filings.toolsItem 1. Financial Statements (Unaudited)
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Item 1. Financial Statements (Unaudited)
Arthur J. Gallagher & Co.
Consolidated Statement of Earnings
(Unaudited - in millions, except per share data)
| Three-month period ended June 30, | Six-month period ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Commissions | $ | 1,807.5 | $ | 1,661.8 | $ | 4,056.7 | $ | 3,655.4 | |||||||||||||||
| Fees | 962.4 | 827.1 | 1,947.2 | 1,778.3 | |||||||||||||||||||
| Supplemental revenues | 102.8 | 88.7 | 216.7 | 182.6 | |||||||||||||||||||
| Contingent revenues | 72.7 | 59.8 | 165.6 | 145.8 | |||||||||||||||||||
| Interest income, premium finance revenues and other income | 232.5 | 98.6 | 480.1 | 192.0 | |||||||||||||||||||
| Revenues before reimbursements | 3,177.9 | 2,736.0 | 6,866.3 | 5,954.1 | |||||||||||||||||||
| Reimbursements | 42.9 | 39.4 | 81.9 | 78.0 | |||||||||||||||||||
| Total revenues | 3,220.8 | 2,775.4 | 6,948.2 | 6,032.1 | |||||||||||||||||||
| Compensation | 1,803.4 | 1,620.1 | 3,701.1 | 3,346.0 | |||||||||||||||||||
| Operating | 519.3 | 425.6 | 1,009.7 | 861.3 | |||||||||||||||||||
| Reimbursements | 42.9 | 39.4 | 81.9 | 78.0 | |||||||||||||||||||
| Interest | 158.6 | 94.3 | 317.0 | 186.5 | |||||||||||||||||||
| Depreciation | 49.7 | 40.8 | 93.8 | 86.2 | |||||||||||||||||||
| Amortization | 181.1 | 170.8 | 390.4 | 333.1 | |||||||||||||||||||
| Change in estimated acquisition earnout payables | (5.6) | 18.8 | 10.2 | 2.7 | |||||||||||||||||||
| Total expenses | 2,749.4 | 2,409.8 | 5,604.1 | 4,893.8 | |||||||||||||||||||
| Earnings before income taxes | 471.4 | 365.6 | 1,344.1 | 1,138.3 | |||||||||||||||||||
| Provision for income taxes | 105.2 | 80.2 | 269.0 | 240.2 | |||||||||||||||||||
| Net earnings | 366.2 | 285.4 | 1,075.1 | 898.1 | |||||||||||||||||||
| Net earnings attributable to noncontrolling interests | 0.4 | 2.0 | 4.9 | 6.3 | |||||||||||||||||||
| Net earnings attributable to controlling interests | $ | 365.8 | $ | 283.4 | $ | 1,070.2 | $ | 891.8 | |||||||||||||||
| Basic net earnings per share | $ | 1.43 | $ | 1.30 | $ | 4.19 | $ | 4.09 | |||||||||||||||
| Diluted net earnings per share | 1.40 | 1.27 | 4.12 | 4.01 | |||||||||||||||||||
| Dividends declared per common share | 0.65 | 0.60 | 1.30 | 1.20 |
See notes to consolidated financial statements.
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Arthur J. Gallagher & Co.
Consolidated Statement of Comprehensive Earnings
(Unaudited - in millions)
| Three-month period ended June 30, | Six-month period ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net earnings | $ | 366.2 | $ | 285.4 | $ | 1,075.1 | $ | 898.1 | |||||||||||||||
| Change in pension liability, net of taxes | (4.6) | (0.1) | (4.7) | 0.2 | |||||||||||||||||||
| Foreign currency translation, net of taxes | 427.6 | 11.3 | 644.9 | (144.5) | |||||||||||||||||||
| Change in fair value of derivative investments, net of taxes | 10.7 | (1.4) | 10.6 | (2.8) | |||||||||||||||||||
| Comprehensive earnings | 799.9 | 295.2 | 1,725.9 | 751.0 | |||||||||||||||||||
| Comprehensive earnings attributable to noncontrolling interests | 0.4 | 2.1 | 4.9 | 6.4 | |||||||||||||||||||
| Comprehensive earnings attributable to controlling interests | $ | 799.5 | $ | 293.1 | $ | 1,721.0 | $ | 744.6 |
See notes to consolidated financial statements.
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Arthur J. Gallagher & Co.
Consolidated Balance Sheet
(Unaudited - in millions)
| June 30, 2025 | December 31, 2024 | ||||||||||
| Cash and cash equivalents | $ | 14,299.5 | $ | 14,987.3 | |||||||
| Fiduciary assets (includes fiduciary cash of $6,507.0 in 2025 and $5,481.3 in 2024) | 38,294.3 | 24,712.1 | |||||||||
| Accounts receivable, net | 4,739.2 | 3,895.9 | |||||||||
| Other current assets | 505.1 | 518.0 | |||||||||
| Total current assets | 57,838.1 | 44,113.3 | |||||||||
| Fixed assets - net | 690.8 | 650.3 | |||||||||
| Deferred income taxes (includes tax credit carryforwards of $684.5 in 2025 and $771.8 in 2024) | 691.6 | 959.1 | |||||||||
| Other noncurrent assets | 1,573.6 | 1,354.4 | |||||||||
| Right-of-use assets | 456.6 | 377.8 | |||||||||
| Goodwill | 13,740.3 | 12,270.2 | |||||||||
| Amortizable intangible assets - net | 5,131.6 | 4,530.1 | |||||||||
| Total assets | $ | 80,122.6 | $ | 64,255.2 | |||||||
| Fiduciary liabilities | $ | 38,294.3 | $ | 24,712.1 | |||||||
| Accrued compensation and other current liabilities | 2,820.4 | 3,586.3 | |||||||||
| Deferred revenue - current | 627.7 | 537.2 | |||||||||
| Premium financing debt | 157.2 | 225.2 | |||||||||
| Corporate related borrowings - current | 640.0 | 200.0 | |||||||||
| Total current liabilities | 42,539.6 | 29,260.8 | |||||||||
| Corporate related borrowings - noncurrent | 12,097.9 | 12,731.9 | |||||||||
| Deferred revenue - noncurrent | 66.8 | 67.1 | |||||||||
| Lease liabilities - noncurrent | 402.0 | 328.1 | |||||||||
| Other noncurrent liabilities | 1,960.0 | 1,687.7 | |||||||||
| Total liabilities | 57,066.3 | 44,075.6 | |||||||||
| Stockholders' equity: | |||||||||||
| Common stock - issued and outstanding 256.4 shares in 2025 and 250.0 shares in 2024 | 256.4 | 250.0 | |||||||||
| Capital in excess of par value | 17,546.3 | 16,068.9 | |||||||||
| Retained earnings | 5,720.7 | 4,985.7 | |||||||||
| Accumulated other comprehensive loss | (500.3) | (1,151.1) | |||||||||
| Stockholders' equity attributable to controlling interests | 23,023.1 | 20,153.5 | |||||||||
| Stockholders' equity attributable to noncontrolling interests | 33.2 | 26.1 | |||||||||
| Total stockholders' equity | 23,056.3 | 20,179.6 | |||||||||
| Total liabilities and stockholders' equity | $ | 80,122.6 | $ | 64,255.2 |
See notes to consolidated financial statements.
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Arthur J. Gallagher & Co.
Consolidated Statement of Cash Flows
(Unaudited - in millions)
| Six-month period ended June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash flows from operating activities: | |||||||||||
| Net earnings | $ | 1,075.1 | $ | 898.1 | |||||||
| Adjustments to reconcile net earnings to net cash provided by operating activities: | |||||||||||
| Net gain on investments and other | (11.9) | (1.8) | |||||||||
| Depreciation and amortization | 484.2 | 419.3 | |||||||||
| Change in estimated acquisition earnout payables | 10.2 | 2.7 | |||||||||
| Amortization of deferred compensation and restricted stock | 60.7 | 58.1 | |||||||||
| Stock-based and other noncash compensation expense | 25.5 | 21.1 | |||||||||
| Payments on acquisition earnouts in excess of original estimates | (479.9) | (23.3) | |||||||||
| Provision for deferred income taxes | 26.8 | 5.6 | |||||||||
| Effect of changes in foreign exchange rates | 50.2 | 0.6 | |||||||||
| Net change in accounts receivable, net | (681.1) | (469.2) | |||||||||
| Net change in deferred revenue | 58.0 | 55.3 | |||||||||
| Net change in other current assets | (0.1) | 2.7 | |||||||||
| Net change in accrued compensation and other accrued liabilities | (132.3) | (94.5) | |||||||||
| Net change in income taxes payable | (37.3) | 0.6 | |||||||||
| Net change in other noncurrent assets and liabilities | (2.4) | 33.5 | |||||||||
| Net cash provided by operating activities | 445.7 | 908.8 | |||||||||
| Cash flows from investing activities: | |||||||||||
| Capital expenditures | (67.6) | (61.5) | |||||||||
| Cash paid for acquisitions, net of cash and restricted cash acquired | (1,661.6) | (518.6) | |||||||||
| Net proceeds from sales of operations/books of business | 2.2 | 1.7 | |||||||||
| Net funding of investment transactions | 0.9 | 0.8 | |||||||||
| Net funding of premium finance loans | 105.6 | 78.0 | |||||||||
| Net cash used by investing activities | (1,620.5) | (499.6) | |||||||||
| Cash flows from financing activities: | |||||||||||
| Payments on acquisition earnouts | (349.6) | (104.4) | |||||||||
| Proceeds from issuance of common stock | 1,378.4 | 93.5 | |||||||||
| Payments to noncontrolling interests | — | (4.1) | |||||||||
| Dividends paid | (332.6) | (262.0) | |||||||||
| Net change in fiduciary assets and liabilities | 891.9 | (103.1) | |||||||||
| Net borrowings on premium financing debt facility | (76.3) | (73.1) | |||||||||
| Borrowings on line of credit facility | 3.3 | 1,663.2 | |||||||||
| Repayments on line of credit facility | (3.3) | (1,826.9) | |||||||||
| Net borrowings of corporate related long-term debt | (199.2) | 567.5 | |||||||||
| Debt acquisition costs | 4.7 | (8.4) | |||||||||
| Settlements on terminated interest rate swaps | — | (1.4) | |||||||||
| Net cash provided by (used by) financing activities | 1,317.3 | (59.2) | |||||||||
| Effect of changes in foreign exchange rates on cash, cash equivalents, restricted cash and fiduciary cash | 195.4 | (55.5) | |||||||||
| Net increase in cash, cash equivalents, restricted cash and fiduciary cash | 337.9 | 294.5 | |||||||||
| Cash, cash equivalents, restricted cash and fiduciary cash at beginning of period | 20,468.6 | 6,543.3 | |||||||||
| Cash, cash equivalents, restricted cash and fiduciary cash at end of period | $ | 20,806.5 | $ | 6,837.8 |
See notes to consolidated financial statements.
