Arthur J. Gallagher & Co. (AJG) 25 Apr 242024 Q1 Earnings call transcript

Good afternoon, and welcome to Arthur J. Gallagher & Co's First Quarter 2024 Earnings Conference Call. [Operator Instructions] Today's call is being recorded. [Operator Instructions] Some of the comments made during this conference call, including answers given in response to questions, may constitute forward-looking statements within the meaning of the securities laws.

The company does not assume any obligation to update information or forward-looking statements provided on this call. subject to and differ are cause that statements results actual materially. forward-looking to uncertainties risks could These Please refer recent to such Risk X-K Factors the for risks information concerning contained filings the forward-looking and in uncertainties. company's details most more XX-K, and sections XX-Q on statements and

the In reconciliations other Relations to refer the non-GAAP release and of website. measures call Investor on this company's please addition, well these as of measures, in for materials section the as other the discussed information regarding earnings

It of & J. begin. and Gallagher, is to Gallagher, Patrick introduce may now my Arthur pleasure Jr., Chairman you Co. CEO Gallagher J. Mr.

Good afternoon. 'XX quarter Thank first for you for our call. us earnings joining

and On today CFO; Doug the other our with our Howell, is me operating divisions. heads the of management members call team and of the

first We to had begin great quarter a XXXX.

our and For double-digit rollover growth $XXX we in quarter posted X.X% million. our segments, revenues organic. XX% Management of XXth Virgin acquisition straight approximately growth. Brokerage revenue, Risk of combined

completed also annualized $XX XX estimate of We nearly revenue. in the mergers totaling million

earnings of Reported share of GAAP margin XX.X%, XX.X%, XX% share EBITDAC $X.XX, adjusted per year-over-year. of earnings up and earnings of adjusted $X.XX margin per net

terrific the by another team. So quarter

a revenue Moving if growth segment with results segment interest starting income. reported include you on to X.X% and Brokerage growth the Organic XX%. XX% of basis, was about

than Adjusted EBITDAC better Day of March our was bit up XX% a IR year-over-year. We margin posted adjusted XX.X% EBITDAC expectations.

organic level some and Let the to our income. figures segment just include me give interest do insights Brokerage behind following set, not

organic. Our global X% posted operations retail brokerage

at our businesses, X%, some in X% or completed of and were Specialty in Canada business brokerage in PC States, XX%. U.K., organic of we at and New specialty XX%. Fantastic retail includes overall in global X% including to X% wholesale U.S. reinsurance. about that and benefit whether and growth, Australia delivered organic XX%, at our sales consulting Gallagher United late X% live U.K. the Re employee posted XX% operations, large wholesale reinsurance, This Shifting wholesale Within our March. Zealand. And case in and the

Next, starting up insurance let increases most to include Global across premiums, on and X%. and some be were changes, PC Renewal the primary renewal first the which premium all pricing quarter our environment, provide continue exposure market. about thoughts both broad-based major product me insurance of up lines. rate with geographies

umbrella example, XX%, up X%. For was up property nearly

General X%, X% package liability comp and up X% personal workers' up XX%. up and of lines

sizable increases. within So X There Lines. many Professional seeing lines are exceptions are

lines premiums reaching bottom of renewal represent down X% These flattish. premiums X close P&L, are where First, are appear a about to globally. PC business renewal around where second pricing our X% and cyber, combined but

their clients but mitigate continue to see appetite with their our insurance these insurance budget. as programs brokers risk comprehensive that overall, to So align increases hit job and is costs deliver and our increase,

the to reinsurance Moving market.

quarter dynamics discipline capacity. cat demand pricing dominated stable the and X exercise increased met client were to property where January saw for with Reinsurers First continue by we increased cover. sufficient renewal demand the and season

our existing many team wins while clients. to was new most of Importantly, the business secure able retaining

pricing, renewals, their more April, and demand maintain being During coverage and carriers stable we reinsurance increased with discipline purchased. saw

The Within of quoting was was market end the of more overall. top casualty available pricing renewal and and the stable property, programs disciplined capacity process saw predictable. at treaty

we're themselves differentiate is able of placements. reinsurance secure good to through reserves, able carrier However, management better to prior year

changes were some a complex bit renewals and more in class with conditions. Specialty terms

or first commentary may website. on the pricing find throughout were renewals able pricing. carriers more our reports many on April the cause new in in Those interested can of that result more However, reinsurance With Baltimore lower our rest tragedy modestly clients the secure detailed to January said, market year.

