[February 01, 2018] |
|
Marsh & McLennan Companies Reports Fourth Quarter and Full-Year 2017 Results
Marsh & McLennan Companies, Inc. (NYSE:MMC), a global professional
services firm offering clients advice and solutions in risk, strategy
and people, today reported financial results for the fourth quarter and
year ended December 31, 2017.
Dan Glaser, President and CEO, said: "Marsh & McLennan Companies
generated strong results in the fourth quarter of 2017. On a
consolidated basis, we produced 10% revenue growth with underlying
revenue growth of 4%, including 3% in Risk & Insurance Services and 6%
in Consulting. Adjusted operating income increased 12% in the quarter
with double-digit growth in both segments."
"For the year, Marsh & McLennan Companies generated solid underlying
revenue growth of 3%, adjusted EPS growth of 15% and adjusted operating
margin expansion of 70 basis points, with higher margins in both
segments for the eighth consecutive year."
"In addition to our excellent underlying performance, we had another
active year of acquisitions while delivering on our capital return
commitments. We are proud of our accomplishments this past year and
believe we are well positioned for another strong year in 2018,"
concluded Mr. Glaser.
Consolidated Results
Consolidated revenue in the fourth quarter of 2017 was $3.7 billion, an
increase of 10% compared with the fourth quarter of 2016, or 4% on an
underlying basis. Operating income rose 8% to $686 million and included
a $54 million pension charge as described in the supplemental schedules.
Adjusted operating income, which excludes noteworthy items as presented
in the attached supplemental schedules, increased 12% to $755 million.
Earnings per share declined to $0.06 reflecting a charge of $460 million
related to the changes in U.S. tax reform as well as the pension charge
noted above. Adjusted earnings per share rose 18% to $1.05 compared with
$0.89 in the prior fourth quarter.
For the year 2017, revenue was $14 billion, an increase of 6% compared
with 2016, or 3% on an underlying basis. Earnings per share declined 15%
to $2.87 and includes the previously mentioned tax and pension charges.
Adjusted earnings per share increased 15% to $3.92 compared with $3.42
in 2016.
Risk & Insurance Services
Risk & Insurance Services revenue was $2 billion in the fourth quarter
of 2017, an increase of 9%, or 3% on an underlying basis. Operating
income of $416 million was essentially flat with the prior year and
includes $47 million of the previously mentioned pension charge.
Adjusted operating income increased 12% to $473 million. For the year
2017, revenue was $7.6 billion, an increase of 7%, or 3% on an
underlying basis. Operating income rose 7% to $1.9 billion while
adjusted operating income rose 11%.
Marsh's revenue in the fourth quarter of 2017 was $1.7 billion, an
increase of 9%, or 3% on an underlying basis. In U.S./Canada, underlying
revenue rose 4%. International operations produced underlying revenue
growth of 1%, reflecting underlying growth of 5% in Asia Pacific, and 9%
in Latin America partially offset by a decline of 3% in EMEA. For the
year 2017, Marsh's revenue growth was 7%, or 3% on an underlying basis.
Guy Carpenter's fourth quarter revenue was $239 million, up 7% on an
underlying basis. For the year 2017, Guy Carpenter's underlying revenue
growth was 4%.
Consulting
Consulting revenue was $1.7 billion in the fourth quarter of 2017, an
increase of 10%, or 6% on an underlying basis. Operating income of $321
million rose 21%. Adjusted operating income increased 10% to $330
million. For the year 2017, revenue was $6.4 billion, up 5%, or 4% on an
underlying basis. Operating income increased 6% to $1.2 billion on both
a GAAP and adjusted basis.
Mercer's revenue was $1.2 billion in the fourth quarter, an increase of
9%, or 4% on an underlying basis. Wealth revenue grew 4% on an
underlying basis. Within Wealth, Defined Benefit Consulting &
Administration increased 1% on an underlying basis, while Investment
Management & Related Services increased 12%. Health revenue increased 3%
on an underlying basis and Career increased 6%. For the year 2017,
Mercer's revenue growth was 5%, or 2% on an underlying basis.
Oliver Wyman Group's revenue was $546 million in the fourth quarter, an
increase of 9% on an underlying basis. For the year 2017, Oliver Wyman
Group's revenue increased to $1.9 billion, up 7% on an underlying basis.
Other Items
The effective tax rate in the fourth quarter of 2017 was 95.5% compared
with 24.9% in the year ago period. For the year 2017, the effective tax
rate was 42.9% compared with 27.6% for the year ago period.
The effective tax rate in the fourth quarter and full year 2017 reflects
the estimated impact of the enactment, in December 2017, of U.S. tax
reform. An aggregate provisional charge of $460 million reflects a $220
million write down of our net deferred tax asset to reflect the decrease
of the U.S. federal corporate income tax rate from 35% to 21% and a $240
million charge related to deemed repatriation.
The tax rate in the fourth quarter and year 2017 also reflects the
impact of the required change in accounting for equity awards.
The Company repurchased 3.6 million shares of stock for $300 million in
the fourth quarter. For the year, 11.5 million shares were repurchased
for $900 million.
Conference Call
A conference call to discuss fourth quarter 2017 results will be held
today at 8:30 a.m. Eastern time. To participate in the teleconference,
please dial +1 800 289 0438. Callers from outside the United States
should dial +1 323 994 2083. The access code for both numbers is
3400073. The live audio webcast may be accessed at mmc.com.
A replay of the webcast will be available approximately two hours after
the event.
About Marsh & McLennan Companies
Marsh & McLennan (NYSE: MMC) is the world's leading professional
services firm in the areas of risk, strategy and people. The company's
nearly 65,000 colleagues advise clients in over 130 countries. With
annual revenue over $14 billion, Marsh & McLennan helps clients navigate
an increasingly dynamic and complex environment through four
market-leading firms. Marsh
advises individual and commercial clients of all sizes on insurance
broking and innovative risk management solutions. Guy
Carpenter develops advanced risk, reinsurance and capital strategies
that help clients grow profitably and pursue emerging opportunities. Mercer
delivers advice and technology-driven solutions that help organizations
meet the health, wealth and career needs of a changing workforce. Oliver
Wyman serves as a critical strategic, economic and brand advisor to
private sector and governmental clients. For more information, visit mmc.com,
follow us on LinkedIn
and Twitter @mmc_global
or subscribe to BRINK.