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Arthur J. Gallagher & Co.
Consolidated Statement of Stockholders’ Equity
(Unaudited - in millions)
| Common Stock | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interests | Total | ||||||||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2024 | 250.0 | $ | 250.0 | $ | 16,068.9 | $ | 4,985.7 | $ | (1,151.1) | $ | 26.1 | $ | 20,179.6 | ||||||||||||||||||||||||||||
| Net earnings | — | — | — | 704.4 | — | 4.5 | 708.9 | ||||||||||||||||||||||||||||||||||
| Net purchase of subsidiary shares from noncontrolling interests | — | — | — | — | — | 3.0 | 3.0 | ||||||||||||||||||||||||||||||||||
| Net change in pension asset/ liability, net of taxes of $0.0 million | — | — | — | — | (0.1) | — | (0.1) | ||||||||||||||||||||||||||||||||||
| Foreign currency translation | — | — | — | — | 217.3 | — | 217.3 | ||||||||||||||||||||||||||||||||||
| Change in fair value of derivative instruments, net of taxes of $(0.2) million | — | — | — | — | (0.1) | — | (0.1) | ||||||||||||||||||||||||||||||||||
| Compensation expense related to stock option plan grants | — | — | 17.8 | — | — | — | 17.8 | ||||||||||||||||||||||||||||||||||
| Common stock issued in: | |||||||||||||||||||||||||||||||||||||||||
| One purchase transaction | 0.1 | 0.1 | 16.5 | — | — | — | 16.6 | ||||||||||||||||||||||||||||||||||
| Stock option plans | 0.7 | 0.7 | 67.9 | — | — | — | 68.6 | ||||||||||||||||||||||||||||||||||
| Employee stock purchase plan | 0.1 | 0.1 | 14.0 | — | — | — | 14.1 | ||||||||||||||||||||||||||||||||||
| Stock issuance from public offering | 4.6 | 4.6 | 1,247.5 | — | — | — | 1,252.1 | ||||||||||||||||||||||||||||||||||
| Shares issued to benefit plans | 0.3 | 0.3 | 119.3 | — | — | — | 119.6 | ||||||||||||||||||||||||||||||||||
| Deferred compensation and restricted stock | 0.3 | 0.3 | (76.8) | — | — | — | (76.5) | ||||||||||||||||||||||||||||||||||
| Cash dividends declared on common stock | — | — | — | (167.2) | — | — | (167.2) | ||||||||||||||||||||||||||||||||||
| Balance at March 31, 2025 | 256.1 | $ | 256.1 | $ | 17,475.1 | $ | 5,522.9 | $ | (934.0) | $ | 33.6 | $ | 22,353.7 | ||||||||||||||||||||||||||||
| Net earnings | — | — | — | 365.8 | — | 0.4 | 366.2 | ||||||||||||||||||||||||||||||||||
| Net purchase of subsidiary shares from noncontrolling interests | — | — | — | — | — | (0.8) | (0.8) | ||||||||||||||||||||||||||||||||||
| Net change in pension asset/ liability, net of taxes of $(1.1) million | — | — | — | — | (4.6) | — | (4.6) | ||||||||||||||||||||||||||||||||||
| Foreign currency translation | — | — | — | — | 427.6 | — | 427.6 | ||||||||||||||||||||||||||||||||||
| Change in fair value of derivative instruments, net of taxes of $3.5 million | — | — | — | — | 10.7 | — | 10.7 | ||||||||||||||||||||||||||||||||||
| Compensation expense related to stock option plan grants | — | — | 11.6 | — | — | — | 11.6 | ||||||||||||||||||||||||||||||||||
| Common stock issued in: | |||||||||||||||||||||||||||||||||||||||||
| Stock option plans | 0.2 | 0.2 | 23.7 | — | — | — | 23.9 | ||||||||||||||||||||||||||||||||||
| Employee stock purchase plan | 0.1 | 0.1 | 19.7 | — | — | — | 19.8 | ||||||||||||||||||||||||||||||||||
| Deferred compensation and restricted stock | — | — | 16.2 | — | — | — | 16.2 | ||||||||||||||||||||||||||||||||||
| Cash dividends declared on common stock | — | — | — | (168.0) | — | — | (168.0) | ||||||||||||||||||||||||||||||||||
| Balance at June 30, 2025 | 256.4 | $ | 256.4 | $ | 17,546.3 | $ | 5,720.7 | $ | (500.3) | $ | 33.2 | $ | 23,056.3 |
See notes to consolidated financial statements.
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Arthur J. Gallagher & Co.
Consolidated Statement of Stockholders’ Equity
(Unaudited - in millions)
| Common Stock | Capital in Excess of Par Value | Retained Earnings | Accumulated Other Comprehensive Loss | Noncontrolling Interests | Total | ||||||||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||||||||
| Balance at December 31, 2023 | 216.7 | $ | 216.7 | $ | 7,297.8 | $ | 4,052.9 | $ | (792.1) | $ | 40.0 | $ | 10,815.3 | ||||||||||||||||||||||||||||
| Net earnings | — | — | — | 608.4 | — | 4.3 | 612.7 | ||||||||||||||||||||||||||||||||||
| Net purchase of subsidiary shares from noncontrolling interests | — | — | — | — | — | (0.3) | (0.3) | ||||||||||||||||||||||||||||||||||
| Dividends paid to noncontrolling interests | — | — | — | — | — | (0.6) | (0.6) | ||||||||||||||||||||||||||||||||||
| Net change in pension asset/ liability, net of taxes of $0.1 million | — | — | — | — | 0.3 | — | 0.3 | ||||||||||||||||||||||||||||||||||
| Foreign currency translation | — | — | — | — | (155.8) | — | (155.8) | ||||||||||||||||||||||||||||||||||
| Change in fair value of derivative instruments, net of taxes of $(0.4) million | — | — | — | — | (1.4) | — | (1.4) | ||||||||||||||||||||||||||||||||||
| Compensation expense related to stock option plan grants | — | — | 15.1 | — | — | — | 15.1 | ||||||||||||||||||||||||||||||||||
| Common stock issued in: | |||||||||||||||||||||||||||||||||||||||||
| Seven purchase transactions | 0.4 | 0.4 | 87.9 | — | — | — | 88.3 | ||||||||||||||||||||||||||||||||||
| Stock option plans | 0.6 | 0.6 | 39.3 | — | — | — | 39.9 | ||||||||||||||||||||||||||||||||||
| Employee stock purchase plan | 0.1 | 0.1 | 12.1 | — | — | — | 12.2 | ||||||||||||||||||||||||||||||||||
| Shares issued to benefit plans | 0.4 | 0.4 | 98.1 | — | — | — | 98.5 | ||||||||||||||||||||||||||||||||||
| Deferred compensation and restricted stock | 0.3 | 0.3 | (48.3) | — | — | — | (48.0) | ||||||||||||||||||||||||||||||||||
| Cash dividends declared on common stock | — | — | — | (132.0) | — | — | (132.0) | ||||||||||||||||||||||||||||||||||
| Balance at March 31, 2024 | 218.5 | $ | 218.5 | $ | 7,502.0 | $ | 4,529.3 | $ | (949.0) | $ | 43.4 | $ | 11,344.2 | ||||||||||||||||||||||||||||
| Net earnings | — | — | — | 283.4 | — | 2.0 | 285.4 | ||||||||||||||||||||||||||||||||||
| Net purchase of subsidiary shares from noncontrolling interests | — | — | — | — | — | (18.4) | (18.4) | ||||||||||||||||||||||||||||||||||
| Dividends paid to noncontrolling interests | — | — | — | — | — | (0.3) | (0.3) | ||||||||||||||||||||||||||||||||||
| Net change in pension asset/ liability, net of taxes of $0.0 million | — | — | — | — | (0.1) | — | (0.1) | ||||||||||||||||||||||||||||||||||
| Foreign currency translation | — | — | — | — | 11.3 | 0.1 | 11.4 | ||||||||||||||||||||||||||||||||||
| Change in fair value of derivative instruments, net of taxes of $0.5 million | — | — | — | — | (1.4) | — | (1.4) | ||||||||||||||||||||||||||||||||||
| Compensation expense related to stock option plan grants | — | — | 10.5 | — | — | — | 10.5 | ||||||||||||||||||||||||||||||||||
| Common stock issued in: | |||||||||||||||||||||||||||||||||||||||||
| Two purchase transactions | 0.2 | 0.2 | 45.3 | — | — | — | 45.5 | ||||||||||||||||||||||||||||||||||
| Stock option plans | 0.3 | 0.3 | 24.5 | — | — | — | 24.8 | ||||||||||||||||||||||||||||||||||
| Employee stock purchase plan | — | — | 16.5 | — | — | — | 16.5 | ||||||||||||||||||||||||||||||||||
| Deferred compensation and restricted stock | 0.1 | 0.1 | 12.6 | — | — | — | 12.7 | ||||||||||||||||||||||||||||||||||
| Cash dividends declared on common stock | — | — | — | (131.5) | — | — | (131.5) | ||||||||||||||||||||||||||||||||||
| Balance at June 30, 2024 | 219.1 | $ | 219.1 | $ | 7,611.4 | $ | 4,681.2 | $ | (939.2) | $ | 26.8 | $ | 11,599.3 |
See notes to consolidated financial statements.
