X and repurchases. position totaled in the the cash billion. billion, was share $XXX included cash dividends, acquisitions at for $XXX Our for quarter the million end $XXX quarter of third million for of $X

share $X.X cash the and million first For and totaled million $XXX uses repurchases. for acquisitions of $XXX billion $X.X for for X dividends, months, included billion

generate year. Overall, terrific we margin today a persist, expansion the EPS adjusted on to current Based assuming to for to full for XX% revenue XXth X% strong our in conditions outlook remain XXXX. on track consecutive and underlying growth, expect and year growth report we

back And I'm it to with that, happy John. to turn

John Doyle

Thank we Operator, you, ready Mark. Q&A. begin are to

Operator

Instructions] question from our Wells line Elyse Fargo. [Operator the And of first comes Greenspan with

Elyse Greenspan

of in that the slowdown color you X%, is you growth. is Can U.S./Canada strong within And on bit a guys the the slowdown? where introductory then question Marsh. My first you comments, Organic just MMA of saw give year. in part guys on the a mentioned little I but first the from were think more what's causing that

of you within can growth growth us the the a segment? MMA give sense within So outside MMA of and that

John Doyle

XX Marsh. Carpenter -- the Again, growth Thanks in had pleased question. for Wyman. Mercer the revenue again, quarter. years. And the in Oliver the overall, at Elyse. was growth growth I We good at Sure, Guy quite and performance growth with strong at Best

of up at Growth executing any our Marsh caution operation note well. is was and Again, X% strong. -- quarter. ago. well X% inclusive one I year U.S., a team MGA U.S. good growth a quarter we had think our any MMA, one was and as at We positioned, Marsh we're well. to you also look versus at would

what have color on Marsh quarter? you any this do Martin, impacted growth other at

Martin South

Yes. you, John. Thank

across North International Marsh for said, very and growth the As America. strong you board in

a some on good markets As quarter. growth we MMA, strong. a capital Canadian look some don't longer financial the reflecting MGA positive and very but at from on We look feel business a lines in the you this construction, it in of we period the U.S. we basis. The partly some and impact time, specifically say, There's said, don't moderating about as comment quarter-over-quarter they've growth cyber business was and pressures. But pricing the over you business. had

John Doyle

Thanks, Martin. a follow-up? Elyse, you do have

Elyse Greenspan

my And second then Yes. question.

savings John, -- savings? it of buckets the of revised realigning are you're year tech, a it And So much on you fair the and falling the sense those rationalizing the should estate workforce. mentioned, there be assume How expecting bottom most the to contributing us to give to is extra a savings line? still that program, came real that to each from is then way this

John Doyle

So Elyse. bit, really, backing a up little

together, technology. opportunities. operated businesses closely say, identified in largely areas, workforce our They're to It's same estate in just right? more around workforce we've would realigning As and and real mostly additional I the as opposed our talent, functions, market-facing

are severance, terminations, group, We've but and by technology. costs not the broken out lease streamlining it

and again, So about team against opportunities the we're We're proud some of that excited them. uncovered the we've of executing I'm

Operator

Bhullar from with the comes of line question next JPMorgan. Jimmy our And

Jamminder Bhullar

first So question reinsurance market. the on

you firm how are Carpenter, then I'm stable? digits these be your And pricing. the of of not double And terms to growth? from expecting be Guy think is think you sure affect somewhat that they'll pricing? prices in do current up of I will At you levels? firm Or that you've that the just mentioned grown how because word tailwind from this much means further year.

John Doyle

Thanks, Yes. There's firm. Jimmy. the did word no I question. use

at terrific has job team done helping Carpenter challenging market. year, a what's our this clients Guy a Our navigate

last be market X that said, orderly I year. expect than I January As will the certainly on more

But costs. loss market about in and there rising insurance both are the reinsurance concerns,

quarter and we with so project really and still accuracy to don't And to can't a project want run. there's

on you what expect We and remain. with But we that, Carpenter could market? to offer think underwriting discipline maybe, thoughts the some Guy Dean, of

Dean Klisura

between give property John Jimmy, And casualty little John. cat as color maybe you and Thanks, I'll a mentioned.

As to cat noted, the market for by John as John noted, at upcoming persist renewal, X driven January property challenging expect conditions we inflation.