line, by by Carriers rationally. In continue rate geography. by carriers reinsurance know they and industry our behave and to insurance need view, where

this are in casualty, underwriting profit. needed to example data. We increasing generate most, where of it's are Premiums we moving where Great an acceptable this primary seeing seeing premiums is renewal higher. differentiation our the are

general high U.S. renewal retail. quarter single on due premium are liability X% umbrella recently negative in increases the general in worsening including believe the social along liability concerns us increases casualty. digits, dynamics Global highlighting litigation A.M. further its maintained expenses and to insurance U.S. to market inflation, a and first outlook rate leads been historical medical financing. increases while, which to for around hearing these reserves, are We've with come Best

closer we believe still end other increases carriers price said, the seeing spectrum, insurance With renewal adequacy, are moderating. and pushing double property the getting to exposure insurance were of premium that for have first they are we and premiums digits. reinsurance At quarter property as renewal

for look again catastrophes the out we or remainder the of of As frequency severity move year, the 'XX. increased in market could

or carrier and And 'XX during while challenging provide limits, willing to more capacity are to was we Notably, our are a the partners. looking clients are we come very standards additional 'XX, change coverage underwriting not in by finding to carriers cover. add now from seeing than when are in

the increases clients mitigating to price experienced coverage do. we increases. navigating having increased insurance for of help partners, trusted While to costs, That's best while rational carrier years seem a complex our continued like businesses adviser what multiple premium have our market by our Gallagher clients finding

to Overall, Moving to be business it continues our solid. activity. customers'

During midyear last indication the daily endorsements across showed geographies. ahead levels positive year's policy and audits quarter, our most of first

of seeing economic not we are broad So global slowdown. a signs

Wage million time, to market the reentering continue persisted to job rising. cost have trends U.S., medical labor workforce. continues increase payrolls the more the tight. are and openings. the nearly Yet there are people same Nonfarm increases Within remains at be X

while businesses help in on opportunities human employers dynamics believe these reining their rewards 'XX. are our them strategy achieve With goals capital in I total will to terrific That's a costs. why focused have benefits

brokerage Overall, we retaining clients new customers. existing continue our while to win

and our this Better holding. Works, a business In service and trend new our expert in is believe on data our retention niche reflection and COREXXX recent production We of has fact, our our been proposition, and analytics. upward value an Gallagher direct quarters, is client

we we're can't just match forget of competing the smaller local than These brokers us, time. value provide. Don't with someone XX% the

to So putting that in and we all the be brokerage range, see year. it X% full organic another year together, to would outstanding 'XX X% continue

Moving points expectations. than on including better Revenue growth of was XX.X% were Management Bassett. of March Gallagher XX.X%, Risk segment, and XX%, our to a Adjusted IR basis revenues and organic margins EBITDAC million. year up Day $XX XXX bit versus our last rollover

Our solid outstanding new results to continued business customer increases both liability resilient claims reflect and across new retention, business, and arising workers' activity. comp in continue

XX% in another new business 'XX we have our approximately to the to now Looking larger That 'XX been range see continue as year year forward, full year. onboarded. would full We be outstanding wins of fully XX.X%. also margin organic X% expect

to Shifting quarter revenue. thank I'd first new professionals. like our and Gallagher partners of family our annualized a We to new an acquisitions. completing XX representing mergers, joining had estimated to extend of of growing us welcome mergers all about warm and for million active $XX very

our ahead, pipeline remains Looking strong.

very XX they Gallagher. a million we'll have Good We choice, term or signed to if prepared, sheets have $XXX around be join and being representing always revenue. of excited firms annualized choose around

decades It's decade a next rooted me some is its values deeply due trust, and guiding This our bedrock which Way, the the XXXX. It fifth is largely of XX in the integrity, tenants which Gallagher that entering culture incredible constant with have since through month. conclude to Let regarding growth. culture. ethics is of the remained has comments been of us

What organization our commitment It our the and the the witness way. that culture is and competitive partners their clients, a right me talent makes to merger is not just our to enduring us employees proud every advantage. Gallagher day our culture relationships. Our that attracts in a action and particularly enables differentiator. as build It's best demonstrate I to is

I'll to Okay. turn now and it Doug? stop Doug. over

I'll I'll posted Pat, the our hello, I'll and our comments including are remarks my the document quarters. we few each on growth modeling and quarter on provide typical you in and website, management. walk and X Then seeing growth the year I'll segment, Thanks, with provide commentary organic M&A of cash, conclude on some release. that CFO margins on next comments we everyone. capital a in and helpers by we first prepared organic comment how through margins Today, full earnings

Okay.

