Marsh tops all analyst profit hopes

MARSH &amp; McLennan (MMC), the second-largest global insurance broker by assets, posted a better-than-expected quarterly profit as significantly lower expenses offset a decline in revenues.<br /><br />Third-quarter net income was $221m, (&pound;133.3m) or 41 cents a share. That compares with a net loss of $8m, or two cents a share, a year earlier, when results were hurt by increases to liability reserves.<br /><br />MMC, which competes with Aon in helping businesses find insurance, has been drastically cutting costs to try to stay ahead of rising unemployment and contraction in spending, which have shrunk demand for insurance coverage.<br /><br />Quarterly revenue fell more than 10 per cent to $2.5bn, while expenses were cut by more than 16 per cent to $2.3bn.<br /><br />MMC&rsquo;s largest division, risk and insurance services, doubled its operating income, while its consulting businesses were able to cut spending in line with declining revenue.<br /><br />&ldquo;While the economic environment continues to be challenging, MMC&rsquo;s results reflect the effective management actions taken by our (divisions) over the past year, including significant expense reduction,&rdquo; said chief executive Brian Duperreault.