Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| Statement |
|---|
| Credit Specialties had a terrific quarter in aviation, as well as MMB, which is a big part of our business in Europe delivered strong double-digit growth |
| And of course, you've got the fundamentals in Latin America with protection gap and somewhat emerging markets in Eastern Europe as well that have had a very strong growth as well |
| Top-line momentum continued with 10% underlying revenue growth, on top of 8% growth in the third quarter of last year |
| Adjusted operating income grew 24% versus a year ago |
| And we've had good growth over a long period of time in Latin America |
| Based on our outlook today and assuming current conditions persist, we expect to generate 9% to 10% full-year underlying revenue growth, strong growth in adjusted EPS and to report margin expansion for the 16th consecutive year |
| We've got a track record, a disciplined track record of growing revenue faster than expense, but we're not going to do it in every quarter, in every business, and every quarter |
| We are seeing the benefit of investments we've made in our talent and capabilities, and we continue to see opportunities to add high-quality acquisitions |
| Guy Carpenter's revenue was $359 million in the quarter, up 9% or 8% on an underlying basis, driven by strong growth across our global specialties and regions |
| I'm very pleased with our performance |
| And while, again, that macro environment is quite volatile, we're confident in our ability to perform over economic cycles |
| So, we believe we're a better growth business and better positioned |
| We do expect solid margin expansion in 2023, which will be our 16th consecutive year of margin expansion |
| small and midsized businesses that helps enhance the resilience in a volatile threat environment |
| But I do believe nominal GDP is a better indicator of demand over time and with inflation, tight labor markets and pricing positive in the P&C market, those macro factors are certainly supportive of growth |
| And in spite of mixed economic outcomes in Europe, our business is performing exceptionally well there |
| It was particularly strong in the International segment in the quarter |
| Our approach to balancing investment and growth drives consistent exceptional performance for shareholders and positions us well to deliver new solutions and insights for our clients |
| The combined value proposition of our businesses continues to gain traction with clients, especially in certain industries and lines of business |
| Again, very pleased with our growth at Marsh |
| So as Nick talked about a couple of different times on this call, we have an increasingly diverse set of offerings that we think is more resilient, and we're very, very pleased with the growth at Oliver Wyman through three quarters |
| We're very excited about it |
| Overall, the momentum we are seeing as our businesses increasingly serve clients together, combined with our restructuring efforts, offers opportunities to deliver enhanced value for clients, drive higher growth, and be more efficient and connected |
| Despite the environment, we continue to perform well, and we have a track record of resilience |
| We believe we are well positioned to perform across economic cycles and manage our business to grow revenues faster than expenses in good as well as challenging periods |
| Well positioned solid growth fundamentals in both of them, expanding our presence in the middle market, which gets back to the mix point that I was making earlier |
| And over the last few years, I've said a few times and have been asked questions about our offerings through the cycle, which we've been seeking to broaden our economic research practices grew strongly, our digital team, our restructuring practice, which is nascent, grew very strongly |
| Again, overall, I was quite pleased with the growth -- the revenue growth in the quarter |
| But John called out our wider resilience of Marsh McLennan, and I'm proud that Oliver Wyman has demonstrated that resilience and chlorine our way back from a flat to Q1 |
| We remain quite active in the market and the pipeline remains solid for sure |
| Statement |
|---|
| There were FX headwinds in RIS' margins in the third quarter |
| But there are concerns both in the insurance and reinsurance market about rising loss costs |
| This includes elevated cat losses, core and social inflation, and continued political instability |
| I do think that a tough economic outlook tends to result in slower growth for Oliver Wyman |
| The outlook remains uncertain |
| With regard to Oliver Wyman, in the past, I guess, you've communicated that Oliver Wyman, when you have strong growth, there could be some pressure on consulting margins just because of the nature of that business |
| Political instability continues |
| We saw some softness in FINPRO lines |
| FINPRO lines came down by 6% in the third quarter |
| Organic of 6%, but that is a slowdown from where you guys were in the first part of the year |
| As John noted, we expect challenging market conditions to persist for property cat at the upcoming January 1 renewal, as John noted, driven by inflation |
| I would say, as I said, obviously, the macro economy remains uncertain, and there is a fair amount of questions about it |
| And all of our meetings with reinsurers this fall, everybody expressed concern with prior year loss development in U.S |
| And somewhat related to that, as Martin also noted earlier, pricing is down as well |
| So, what I would say is, yes, there's been some major breaches that will drive some insured losses in the marketplace |
| Foreign exchange was a $0.01 headwind to EPS in the third quarter |
| What I would also say, David, and I mentioned this to Jimmy, but clearly, the cost of risk is rising, right? So, whether it's a frequency of cat events, including extreme weather, casualty loss costs, whether it's core inflation, social inflation, some of the underwriting community referring to as legal system abuse, the growth in litigation funding, concerns for our clients for sure and the underwriting community as well |
| There's partly some impact from the capital markets and some moderating growth in financial construction, cyber lines reflecting some pricing pressures |
| I know you mentioned that the cyber insurance pricing growth is slowing down a little bit |
| The market is also -- the underwriting market is also reacting to possible systemic events that could aggregate losses in their portfolios |
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