Many remain won't to do region. will we there. in this as Europe, be do saw continues. what region we continue vary year. be It be very think We an instability pricing by the dollar I As to firm you're reading cat. attritional losses elevated. It losses. U.S. and events Political firmness expect example, in that about, last plus will cat billion mean, year, but property Many

do layers. reinsurers more anything discipline But I I higher pricing We terms, backwards. from write additional expect at that and don't think key an business, capacity continue particularly attachment going points, on is exhibit increased to cat reinsurers appetite and to to attaching see property expect the and we

manageable will As that cat we for dislocation saw and John without capacity think in expect it John as reinsurance and Europe. adequate. imbalance noted, significant market the more more we property that noted, think year. buy demand will to for we remain supply/demand a regions last our like we be And clients. increased do renewal our key clients particularly And

U.S. pressure driven this as for the reinsurers On expressed all casualty And from fall, in we do U.S. reinsurers with by inflation. our the economic our lines, loss remain for concern to development casualty expect year seating social John and quota capacity very clients downward share in adequate. Casualty, contracts casualty and meetings trending market casualty, expect on prior some with we certain cautiously. But with commissions is do And lines. again, and side, noted, of certain everybody

John Doyle

The cost reinsurance of both risk, Jimmy and the our us in market find best is rising, for and clients. it's up the to to solutions insurance

to think And well that. we're so I do positioned

a follow-up? Do you have

Jamminder Bhullar

on Just Oliver Wyman.

uncertainty. Oliver to of has business typically, I shown as a year, the economic lot think momentum. And being of this think you sensitive Wyman

what's economy Suisse down? if UBS think the And Oliver of won integration I -- Credit Wyman? what's like? you slow that is. know performing in do it but how sort really does, I'm look I you sure UBS, fact, the don't how maybe about pipeline driving And But know your material not contract, So

John Doyle

very, as over the is business been slow GDP now growing to had after but it's Jimmy. has strong time terrific Oliver growth Oliver has year-to-date of relatively start time, And Yes, strong faster been quarter. thanks, well. sensitive also Wyman over year, a to a Wyman part and our a having a more run, very

color can Oliver on how So look things Nick, at Wyman. Jimmy maybe with some you share

Nicholas Studer

I a bit. possible see still thank little in and for a John, wide me our economic paths. you, environment definitely easy spending let on Thank Jimmy. an clients. not of that fairly you, range It's discretionary Yes, enlarge

of our well, proud this QX. flat on that than that out called does wider Wyman to And resilience I'm and look but Martin John as to basis But our said matter. a back way demonstrated we from as business has resilience a more at do Oliver quarter-over-quarter and McLennan, try a the basis, Marsh year-over-year clawing

We're quite more been and becoming diverse we've a business diverse. now,

our been So India, if you also with has that driving Africa contributing are Europe to strongly. growth Middle our our sectors growth think and East biggest the regions, about contributor the in region regional the

sectoral the public in and by which followed sector, services. quite communications, side, On banking, followed media Middle East, the and transportation by practice present is technology our

wide So array again, there. a sectors quite of industry

would quite been well, study practice equity, work. broaden. be And about company maybe case been said But industry through great I've environment. and has to seeking not by I've questions private our it's And practice. few just times portfolio an cycle, interesting deal few been asked years, the driven which on private a been Clearly, a side doing we've our that the over the last capital offerings

digital grew practices economic strongly. Our grew is restructuring very nascent, strongly, team, practice, which our research our

with lot where well of we collaboration in performance a organizational work work performance people do environment Our economic offering transformation which as a with as is more our tough clients, of Mercer. on

our I'm this term. for moment. So to the in in at mid- to growth line we growth continue looking longer our but optimistic with And that long-term plan high single-digit over ultimately, prospects, is pipeline

Operator

next question Capital Zaremski our the with from line of Mike Markets. And comes BMO

Michael Zaremski

about just global to question I of a growth. follow-up guess kind the last

So a high there's like more Marsh's been record I historically, correlation growth nominal feel and of clearly between growth GDP. levels.

hires? premise of out that of that's just to changed? decoupling And with it you, phenomenon call agree question. a recently anything agree kind way with want is there do been you like that, just Or are relationship you permanently obviously. curious if it the of if good my feels there's there's If -- for anything with temporary and a Or structurally you