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains "forward-looking statements," as defined in
the Private Securities Litigation Reform Act of 1995. These statements,
which express management's current views concerning future events or
results, use words like "anticipate," "assume," "believe," "continue,"
"estimate," "expect," "intend," "plan," "project" and similar terms, and
future or conditional tense verbs like "could," "may," "might,"
"should," "will" and "would."
Forward-looking statements are subject to inherent risks and
uncertainties that could cause actual results to differ materially from
those expressed or implied in our forward-looking statements. Factors
that could materially affect our future results include, among other
things:
-
the impact of any investigations, reviews, market studies or other
activity by regulatory or law enforcement authorities, including the
recently-announced UK FCA wholesale insurance broker market study and
the ongoing investigations by the European Commission;
-
the impact from lawsuits, other contingent liabilities and loss
contingencies arising from errors and omissions, breach of fiduciary
duty or other claims against us;
-
our organization's ability to maintain adequate safeguards to protect
the security of our information systems and confidential, personal or
proprietary information, particularly given the volume of our vendor
network and the need to patch software vulnerabilities;
-
our ability to compete effectively and adapt to changes in the
competitive environment, including to respond to disintermediation,
digital disruption and other types of innovation;
-
the financial and operational impact of complying with laws and
regulations where we operate, including cybersecurity and data privacy
regulations such as the E.U.'s General Data Protection Regulation,
anti-corruption laws and trade sanctions regimes;
-
the regulatory, contractual and reputational risks that arise based on
insurance placement activities and various broker revenue streams;
-
the extent to which we manage risks associated with the various
services, including fiduciary and investments and other advisory
services;
-
our ability to successfully recover if we experience a business
continuity problem due to cyberattack, natural disaster or otherwise;
-
the impact of changes in tax laws, guidance and interpretations,
including related to certain provisions of the U.S. Tax Cuts and Jobs
Act, or disagreements with tax authorities;
-
the impact of fluctuations in foreign exchange and interest rates on
our results;
-
the impact of macroeconomic, political, regulatory or market
conditions on us, our clients and the industries in which we operate;
and
-
the impact of changes in accounting rules or in our accounting
estimates or assumptions, including the impact of the adoption of the
new revenue recognition and pension accounting standards.
The factors identified above are not exhaustive. Further information
concerning Marsh & McLennan Companies and its businesses, including
information about factors that could materially affect our results of
operations and financial condition, is contained in the Company's
filings with the Securities and Exchange Commission, including the "Risk
Factors" section and the "Management's Discussion and Analysis of
Financial Condition and Results of Operations" section of our most
recently filed Annual Report on Form 10-K. We caution readers not to
place undue reliance on any forward-looking statements, which are based
only on information currently available to us and speak only as of the
dates on which they are made. We undertake no obligation to update or
revise any forward-looking statement to reflect events or circumstances
arising after the date on which it is made.
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Marsh & McLennan Companies, Inc.
Consolidated Statements of Income
(In millions, except per share figures)
(Unaudited)
|
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Three Months Ended December 31,
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Twelve Months Ended December 31,
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2017
|
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2016
|
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2017
|
|
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|
2016
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|
Revenue
|
|
|
$
|
3,685
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|
|
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$
|
3,364
|
|
|
|
$
|
14,024
|
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|
$
|
13,211
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|
Expense:
|
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|
|
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|
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Compensation and Benefits
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2,098
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|
1,918
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|
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|
7,884
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|
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7,461
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Other Operating Expenses
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|
901
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|
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|
813
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3,284
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|
|
|
3,086
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|
Operating Expenses
|
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2,999
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|
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|
2,731
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|
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|
11,168
|
|
|
|
10,547
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|
Operating Income
|
|
|
686
|
|
|
|
633
|
|
|
|
2,856
|
|
|
|
2,664
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Interest Income
|
|
|
3
|
|
|
|
1
|
|
|
|
9
|
|
|
|
5
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|
Interest Expense
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|
(59
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)
|
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|
(48
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)
|
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|
(237
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)
|
|
|
(189
|
)
|
Investment Income
|
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|
12
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|
|
|
2
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15
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-
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Income Before Income Taxes
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642
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588
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2,643
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2,480
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Income Tax Expense
|
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614
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|
|
|
147
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1,133
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|
|
685
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Income from Continuing Operations
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28
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|
|
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441
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|
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1,510
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|
|
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1,795
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Discontinued Operations, Net of Tax
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2
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|
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-
|
|
|
|
2
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|
|
|
-
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Net Income Before Non-Controlling Interests
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30
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|
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441
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1,512
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1,795
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Less: Net Income Attributable to Non-Controlling Interests
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1
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|
|
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5
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20
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|
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27
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|
Net Income Attributable to the Company
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$
|
29
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|
|
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$
|
436
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|
|
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$
|
1,492
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|
|
|
$
|
1,768
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Basic Net Income Per Share
|
|
|
|
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|
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|
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- Continuing Operations
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$
|
0.05
|
|
|
|
$
|
0.85
|
|
|
|
$
|
2.91
|
|
|
|
$
|
3.41
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- Net Income Attributable to the Company
|
|
|
$
|
0.06
|
|
|
|
$
|
0.85
|
|
|
|
$
|
2.91
|
|
|
|
$
|
3.41
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|
Diluted Net Income Per Share
|
|
|
|
|
|
|
|
|
|
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- Continuing Operations
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$
|
0.05
|
|
|
|
$
|
0.84
|
|
|
|
$
|
2.87
|
|
|
|
$
|
3.38
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- Net Income Attributable to the Company
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|
|
$
|
0.06
|
|
|
|
$
|
0.84
|
|
|
|
$
|
2.87
|
|
|
|
$
|
3.38
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Average Number of Shares Outstanding
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- Basic
|
|
|
510
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|
|
|
515
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|
|
|
513
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|
|
|
519
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|
- Diluted
|
|
|
517
|
|
|
|
521
|
|
|
|
519
|
|
|
|
524
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|
Shares Outstanding at 12/31
|
|
|
509
|
|
|
|
514
|
|
|
|
509
|
|
|
|
514
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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Marsh & McLennan Companies, Inc.