Page Day about expectation IR earnings growth release. organic the X.X%. including brokerage first our remember, of growth. X.X%. have X% than we shown look of X quarter to March Headline, better of And such Let's That's XX% organic interest to would a income, exclude bit we

retention. new production business we favorable client see and Looking continue strong ahead, to

Combine that brokerage XXXX organic and a further is with resilient sticky backdrop inflation, economic outlook our unchanged. rate increases,

We seeing X% to in growth still full X% year range. organic that are

EBITDAC adjusted release Turning the to earnings segment of Page to X the table. Brokerage

expectations. there IRD XX was First margins. a at call quarter our naturally EBITDAC discussed and that we The on explains earnings lower from buck margin is than points March what page impact XX.X%, in March our better footnote bit IR M&A, runs roll-in day, that principally of January our again basis adjusted

expanded on forecasted surface, Again, but that March. what XX basis than So in actually better basis it XX little the margins is points is underlying points. lower, improvement showing a we

Let me last from bridge walk you year. through a

we year's First, you quarter, would XX.X%. of XXXX then out adjusted pull first were reported if to margin see EBITDAC last you back

here. Second, adjusted done to FX gets And margin that that FX current period you update about when XX.X%. we an of margin using rate we've

table. XXXX can you the column So this see that in in

all XX due to Third, margins the that are basis deduct rolling backwards. to going these Roan be that's that math. not impact. clear, just Again, are the businesses with And point

the is that by really you gets the that that to you team. expansion. basis gives great XX So margin show to of XX.X%, we points XX.X% work That today, the Compare and underlying

like range the quarters. look next it we each of XX 'XX, could XXX looking of quarters expand to X basis the to X margins we the point As in following ahead in is

me flavor you that. on some Let give

Buck said, anniversary, is X-year past us. that noise Pat as behind First, rolling so its

the at of Day, XXXX discussed March our over next as IR lesser the raises quarters. X is in Second, given comparatively impact carryover

typically And posting M&A third, are targets. we of margins the our reality higher than is most

expansion, report While combine, what when all we talent. that are any margin do better mergers we day. together. businesses we day, we will These with great terrific these slightly impacts And as are

repeat us to full the with of allowing to in basis year XX in and range XX investments to expansion the that at points in to is that the analytics, margin service in and each still continue quarters That of X% and service it range best business. points basis So substantial we about digital our assumes X sales data X% organic make sales arming expansion. to tools, resources get post would XXX would to you next folks

Okay.

to X move Management Pages segment Risk and the and EBITDAC tables on X. and Let's organic

wins XX.X%. excellent at growth margins benefiting and from Another fantastic client new and quarter business organic XX.X% retention,

for organic the are from we of range. the 'XX, with forward, X% lapping so associated 'XX see now in Looking rest wins to growth business new and quarterly X% large we our

also the remainder Day that As for the done we and team can believe this for a March better quarter, great posting a of has our year. the That margins, is XX% job IR margins hold above bit than outlook. we

first earnings primarily Adjusted stock-based Turning than in to March Page segment corporate of X corporate quarter costs Day shown the and favorable some table. the to numbers items release end acquisition in our came of the lower tax line. compensation, IR expectations that's associated shortcut with and due and the favorable better

do items, Page website. move on your the to a et to numbers than X a X Not Page that double numbers. few just these document such our other we on noncash tweaks now M&A. $XXX updates are It let's $XXX using we all that X at much models to P&L, cetera, million at available CFO million changes carryforwards. check through still or nice few with as a a posted So a million FX, benefiting doesn't we our and March flow our $XXX be would benefit fund tax help flow future us cash about that annual about cash shows flows -- to our but credit year XX, commentary

X we January. embedding revenues, equity Page helper X, introduced the still It brokers. what cuts in and but very March to basis IR half much in revenues. second to Page third-party of rate finance $XXX $XXX million of our on two point at rollover million XX we rates. subtotal book investments from investment down has modeling premium are also is we lower Turning updated for about in is table. changed Recall, current components column day. provided that March of breaks the 'XX. this And the provided close Blue we gains FX top we've income, in The Not the table

that pinkish columns closed that And for through estimated only M&A include remember yesterday. we've revenues through

page, When expenses. future So just related need the on historical little a gross a you'll estimate Also Note change of to make up that that housekeeping. causes X a you'll revenues acquisitions pick and we some see reminder, you an to for read M&A. had

flow adjusted to or through it nothing, does out, P&L. or We've there's but adjusted close so net EPS. organic impact It earnings EBITDA the adjusted to no these adjusted

funding. Moving from XX and our management capital a includes at which offering. March of Available to cash, cash hand billion, portion M&A was the debt $X February on proceeds around

still So 'XX about with strong of fund $X expected capacity total having nor stock borrow are bank flows, issuing have to anymore. we estimating in the without in M&A billion $X.X much future and cash billion we of to

fund XXXX, M&A for with and $X over As of could free debt. looks it like billion we cash