John Doyle

environment, pricing is economy it labor macro say growth. the nominal as over inflation, both I before. certainly with and macro and factors do positive mentioned a time in demand the is believe GDP a geopolitically, markets would I I and What indicator But market. volatile of P&C Those better supportive is certainly, are of Mike. Sure, tight

would markets A we've to better is of business very time. M&A, But growth Marsh our course, both say working we've over the what investing I and middle also at handful been to of hard examples: ROCIO been shift of Mercer; business, in. mix market

have throughout invested inorganically We organically Asia. and

talent, client more then sales invested broadly, model. And engagement we've operations and in our

So we believe we're volatile. to perform a ability better growth business macro and economic better positioned. in is environment our over And confident cycles. while, again, quite that We're

Michael Zaremski

helpful. If into Okay. recent back ask a could out and follow-up, the wholesale chatter potentially of the a there's but of hopefully, left and That's a about media larger at wholesale I in the getting business. it's some not brokers been conference field,

wholesale its comment I'm presence can want to of on on doesn't as relative non-wholesale a share maybe why have or big that just sure not if offer Marsh can. to some you insurance? market you But at least perspective of

John Doyle

me, happy excuse Mike, I comment. have of cycles. that say volumes pricing E&S -- Mark Sure, moved with I I'm to would all, historically Yes. the market mean, first

think I E&S been volumes will than I more volatile given environment, the they've that suspect durable market be risk historically.

third-party directly E&S markets. And we access flexibility. the for markets some wholesalers looking today. At can to are same us give Underwriters time, certain access

main market business have business out small that's about we But does of nonadmitted Marsh's serve a bringing protect was of terms entirety that the lot admitted really sure Whether all business our that, the are we solutions to Victor with or I third-party make market flexibility clients. have solutions that there. a we we do they're solutions, or in bring want owner. We in with to again, solutions. to And commercial do standard and do so about be street solutions whether the agents. Hopefully, best not what can serve be think that market, we our of independent, that helpful. today to thoughtful do is can and we'd speaking, the have in or good That's marketplace to a a and broadly would focus, wholesale,

Operator

of comes question Evercore line with ISI. next our David And from the Motemaden

David Motemaden

mentioned future how RIS? if if quarter, in future John, the through particularly for so, of some you nature revenue you can investments quarter. there of to them make And acceleration think just was release, in this those I'm wondering contribution? if press the the and the this in we continuing about in could investments walk an

John Doyle

No, don't there. it I as David. impacted basis, played in see but expense by -- FX. a Certainly, an the obviously, an quarter. even GAAP growth on role FX M&A, basis, a I acceleration the restructuring, in was adjusted And on thanks, don't quarter, also

quarter. every track today expense, matter, a a said every and record balance quarter, I year. We've quarter business We're growing faster for in got a disciplined particular not earlier, as revenue every a optimize to But record, of we're track it than trying delivering in but we're going in and do to investing or that margins trying the to future. not for in

them. to We're to so investments for clients. for our And create value make opportunities going opportunities to us think that see deliver right make going we we are to

David Motemaden

comp just an acceleration Marsh the Got excluding in we're lines. Pricing of seeing it. And just I'm excluding then guess workers' lines, I some Index. casualty and wondering Global if on the financial

it in acceleration that if some sounded If signs on any given reinsurance bit entering primary you're of like concerns. seeing more there, a seeing I'm inflation the the market? discipline you're social side, an the there's that's market wondering

John Doyle

would to same amount. we to So right? doesn't we to the note, on it's was, Yes, market. similar different in saw average, in I quarter. it second our relates the we it always suggest third products, really pretty And it's statement, what not have would add I income commission a up exposure experienced as different the of levels what collection quarter to markets. of a

for role get And share But And clients too. mixed a to just is maybe a Martin marketplace. it's the to as our everyone, and remind retail solution market it's the maker, I'll ask our a best have some market, in to thoughts. we role

so things bring few to to maker as Martin? financing try our to efficient a a market And solutions done more clients. we've

Martin South

John. our that, with job. agree Yes, That's I

Just to XXth to in when consecutive of our think level a increases. pricing. rate an of we're time. comes in We'll survey And it we're release couple I set, point inflection don't the weeks' quarter at

The the cycles different of weaknesses we're combination. product and mix strengths beginning the geographies and across on seeing pricing to depending lines show are a

third grew quarter It before the in grew before. quarter Casualty the and X%. The and the X% before quarter quarter at

that I So we're pricing clients talk about more we're seeing we're social hearing posted lot pricing closely nuclear a and of keeping some carriers pressures would verdicts from not are our the and But and out on acceleration. those. an on say there,