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Notes to June 30, 2025 Consolidated Financial Statements (Unaudited)
1. Summary of Significant Accounting Policies
Terms Used in Notes to Consolidated Financial Statements
ASC - Accounting Standards Codification.
ASU - Accounting Standards Update.
FASB - The Financial Accounting Standards Board.
GAAP - U.S. generally accepted accounting principles.
IRC - Internal Revenue Code.
IRS - Internal Revenue Service.
Underwriting enterprises - Insurance companies, reinsurance companies and various other forms of risk-taking entities, including intermediaries of underwriting enterprises.
Nature of Operations and Basis of Presentation
Arthur J. Gallagher & Co. and its subsidiaries, collectively referred to herein as we, our, us, Gallagher or the Company, provide insurance and reinsurance brokerage, consulting and third party claims settlement and administration services to both domestic and international entities. We have three reportable segments: brokerage, risk management and corporate. Our brokers, agents and administrators act as intermediaries between underwriting enterprises and our clients.
Our brokerage segment operations provide brokerage and consulting services to entities of all types, including commercial, nonprofit, public sector entities, and, to a lesser extent, individuals, in the areas of insurance and reinsurance placements, risk of loss management, and management of employer sponsored benefit programs. Our risk management segment operations provide contract claim settlement, claim administration, loss control services and risk management consulting for commercial, nonprofit, captive and public sector entities, and various other organizations that choose to self-insure property/casualty coverages or choose to use a third‑party claims management organization rather than the claim services provided by underwriting enterprises. The corporate segment reports the financial information related to our debt and other corporate costs, clean energy investments, external acquisition‑related expenses and the impact of foreign currency translation.
We do not assume insurance underwriting risk on a net basis, other than with respect to de minimis amounts necessary to provide minimum or regulatory capital to organize captives, pools, specialized underwriters or risk-retention groups. Rather, capital necessary for covering losses is provided by underwriting enterprises.
Interest income, premium finance revenues and other income are primarily generated from our premium financing operations, our invested cash and restricted cash we hold on behalf of our clients, as well as clean energy investments. In addition, our share of the net earnings related to partially owned entities that are accounted for using the equity method is included in other income.
We are a global insurance brokerage, risk management and consulting services firm, headquartered in Rolling Meadows, Illinois. We provide these services in approximately 130 countries around the world through our owned operations and a network of correspondent brokers and consultants. We have prepared the accompanying unaudited consolidated financial statements pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in annual financial statements have been omitted pursuant to such rules and regulations. The unaudited consolidated financial statements included herein are, in the opinion of management, prepared on a basis consistent with our audited consolidated financial statements for the year ended December 31, 2024, and include all normal recurring adjustments necessary for a fair presentation of the information set forth herein. The quarterly results of operations are not necessarily indicative of the results of operations to be reported for subsequent quarters or the full year. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024. In the preparation of our unaudited consolidated financial statements as of June 30, 2025, management evaluated all material subsequent events or transactions that occurred after the balance sheet date through the date on which the financial statements were issued, for potential recognition and/or disclosure therein.
Use of Estimates
The preparation of our unaudited consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.
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These accounting principles require us to make estimates and assumptions that affect the reported amounts of assets and liabilities and revenues and expenses, and the disclosure of contingent assets and liabilities at the date of our unaudited consolidated financial statements. We periodically evaluate our estimates and assumptions, including those relating to the valuation of goodwill and other intangible assets, right-of-use assets, investments, income taxes, revenue recognition, deferred costs, stock-based compensation, claims handling obligations, retirement plans, litigation and contingencies. We base our estimates on historical experience and various assumptions that we believe to be reasonable based on specific circumstances. Such estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed in the notes herein.
2. Effect of New Accounting Pronouncements
Segment Reporting
In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires that an entity report segment information in accordance with Topic 280, Segment Reporting. The amendment in the ASU is intended to improve reportable segment disclosure requirements primarily through enhanced disclosures about significant segment expenses. The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. We adopted this ASU as of December 31, 2024, which affected our segment disclosures. See Note 15 to our consolidated financial statements for further detail regarding the impact of this ASU.
Income Taxes
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which requires that an entity, on an annual basis, disclose additional income tax information, primarily related to the rate reconciliation and income taxes paid. The amendment in the ASU is intended to enhance the transparency and decision usefulness of income tax disclosures. The amendments in this update are effective for fiscal years beginning after December 15, 2024. We are currently evaluating the impact of the new standard on our consolidated financial statements which is expected to result in enhanced disclosures.
Climate Risk Disclosures
In March 2024, the SEC issued final climate-related disclosure rules that will require disclosure of material climate-related risks and material direct greenhouse gas emissions from operations owned or controlled (Scope 1) and/or material indirect greenhouse gas emissions from purchased energy consumed in owned or controlled operations (Scope 2). Additionally, the rules require disclosure in the notes to the financial statements of the effects of severe weather events and other natural conditions, subject to certain materiality thresholds. The disclosure requirements were scheduled to begin phasing in for annual reports and registration statements including financial information with respect to annual periods beginning in calendar year 2025. On April 4, 2024, the SEC issued an order staying the rules during the pendency of a number of legal challenges to the rules’ validity. On March 27, 2025, the SEC announced it had approved ending its defense of the rules in court. On April 24, 2025, the litigation was suspended pending confirmation from the SEC whether it intends to engage in the administrative process to change or revoke the rules. We are continuing to monitor these developments.
Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU 2024-03, Income Statement Reporting–Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220- 40), Disaggregation of Income Statement Expenses. The standard update improves the disclosures about a public business entity’s expenses by requiring more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation and amortization) included within income statement expense captions. The guidance will be effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The standard updates are to be applied prospectively with the option for retrospective application. We are currently evaluating the impact of adoption of the standard update on our financial statement disclosures.
3. Business Combinations
During the six-month period ended June 30, 2025, we acquired substantially all of the ownership interest or net assets, as applicable, of the following firms in exchange for our common stock and/or cash. These acquisitions have been accounted for using the acquisition method for recording business combinations (in millions, except share data):
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| Name and Effective Date of Acquisition | Common Shares Issued | Common Shares Value | Cash Paid | Accrued Liability | Escrow Deposited | Recorded Earnout Payable | Total Recorded Purchase Price | Maximum Potential Earnout Payable | ||||||||||||||||||||||||||||||||||||||||||
| (000s) | ||||||||||||||||||||||||||||||||||||||||||||||||||
| W K Webster & Co Ltd February 1, 2025 (WKW) | — | $ | — | $ | 138.4 | $ | 1.9 | $ | — | $ | 13.9 | $ | 154.2 | $ | 28.5 | |||||||||||||||||||||||||||||||||||
| Case Group February 26, 2025 (CSG) | — | — | 57.8 | 3.5 | 6.5 | 15.0 | 82.8 | 84.1 | ||||||||||||||||||||||||||||||||||||||||||
| Woodruff Sawyer & Co April 10, 2025 (WSC) | — | — | 1,195.5 | 12.2 | 66.6 | — | 1,274.3 | — | ||||||||||||||||||||||||||||||||||||||||||
| Seventeen other acquisitions completed in 2025 | 49 | 16.0 | 260.0 | 18.7 | 10.8 | 50.0 | 355.5 | 95.4 | ||||||||||||||||||||||||||||||||||||||||||
| 49 | $ | 16.0 | $ | 1,651.7 | $ | 36.3 | $ | 83.9 | $ | 78.9 | $ | 1,866.8 | $ | 208.0 |
On December 7, 2024, we signed a definitive agreement to acquire all of the issued and outstanding stock of Dolphin Topco, Inc., the holding company of AssuredPartners for gross consideration of $13.45 billion. The transaction is subject to customary regulatory approvals. On March 7, 2025, we received a request for additional information as part of the HSR filing. We have responded to the request and expect that the transaction will close in the third quarter of 2025. AssuredPartners is a leading U.S. insurance broker with client capabilities across commercial property/casualty, specialty, employee benefits and personal lines with operations in the U.K. and Ireland. We raised $8.5 billion of cash in our December 11, 2024 follow-on common stock offering and borrowed $5.0 billion of cash in our December 19, 2024 senior notes issuance (which we refer to, together with the follow-on common stock offering, as the AssuredPartners Financing), to fund the transaction. On January 7, 2025, we received an additional $1.28 billion of cash due to the exercise by the underwriters of the overallotment provision related to the follow-on common stock offering.