All of rating. this investment-grade a solid while maintaining

Okay.

year. start to and quarter terrific the Another

beat. hard M&A, well to opportunities strong we for pipeline Back ahead, and productivity here believe further we in Looking to very fantastic are growing us a culture see you, deliver continued 'XX. of improvements to another Pat. positioned a year organic makes I that growth,

Operator, I ready some for think Doug. questions. you, we're Thank

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

question brokerage My the on first segment. is

as right, organic, said, So March. than a in guys you what expected you better bit

So do balance you of end there that maintaining are outlook. the full level Could growth a year? to the top you of range, right, close give that Is just expect the year us slow guys sense some of conservatism? guided you over of the to

within the how over growth you trying you together I come like positive seemed the how think trend brokerage think pricing would X on that little to about next out. I'm We saw quarters. Pat, put a would GDP mean, today and numbers all you environment. bit just

I Lisa, Well, I'm me yes, Doug I right. do think the mean, you're to on let numbers. But environment. the bullish reading going I'm

They're the We're on was bellwether seeing seeing a We good Gallagher more are clients. our activity terms not a in client people. at Bassett. which downturn robust employing in very of economy. That's going

and and for the the help all it. growth rates hates brokers good rest of inflation, The well are headcount interest market high in up. as Interest but rates us it's revenues of terms in and

fundamental the really for So business us. is environment good really,

As far as the numbers ahead. don't go

see a heavily don't is we quarter X% weighted difference it quarter we much that We do each we'll Listen, range. large think to to in Yes. first Elyse, in going and be X% forward. have reinsurance.

the I expect naturally anything that to X next first us touch say if quarters, -- it's in So we're you would to quarter the that range, but going maybe be wouldn't is a meaningful. above

X% X us in, of that next bring quarters, range in that which to we're each so the would And X% year. for in range the full

So what couple really times with nothing different than last we've of we've talked about the you. been

second little the right, the better X margin, X on QX So bit in then you but March right? And basis you than had the a XXX guide, was points little like is said previously bit, a quarters. the said,

just guide it's seems a and Now full XXX XX year it was to Is bit unchanged. maybe little better. the QX

square a just kind little updated of the of some XXX, taking what to know you're it's to margin it's view in March? XX with still you I but us now invest So nitpicky told that trying to internally. because out-quarter

kind IR think I has XXX, XXX% XXX listen, if I to the commentary CFO I may towards said of said of Day, that have the I basis Well, consistently, points. XX think, said last document

So I think the feels guidance same. about our

Gallagher from And X potentially question go then to noncompetes. bring other does do you and you it is looking two-pronged to the know this folks potential impact one. Okay. FTC talent into company How I considering last the The my if ability, remove the through? lose actually what guess, I think right, to guess could both is players. to also

comment on one. that me let Well,

lawsuit chambers filed we we're efforts challenging supportive branch. in saw overreach that First an think U.S. executive this, that's by the Texas the everybody Chamber all, of of has it's a and the I think

business. that, new if of as sale having rules there's But agreements up, count said actually the the the hold a part noncompete in of

so concern. And kind that having a of it strategy. our little impact And -- on my was rule that that's we out, see when really M&A came first is

not nonsolicitation use Our agreements clauses. contain with we staff provisions our production do noncompete rather

from all enforceable. a there, remain reason a to here. clients cover is do, look, those want work, and think work to are said culture passionate line and to going want in this Having The they that there so and we is want to place fine people those to difference entrepreneurs highly is and why what great our and employees. motivated to we their expertise is And salespeople are important. about we attract but that, This first And they leverage capabilities.

place of they analytics the being And part better armament to we and give centers work we data We're competitor. a with, and that from great them a arm that with local to get of them excellence way work.

agree I with agree the do supportive that. and while I FTC, of Chambers don't So position, with we're the

our For nonissue. a business, it's I think

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

the Just as on FTC question. quick a follow-up

the Kelly California XX the bit record a of rest nonsolicited a which saying bit their not regions might having of to due One of on brokers higher top to be is that margins the noncompetes. are turnover, the due little lower rest than

have Just than margins? little And curious, bit of the rest slice are your dice a ever they you California the lower company? is and

trading Slice and and you a bit dice years. there's and We've big in love of think there, XX been working the lower. state, big, not love -- every We measure there. we're every our possible margin cal people can no, by

gears Switching M&A. to Okay. That's clear.