Supplemental Information - Revenue Analysis
Three Months Ended December 31, 2017
(Millions) (Unaudited)
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Components of Revenue Change*
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Three Months Ended December 31,
|
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% Change GAAP Revenue
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|
|
Currency Impact
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|
Acquisitions/ Dispositions Impact
|
|
|
Underlying Revenue
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
Risk and Insurance Services
|
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|
|
|
|
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|
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|
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|
Marsh
|
|
|
$
|
1,712
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|
|
|
$
|
1,565
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|
|
|
9
|
%
|
|
|
1
|
%
|
|
|
6
|
%
|
|
|
3
|
%
|
Guy Carpenter
|
|
|
239
|
|
|
|
222
|
|
|
|
8
|
%
|
|
|
1
|
%
|
|
|
-
|
|
|
|
7
|
%
|
Subtotal
|
|
|
1,951
|
|
|
|
1,787
|
|
|
|
9
|
%
|
|
|
1
|
%
|
|
|
5
|
%
|
|
|
3
|
%
|
Fiduciary Interest Income
|
|
|
11
|
|
|
|
6
|
|
|
|
|
|
|
|
|
|
|
|
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|
Total Risk and Insurance Services
|
|
|
1,962
|
|
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|
1,793
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|
|
|
9
|
%
|
|
|
1
|
%
|
|
|
5
|
%
|
|
|
3
|
%
|
Consulting
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mercer
|
|
|
1,193
|
|
|
|
1,096
|
|
|
|
9
|
%
|
|
|
2
|
%
|
|
|
2
|
%
|
|
|
4
|
%
|
Oliver Wyman Group
|
|
|
546
|
|
|
|
486
|
|
|
|
12
|
%
|
|
|
3
|
%
|
|
|
-
|
|
|
|
9
|
%
|
Total Consulting
|
|
|
1,739
|
|
|
|
1,582
|
|
|
|
10
|
%
|
|
|
2
|
%
|
|
|
2
|
%
|
|
|
6
|
%
|
Corporate / Eliminations
|
|
|
(16
|
)
|
|
|
(11
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenue
|
|
|
$
|
3,685
|
|
|
|
$
|
3,364
|
|
|
|
10
|
%
|
|
|
2
|
%
|
|
|
3
|
%
|
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue Details
The following table provides more detailed revenue information for
certain of the components presented above:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of Revenue Change*
|
|
|
|
Three Months Ended December 31,
|
|
|
% Change GAAP Revenue
|
|
|
Currency Impact
|
|
|
Acquisitions/ Dispositions Impact
|
|
|
Underlying Revenue
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
|
Marsh:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMEA
|
|
|
$
|
521
|
|
|
|
$
|
481
|
|
|
|
8
|
%
|
|
|
4
|
%
|
|
|
7
|
%
|
|
|
(3
|
)%
|
Asia Pacific
|
|
|
161
|
|
|
|
153
|
|
|
|
5
|
%
|
|
|
1
|
%
|
|
|
-
|
|
|
|
5
|
%
|
Latin America
|
|
|
130
|
|
|
|
122
|
|
|
|
7
|
%
|
|
|
(5
|
)%
|
|
|
3
|
%
|
|
|
9
|
%
|
Total International
|
|
|
812
|
|
|
|
756
|
|
|
|
8
|
%
|
|
|
2
|
%
|
|
|
5
|
%
|
|
|
1
|
%
|
U.S. / Canada
|
|
|
900
|
|
|
|
809
|
|
|
|
11
|
%
|
|
|
-
|
|
|
|
6
|
%
|
|
|
4
|
%
|
Total Marsh
|
|
|
$
|
1,712
|
|
|
|
$
|
1,565
|
|
|
|
9
|
%
|
|
|
1
|
%
|
|
|
6
|
%
|
|
|
3
|
%
|
Mercer:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Defined Benefit Consulting & Administration
|
|
|
$
|
371
|
|
|
|
$
|
364
|
|
|
|
2
|
%
|
|
|
3
|
%
|
|
|
(2
|
)%
|
|
|
1
|
%
|
Investment Management & Related Services
|
|
|
195
|
|
|
|
152
|
|
|
|
28
|
%
|
|
|
2
|
%
|
|
|
14
|
%
|
|
|
12
|
%
|
Total Wealth
|
|
|
566
|
|
|
|
516
|
|
|
|
10
|
%
|
|
|
3
|
%
|
|
|
3
|
%
|
|
|
4
|
%
|
Health
|
|
|
409
|
|
|
|
381
|
|
|
|
7
|
%
|
|
|
1
|
%
|
|
|
2
|
%
|
|
|
3
|
%
|
Career
|
|
|
218
|
|
|
|
199
|
|
|
|
10
|
%
|
|
|
2
|
%
|
|
|
2
|
%
|
|
|
6
|
%
|
Total Mercer
|
|
|
$
|
1,193
|
|
|
|
$
|
1,096
|
|
|
|
9
|
%
|
|
|
2
|
%
|
|
|
2
|
%
|
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Underlying revenue measures the change in revenue using consistent
currency exchange rates, excluding the impact of certain items that
affect comparability such as: acquisitions, dispositions, transfers
among businesses and the deconsolidation of Marsh India.
|
|
Effective January 1, 2017, Mercer established a Wealth business
reflecting a unified client strategy for its former Retirement and
Investment business. The 2016 information in the chart above has
been conformed to the current presentation. Please refer to the
"Supplemental Information - Mercer" schedules included in the first
quarter 2017 press release for additional information about the
Wealth business.
|
|
* Components of revenue change may not add due to rounding.
|
|
|
|
|
|
|
|
|
|
|
Marsh & McLennan Companies, Inc.