On April 10, 2025, we acquired all of the issued and outstanding stock of Woodruff Sawyer for consideration of $1.2 billion. We funded the transaction using cash on hand. Woodruff Sawyer provides a full suite of commercial property/casualty products, employee benefits solutions and risk management services with a focus on middle and large market clients. Immediately prior to closing, Woodruff Sawyer had over 600 employees serving through 14 U.S. offices and one U.K. office.
Common shares issued in connection with acquisitions are valued at closing market prices as of the effective date of the applicable acquisition or on the days when the shares are issued, if purchase consideration is deferred. We record escrow deposits that are returned to us as a result of adjustments to net assets acquired as reductions of goodwill when the escrows are settled. The maximum potential earnout payables disclosed in the foregoing table represent the maximum amount of additional consideration that could be paid pursuant to the terms of the purchase agreement for the applicable acquisition. The amounts recorded as earnout payables, which are primarily based upon the estimated future operating results of the acquired entities over a two- to three-year period subsequent to the acquisition date, are measured at fair value as of the acquisition date and are included on that basis in the recorded purchase price consideration in the foregoing table. We will record subsequent changes in these estimated earnout obligations, including the accretion of discount, in our consolidated statement of earnings when incurred.
The fair value of these earnout obligations is generally based on the present value of the expected future payments to be made to the sellers of the acquired entities in accordance with the provisions outlined in the respective purchase agreements, which is a Level 3 fair value measurement (discounted cash flow method of the income approach). In determining fair value, we estimated the acquired entity’s future performance using financial projections developed by management for the acquired entity and market participant assumptions that were derived for revenue growth and/or profitability. Revenue growth rates generally ranged from 5.0% to 17.5% for our 2025 acquisitions. We estimated future payments using the earnout formula and performance targets specified in each purchase agreement and the financial projections just described. We then discounted these payments to present value using a risk-adjusted rate that takes into consideration market-based rates of return that reflect the ability of the acquired entity to achieve the targets. The discount rate was 9.0% for all of our 2025 acquisitions. In some instances, the fair value of these earnout obligations can be based on other valuation methods including the Black-Scholes Option Pricing Method or Monte Carlo Simulation method. Changes in financial projections, market participant assumptions for revenue growth and/or profitability, or the risk-adjusted discount rate, would result in a change in the fair value of recorded earnout obligations.
During the three-month periods June 30, 2025 and 2024, we recognized $11.1 million and $15.0 million, respectively, of expense in our consolidated statement of earnings related to the accretion of the discount recorded for earnout obligations
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in connection with our acquisitions. During the six-month periods ended June 30, 2025 and 2024, we recognized $24.1 million and $33.8 million, respectively, of expense in our consolidated statement of earnings related to the accretion of the discount recorded for earnout obligations in connection with our acquisitions. In addition, during the three-month periods June 30, 2025 and 2024, we recognized $16.7 million of income and $3.8 million of expense, respectively, related to net adjustments in the estimated fair value of the liability for earnout obligations in connection with revised assumptions due to changes in interest rates, volatility and other assumptions and projections of future performance for 36 and 30 acquisitions, respectively. In addition, during the six-month periods ended June 30, 2025 and 2024, we recognized $13.9 million and $31.1 million of income, respectively, related to net adjustments in the estimated fair value of the liability for earnout obligations in connection with revised assumptions due to changes in interest rates, volatility and other assumptions and projections of future performance for 56 and 58 acquisitions, respectively. The aggregate amount of maximum earnout obligations related to acquisitions was $1,411.5 million as of June 30, 2025, of which $600.3 million was recorded in the consolidated balance sheet as of June 30, 2025, based on the estimated fair value of the expected future payments to be made, of which approximately $546.7 million can be settled in cash or stock at our option and $53.6 million must be settled in cash**.**
The following is a summary of the estimated fair values of the net assets acquired at the date of each acquisition made in the six-month period ended June 30, 2025 (in millions):
| WKW | CSG | WSC | Seventeen Other Acquisitions | Total | ||||||||||||||||||||||
| Cash and cash equivalents | $ | 5.3 | $ | 5.6 | $ | 61.9 | $ | 20.7 | $ | 93.5 | ||||||||||||||||
| Fiduciary assets | 86.8 | — | 465.3 | 41.6 | 593.7 | |||||||||||||||||||||
| Other current assets | 16.7 | 4.0 | 77.6 | 8.7 | 107.0 | |||||||||||||||||||||
| Fixed assets | 1.1 | 1.0 | 12.8 | 1.1 | 16.0 | |||||||||||||||||||||
| Noncurrent assets | 2.2 | — | 25.0 | 2.9 | 30.1 | |||||||||||||||||||||
| Goodwill | 83.7 | 49.5 | 658.1 | 236.4 | 1,027.7 | |||||||||||||||||||||
| Expiration lists | 70.9 | 36.2 | 673.4 | 155.2 | 935.7 | |||||||||||||||||||||
| Non-compete agreements | 7.9 | 7.3 | 2.4 | 4.0 | 21.6 | |||||||||||||||||||||
| Total assets acquired | 274.6 | 103.6 | 1,976.5 | 470.6 | 2,825.3 | |||||||||||||||||||||
| Fiduciary liabilities | 86.8 | — | 465.3 | 41.6 | 593.7 | |||||||||||||||||||||
| Current liabilities | 11.8 | 7.3 | 35.2 | 10.8 | 65.1 | |||||||||||||||||||||
| Noncurrent liabilities | 21.8 | 13.5 | 201.7 | 62.7 | 299.7 | |||||||||||||||||||||
| Total liabilities assumed | 120.4 | 20.8 | 702.2 | 115.1 | 958.5 | |||||||||||||||||||||
| Total net assets acquired | $ | 154.2 | $ | 82.8 | $ | 1,274.3 | $ | 355.5 | $ | 1,866.8 |
Among other things, these acquisitions allow us to expand into desirable geographic locations, further extend our presence in the third party claims administration, retail and wholesale insurance and reinsurance brokerage markets and increase the volume of general services currently provided. The excess of the purchase price over the estimated fair value of the tangible net assets acquired at the acquisition date was allocated to goodwill, expiration lists and non-compete agreements in the amounts of $1,027.7 million, $935.7 million and $21.6 million, respectively, within the brokerage and risk management segments.
Provisional estimates of fair value are established at the time of each acquisition and are subsequently reviewed and finalized within the first year of operations subsequent to the acquisition date to determine the necessity for adjustments. During this period, we may use independent third-party valuation specialists to assist us in finalizing the fair value of assets acquired and liabilities assumed. Fair value adjustments, if any, are most common to the values established for amortizable intangible assets, including expiration lists, non‑compete agreements and trade names, as well as for acquired software, and earnout liabilities, with the offset to goodwill, net of any income tax effect.
The fair value of the tangible assets and liabilities for each applicable acquisition at the acquisition date approximated their carrying values. In general, the fair value of expiration lists was established using the excess earnings method, which is an income approach based on estimated financial projections developed by management for each acquired entity using market participant assumptions. Revenue growth and attrition rates generally ranged from 3.0% to 4.1% and 5.0% to 12.0%, respectively, for our 2024 acquisitions for which valuations were performed in 2025. We estimate the fair value as the present value of the benefits anticipated from ownership of the subject expiration list in excess of returns required on the investment in contributory assets necessary to realize those benefits. The rate used to discount the net benefits was based on
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a risk-adjusted rate that takes into consideration market-based rates of return and reflects the risk of the asset relative to the acquired business. The discount rates generally ranged from 11.0% to 11.5% for our 2024 acquisitions for which valuations were performed in 2025. The fair value of non-compete agreements was established using the profit differential method, which is an income approach based on estimated financial projections developed by management for the acquired company using market participant assumptions and various non-compete scenarios.
Expiration lists, non-compete agreements and trade names related to our acquisitions are amortized using the straight-line method over their estimated useful lives (two to fifteen years for expiration lists, two to six years for non-compete agreements and two to fifteen years for trade names), while goodwill is not subject to amortization. We use the straight-line method to amortize these intangible assets because the pattern of their economic benefits cannot be reasonably determined with any certainty. We review all of our identifiable intangible assets for impairment periodically (at least annually) and whenever events or changes in business circumstances indicate that the carrying value of the assets may not be recoverable. In reviewing identifiable intangible assets, if the undiscounted future cash flows were less than the carrying amount of the respective (or underlying) asset, an indicator of impairment would exist and further analysis would be required to determine whether or not a loss would need to be charged against current period earnings as a component of amortization expense. Based on the results of impairment reviews and decisions made to exit some non-core operations during the six-month period ended June 30, 2025, we wrote off $40.6 million of amortizable assets related to the brokerage segment. Based on the results of impairment reviews during the three and six-month periods ended June 30, 2024 we wrote off $14.0 million of amortizable assets related to the brokerage segment.
Of the $935.7 million of expiration lists and $21.6 million of non-compete agreements related to our acquisitions made during the six-month period ended June 30, 2025, $885.0 million and $20.6 million, respectively, are not expected to be deductible for income tax purposes. Accordingly, we recorded a deferred tax liability of $237.8 million and a corresponding amount of goodwill in the six-month period ended June 30, 2025, related to the nondeductible amortizable intangible assets.
