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AJG NYSE· Arthur J. Gallagher & Co.
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AJG NYSE· Arthur J. Gallagher & Co.
Earnings report Q4 2023

AJG Reports Strong Revenue Growth in Latest Quarter

Segments of revenue

In the latest quarter, AJG reported total revenues of $10.07 billion, representing a significant increase from $8.55 billion in the same quarter last year. The company's revenue streams can be broken down as follows: Commissions contributed $5.87 billion, fees contributed $3.14 billion, supplemental revenues contributed $314.2 million, and contingent revenues contributed $235.3 million. Additionally, interest income, premium finance revenues, and other income accounted for $367.3 million of the total revenues.

Strengths

AJG demonstrated strong revenue growth in the latest quarter, with a 17.7% increase compared to the same quarter last year. This growth can be attributed to the company's ability to generate revenues from its brokerage and risk management segments, which accounted for approximately 64% of total revenues. Furthermore, AJG's international operations in Australia, Canada, New Zealand, and the U.K. contributed 36% of the company's revenues, indicating a diversified revenue base.

Challenges

One of the challenges faced by AJG in the latest quarter was the absence of revenues from the corporate segment. This segment did not generate any revenues in 2023, which could impact the overall revenue growth of the company. Additionally, the wind-down of the clean coal activities resulted in a decline in revenues from this source.

Noteworthy

It is worth noting that AJG's ability to generate tax credits from qualified refined coal under IRC Section 45 ended in December 2021. This change impacted the company's revenue generation in 2022 and subsequent years. Furthermore, the company's market capitalization stood at approximately $48.7 billion at the end of December 2023.

Summary

AJG reported strong revenue growth in the latest quarter, driven by solid performance in its brokerage and risk management segments. The company's ability to generate revenues from international operations also contributed to its overall revenue growth. However, the absence of revenues from the corporate segment and the wind-down of clean coal activities posed challenges to AJG's revenue generation. Overall, AJG's revenue performance reflects its strong market position and diversified revenue streams.

Source documents

Form 10-K  filed on Feb 09, 2024
116 pages scanned

Reference data

Company financials Q4 revenue 2.27B
Analyst estimates Q4 EPS missed by -0.06%
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