Supplemental Information - Revenue Analysis
Twelve Months Ended December 31, 2017
(Millions) (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of Revenue Change*
|
|
|
|
Twelve Months Ended December 31,
|
|
|
% Change GAAP Revenue
|
|
|
Currency Impact
|
|
|
Acquisitions/ Dispositions Impact
|
|
|
Underlying Revenue
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
|
Risk and Insurance Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marsh
|
|
|
$
|
6,404
|
|
|
|
$
|
5,976
|
|
|
|
7
|
%
|
|
|
-
|
|
|
|
5
|
%
|
|
|
3
|
%
|
Guy Carpenter
|
|
|
1,187
|
|
|
|
1,141
|
|
|
|
4
|
%
|
|
|
-
|
|
|
|
-
|
|
|
|
4
|
%
|
Subtotal
|
|
|
7,591
|
|
|
|
7,117
|
|
|
|
7
|
%
|
|
|
-
|
|
|
|
4
|
%
|
|
|
3
|
%
|
Fiduciary Interest Income
|
|
|
39
|
|
|
|
26
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Risk and Insurance Services
|
|
|
7,630
|
|
|
|
7,143
|
|
|
|
7
|
%
|
|
|
-
|
|
|
|
4
|
%
|
|
|
3
|
%
|
Consulting
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mercer
|
|
|
4,528
|
|
|
|
4,323
|
|
|
|
5
|
%
|
|
|
-
|
|
|
|
2
|
%
|
|
|
2
|
%
|
Oliver Wyman Group
|
|
|
1,916
|
|
|
|
1,789
|
|
|
|
7
|
%
|
|
|
-
|
|
|
|
-
|
|
|
|
7
|
%
|
Total Consulting
|
|
|
6,444
|
|
|
|
6,112
|
|
|
|
5
|
%
|
|
|
-
|
|
|
|
2
|
%
|
|
|
4
|
%
|
Corporate / Eliminations
|
|
|
(50
|
)
|
|
|
(44
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenue
|
|
|
$
|
14,024
|
|
|
|
$
|
13,211
|
|
|
|
6
|
%
|
|
|
-
|
|
|
|
3
|
%
|
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue Details
The following table provides more detailed revenue information for
certain of the components presented above:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of Revenue Change*
|
|
|
|
Twelve Months Ended December 31,
|
|
|
% Change GAAP Revenue
|
|
|
Currency Impact
|
|
|
Acquisitions/ Dispositions Impact
|
|
|
Underlying Revenue
|
|
|
|
2017
|
|
|
2016
|
|
|
|
|
|
|
|
|
Marsh:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMEA
|
|
|
$
|
2,033
|
|
|
|
$
|
1,924
|
|
|
|
6
|
%
|
|
|
(1
|
)%
|
|
|
7
|
%
|
|
|
-
|
|
Asia Pacific
|
|
|
645
|
|
|
|
635
|
|
|
|
2
|
%
|
|
|
-
|
|
|
|
(5
|
)%
|
|
|
6
|
%
|
Latin America
|
|
|
404
|
|
|
|
374
|
|
|
|
8
|
%
|
|
|
(3
|
)%
|
|
|
3
|
%
|
|
|
7
|
%
|
Total International
|
|
|
3,082
|
|
|
|
2,933
|
|
|
|
5
|
%
|
|
|
(1
|
)%
|
|
|
4
|
%
|
|
|
2
|
%
|
U.S. / Canada
|
|
|
3,322
|
|
|
|
3,043
|
|
|
|
9
|
%
|
|
|
-
|
|
|
|
6
|
%
|
|
|
4
|
%
|
Total Marsh
|
|
|
$
|
6,404
|
|
|
|
$
|
5,976
|
|
|
|
7
|
%
|
|
|
-
|
|
|
|
5
|
%
|
|
|
3
|
%
|
Mercer:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Defined Benefit Consulting & Administration
|
|
|
$
|
1,381
|
|
|
|
$
|
1,447
|
|
|
|
(5
|
)%
|
|
|
(1
|
)%
|
|
|
(2
|
)%
|
|
|
(2
|
)%
|
Investment Management & Related Services
|
|
|
767
|
|
|
|
606
|
|
|
|
26
|
%
|
|
|
1
|
%
|
|
|
15
|
%
|
|
|
10
|
%
|
Total Wealth
|
|
|
2,148
|
|
|
|
2,053
|
|
|
|
5
|
%
|
|
|
-
|
|
|
|
3
|
%
|
|
|
2
|
%
|
Health
|
|
|
1,648
|
|
|
|
1,588
|
|
|
|
4
|
%
|
|
|
-
|
|
|
|
2
|
%
|
|
|
2
|
%
|
Career
|
|
|
732
|
|
|
|
682
|
|
|
|
7
|
%
|
|
|
-
|
|
|
|
2
|
%
|
|
|
5
|
%
|
Total Mercer
|
|
|
$
|
4,528
|
|
|
|
$
|
4,323
|
|
|
|
5
|
%
|
|
|
-
|
|
|
|
2
|
%
|
|
|
2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Underlying revenue measures the change in revenue using consistent
currency exchange rates, excluding the impact of certain items that
affect comparability such as: acquisitions, dispositions, transfers
among businesses and the deconsolidation of Marsh India.
|
|
Effective January 1, 2017, Mercer established a Wealth business
reflecting a unified client strategy for its former Retirement and
Investment business. The 2016 information in the chart above has
been conformed to the current presentation. Please refer to the
"Supplemental Information - Mercer" schedules included in the first
quarter 2017 press release for additional information about the
Wealth business.
|
|
* Components of revenue change may not add due to rounding.
|
|
Marsh & McLennan Companies, Inc.
|
Reconciliation of Non-GAAP Measures
|
Three Months Ended December 31
|
(Millions) (Unaudited)
|
|
Overview
The Company reports its financial results in accordance with accounting
principles generally accepted in the United States (referred to in this
release as "GAAP" or "reported" results). The Company also refers to and
presents below certain additional non-GAAP financial measures, within
the meaning of Regulation G under the Securities Exchange Act of 1934.
These measures are: adjusted operating income (loss), adjusted
operating margin, adjusted income, net of tax and adjusted
earnings per share (EPS). The Company has included reconciliations
of these non-GAAP financial measures to the most directly comparable
financial measure calculated in accordance with GAAP in the following
tables.
The Company believes these non-GAAP financial measures provide useful
supplemental information that enables investors to better compare the
Company's performance across periods. Management also uses these
measures internally to assess the operating performance of its
businesses, to assess performance for employee compensation purposes and
to decide how to allocate resources. However, investors should not
consider these non-GAAP measures in isolation from, or as a substitute
for, the financial information that the Company reports in accordance
with GAAP. The Company's non-GAAP measures include adjustments that
reflect how management views our businesses, and may differ from
similarly titled non-GAAP measures presented by other companies.