Our unaudited consolidated financial statements for the six-month period ended June 30, 2025 include the operations of the entities acquired in the six-month period ended June 30, 2025 from their respective acquisition dates. The following is a summary of the unaudited pro forma historical results, as if these entities had been acquired at January 1, 2024 (in millions, except per share data):
| Three-month period ended June 30, | Six-month period ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Total revenues | $ | 3,229.5 | $ | 2,872.1 | $ | 7,031.7 | $ | 6,218.5 | |||||||||||||||
| Net earnings attributable to controlling interests | 366.4 | 282.4 | 1,060.4 | 881.2 | |||||||||||||||||||
| Basic net earnings per share | 1.43 | 1.29 | 4.15 | 4.04 | |||||||||||||||||||
| Diluted net earnings per share | 1.41 | 1.27 | 4.08 | 3.96 |
The unaudited pro forma results above have been prepared for comparative purposes only and do not purport to be indicative of the results of operations which actually would have resulted had these acquisitions occurred at January 1, 2024, nor are they necessarily indicative of future operating results. Annualized revenues of entities acquired during the six-month period ended June 30, 2025 totaled approximately $391.7 million. For the six-month period ended June 30, 2025, total revenues, net pretax loss and net earnings before interest, income taxes, depreciation, amortization and the change in estimated acquisition earnout payables (EBITDAC) recorded in our unaudited consolidated statement of earnings related to our acquisitions made during the six-month period ended June 30, 2025 in the aggregate, were $98.3 million, $(28.3) million and $1.2 million, respectively.
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4. Contracts with Customers
Contract Assets and Liabilities/Contract Balances
Information about unbilled receivables, contract assets and contract liabilities from contracts with customers is as follows (in millions):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Unbilled receivables | $ | 1,908.3 | $ | 1,273.9 | |||||||
| Deferred contract costs | 144.0 | 206.8 | |||||||||
| Deferred revenue | 694.5 | 604.3 |
The unbilled receivables, which are included in accounts receivable in our consolidated balance sheet, primarily relate to our rights to consideration for work completed but not billed at the reporting date. These are transferred to the receivables when the client is billed. The deferred contract costs represent the costs we incur to fulfill a new or renewal contract with our clients prior to the effective date of the contract. These costs are expensed on the contract effective date. The deferred revenue in the consolidated balance sheet includes amounts that represent the remaining performance obligations under our contracts and amounts collected related to advanced billings and deposits received from customers that may or may not ultimately be recognized as revenues in the future. Deposits received from customers could be returned to the customers based on lesser actual transactional volume than originally billed volume.
Significant changes in the deferred revenue balances, which include foreign currency translation adjustments, during the period are as follows (in millions):
| Brokerage | Risk Management | Total | |||||||||||||||
| Deferred revenue at December 31, 2024 | $ | 430.9 | $ | 173.4 | $ | 604.3 | |||||||||||
| Incremental deferred revenue | 342.4 | 53.8 | 396.2 | ||||||||||||||
| Revenue recognized during the six-month period ended June 30, 2025 included in deferred revenue at December 31, 2024 | (317.1) | (47.1) | (364.2) | ||||||||||||||
| Net change in collected billings/deposits received from customers | 13.8 | (6.3) | 7.5 | ||||||||||||||
| Impact of change in foreign exchange rates | 37.6 | — | 37.6 | ||||||||||||||
| Deferred revenue recognized from business acquisitions | 13.1 | — | 13.1 | ||||||||||||||
| Deferred revenue at June 30, 2025 | $ | 520.7 | $ | 173.8 | $ | 694.5 |
Revenue recognized during the six-month period ended June 30, 2025 in the table above included revenue from 2024 acquisitions that would not be reflected in prior periods.
Remaining Performance Obligations
Remaining performance obligations represent the portion of the contract price for which work has not been performed. As of June 30, 2025, the aggregate amount of the contract price allocated to remaining performance obligations was $694.5 million. The estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period is as follows (in millions):
| Brokerage | Risk Management | Total | |||||||||||||||
| 2025 (remaining six months) | $ | 444.4 | $ | 83.0 | $ | 527.4 | |||||||||||
| 2026 | 72.2 | 39.7 | 111.9 | ||||||||||||||
| 2027 | 2.2 | 22.7 | 24.9 | ||||||||||||||
| 2028 | 0.9 | 11.0 | 11.9 | ||||||||||||||
| 2029 | 0.5 | 5.6 | 6.1 | ||||||||||||||
| Thereafter | 0.5 | 11.8 | 12.3 | ||||||||||||||
| Total | $ | 520.7 | $ | 173.8 | $ | 694.5 |
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Deferred Contract Costs
We capitalize costs incurred to fulfill contracts as deferred contract costs which are included in other current assets in our consolidated balance sheet. Deferred contract costs were $144.0 million and $206.8 million as of June 30, 2025 and December 31, 2024, respectively. Capitalized fulfillment costs are amortized to expense on the contract effective date. The amount of amortization of the deferred contract costs was $431.3 million and $362.9 million for the six-month periods ended June 30, 2025 and 2024, respectively.
We have applied the practical expedient to recognize the incremental costs of obtaining contracts as an expense when incurred if the amortization period of the assets that we otherwise would have recognized is one year or less for our brokerage segment. These costs are included in compensation and operating expenses in our consolidated statement of earnings.
5. Intangible Assets
The carrying amount of goodwill at June 30, 2025 and December 31, 2024 allocated by domestic and foreign operations is as follows (in millions):
| Brokerage | Risk Management | Corporate | Total | ||||||||||||||||||||
| At June 30, 2025 | |||||||||||||||||||||||
| United States | $ | 7,737.2 | $ | 74.8 | $ | — | $ | 7,812.0 | |||||||||||||||
| United Kingdom | 2,820.3 | 126.5 | — | 2,946.8 | |||||||||||||||||||
| Canada | 630.8 | — | — | 630.8 | |||||||||||||||||||
| Australia | 566.9 | 228.6 | — | 795.5 | |||||||||||||||||||
| New Zealand | 227.5 | 9.1 | — | 236.6 | |||||||||||||||||||
| Other foreign | 1,300.2 | — | 18.4 | 1,318.6 | |||||||||||||||||||
| Total goodwill | $ | 13,282.9 | $ | 439.0 | $ | 18.4 | $ | 13,740.3 | |||||||||||||||
| At December 31, 2024 | |||||||||||||||||||||||
| United States | $ | 6,965.6 | $ | 74.8 | $ | — | $ | 7,040.4 | |||||||||||||||
| United Kingdom | 2,591.4 | 25.7 | — | 2,617.1 | |||||||||||||||||||
| Canada | 586.9 | — | — | 586.9 | |||||||||||||||||||
| Australia | 509.1 | 219.3 | — | 728.4 | |||||||||||||||||||
| New Zealand | 183.2 | 8.5 | — | 191.7 | |||||||||||||||||||
| Other foreign | 1,087.2 | — | 18.5 | 1,105.7 | |||||||||||||||||||
| Total goodwill | $ | 11,923.4 | $ | 328.3 | $ | 18.5 | $ | 12,270.2 |
The changes in the carrying amount of goodwill for the six-month period ended June 30, 2025 are as follows (in millions):
| Brokerage | Risk Management | Corporate | Total | ||||||||||||||||||||
| Balance as of December 31, 2024 | $ | 11,923.4 | $ | 328.3 | $ | 18.5 | $ | 12,270.2 | |||||||||||||||
| Goodwill acquired during the period | 944.0 | 83.7 | — | 1,027.7 | |||||||||||||||||||
| Goodwill true-ups due to appraisals and other acquisition adjustments (see Note 3) | 34.3 | 5.9 | — | 40.2 | |||||||||||||||||||
| Foreign currency translation adjustments during the period | 381.2 | 21.1 | (0.1) | 402.2 | |||||||||||||||||||
| Balance as of June 30, 2025 | $ | 13,282.9 | $ | 439.0 | $ | 18.4 | $ | 13,740.3 |
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Major classes of amortizable intangible assets at June 30, 2025 and December 31, 2024 consist of the following (in millions):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Expiration lists | $ | 9,877.6 | $ | 8,763.7 | |||||||
| Accumulated amortization - expiration lists | (4,828.7) | (4,312.7) | |||||||||
| 5,048.9 | 4,451.0 | ||||||||||
| Non-compete agreements | 135.0 | 117.7 | |||||||||
| Accumulated amortization - non-compete agreements | (95.4) | (85.4) | |||||||||
| 39.6 | 32.3 | ||||||||||
| Trade names | 122.6 | 120.0 | |||||||||
| Accumulated amortization - trade names | (79.5) | (73.2) | |||||||||
| 43.1 | 46.8 | ||||||||||
| Net amortizable assets | $ | 5,131.6 | $ | 4,530.1 |
Estimated aggregate amortization expense for each of the next five years and thereafter is as follows (in millions):
| 2025 (remaining six months) | $ | 362.6 | |||
| 2026 | 694.8 | ||||
| 2027 | 658.6 | ||||
| 2028 | 614.2 | ||||
| 2029 | 562.6 | ||||
| Thereafter | 2,238.8 | ||||
| Total | $ | 5,131.6 |
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6. Credit and Other Debt Agreements
The following is a summary of our corporate and other debt (in millions):
| June 30, 2025 | December 31, 2024 | ||||||||||
| Senior Notes: | |||||||||||
| Semi-annual payments of interest, fixed rate of 4.60%, balloon due December 15, 2027 | $ | 750.0 | $ | 750.0 | |||||||
| Semi-annual payments of interest, fixed rate of 4.85%, balloon due December 15, 2029 | 750.0 | 750.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 2.40%, balloon due November 9, 2031 | 400.0 | 400.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.00%, balloon due February 15, 2032 | 500.0 | 500.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.50%, balloon due March 2, 2033 | 350.0 | 350.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 6.50%, balloon due February 15, 2034 | 400.0 | 400.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.45%, balloon due July 15, 2034 | 500.0 | 500.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.15%, balloon due February 15, 2035 | 1,500.0 | 1,500.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 3.50%, balloon due May 20, 2051 | 850.0 | 850.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 3.05%, balloon due March 9, 2052 | 350.0 | 350.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.75%, balloon due March 2, 2053 | 600.0 | 600.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 6.75%, balloon due February 15, 2054 | 600.0 | 600.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.75%, balloon due July 15, 2054 | 500.0 | 500.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.55%, balloon due February 15, 2055 | 1,500.0 | 1,500.0 | |||||||||
| Total Senior Notes | 9,550.0 | 9,550.0 | |||||||||
| Note Purchase Agreements: | |||||||||||