You guys big asking keep but are in I've -- these and this the because asked numbers. just past, I'll

$X thinking chunkier cash as does kind be like able $X clear. deals debt? do we if But that's to be brokers, list fully stuff. just you $X.X deploy and some there's XXX you time capacity overseas lots are of progresses So look for this know just size imply, Doug, That's to of numbers, billion you that U.S., billion big should But year. top I of billion year. year, this the of these said just next next guys

Mike, this is Pat.

I stepped Wesfarmers years and That we're of think we presents bought when afraid. to play was XX fair it's up we'd opportunity $X made. not out for ever mean say itself, billion. that ago, the I biggest Australia

worked some for it that's it's fact, financing incredibly In well. out

as was purchase good somewhere Willis last was of spent order think on I of $X year, our And of order the bit the we a billion. Willis on somewhere well.

smaller where afraid There's States chunkier on you than of So to happens based look hit time. be most that. at the not that That's it. to There in United deals, XX,XXX is XXX XXX. are top but the we're our activity alone

Yes.

Mike, is -- think Doug. this I

we chassis family-owned a we can acquisitions, they of nice together think can have be on that that now I better that bring lot a that smaller us. realize businesses with

I think that M&A XX last the over refined is deals very years. pretty our smooth, integration process XXX

So that we've down. got

more I maybe resources overnight think years. been from realizing And wanting they've smaller the XX get can local and or that more, have they brokers to are for us

to So advantage we'll I forever owner now is is right capabilities value break think us. we join being a have maybe broker that or talked or that now what's sees different them This to inside don't of in apart that a get get have to sell family-owned us. them model they real sell about their see home. that They they into an to order flip them of different

do saying another when they them, they go for versus what have And going sometimes what done. quarter they're to to they're

rate, that there. story we have the day business. others tuck-in that stronger getting And higher think reinvest help that and into we I to does is it not deals stronger see volume out opportunity our think that of the So I interest their increase nice every

the a haven't day just capabilities We for others day they're into new are business going do there higher interest it. and our I say reinvest out, it rate. ideas think They can't and done that. tools in to so and don't much in

billion $X spent tuck-in will I the maybe So Well, and we of our deals volume next increase. billion this think Yes, we'll see. year. year $X.X

shot think it. we've I at got a good

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

moderation on to can think add of coverage on wanted on a or property But incremental me insurance that were think potential comments sort of could property pricing the just moderation in the your looking to that offset Pat, insurance of Just to about think and you how the factors clients you organic as those I I that future? as limits just how about some impact talking about help about growth the have and about both talk -- in side your to that made well? and and the

the the to have was or meet. able all, what for prepared hard of in the frankly think why you about There's that do people number this had of fact and to less. talk in a I years last when were we X/X, more at were of to remarks Well, those look that, we orderly of that the covers lot first section been with And cat that reinsurance. more you it were complete what wanted that's demand

more an the there see structure, cover appetite and for There's predictable, start that of remember, potential more offsetting allows have their But on that as their meeting sellers pricing this we we from. that there more buyers it into now And we're away property I walked stabilize, demand I has been come cover to see some think think et -- that flow part, But and rates rating become down quarter. didn't cetera. demand. is to for

the we're moderated. is What saying that increase

have and moderates -- our on me book middle you're there's of lot players acquisitions a we bit, business, it's for of a don't and like we're a business retail risk tuck-in buying Don't a those They're -- management lot of these middle if but if So -- the full that client. do that And higher market. cover market people retail prices. side, that clearly buyer I most of think the choice. the wrong, at kind good commercial doing remember, are the of get is

we're the exposure say account back increases increases in year have than market smaller we and and opposite. seeing the whereas it ago, in so the size or go we greater just David, you unit the did been a larger have middle -- Interestingly, rate we might

and increase the rate bit market starting a to little space. if to moderation -- starting we're in it's the small pick So middle talking in you're -- about up some see

our The and as of rates for as customers the moderates, second in rates down. buy about or very rate if back coverage remember, good more are opting are when thing opting to coverage then much is, cover out go coming up

the little of -- bit. we we've increase never won't rate captured rates entire the back and give So the if a full moderate suffer

opt in, out. So opt there's that

talked We more the in to that so. years back the increase some much in customers in the there's about we're last X haven't really seeing or rates. coverage if buy But moderation opt of

to many Also that, on is X pretty schedule the side, were the much property years David, you've left, back couple, last got the rates X interest rates, but not untouched. interest

have underwriters around you much that's So pushing the being values disciplined do more now values, and up.

the values being insured we've property in the So benefit business. got of more

that prepared my basically pointed this quarter. XX% nearly was out And remarks property up

So less property in We're viciously. we're little seeing rates a up rates seeing not go dropping.