Adjusted Operating Income (Loss) and Adjusted Operating Margin
Adjusted operating income (loss) is calculated by excluding the
impact of certain noteworthy items from the Company's GAAP operating
income or loss. The following tables identify these noteworthy items and
reconcile adjusted operating income (loss) to GAAP operating
income or loss, on a consolidated and segment basis, for the three and
twelve months ended December 31, 2017 and 2016. The following tables
also present adjusted operating margin. For the three and twelve
months ended December 31, 2017 and 2016, adjusted operating margin
is calculated by dividing adjusted operating income by
consolidated or segment GAAP revenue less, where applicable, the net
gain on the deconsolidation of Marsh's India subsidiary and the proceeds
related to the disposal of Mercer's U.S. defined contribution
recordkeeping business.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk & Insurance Services
|
|
|
Consulting
|
|
|
Corporate/ Eliminations
|
|
|
Total
|
Three Months Ended December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
$
|
416
|
|
|
|
$
|
321
|
|
|
|
$
|
(51
|
)
|
|
|
$
|
686
|
|
Add impact of Noteworthy Items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring (a)
|
|
|
4
|
|
|
|
1
|
|
|
|
3
|
|
|
|
8
|
|
Adjustments to acquisition related accounts (b)
|
|
|
5
|
|
|
|
1
|
|
|
|
-
|
|
|
|
6
|
|
Pension settlement charge (c)
|
|
|
47
|
|
|
|
7
|
|
|
|
-
|
|
|
|
54
|
|
Other
|
|
|
1
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1
|
|
Operating income adjustments
|
|
|
57
|
|
|
|
9
|
|
|
|
3
|
|
|
|
69
|
|
Adjusted operating income (loss)
|
|
|
$
|
473
|
|
|
|
$
|
330
|
|
|
|
$
|
(48
|
)
|
|
|
$
|
755
|
|
Operating margin
|
|
|
21.2
|
%
|
|
|
18.5
|
%
|
|
|
N/A
|
|
|
18.6
|
%
|
Adjusted operating margin
|
|
|
24.1
|
%
|
|
|
19.0
|
%
|
|
|
N/A
|
|
|
20.5
|
%
|
Three Months Ended December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
$
|
413
|
|
|
|
$
|
265
|
|
|
|
$
|
(45
|
)
|
|
|
$
|
633
|
|
Add impact of Noteworthy Items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring (a)
|
|
|
1
|
|
|
|
33
|
|
|
|
1
|
|
|
|
35
|
|
Adjustments to acquisition related accounts (b)
|
|
|
5
|
|
|
|
1
|
|
|
|
-
|
|
|
|
6
|
|
Deconsolidation of business (d)
|
|
|
1
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1
|
|
Other
|
|
|
1
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1
|
|
Operating income adjustments
|
|
|
8
|
|
|
|
34
|
|
|
|
1
|
|
|
|
43
|
|
Adjusted operating income (loss)
|
|
|
$
|
421
|
|
|
|
$
|
299
|
|
|
|
$
|
(44
|
)
|
|
|
$
|
676
|
|
Operating margin
|
|
|
23.0
|
%
|
|
|
16.8
|
%
|
|
|
N/A
|
|
|
18.8
|
%
|
Adjusted operating margin
|
|
|
23.5
|
%
|
|
|
18.9
|
%
|
|
|
N/A
|
|
|
20.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Includes severance and related charges from restructuring
activities, adjustments to restructuring liabilities for future rent
under
non-cancellable leases and other real estate costs, and
restructuring costs related to the integration of recent
acquisitions.
|
(b) Primarily includes the change in fair value as measured each
quarter of contingent consideration related to acquisitions.
|
(c) Pension settlement charge resulting from lump sum settlements
elected by participants in certain U.K. pension plans. Recognition
of these payments as a partial settlement was required because in
each respective plan the lump sum payments exceeded the total of
interest and service cost for the year.
|
(d) Relates to net gain on the deconsolidation of Marsh India.
|
|
|
Marsh & McLennan Companies, Inc.
|
Reconciliation of Non-GAAP Measures
|
Twelve Months Ended December 31
|
(Millions) (Unaudited)
|
|
Adjusted Operating Income (Loss) and Adjusted Operating Margin
(cont'd)
|
|
|
|
Risk & Insurance Services
|
|
|
Consulting
|
|
|
Corporate/ Eliminations
|
|
|
Total
|
Twelve Months Ended December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
$
|
1,871
|
|
|
|
$
|
1,174
|
|
|
|
$
|
(189
|
)
|
|
|
$
|
2,856
|
|
Add impact of Noteworthy Items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring (a)
|
|
|
11
|
|
|
|
19
|
|
|
|
10
|
|
|
|
40
|
|
Adjustments to acquisition related accounts (b)
|
|
|
-
|
|
|
|
3
|
|
|
|
-
|
|
|
|
3
|
|
Other Settlement, Legal and Regulatory (c)
|
|
|
15
|
|
|
|
-
|
|
|
|
-
|
|
|
|
15
|
|
Pension settlement charge (d)
|
|
|
47
|
|
|
|
7
|
|
|
|
-
|
|
|
|
54
|
|
Other
|
|
|
1
|
|
|
|
-
|
|
|
|
-
|
|
|
|
1
|
|
Operating income adjustments
|
|
|
74
|
|
|
|
29
|
|
|
|
10
|
|
|
|
113
|
|
Adjusted operating income (loss)
|
|
|
$
|
1,945
|
|
|
|
$
|
1,203
|
|
|
|
$
|
(179
|
)
|
|
|
$
|
2,969
|
|
Operating margin
|
|
|
24.5
|
%
|
|
|
18.2
|
%
|
|
|
N/A
|
|
|
20.4
|
%
|
Adjusted operating margin
|
|
|
25.5
|
%
|
|
|
18.7
|
%
|
|
|
N/A
|
|
|
21.2
|
%
|
Twelve Months Ended December 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
|
$
|
1,753
|
|
|
|
$
|
1,103
|
|
|
|
$
|
(192
|
)
|
|
|
$
|
2,664
|
|
Add (Deduct) impact of Noteworthy Items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring (a)
|
|
|
3
|
|
|
|
34
|
|
|
|
7
|
|
|
|
44
|
|
Adjustments to acquisition related accounts (b)
|
|
|
12
|
|
|
|
3
|
|
|
|
-
|
|
|
|
15
|
|
Disposal/deconsolidation of business (e)
|
|
|
(11
|
)
|
|
|
(6
|
)
|
|
|
-
|
|
|
|
(17
|
)
|
Other
|
|
|
2
|
|
|
|
-
|
|
|
|
-
|
|
|
|
2
|
|
Operating income adjustments
|
|
|
6
|
|
|
|
31
|
|
|
|
7
|
|
|
|
44
|
|
Adjusted operating income (loss)
|
|
|
$
|
1,759
|
|
|
|
$
|
1,134
|
|
|
|
$
|
(185
|
)
|
|
|
$
|
2,708
|
|
Operating margin
|
|
|
24.5
|
%
|
|
|
18.1
|
%
|
|
|
N/A
|
|
|
20.2
|
%
|
Adjusted operating margin
|
|
|
24.7
|
%
|
|
|
18.6
|
%
|
|
|
N/A
|
|
|
20.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Includes severance and related charges from restructuring
activities and the Mercer business restructure (initially announced
in Q4 2016), adjustments to restructuring liabilities related to
future rent under non-cancellable leases and other real estate
costs, as well as restructuring costs related to the integration of
recent acquisitions.