Property FINPRO rates saw were third We with X%. line down in quarter. quarter. came X% lines was the some roughly were before. in in lines. These FINPRO prior softness They X% quarter the by at in the down

think delta down So it's introduction, in trend a up but I yet, that's the the quarter, you as mentioned percentage our by X% between less. was And index in the and by came cyber John, certainly point don't so X X%, it courses.

relatively So casualty. a it's on we'll calm market that see

John Doyle

funding; abuse; community the the litigation of extreme for our What whether say, events, to some Yes. underwriting clearly, legal also Thanks, a of frequency I as the Thanks, inflation, including social sure casualty the weather, inflation, So clients and core underwriting Jimmy, risk concerns is loss in but I rising, community it's well. David, system for cost it's whether cat to and referring costs; David. mentioned this Martin. would as right? of growth

Operator

Sachs. Rob the with comes Our Goldman from next question of Cox line

Robert Cox

in there level it expectations expansion of accelerate quarter, was interpreted some margin to last second in but that as think I the half, bit were lower. just a the RIS comments for I So

the assume takes margin you with still margin have fair if second the will could curious XQ of half that talk than whether to expansion to year just XQ? the it's about the relative and and So puts to stronger respect

John Doyle

and primary it's Yes. outcome, margins Again, Sure, Rob. our not objective.

Our be free flow earnings year which in certainly is in solid expansion to in on over focus consecutive our not margin do growing and margin of will period. cash margin in any optimize time. period, expect any business expansion We're We XXXX, trying expansion. any XXth

remarks, prepared as headwinds solid again, I'm XXXX. in margins good mentioned in we progress margin with But again, third made There were that in FX RIS' there. pleased And expect quarter. we've my I the expansion in the

Robert Cox

just Got follow-up. maybe it. And a

peers to some expectations medical highlighted costs have increase. think I for

could discuss hoping and space So XXXX? into the I look expectations in we seeing health was as benefit if the trends you're you and

John Doyle

ask at to and business is for clients our in It Sure, in second, our which benefits Marsh clearly, this Mercer had Benefits in we've Mercer good in growth but business MMA. our Rob. pressure point, a I'll economy. comment internationally, health is at Martine a and

to share maybe And you more Martine, looking there. insights? for so could and clients solutions some us more

Martine Ferland

you, the John. you, question. Yes. Thank for Thank Robert,

try advantage of we're clients. revenue At to clients or for as Indeed, those those working because medical with said, lot big a kind are -- time, John of costs, on clients those things. same increasing. lot inflation it's is our part When the control just our an of to sources not increases. a fee-based it's And a our control also

Because, you in often, very space, employers benefit employee the with as the share would may know, very, base. cost the the health

costs. those pretty about they're in passing concerned time on our of So this inflation,

et a we're at technology, access in of So different looking way, the design leveraging cetera. plan,

there's counter revenue ways small impacting And us we increase clients points. that it's clients costs. honestly, all little the -- many address in of a help So it's can given our those a for bit, that our part different but

Operator

our And line comes Shields the question Meyer of next KBW. of from

Meyer Shields

questions, if quick can. I Two

macroeconomic Mercer wondering First, John, [indiscernible] revenue? in you impacts talked visibility of terms about from that I'm how uncertainty. near-term

John Doyle

is fair have relatively say said, mature about and markets as Meyer. inflation would Yes. I Thanks, What obviously, say, persists. I questions remained cost uncertain, the of of it. resilient, remains macro amount there is but would economy I a

-- see of a recession, to banks do sure. and for meaningful primary their inflation. is prepared risk we're But we mission reduce Central that are

recession are now. in markets some And

bit might Nick, Wyman thoughts business. But historically Career Martine, Mercer's Oliver on has you again, think and think share sensitive to our what to GDP business more been Nick, a I well. mean could and maybe I'll economy as some you the ask has But that

Nicholas Studer

our pandemic. range paths tough of Yes. Meyer. I been Different react see. of economic think industries that some do I Thank of you, pretty since and sectors sort having you, a on, said through since -- the it our John. a wide It's Thank and earlier of as is differently have time I

see outlook tough think being Aerospace some Oliver a as economic for through a I the of where we Some We've seen that made sectors, been Wyman. in which last we more and in growing tends for have year, do to acquisition slower example, Defense, spurts significant robust growth. result growth little cycle.