Now wind going happen. having X know bets start I I'm all of the said away this just we're what's from if don't that, the to off. fall, the month blows are you telling season, hurricane

I clients we So hope for season. have that benign sake, our a

yes, And sort -- No, referring was thought about. it you hear the just moderation to market, that. I have about more do thanks not is interesting that opt-in answered for I it guys there, of which I primary the also, and

about to So hear that. that is helpful

And more question. add then just X just could if I X more,

throughout the pipeline about how of and of that pull thinking towards how or, life So quarters March. sales some it the -- outlook large on sounds that like you're the through there the future rest forward Was came from a end that sales I that guess, sort of year? the life just were of

of if fourth remember, more the December, out quarter. we push had probably you As in the of -- some

So $X on quarter. from about And future. revenue talking say I more than $X be pulling a billion is the would might million it we're it catch-up

in not a our numbers. business, of it's So The doesn't in of the but it difference. numbers. any our it's it love was -- big difference We any meaningful -- not make

it. Got

in outlook gave of that that you range in your So was sort March.

quarter was just not upside life solely sale. So the from this the .

right. That's

Our Mark with comes the from Securities. next line Hughes Truist question of

business or brokerage give versus open breakout for you did binding the within MGA the wholesale? the Pat,

not. I did

You quarter. got about XX% open this brokerage

that the then And was binding.

I been Is it's that. running think mid-single digits.

Higher than that.

XX, like So more XX.

the Okay. waiting there selecting? workers' same? comp And could it reason then more to be on terms pricing. for do of severity, signs frequencies, life some Or the in of it in have or of think we side Is anything

Mark. is No, In It's career, really times, darn pretty I just think going been interesting, pancake. that's a along. at as just my cyclical, flat mine it that has and as

X X there. it's might see of You really just kind flat. And here,

the of next Sakys Research. from question line with comes Katie Autonomous

guys First, much some you made just of from the greater letting property kind of margin on. envision comes kind we see else? full for fall should like of guide, you progress line? the on organic to the Or bottom that guys of see whether wanted that Like kind guidance blowing would to are to to margin that If for reaccelerating than year. were areas the How would expansion? the higher expect growth to expansion there in revenue other of opportunities come current investment touch and rates wind or something

growth to Well, into and if rolled fast the or listen, investment if starting out organic something blows spend be order wind opportunities to up would we had our that. I August, don't think that something enough in in more in pop going like

have we offset the So even to ramp of big ability organic the would some don't growth. additional to -- I that up think investment on some opportunities

in But doing that, point my something mental math had $XX for up I'm some if or a math like produce organic X million another right. it quarter here year X.XX million in if we it if half I'm $XX or trying might to we're do another

So the back go clarify make probably right? sure I don't would it to and the -- we want margins question improve naturally within think a I little bit. wholesale,

more running The range. And open that XX%. XX% are really brokerages programs programs, X%. combine you in When X% around to

out So just X to combined question answered single digits has just over I break the question, sure low -- a on that answered side. X and XX those and program Pat make XX% to we

helpful It's clarification. a

Just maybe as a quick follow-up.

particular? In specific those from goes year or Or expect the benefits to things terms saves client-related of expense as that headcount more in to on? persist controls are those XQ you and

team a at the of headcount really does controls. think I nice Listen, looking job our

have We need we do forecast we -- hire that. model people August many in many kind how of that need can have, we to show and September, to how work July,

very say, Our it good. today at was, I retention got to been say retention you better 'XX. it, in and has that our is when look let's 'XX than

done employees really So our throughout I job period. we've of a this of nice care taking think inflation

terminations significant seeing not we're So here.

So joystick to and we think many push we our forecast not more the take to on, need do has kind overall, pull how there to bring many us need our models work planning ability on how helped retention and to to I have off. of see

steady now. it's So pretty right

question with line next Kinar Jefferies. the Our of from Yaron comes

have no the idea sure but where I'm I I afternoon. pretty am, it's

just couple I wanted a market touch to want on on to questions, if just of I So could. touch I

I in about liability you being were general talking up remarks, and like retail X%. prepared the think

lines the go back X X%, month If from or I I were talking about so year to of or to think maybe investor X. course liability the up you moving meeting ago, seeing a range like over the XX%

by liability Or apples-to-apples that improvement talking now? you're right lines here? in are you we the of magnitude are surprised So seeing

think some about at line quarter, kind going remarks. back my that's with are X%, up to challenges in say, and there be we've March. and We've which what is forward. think to talking I I in of GL -- look got let reserve prepared going we're X, seen where the in me carriers go umbrella to our probably

were seems liability stable. it is, comp be which and property together pretty push bit X%. Maybe X% there'll up and really not much seems package, So the pretty course, of a X% a -- at