|
(b) Primarily includes the change in fair value as measured each
quarter of contingent consideration related to acquisitions.
|
(c) Reflects the settlement of the final legacy litigation,
originally filed in 2006, regarding Marsh's use of market service
agreements.
|
(d) Pension settlement charge resulting from lump sum settlements
elected by participants in certain U.K. pension plans. Recognition
of these payments as a partial settlement was required because in
each respective plan the lump sum payments exceeded the total of
interest and service cost for the year.
|
(e) Relates to a net gain on the deconsolidation of Marsh India and
contingent proceeds related to the disposal of Mercer's U.S. defined
contribution recordkeeping business. The amounts are excluded from
GAAP revenue in the calculation of adjusted operating margin.
|
|
|
Marsh & McLennan Companies, Inc.
|
Reconciliation of Non-GAAP Measures
|
Three and Twelve Months Ended December 31
|
(Millions) (Unaudited)
|
|
Adjusted income, net of tax and Adjusted Earnings per Share
Adjusted income, net of tax is calculated as the Company's GAAP
income from continuing operations, adjusted to reflect the after-tax
impact of the operating income adjustments set forth in the preceding
tables and the impact related to recently enacted U.S. tax reform
legislation. Adjusted EPS is calculated by dividing the Company's adjusted
income, net of tax, by MMC's average number of shares
outstanding-diluted for the relevant period. The following tables
reconcile adjusted income, net of tax to GAAP income from
continuing operations and adjusted EPS to GAAP EPS for the three
and twelve months ended December 31, 2017 and 2016.
|
|
|
Three Months Ended December 31, 2017
|
|
|
Three Months Ended December 31, 2016
|
|
|
|
Amount
|
|
|
Adjusted EPS
|
|
|
Amount
|
|
|
Adjusted EPS
|
Income from continuing operations
|
|
|
|
|
|
$
|
28
|
|
|
|
|
|
|
|
|
|
$
|
441
|
|
|
|
|
Less: Non-controlling interest, net of tax
|
|
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
5
|
|
|
|
|
Subtotal
|
|
|
|
|
|
$
|
27
|
|
|
|
$
|
0.05
|
|
|
|
|
|
|
$
|
436
|
|
|
|
$
|
0.84
|
Operating income adjustments
|
|
|
$
|
69
|
|
|
|
|
|
|
|
|
|
$
|
43
|
|
|
|
|
|
|
|
Impact of income taxes
|
|
|
(12
|
)
|
|
|
|
|
|
|
|
|
(14
|
)
|
|
|
|
|
|
|
Subtotal
|
|
|
57
|
|
|
|
|
|
|
|
|
|
29
|
|
|
|
|
|
|
|
Impact of U.S. tax reform*
|
|
|
460
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
517
|
|
|
|
1.00
|
|
|
|
|
|
|
29
|
|
|
|
0.05
|
Adjusted income, net of tax
|
|
|
|
|
|
$
|
544
|
|
|
|
$
|
1.05
|
|
|
|
|
|
|
$
|
465
|
|
|
|
$
|
0.89
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended December 31, 2017
|
|
|
Twelve Months Ended December 31, 2016
|
|
|
|
Amount
|
|
|
Adjusted EPS
|
|
|
Amount
|
|
|
Adjusted EPS
|
Income from continuing operations
|
|
|
|
|
|
$
|
1,510
|
|
|
|
|
|
|
|
|
|
$
|
1,795
|
|
|
|
|
Less: Non-controlling interest, net of tax
|
|
|
|
|
|
20
|
|
|
|
|
|
|
|
|
|
27
|
|
|
|
|
Subtotal
|
|
|
|
|
|
$
|
1,490
|
|
|
|
$
|
2.87
|
|
|
|
|
|
|
$
|
1,768
|
|
|
|
$
|
3.38
|
Operating income adjustments
|
|
|
$
|
113
|
|
|
|
|
|
|
|
|
|
$
|
44
|
|
|
|
|
|
|
|
Impact of income taxes
|
|
|
(28
|
)
|
|
|
|
|
|
|
|
|
(21
|
)
|
|
|
|
|
|
|
Subtotal
|
|
|
85
|
|
|
|
|
|
|
|
|
|
23
|
|
|
|
|
|
|
|
Impact of U.S. tax reform*
|
|
|
460
|
|
|
|
|
|
|
|
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
545
|
|
|
|
1.05
|
|
|
|
|
|
|
23
|
|
|
|
0.04
|
Adjusted income, net of tax
|
|
|
|
|
|
$
|
2,035
|
|
|
|
$
|
3.92
|
|
|
|
|
|
|
$
|
1,791
|
|
|
|
$
|
3.42
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*The provisional estimates are based on the Company's initial
analysis of the Tax Cuts and Jobs Act (the "Act"). Given the
significant complexity of the Act, anticipated guidance from the
U.S. Treasury about implementing the Act, and the potential for
additional guidance from the Securities and Exchange Commission or
the Financial Accounting Standards Board related to the Act, these
estimates may be adjusted during 2018.
|
|
|
|
|
|
|
|
Marsh & McLennan Companies, Inc.