| Semi-annual payments of interest, fixed rate of 4.31%, balloon due June 24, 2025 | — | 200.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.85%, balloon due February 13, 2026 | 140.0 | 140.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.73%, balloon due February 27, 2026 | 175.0 | 175.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.40%, balloon due June 2, 2026 | 175.0 | 175.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.36%, balloon due June 24, 2026 | 150.0 | 150.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 3.75%, balloon due January 30, 2027 | 30.0 | 30.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.09%, balloon due June 27, 2027 | 125.0 | 125.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.09%, balloon due August 2, 2027 | 125.0 | 125.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.14%, balloon due August 4, 2027 | 98.0 | 98.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 3.46%, balloon due December 1, 2027 | 100.0 | 100.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.55%, balloon due June 2, 2028 | 75.0 | 75.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.34%, balloon due June 13, 2028 | 125.0 | 125.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.04%, balloon due February 13, 2029 | 100.0 | 100.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.98%, balloon due February 27, 2029 | 100.0 | 100.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.19%, balloon due June 27, 2029 | 50.0 | 50.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.19%, balloon due August 2, 2029 | 50.0 | 50.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 3.48%, balloon due December 2, 2029 | 50.0 | 50.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 3.99%, balloon due January 30, 2030 | 341.0 | 341.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.44%, balloon due June 13, 2030 | 125.0 | 125.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.14%, balloon due March 13, 2031 | 180.0 | 180.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.70%, balloon due June 2, 2031 | 25.0 | 25.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.09%, balloon due January 30, 2032 | 69.0 | 69.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.34%, balloon due June 27, 2032 | 75.0 | 75.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.34%, balloon due August 2, 2032 | 75.0 | 75.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.59%, balloon due June 13, 2033 | 125.0 | 125.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 5.29%, balloon due March 13, 2034 | 40.0 | 40.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.48%, balloon due June 12, 2034 | 175.0 | 175.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.24%, balloon due January 30, 2035 | 79.0 | 79.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 2.44%, balloon due February 10, 2036 | 100.0 | 100.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 2.46%, balloon due May 5, 2036 | 75.0 | 75.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.69%, balloon due June 13, 2038 | 75.0 | 75.0 |
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| Semi-annual payments of interest, fixed rate of 5.45%, balloon due March 13, 2039 | 40.0 | 40.0 | |||||||||
| Semi-annual payments of interest, fixed rate of 4.49%, balloon due January 30, 2040 | 56.0 | 56.0 | |||||||||
| Total Note Purchase Agreements | 3,323.0 | 3,523.0 | |||||||||
| Credit Agreement: | |||||||||||
| Periodic payments of interest and principal, expires April 3, 2030 | — | — | |||||||||
| Premium Financing Debt Facility - expires October 31, 2026: | |||||||||||
| Facility B | |||||||||||
| AUD denominated tranche, interbank rates plus 1.400% | 146.3 | 218.2 | |||||||||
| NZD denominated tranche, interbank rates plus 1.850% | — | — | |||||||||
| Facility C and D | |||||||||||
| AUD denominated tranche, interbank rates plus 0.830% | 3.2 | — | |||||||||
| NZD denominated tranche, interbank rates plus 0.990% | 7.7 | 7.0 | |||||||||
| Total Premium Financing Debt Facility | 157.2 | 225.2 | |||||||||
| Total corporate and other debt | 13,030.2 | 13,298.2 | |||||||||
| Less unamortized debt acquisition costs on Senior Notes and Note Purchase Agreements | (85.5) | (90.1) | |||||||||
| Less unamortized discount on Bonds Payable | (49.6) | (51.0) | |||||||||
| Net corporate and other debt | $ | 12,895.1 | $ | 13,157.1 | |||||||
| The Senior Notes in the table above are registered by the Company with the Securities and Exchange Commission and are not guaranteed. |
7. Earnings Per Share
The following table sets forth the computation of basic and diluted net earnings per share (in millions, except per share data):
| Three-month period ended June 30, | Six-month period ended June 30, | ||||||||||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||||||||||
| Net earnings attributable to controlling interests | $ | 365.8 | $ | 283.4 | $ | 1,070.2 | $ | 891.8 | |||||||||||||||
| Weighted average number of common shares outstanding | 256.2 | 218.8 | 255.5 | 218.1 | |||||||||||||||||||
| Dilutive effect of stock options using the treasury stock method | 4.2 | 4.1 | 4.4 | 4.3 | |||||||||||||||||||
| Weighted average number of common and common equivalent shares outstanding | 260.4 | 222.9 | 259.9 | 222.4 | |||||||||||||||||||
| Basic net earnings per share | $ | 1.43 | $ | 1.30 | $ | 4.19 | $ | 4.09 | |||||||||||||||
| Diluted net earnings per share | $ | 1.40 | $ | 1.27 | $ | 4.12 | $ | 4.01 |
Anti-dilutive stock-based awards of 0.8 million and 1.0 million shares were outstanding at the three-month periods ended June 30, 2025 and 2024, respectively, which were excluded in the computation of the dilutive effect of stock-based awards for the three-month periods then ended. Anti-dilutive stock-based awards of 0.8 million and 0.7 million shares were outstanding at the six-month periods ended June 30, 2025 and 2024, respectively, which were excluded in the computation of the dilutive effect of stock-based awards for the six-month periods then ended. These stock‑based awards were excluded from the computation because the exercise prices on these stock‑based awards were greater than the average market price of our common shares during the respective period, and therefore, would be anti‑dilutive to earnings per share under the treasury stock method.
8. Stock Option Plans
On May 10, 2022, our stockholders approved the Arthur J. Gallagher & Co. 2022 Long-Term Incentive Plan (which we refer to as the LTIP), which replaced our previous stockholder-approved Arthur J. Gallagher & Co. 2017 Long-Term Incentive Plan (which we refer to as the 2017 LTIP). The LTIP term began May 10, 2022 and terminates on the date of the annual meeting of stockholders in 2032, unless terminated earlier by our board of directors. All of our officers, employees and non-employee directors are eligible to receive awards under the LTIP. The compensation committee of our board of directors determines the annual number of shares delivered under the LTIP. The LTIP provides for non-qualified and
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incentive stock options, stock appreciation rights, restricted stock and restricted stock units, any or all of which may be made contingent upon the achievement of performance criteria.
Shares of our common stock available for issuance under the LTIP include authorized and unissued shares of common stock or authorized and issued shares of common stock reacquired and held as treasury shares or otherwise, or a combination thereof. The number of available shares will be reduced by the aggregate number of shares that become subject to outstanding awards granted under the LTIP. A maximum of 3.5 million shares issued for full value awards (i.e., awards other than stock options or stock appreciation rights) will be counted one-for-one against the 13.5 million share pool, and every share subject to a full value award in excess of such limit will count as 3.8 shares against the pool. To the extent that shares subject to an outstanding award granted under either the LTIP or prior equity plans are not issued or delivered by reason of the expiration, termination, cancellation or forfeiture of such award or by reason of the settlement of such award in cash, then such shares will again be available for grant under the LTIP.
The maximum number of shares available under the LTIP for restricted stock, restricted stock unit awards and performance unit awards settled with stock (i.e., all awards other than stock options and stock appreciation rights) was 2.1 million at June 30, 2025.
The LTIP provides for the grant of stock options, which may be either tax-qualified incentive stock options or non-qualified stock options and stock appreciation rights. The compensation committee determines the period for the exercise of a non-qualified stock option, tax-qualified incentive stock option or stock appreciation right, provided that no option can be exercised later than seven years after its date of grant. The exercise price of a non-qualified stock option or tax-qualified incentive stock option and the base price of a stock appreciation right cannot be less than 100% of the fair market value of a share of our common stock on the date of grant, provided that the base price of a stock appreciation right granted in tandem with an option will be the exercise price of the related option.
Upon exercise, the option exercise price may be paid in cash, by the delivery of previously owned shares of our common stock, through a net-exercise arrangement, or through a broker-assisted cashless exercise arrangement. The compensation committee determines all of the terms relating to the exercise, cancellation or other disposition of an option or stock appreciation right upon a termination of employment, whether by reason of disability, retirement, death or any other reason. Stock option and stock appreciation right awards under the LTIP are non-transferable.
On March 1, 2025, the compensation committee granted 829,000 options under the LTIP to our officers and key employees that become exercisable at the rate of 34%, 33% and 33% on the anniversary date of the grant in 2028, 2029 and 2030, respectively. On March 1, 2024, the compensation committee granted 1,044,000 options under the LTIP to our officers and key employees that become exercisable at the rate of 34%, 33% and 33% on the anniversary date of the grant in 2027, 2028 and 2029, respectively. The 2025 and 2024 options expire seven years from the date of grant, or earlier in the event of certain terminations of employment. Stock options granted in 2025 and 2024 to executive officers are not subject to forfeiture upon such officers’ departure from the Company once they attain the age of 62.
During the three-month periods ended June 30, 2025 and 2024, we recognized $11.7 million and $10.5 million, respectively, of compensation expense related to our stock option grants. During the six-month periods ended June 30, 2025 and 2024, we recognized $29.5 million and $25.6 million, respectively, of compensation expense related to our stock option grants.