wider been But develop earlier, a to trying we've as I offerings. said set of through-the-cycle

And sometimes change, the questions all when people answering need help them.

anymore. So it's correlation a not definitely

correlation it and time declined low over I that it's think probably has now. -- pretty

John Doyle

can you thoughts some Career? maybe Martine, on share Nick. Mercer you, Thank

Martine Ferland

from Career more last we the Yes, the particularly of our businesses, our few years, more a focused business on And we've absolutely. also nature little in and work. have portfolio type away bit of over the recurring Yes. discretionary business, mix of diversifying with improved

that, with demand, to also -- of there's Nick said. as would lots I current with And the add just our environment, that

You transfer. example, of pension businesses. plan demand benefits the interest defined and Well-funded for look contribution high defined demand creating our benefits capital also volatile for markets, rates on advice back drives is at defined for risk in our

about working, the of digital -- all earlier. as direct of correlation we change It's the workplace. say, talked health GDP, countering in previous We and to driving different tight traditional, and discussed would more labor upcoming of impact the in the the demand year's markets, the technology of I ways

John Doyle

Thanks, Martine.

not are we economic of we, of And have business. So you a a demand resilient we're immune Meyer, Do to record follow-up? but economic again, remains strong. across a have growth, moment, And the track cycles. performing at course,

Meyer Shields

do. I

very helpful. That one. quick a was Just

there in that lower Wyman, With growth, true business. of regard be margins you've to nature you because now? past, have Oliver see of margins the I'm in that Oliver wondering, didn't we Wyman, communicated could just some when on guess, And of less is Wyman of this context that pressure strong that Oliver I consulting quarter. the

John Doyle

had less and Wyman again, No, growth its best business of in Mercer has it's But keep Oliver XX not it mind, growth. years. in true. quarter best a bigger It's of than quarter

you So didn't see anything there. that's reason the

Operator

next Markets. Scott Capital Heleniak our line with question And RBC the from of comes

Scott Heleniak

seeing double-digit few any could benefit can if a a America? that? driving from for Marsh, increases I you detail there? just much Is give new comment there quarters, wondering you rate at there And growth? what's more Just that's on growth there but is we're Latin areas of at been strong know and EMEA

John Doyle

a Scott. It the sure. Yes, spite was in to Happy segment particularly there. very growth is some in good Martin, over in the And pleased performing Europe, talk maybe And color we've time those well International Marsh. you of markets. both Again, our business in quarter. in on of share strong that, had at exceptionally Latin mixed America. in about with growth of economic outcomes long period could our growth

Martin South

thrilled be Yes. to. I'd

As you say, Latin great up XX%, XX%; growth APAC, XX%; in America, international, X%. EMEA,

So pleasing really, really growth.

terrific Specialties strong at few is areas our there outstanding the a delivered Credit fueling are the are the part and energy a in which big as transition MMB, well of as aviation, that I'd say business, power had growth. moment, in growth. is business double-digit Europe, quarter a

And our cost Advisory value think through go proposition through to of our market help to lens risk. is business, clients a to our the

and It's we business so new opportunities. will big to the that continue had and less been bid great growth lost That's we've think business. area good across renewal us for our business been that, think a that's and broaden growth And as we between been growth.

an has that longer see clients staying such The like value in broad the with ours as are they us organization capabilities.

So of the that strong feel Europe And and in well as in growth Eastern board. across America somewhat very good with emerging the markets well. have you've about that we got a fundamentals gap course, had Latin very protection as

there. we trajectory positive feel So the about and very positioned well

John Doyle

Thanks, Martin. follow-up? do you have Scott, a

Scott Heleniak

Yes.

one here. quick other follow-up Just

you M&A, of on couple sized those deals did quarter. bigger a in Just the

XXXX, comment in areas maybe at, where maybe X with if you to looking on opportunities you focus areas? some months You're could pipeline and X the bit as versus you're particular that those about ago? wondering feeling just was your it Just M&A a better into go

John Doyle

quite Sure. to sure. the I relatively welcome again, remain solid for to Honan We to pipeline to the pleased and in just in we quarter, Grant emphasize market want And expect third and how the family the soon. active were remains we close

market, They're positioned, in to of two mix point gets expanding our well-led which in middle them, fundamentals earlier. the growth I back well both solid presence that making businesses, was the

bigger quarter. Those five in the closed excited we very deals the two ones. were We're it. overall, So about

active We're marketplace. certainly -- an it's

fewer transactions, play. there's a at there's While that is lot

so and we're And of businesses market. But to we what we're out remain are for looking for Valuations what how know on we're elevated looking manage the strong the know we in that for. wide M&A. clear risk about and

disciplined, continue and deploy to but so expect inorganically. And we're we going be capital to to selective

Operator

with of the Huang line And our from comes Morgan question Bob next Stanley.