Supplemental Information
Three and Twelve Months Ended December 31
(Millions) (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Twelve Months Ended
|
|
|
|
December 31,
|
|
|
December 31,
|
|
|
|
2017
|
|
|
2016
|
|
|
2017
|
|
|
2016
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and Benefits
|
|
|
$
|
2,098
|
|
|
|
$
|
1,918
|
|
|
|
$
|
7,884
|
|
|
|
$
|
7,461
|
Other operating expenses
|
|
|
901
|
|
|
|
813
|
|
|
|
3,284
|
|
|
|
3,086
|
Total Expenses
|
|
|
$
|
2,999
|
|
|
|
$
|
2,731
|
|
|
|
$
|
11,168
|
|
|
|
$
|
10,547
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization expense
|
|
|
$
|
78
|
|
|
|
$
|
77
|
|
|
|
$
|
312
|
|
|
|
$
|
308
|
Identified intangible amortization expense
|
|
|
47
|
|
|
|
31
|
|
|
|
169
|
|
|
|
130
|
Total
|
|
|
$
|
125
|
|
|
|
$
|
108
|
|
|
|
$
|
481
|
|
|
|
$
|
438
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock option expense
|
|
|
$
|
1
|
|
|
|
$
|
3
|
|
|
|
$
|
20
|
|
|
|
$
|
21
|
Capital expenditures
|
|
|
$
|
85
|
|
|
|
$
|
79
|
|
|
|
$
|
302
|
|
|
|
$
|
253
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk and Insurance Services
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and Benefits
|
|
|
$
|
1,084
|
|
|
|
$
|
953
|
|
|
|
$
|
4,031
|
|
|
|
$
|
3,732
|
Other operating expenses
|
|
|
462
|
|
|
|
427
|
|
|
|
1,728
|
|
|
|
1,658
|
Total Expenses
|
|
|
$
|
1,546
|
|
|
|
$
|
1,380
|
|
|
|
$
|
5,759
|
|
|
|
$
|
5,390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization expense
|
|
|
$
|
37
|
|
|
|
$
|
34
|
|
|
|
$
|
143
|
|
|
|
$
|
139
|
Identified intangible amortization expense
|
|
|
39
|
|
|
|
26
|
|
|
|
139
|
|
|
|
109
|
Total
|
|
|
$
|
76
|
|
|
|
$
|
60
|
|
|
|
$
|
282
|
|
|
|
$
|
248
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consulting
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and Benefits
|
|
|
$
|
926
|
|
|
|
$
|
879
|
|
|
|
$
|
3,509
|
|
|
|
$
|
3,385
|
Other operating expenses
|
|
|
492
|
|
|
|
438
|
|
|
|
1,761
|
|
|
|
1,624
|
Total Expenses
|
|
|
$
|
1,418
|
|
|
|
$
|
1,317
|
|
|
|
$
|
5,270
|
|
|
|
$
|
5,009
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization expense
|
|
|
$
|
23
|
|
|
|
$
|
25
|
|
|
|
$
|
99
|
|
|
|
$
|
100
|
Identified intangible amortization expense
|
|
|
8
|
|
|
|
5
|
|
|
|
30
|
|
|
|
21
|
Total
|
|
|
$
|
31
|
|
|
|
$
|
30
|
|
|
|
$
|
129
|
|
|
|
$
|
121
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marsh & McLennan Companies, Inc.
Consolidated Balance Sheets
(Millions) (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
December 31, 2017
|
|
|
December 31, 2016
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
1,205
|
|
|
|
$
|
1,026
|
|
Net receivables
|
|
|
4,133
|
|
|
|
3,643
|
|
Other current assets
|
|
|
224
|
|
|
|
215
|
|
Total current assets
|
|
|
5,562
|
|
|
|
4,884
|
|
|
|
|
|
|
|
|
Goodwill and intangible assets
|
|
|
10,363
|
|
|
|
9,495
|
|
Fixed assets, net
|
|
|
712
|
|
|
|
725
|
|
Pension related assets
|
|
|
1,693
|
|
|
|
776
|
|
Deferred tax assets
|
|
|
669
|
|
|
|
1,097
|
|
Other assets
|
|
|
1,430
|
|
|
|
1,213
|
|
TOTAL ASSETS
|
|
|
$
|
20,429
|
|
|
|
$
|
18,190
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
Short-term debt
|
|
|
$
|
262
|
|
|
|
$
|
312
|
|
Accounts payable and accrued liabilities
|
|
|
2,083
|
|
|
|
1,969
|
|
Accrued compensation and employee benefits
|
|
|
1,718
|
|
|
|
1,655
|
|
Accrued income taxes
|
|
|
199
|
|
|
|
146
|
|
Total current liabilities
|
|
|
4,262
|
|
|
|
4,082
|
|
|
|
|
|
|
|
|
Fiduciary liabilities
|
|
|
4,847
|
|
|
|
4,241
|
|
Less - cash and investments held in a fiduciary capacity
|
|
|
(4,847
|
)
|
|
|
(4,241
|
)
|
|
|
|
-
|
|
|
|
-
|
|
Long-term debt
|
|
|
5,225
|
|
|
|
4,495
|
|
Pension, post-retirement and post-employment benefits
|
|
|
1,888
|
|
|
|
2,076
|
|
Liabilities for errors and omissions
|
|
|
301
|
|
|
|
308
|
|
Other liabilities
|
|
|
1,311
|
|
|
|
957
|
|
|
|
|
|
|
|
|
Total equity
|
|
|
7,442
|
|
|
|
6,272
|
|
TOTAL LIABILITIES AND EQUITY
|
|
|
$
|
20,429
|
|
|
|
$
|
18,190
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marsh & McLennan Companies, Inc.
|
Supplemental Information
|
Revised Presentation Under the New Retirement Benefits
Accounting Standard
|
(Millions) (Unaudited)
|
|
On January 1, 2018, new accounting guidance became effective that
changes the presentation of net periodic pension and postretirement
benefit cost ("net benefit cost") under ASC 715. Under the new standard,
the service cost component of net benefit cost will continue to be
included in compensation and benefit costs in operating income. All
other components of net benefit cost, which include interest cost,
expected return on plan assets, amortization of gains and losses and
settlements costs or credits, will be reported in a separate line item
below operating income. This change in presentation will have no impact
on income before income taxes, net income, earnings per share or cash
flow. To aid investors in their understanding of these presentation
changes, the tables below provide the restatements of both 2017 and 2016
results that will be reflected when the Company files its 2018 financial
statements.