the like year. think I feels going it's to be for that there

discussions and of I think those you could weeks later X for take kind numbers. them March update our

be that concerns louder clients today interactions carriers adequacy. with rate around to casualty of and tone a in There's seems our

that say to would in louder we confirms January were seems February about bit chatting louder I to what today, be a So and that little today. be

combine compared you March And in so rates with the going we I February. -- that of seeing X data I that you by we X again would hear I don't have that any likely absolutely going that and what what are means. we're probably were next say we up the But When our in shift down casualty yet that in in there see feel you and with and know quarters tone with we what in we isolated January just a to meetings boil all quarters, at next look more was some data the enough down read. carriers, situations, when to think each if --

there So it I yet, coming. it's XXX% see can't our a there. in but it like is data tone shift seems quite just

disappointment, stamping and that data That addressed the come And I of And it I this, I noise? bit E&S is if was already much a saw think But the then seems and out March we appreciate rates. and around in little it color. of and how apologize -- surprise it. flows missed office you've makes a do like sense. you

And looking wholesale slowdown? E&S seeing kind just that Are and of market? still or you that strong a is that business? sorry, your very Or real? that is past noise you're And see and

That is noise.

on is business fire. Our E&S

on our renewing We're seeing submissions don't have come in. that. are caution business. any We I

Our of KBW. the Shields next from line question Meyer comes with

was to reinsurance start side. I on hoping the

any of talked purchased And share think XX% way are maybe between versus there that down about pricing? is the increasing breaking that wins organic being market I you limits versus growth.

that. actual stats on don't the I have

it Well, terrific business you I we tell quarter. And that had was. a this new will

of I stories that When that. see it a back at down retailers starting Our nice to and the our merger. think lot about some and hearing on look team teams on working our settled wins to measure we're you were we with we in, doing working that go of together, great when try success see

Our We're more business. new are together. selling working teams

be price are some cover seeing Our customers while is stability a maybe. you're good think buying to pretty I retention more seems little fact the And that. on darn

that So the be to everything successful we to box we're consider checking on merger. be this a

Okay. if seeing is not on That's successful successful? not an they're made, helpful. pressure that to clearly, efforts carriers I percentages And was even of the premise the reduce question, any commission guess, second I are and we're on update being hoping part

No.

that that all. partners head think not I We're of having we're our reasonable. not subject being a on very lot are at

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

So to XXXX to on due exposure remainder for March the in Day, were optimistic reacceleration at I RPC think the Investor workers' property guys of less higher rate the change bit. Is is in and maybe business in increases. that you the pretty Or potential pricing little a casualty rate a for potential with still the little case? and increase, environment deceleration your comp of you the property view in the

view our think I No, is unchanged. very We're bullish.

Got same? the say, the And ways. the would for reinsurance? do reinsurance, of what remainder sort of year, touch the ex think guide maybe ex strip then Okay. out organic reinsurance, organic it. if is you But Or trend of growth the you question a similar lower some for in we

is quarter, us, pretty to I some renewals see the we'll did X.X% more think because skewed right? X first the Well, in so in, April a to do quarter, yes, quarter. coming this let's from seasonally say, little X% We good get have just reinsurance that it help second

we'll it in else that X% wasn't did right It each X%. reinsurance up in that's our what quarter, quarter, us little it's help anywhere quarter benefit quarter. amount win. to percentage-wise why and basis the that but even there's moved I something revenues. total with X% say, a now, moved points, the a in get of the range second pretty I in big though We'll see fourth feel as the us So reinsurance Hopefully, shake happens like because we'll to happens. world. comfortable bit is of not third think XX not I this it from the see then X% what But the And like

what In And business you're the in. segment, and annually in you're could it. reinvesting remind Brokerage sneak could if the Got how spending on? it I more you X us much

first, I you it's a with mean list. start our laundry Well, people.

producers bringing I our lots that experienced interest Gallagher we our think by internship think I for our are out program, in on producers, seeing training, more -- of joining development, there.

on I that to think see right, budget, for sell are that's lot something year's like operating on projects is this you ton enables Those probably next technology. us service that enables at the organization spending expense. some a When to them. some Then has We're the they both that. look more, technology capital, million, thing numbers that of I a look is better. the to offer of us the sheet at could be $XX

spending as back million $XX -- on year selling a about cyber we're look today. We'll

million on years that. go If we back ago, you were X about spending $XX

and improvement, into infrastructure the infrastructure you fact the down get that data So we're and improvements. other cyber investing Then analytics.