Jian Huang

Previously, regarding That quarter. Credit we if Suisse Wyman maybe and mentioned back to just bit. So a second happened deal. can UBS the that little Oliver merger go the you in

of Wyman? that through a the and that meaningful Just if organic forward was and expect into for for in growth that, residual any going third Oliver do curious the you on quarter? Oliver Wyman quarter of come second from And quarter deal driver to also top fourth

John Doyle

We're on work not that clients individual and the do Yes. for individual going comment Thanks, Bob. we clients. to

pleased the X we Wyman call, and as couple that have on Nick very times resilient, increasingly of this we're think is very, through we a growth with of at quarters. about So more offerings Oliver different talked an set diverse

term could other we volatility in expect our term. Oliver more longer a Do that's quarter-to-quarter, also expect see at top a term. case businesses. the Oliver have line and And Wyman's more But and see been to year, we to expect medium this over the That's faster than case grow Again, volatility Wyman we be certainly over case. to been it the follow-up? the longer you and

Scott Heleniak

Yes, sure.

more So very quickly. one thing

namely cyber some as gaming pricing know There been as is incidents bit. as as your Regarding practice. other well a mentioned had the little cyber large slowing you insurance area insurance few the relatively government growth casino cyber down a in the claims, areas. cyber I well headline that and

do expect growth just kind cyber you of in think rebound pricing stay do expect that right soft back? to cyber of Do insurance the is the just sort pricing where will in maybe now? current But pricing it you slowdown you patch? a Or

John Doyle

our -- I most it's again, important risk our here what financing Bob, to to job efficient is clients. the point solutions find make for

the marketplace. the losses say in major again, have this will happened would been There's drive number been claims insured ransomware of in some that of -- an also year. So there's that that's breaches course I the during yes, what increase, some is,

of note market of also last also the has would possible ransomware could the also growing years couple is systemic reacting underwriting in claims course reacted the The higher aggregate is portfolios. underwriting events their that -- I the through over that to points. But to community attachment market losses

type for Marsh We're, systemic build of the that. market's better to and at been them same with working restricting solutions time, Guy coverage at events. Carpenter helping for course, the But

so marketplace And that's that a as factor in well.

the And based couple will on losses. market meaningfully so a think don't move of I

coming work digital we, some collectively a to you. say help I When a in marketplace, we economy. economy. do in the mean help royal up entire cyber-related the in collectively, I to -- digital with risks have solutions manage But to clients the Thank risks better

Operator

of next comes Ryan line with Research. the Our from Tunis Autonomous question

Ryan Tunis

some have from like competitors D&O -- highlighted specifically very the U.S. growth markets-related So in pressures organic transactions. pressures capital

You mentioned it briefly.

wearing you headwind that Marsh, within magnitude? any be there is U.S./Canada your at look of we when wouldn't curious, similar to Just reason believe a guys

John Doyle

is down, that activity pressure. down, those rising activity drive But Thanks, of and M&A things us is de-SPACs Ryan, exposure. SPACs of opportunities for IPO talk risk down, the to capital, offer capital Yes, for pointed can't are market relative kinds some solutions advice think all question. create down, are cost about and out. I -- volatility, this clearly, Martin There's I under

noted that, as to related Martin pricing is somewhat well. down as earlier, And also

well-diversified headwinds. call. the wide broadly mentioned on manage for to business We so again, And that earlier of those of are a risk we the But a the cost help again, clients in States. have range And the United rise risks. speaking, I factors continues our

for I colleagues So and you all XX,XXX the for thank over their that, want support. thank want In you, continued joining also our us closing, work to dedication. and on call. for our to to clients I their Ryan. I want hard thank appreciate thank I

much, forward look very we all, again and you you, to speaking Thank quarter. next with

Operator

gentlemen, Thank disconnect. participating, now concludes and today's program. Ladies for you may this you and

Marsh & McLennan Companies (MMC) 19 Oct 232023 Q3 Earnings call transcript