For purposes of expense recognition, the estimated fair values of the stock option grants are amortized to expense over the options’ vesting period. We estimated the fair value of stock options at the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions:
| 2025 | 2024 | ||||||||||
| Expected dividend yield | 0.8 | % | 1.0 | % | |||||||
| Expected risk-free interest rate | 4.1 | % | 4.2 | % | |||||||
| Volatility | 25.4 | % | 25.3 | % | |||||||
| Expected life (in years) | 5.5 | 5.5 |
Option valuation models require the input of highly subjective assumptions including the expected stock price volatility. The Black-Scholes option pricing model was developed for use in estimating the fair value of traded options which have no vesting restrictions and are fully transferable. The weighted average fair value per option for all options granted during the six-month periods ended June 30, 2025 and 2024, as determined on the grant date using the Black-Scholes option pricing model, was $98.27 and $69.55, respectively.
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The following is a summary of our stock option activity and related information for 2025 (in millions, except exercise price and year data):
| Six-month period ended June 30, 2025 | |||||||||||||||||||||||
| Shares Under Option | Weighted Average Exercise Price | Weighted Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value | ||||||||||||||||||||
| Beginning balance | 7.3 | $ | 148.26 | ||||||||||||||||||||
| Granted | 0.8 | 337.75 | |||||||||||||||||||||
| Exercised | (1.0) | 105.45 | |||||||||||||||||||||
| Forfeited or canceled | (0.1) | 186.68 | |||||||||||||||||||||
| Ending balance | 7.0 | $ | 175.86 | 3.88 | $ | 1,025.7 | |||||||||||||||||
| Exercisable at end of period | 2.4 | $ | 110.24 | 2.16 | $ | 495.7 | |||||||||||||||||
| Ending unvested and expected to vest | 4.3 | $ | 206.32 | 4.70 | $ | 497.1 |
Options with respect to 10.1 million shares (less any shares of restricted stock issued under the LTIP - see Note 10 to these unaudited consolidated financial statements) were available for grant under the LTIP at June 30, 2025.
The total intrinsic value of options exercised during the six-month periods ended June 30, 2025 and 2024 was $215.8 million and $173.7 million, respectively. As of June 30, 2025, we had approximately $167.8 million of total unrecognized compensation expense related to nonvested options. We expect to recognize that cost over a weighted average period of approximately four years.
Other information regarding stock options outstanding and exercisable at June 30, 2025 is summarized as follows (in millions, except exercise price and year data):
| Options Outstanding | Options Exercisable | |||||||||||||||||||||||||||||||||||||||||||
| Range of Exercise Prices | Number Outstanding | Weighted Average Remaining Contractual Term (in years) | Weighted Average Exercise Price | Number Exercisable | Weighted Average Exercise Price | |||||||||||||||||||||||||||||||||||||||
| $ | 79.59 | — | $ | 79.59 | 0.4 | 0.70 | $ | 79.59 | 0.4 | $ | 79.59 | |||||||||||||||||||||||||||||||||
| 86.17 | — | 86.17 | 0.8 | 1.66 | 86.17 | 0.8 | 86.17 | |||||||||||||||||||||||||||||||||||||
| 127.90 | — | 127.90 | 1.2 | 2.71 | 127.90 | 0.7 | 127.90 | |||||||||||||||||||||||||||||||||||||
| 156.85 | — | 156.85 | 0.8 | 3.58 | 156.85 | 0.2 | 156.85 | |||||||||||||||||||||||||||||||||||||
| 158.56 | — | 161.14 | 1.0 | 3.71 | 158.64 | 0.3 | 158.59 | |||||||||||||||||||||||||||||||||||||
| 177.09 | — | 202.13 | 1.0 | 4.71 | 177.76 | — | — | |||||||||||||||||||||||||||||||||||||
| 238.88 | — | 243.54 | 1.0 | 5.67 | 243.54 | — | — | |||||||||||||||||||||||||||||||||||||
| 337.74 | — | 347.44 | 0.8 | 6.67 | 337.75 | — | — | |||||||||||||||||||||||||||||||||||||
| $ | 79.59 | — | $ | 347.44 | 7.0 | 3.88 | $ | 175.86 | 2.4 | $ | 110.24 |
9. Deferred Compensation
We have a Deferred Equity Participation Plan (which we refer to as the DEPP), which is a non-qualified plan that generally provides for distributions to certain of our key executives when they reach age 62 (or the one-year anniversary of the date of the grant for participants over the age of 61 as of the grant date) or upon or after their actual retirement if later. Under the provisions of the DEPP, we typically contribute cash in an amount approved by the compensation committee to a rabbi trust on behalf of the executives participating in the DEPP, and instruct the trustee to acquire a specified number of shares of our common stock on the open market or in privately negotiated transactions based on participant elections. Distributions under the DEPP may not normally be made until the participant reaches age 62 (or the one-year anniversary of the date of the grant for participants over the age of 61 as of the grant date) and are subject to forfeiture in the event of voluntary termination of employment or termination for cause prior to then. DEPP awards are generally made annually in
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the first quarter. In addition, we annually make awards under sub-plans of the DEPP for certain production staff, which generally provide for vesting and/or distributions no sooner than five years from the date of awards, although certain awards vest and/or distribute after the earlier of fifteen years or the participant reaching age 65. All contributions to the plan (including sub-plans) deemed to be invested in shares of our common stock are distributed in the form of our common stock and all other distributions are paid in cash.
Our common stock that is issued to or purchased by the rabbi trust as a contribution under the DEPP is valued at historical cost, which equals its fair market value at the date of grant or date of purchase. When common stock is issued, we record an unearned deferred compensation obligation as a reduction of capital in excess of par value in the accompanying consolidated balance sheet, which is amortized to compensation expense ratably over the vesting period of the participants. Future changes in the fair market value of our common stock owed to the participants do not have any impact on the amounts recorded in our unaudited consolidated financial statements.
In the first quarters of 2025 and 2024, the compensation committee approved $22.2 million and $23.2 million, respectively, of awards in the aggregate to certain key executives under the DEPP that were contributed to the rabbi trust in the first quarters of 2025 and 2024, respectively. We contributed cash to the rabbi trust and instructed the trustee to acquire a specified number of shares of our common stock on the open market to fund these 2025 and 2024 awards. During the three-month periods ended June 30, 2025 and 2024, we charged $5.2 million and $5.6 million, respectively, to compensation expense related to these awards. During the six-month periods ended June 30, 2025 and 2024, we charged $8.7 million and $9.6 million, respectively, to compensation expense related to these awards.
In the first quarters of 2025 and 2024, the compensation committee approved $2.3 million and $2.3 million, respectively, of awards under the sub-plans referred to above, which were contributed to the rabbi trust in the first quarters of 2025 and 2024, respectively. During the three-month periods ended June 30, 2025 and 2024, we charged $0.4 million and $0.6 million compensation expense related to these awards. During the six-month periods ended June 30, 2025 and 2024, we charged $0.9 million and $1.1 million, respectively, to compensation expense related to these awards. There were $3.8 million and $2.3 million, respectively, of distributions from the sub-plans during the six-month periods ended June 30, 2025 and 2024.
At June 30, 2025 and December 31, 2024, we recorded $87.2 million (related to 2.1 million shares) and $77.0 million (related to 2.2 million shares), respectively, of unearned deferred compensation as a reduction of capital in excess of par value in the accompanying consolidated balance sheet. The total intrinsic value of our unvested equity-based awards under the plan at June 30, 2025 and December 31, 2024 was $659.4 million and $616.4 million, respectively. During the six-month periods ended June 30, 2025 and 2024, cash and equity awards with an aggregate fair value of $16.9 million and $17.9 million, respectively, were vested and distributed to executives under the DEPP.
We have a Deferred Cash Participation Plan (which we refer to as the DCPP), which is a non-qualified deferred compensation plan for certain key employees, other than executive officers, that generally provides for vesting and/or distributions no sooner than five years from the date of awards. Under the provisions of the DCPP, we typically contribute cash in an amount approved by the compensation committee to the rabbi trust on behalf of the executives participating in the DCPP, and instruct the trustee to acquire a specified number of shares of our common stock on the open market or in privately negotiated transactions based on participant elections. In the first quarters of 2025 and 2024, the compensation committee approved $7.8 million and $8.1 million, respectively, of awards in the aggregate to certain key executives under the DCPP that were contributed to the rabbi trust in the first quarters of 2025 and 2024, respectively. During the three-month periods ended June 30, 2025 and 2024, we charged $2.3 million and $5.1 million, respectively, to compensation expense related to these awards. During the six-month periods ended June 30, 2025 and 2024, we charged $7.0 million and $9.9 million, respectively, to compensation expense related to these awards. There were $23.0 million and $13.6 million, respectively, of distributions from the DCPP during the six-month periods ended June 30, 2025 and 2024.
10. Restricted Stock, Performance Share and Cash Awards
Restricted Stock Awards
As discussed in Note 8 to these unaudited consolidated financial statements, on May 10, 2022, our stockholders approved the LTIP, which replaced our previous stockholder-approved 2017 LTIP. The LTIP provides for the grant of a stock award either as restricted stock or as restricted stock units to officers, employees and non-employee directors. In either case, the compensation committee may determine that the award will be subject to the attainment of performance measures over an established performance period. Stock awards and the related dividend equivalents are non-transferable and subject to forfeiture if the holder does not remain continuously employed with us during the applicable restriction period or, in the case of a performance-based award, if applicable performance measures are not attained. The compensation committee will determine all of the terms relating to the satisfaction of performance measures and the termination of a restriction period, or
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the forfeiture and cancellation of a restricted stock award upon a termination of employment, whether by reason of disability, retirement, death or any other reason.