We are and hiring platform more that and data, us statistics better of our more digital to at bring data day through people a license a help our look that customers. delivery industry every

$XX look And lot is on yield. projects inside the a spending year at a efforts. that to starting we're AI million you starting My company now, there's then are of deliver AI those guess some be to of

of million $X spending kind activities year we're so out there. on a And AI-related

So million you to think make a can $XXX to $XXX up, we're you going what better and get quickly add to doing pretty all we that forward. million franchise

are, through our can that to better, Go et a cetera, or most what like the I'd I've got well started our their instance, way this and client know, from are emphasize on Doug spend going Doug received. either digital their we emphasize this happen for -- clients Gallagher with to or listeners service like what -- is lot being risk market our small to I'd of to et see making buildings, cetera, accounts, a related offerings even middle of policies what's directly call. things another management connectivity, accounts incredibly like that offering to X on where in

literally that quarter. rolling we're like And every things out

get years want being know to then want data they analytics. care. know you you'd to able into asked And much care about them ago, people what God, rate So my if that to would And that Oh the spend buy X tell structure and the clients and then they really me they you like and why.

was quoted did million good they they're said where market, what's day it's let prepared alone should $XXX world they to on. move tell incredible. they million in who's just I CNA of smaller saying, to I don't and against time And question. and happening Or our And fighting go it's a more the the and insurance I the here's I when them remember because Hartford were, cheaper deal why day, one, mean what this out so have somebody advantage. a capability reinvest remarks, -- to XX% appreciate it. selling I in I'd it's have our let's had of by incredible started of -- but people the of in $XXX reason when stay doesn't we any an substantially I

with Ward comes Our from Citi. next question the of line Mike

on question, specifically similar reinsurance. but a of Kind

getting where where want to you of business Just be? the it of in innings are curious that guys terms you

did We've house, existing, in remarkable and We're The building It's defections. dialogue team the instance, getting just dreamed country, that X That's only and the were analytics, that we fun the having is incredibly seen having data and together, broker really and be. in where relationships interest retail side got with on the been working but example. forth. we a not biggest the and helpful it pool that continued in incredibly what solid. is would be impact accounts pooling predicted. had public we longest especially would business, what's of the probably back we'd is running for be been we've that sector relationships -- there's which We not that it the about

see recognize the it's they incredibly from tremendous like mean you're opportunities, I clients their school not new that really the Doug, And the thirst a kid, you the Well, feel the for whatever. part me, -- and the the in not and always the analytics the anymore. kid, business enterprise. There's And recognize kids hall, out to they're they and well. and new that's think anymore. the when data now I working in period invest you're you right? to retailers, They're they opportunities there of come it new

the top the from just how health of perspective? maybe then customer X the the last trending what's labor? on curious economy terms guess is how gone if of line tone X renewals the And in can the and of discuss among and hiring I you Kind sort like Benefits. and Group your of have base And

and And turnover. And have in interestingly, that, data able there. the don't instances, a our with is we're going going where to we're large some of and clients tone on do they know why what's with a, Well, around there's like -- some from on in sitting clients amount analytics get what's them concern.

deep their to wanting on very people. to a So concern hold about top

to of -- whatever just that's off jobs. lot people fill and trying stuff difficult. have an attract racks, serve people We to also awful tables, Pick of

Inflation to difficult. they're that on regard. real. lot inflation is the concern employer costs to got of inflation. cost. their directly around So differentiate Those get trying themselves whole back Medical problem is then And of you've there's passed the a in part

for I'm and That's maybe here. there's a valuable us So insurance. talking what think says employing I your that's are XXX -- I it's in and comes PPO person office the let people, can The live that local get that not people they the not making it's help. really good cutting doing XXX, then more this, we're show and of and our at XXX, not me need anymore. another you quote about is X,XXX X cases And of this just far out kind professionals it

jobs for and employers. get hold do people robust fill then to right So to they it's to it they the a going difficult on very how us, a and period time for are them. Where is the

question And Markets. Capital from with our is coming Zaremski Mike BMO last

Just a follow-up. quick

umbrella, guys give You color always lots of people do. on

Just what you curious, percentage is there business umbrella? is any way can dimension your of

you have that? of Did out. it dig can second a I piece

have . second. question, on a dig another Mike. We'll that for You

only I here. question. was No, we're asking looking my

business. it in see, let's our up X% say, I 'XX, of makes would So

profitability. Thank Well, this report quarter I efforts. the work it can think again and that's And growth to Their would colleagues for for comment just around If like hard another us for of XX,XXX joining evident I when is thank here. our and fantastic a their we world questions. you I make dedication afternoon.

with and us you community at speaking our to deliver As evening. evening. I believe IR look another prospects investment I with are excellent being Thank financial we performance. on ahead, our well forward positioned a look to the bullish of nice for this Day. year very Have again remain We

today's This call. conclude does conference

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