|
|
|
2016
|
|
|
2017
|
Consolidated Income Statements
|
|
|
FY
|
|
|
Q1
|
|
|
Q2
|
|
|
Q3
|
|
|
Q4
|
|
|
FY
|
Revenue
|
|
|
$
|
13,211
|
|
|
|
$
|
3,503
|
|
|
|
$
|
3,495
|
|
|
|
$
|
3,341
|
|
|
|
$
|
3,685
|
|
|
|
$
|
14,024
|
|
Expense:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and Benefits As Reported
|
|
|
7,461
|
|
|
|
1,945
|
|
|
|
1,935
|
|
|
|
1,906
|
|
|
|
2,098
|
|
|
|
7,884
|
|
Add: Other Net Benefit Credits (a)
|
|
|
233
|
|
|
|
60
|
|
|
|
63
|
|
|
|
62
|
|
|
|
16
|
|
|
|
201
|
|
Compensation and Benefits As Restated
|
|
|
7,694
|
|
|
|
2,005
|
|
|
|
1,998
|
|
|
|
1,968
|
|
|
|
2,114
|
|
|
|
8,085
|
|
Other Operating Expenses
|
|
|
3,086
|
|
|
|
749
|
|
|
|
796
|
|
|
|
838
|
|
|
|
901
|
|
|
|
3,284
|
|
Operating Expenses As Restated
|
|
|
10,780
|
|
|
|
2,754
|
|
|
|
2,794
|
|
|
|
2,806
|
|
|
|
3,015
|
|
|
|
11,369
|
|
Operating Income As Restated
|
|
|
2,431
|
|
|
|
749
|
|
|
|
701
|
|
|
|
535
|
|
|
|
670
|
|
|
|
2,655
|
|
Other Net Benefit Credits (a)
|
|
|
233
|
|
|
|
60
|
|
|
|
63
|
|
|
|
62
|
|
|
|
16
|
|
|
|
201
|
|
Interest Income
|
|
|
5
|
|
|
|
2
|
|
|
|
2
|
|
|
|
2
|
|
|
|
3
|
|
|
|
9
|
|
Interest Expense
|
|
|
(189
|
)
|
|
|
(58
|
)
|
|
|
(60
|
)
|
|
|
(60
|
)
|
|
|
(59
|
)
|
|
|
(237
|
)
|
Investment Income (Loss)
|
|
|
-
|
|
|
|
-
|
|
|
|
5
|
|
|
|
(2
|
)
|
|
|
12
|
|
|
|
15
|
|
Income Before Income Taxes
|
|
|
$
|
2,480
|
|
|
|
$
|
753
|
|
|
|
$
|
711
|
|
|
|
$
|
537
|
|
|
|
$
|
642
|
|
|
|
$
|
2,643
|
|
Operating Income and Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk and Insurance Services
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Originally Reported
|
|
|
$
|
1,753
|
|
|
|
$
|
613
|
|
|
|
$
|
528
|
|
|
|
$
|
314
|
|
|
|
$
|
416
|
|
|
|
$
|
1,871
|
|
Other Net Benefit Credits (a)
|
|
|
(172
|
)
|
|
|
(45
|
)
|
|
|
(46
|
)
|
|
|
(46
|
)
|
|
|
(3
|
)
|
|
|
(140
|
)
|
As Restated
|
|
|
$
|
1,581
|
|
|
|
$
|
568
|
|
|
|
$
|
482
|
|
|
|
$
|
268
|
|
|
|
$
|
413
|
|
|
|
$
|
1,731
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Originally Reported
|
|
|
24.5
|
%
|
|
|
30.8
|
%
|
|
|
27.5
|
%
|
|
|
17.8
|
%
|
|
|
21.2
|
%
|
|
|
24.5
|
%
|
As Restated
|
|
|
22.1
|
%
|
|
|
28.6
|
%
|
|
|
25.2
|
%
|
|
|
15.2
|
%
|
|
|
21.0
|
%
|
|
|
22.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consulting
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Originally Reported
|
|
|
$
|
1,103
|
|
|
|
$
|
241
|
|
|
|
$
|
283
|
|
|
|
$
|
329
|
|
|
|
$
|
321
|
|
|
|
$
|
1,174
|
|
Other Net Benefit Credits (a)
|
|
|
(65
|
)
|
|
|
(16
|
)
|
|
|
(18
|
)
|
|
|
(18
|
)
|
|
|
(12
|
)
|
|
|
(64
|
)
|
As Restated
|
|
|
$
|
1,038
|
|
|
|
$
|
225
|
|
|
|
$
|
265
|
|
|
|
$
|
311
|
|
|
|
$
|
309
|
|
|
|
$
|
1,110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Originally Reported
|
|
|
18.1
|
%
|
|
|
15.8
|
%
|
|
|
17.8
|
%
|
|
|
20.7
|
%
|
|
|
18.5
|
%
|
|
|
18.2
|
%
|
As Restated
|
|
|
17.0
|
%
|
|
|
14.7
|
%
|
|
|
16.6
|
%
|
|
|
19.6
|
%
|
|
|
17.8
|
%
|
|
|
17.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Originally Reported
|
|
|
$
|
2,664
|
|
|
|
$
|
809
|
|
|
|
$
|
764
|
|
|
|
$
|
597
|
|
|
|
$
|
686
|
|
|
|
$
|
2,856
|
|
Other Net Benefit Credits (a)
|
|
|
(233
|
)
|
|
|
(60
|
)
|
|
|
(63
|
)
|
|
|
(62
|
)
|
|
|
(16
|
)
|
|
|
(201
|
)
|
As Restated
|
|
|
$
|
2,431
|
|
|
|
$
|
749
|
|
|
|
$
|
701
|
|
|
|
$
|
535
|
|
|
|
$
|
670
|
|
|
|
$
|
2,655
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Originally Reported
|
|
|
20.2
|
%
|
|
|
23.1
|
%
|
|
|
21.9
|
%
|
|
|
17.9
|
%
|
|
|
18.6
|
%
|
|
|
20.4
|
%
|
As Restated
|
|
|
18.4
|
%
|
|
|
21.4
|
%
|
|
|
20.1
|
%
|
|
|
16.0
|
%
|
|
|
18.2
|
%
|
|
|
18.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) The net benefit credit in the fourth quarter of 2017 includes
the U.K. pension settlement charge of $54 million, which is excluded
from our adjusted results.
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20180201005590/en/
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|