The agreements awarding restricted stock units under the LTIP will specify whether such awards may be settled in shares of our common stock, cash or a combination of shares and cash and whether the holder will be entitled to receive dividend equivalents, on a current or deferred basis, with respect to such award. Prior to the settlement of a restricted stock unit, the holder of a restricted stock unit will have no rights as a stockholder of the Company. The maximum number of shares available under the LTIP for restricted stock, restricted stock units and performance unit awards settled with stock (i.e., all awards other than stock options and stock appreciation rights) is 4.0 million. At June 30, 2025, 2.1 million shares were available for grant under the LTIP for such awards.
In the first quarters of 2025 and 2024, we granted 297,000 and 345,000 restricted stock units, respectively, to employees under the LTIP, with an aggregate fair value of $94.3 million and $83.9 million, respectively, at the date of grant. These 2025 and 2024 awards of restricted stock units vest in full based on continued employment through March 1, 2030 and March 1, 2029, respectively.
We account for restricted stock awards at historical cost, which equals its fair market value at the date of grant, which is amortized to compensation expense ratably over the vesting period of the participants. Future changes in the fair market value of our common stock that is owed to the participants do not have any impact on the amounts recorded in our unaudited consolidated financial statements. During the three-month periods ended June 30, 2025 and 2024, we recognized $16.1 million and $14.1 million, respectively, to compensation expense related to restricted stock unit awards granted in 2020 through 2025. During the six-month periods ended June 30, 2025 and 2024, we recognized $29.3 million and $27.0 million, respectively, to compensation expense related to restricted stock unit awards granted in 2020 through 2025. The total intrinsic value of unvested restricted stock units at June 30, 2025 and 2024 was $593.0 million and $512.7 million, respectively. During the six-month periods ended June 30, 2025 and 2024, equity awards (including accrued dividends) with an aggregate value of $112.3 million and $93.3 million, respectively, were vested and distributed to employees under this plan.
Performance Share Awards
On March 1, 2025 and March 1, 2024, pursuant to the LTIP, respectively, the compensation committee approved 68,000 and 58,000, respectively, of provisional performance share awards, with an aggregate fair value of $21.8 million and $14.2 million, respectively, for future grants to our officers. Each performance share award was equivalent to the value of one share of our common stock on the date such provisional award was approved. At the end of the performance period, eligible participants will receive a number of earned shares based on the growth in adjusted EBITDAC per share (as defined in our 2025 Proxy Statement). Earned shares for the 2025 and 2024 provisional awards will fully vest based on continuous employment through March 1, 2028 and March 1, 2027, respectively, and will be settled in unrestricted shares of our common stock on a one-for-one basis as soon as practicable thereafter. The 2025 and 2024 awards are subject to a three-year performance period that began on January 1, 2025 and 2024, respectively, and vest on the three-year anniversary of the date of grant (March 1, 2028 and March 1, 2027). Performance share awards granted in 2023 to certain executive officers age 55 or older are not subject to forfeitures upon such officers’ departure from the Company after two years from date of grant. Performance share awards granted in 2024 to executive officers are not subject to forfeiture upon such officers’ departure from the Company once they attain the age of 62. In each case, the awards vest on a pro rata basis based on the number of months rounded up during which the officer was employed during the three-year performance period. During the three-month periods ended June 30, 2025 and 2024, we recognized $6.3 million and $5.6 million, respectively, to compensation expense related to performance share awards granted in 2021 through 2025. During the six-month periods ended June 30, 2025 and 2024, we recognized $12.6 million and $10.6 million, respectively, to compensation expense related to performance share awards granted in 2021 through 2025. The total intrinsic value of unvested performance share awards at June 30, 2025 and 2024 was $103.9 million and $85.2 million, respectively. During the six-month periods ended June 30, 2025 and 2024, equity awards (including accrued dividends) with an aggregate fair value of $35.5 million and $31.6 million, respectively, were vested and distributed to employees under this plan.
Cash Awards
Pursuant to our Performance Unit Program (which we refer to as the Program), there were no units granted in the six-month periods ended June 30, 2025 and 2024. The Program consists of a one-year performance period based on our financial performance and a three-year vesting period measured from January 1 of the year of grant. At the discretion of the compensation committee and determined based on our performance, the eligible officer or key employee will be granted a percentage of the provisional cash award units that equates to the EBITDAC growth achieved (as defined in the Program). At the end of the performance period, eligible participants will be granted a number of units based on achievement of the performance goal and subject to approval by the compensation committee. Granted units will fully vest based on continuous employment through the three-year vesting period. The ultimate award value will be equal to the trailing
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twelve-month price of our common stock, multiplied by the number of units subject to the award, but limited to between 0.5 and 1.5 times the original value of the units determined as of the grant date. The fair value of the awarded units will be paid out in cash as soon as practicable. If an eligible employee leaves us prior to the vesting date, the entire award will be forfeited.
On March 15, 2022, pursuant to the Program, the compensation committee approved provisional cash awards of $19.9 million in the aggregate for future grants to our officers and key employees that are denominated in units (125,000 units in the aggregate), each of which was equivalent to the value of one share of our common stock on the date the provisional award was approved. During the three and six-month periods ended June 30, 2025, there was no compensation expense recognized related to these awards. During the three-month and six-month periods ended June 30, 2024, we recognized $3.3 million and $6.7 million to compensation expense related to these awards.
During the six-month period ended June 30, 2025, cash awards related to the 2022 provisional award with an aggregate fair value of $26.5 million (111,000 units in the aggregate) were vested and distributed to employees under the program. During the six-month period ended June 30, 2024, cash awards related to the 2021 provisional award with an aggregate fair value of $25.4 million (129,000 units in the aggregate) were vested and distributed to employees under the program.
11. Derivatives and Hedging Activity
We are exposed to market risks, including changes in foreign currency exchange rates and interest rates. To manage the risk related to these exposures, we enter into various derivative instruments that reduce these risks by creating offsetting exposures. We generally do not enter into derivative transactions for trading or speculative purposes.
Foreign Exchange Risk Management
We are exposed to foreign exchange risk when we earn revenues, pay expenses, or enter into monetary intercompany transfers denominated in a currency that differs from our functional currency, or other transactions that are denominated in a currency other than our functional currency. We use foreign exchange derivatives, typically forward contracts and options, to reduce our overall exposure to the effects of currency fluctuations on cash flows. These exposures are hedged, on average, for less than three years.
Interest Rate Risk Management
We enter into various long-term debt agreements. We use interest rate derivatives, typically swaps, to reduce our exposure to the effects of interest rate fluctuations on the forecasted interest rates for up to three years into the future.
We have not received or pledged any collateral related to derivative arrangements at June 30, 2025.
The notional and fair values of derivatives designated as hedging instruments are as follows at June 30, 2025 and December 31, 2024 (in millions):
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| Derivative Assets | Derivative Liabilities | |||||||||||||||||||||||||||||||
| Instrument | Notional Amount | Balance Sheet Classification | Fair Value | Balance Sheet Classification | Fair Value | |||||||||||||||||||||||||||
| At June 30, 2025 | ||||||||||||||||||||||||||||||||
| Interest rate contracts | $ | 1,500.0 | Other current assets | $ | 2.7 | Accrued compensation and other current liabilities | $ | 16.8 | ||||||||||||||||||||||||
| Other noncurrent assets | — | Other noncurrent liabilities | — | |||||||||||||||||||||||||||||
| Foreign exchange contracts (1) | 8.0 | Other current assets | 23.9 | Accrued compensation and other current liabilities | 0.2 | |||||||||||||||||||||||||||
| Other noncurrent assets | 14.1 | Other noncurrent liabilities | 0.8 | |||||||||||||||||||||||||||||
| Total | $ | 1,508.0 | $ | 40.7 | $ | 17.8 | ||||||||||||||||||||||||||
| At December 31, 2024 | ||||||||||||||||||||||||||||||||
| Interest rate contracts | $ | — | Other current assets | $ | — | Accrued compensation and other current liabilities | $ | — | ||||||||||||||||||||||||
| Other noncurrent assets | — | Other noncurrent liabilities | — | |||||||||||||||||||||||||||||
| Foreign exchange contracts (1) | 24.4 | Other current assets | 6.2 | Accrued compensation and other current liabilities | 2.4 | |||||||||||||||||||||||||||
| Other noncurrent assets | 2.6 | Other noncurrent liabilities | 2.9 | |||||||||||||||||||||||||||||
| Total | $ | 24.4 | $ | 8.8 | $ | 5.3 |
(1)Included within foreign exchange contracts at June 30, 2025 were $622.5 million of call options, offset with $622.5 million of put options, and $0.2 million of buy forwards, offset with $8.2 million of sell forwards. Included within foreign exchange contracts at December 31, 2024 were $595.4 million of call options, offset with $595.4 million of put options, and $1.2 million of buy forwards, offset with $25.6 million of sell forwards.
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The effect of cash flow hedge accounting on accumulated other comprehensive loss for the six-month periods ended June 30, 2025 and 2024 was as follows (in millions):
| Instrument | Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Loss (1) | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Earnings | Amount of Gain Recognized in Earnings Related to Amount Excluded from Effectiveness Testing | Statement of Earnings Classification | ||||||||||||||||||||||
| Three-month period ended June 30, 2025 | ||||||||||||||||||||||||||
| Interest rate contracts | $ | (8.9) | $ | (0.3) | $ | — | Interest expense | |||||||||||||||||||
| