Arthur J. Gallagher (AJG) Q4 2024 earnings summary

Executive summary

• Achieved 16th consecutive quarter of double-digit revenue growth, with Q4 revenue up 12% and organic growth at 7% in brokerage and risk management segments.

• Completed 20 mergers in Q4, totaling 48 for the year and $387M in estimated annualized revenue; signed a definitive agreement to acquire AssuredPartners, a $2.9B revenue deal.

• Full-year 2024 saw 15% revenue growth, 7.6% organic growth, and 18% adjusted EBITDA growth.

• Global P/C insurance market remains strong, with Q4 and January 2025 renewal premium increases above 5%.

• GAAP EPS was $1.56 and adjusted EPS $2.51, up 15% year-over-year.

Financial highlights

• Q4 2024 total revenues before reimbursements: $2.68B, up from $2.39B in Q4 2023; adjusted net earnings: $491.2M vs. $402.4M.

• Brokerage and risk management segments combined posted a net earnings margin of 13.5% and adjusted EBITDA/EBITDAC margin of 31.4%.

• Brokerage segment reported 12% revenue growth and 7.1% organic growth; adjusted EBITDA margin expanded to 33.1%.

• Risk management segment revenue grew 9% (6% organic), with adjusted EBITDA margin at 20.6%.

• Q4 2024 adjusted EPS: $2.13, up from $1.82; full year adjusted EPS: $10.09, up from $8.70.

Outlook and guidance

• Brokerage and risk management segments both guided to 6%-8% organic growth for full year 2025.

• Brokerage margins expected to expand 50-100 basis points in 2025, depending on organic growth rate.

• Risk management margins expected to remain around 20.5% in 2025.

• M&A pipeline robust, with $3.5B available for deals in 2025 and nearly $5B in 2026.

• Management expresses optimism for 2025, citing strong insurance market conditions and successful integration of acquisitions.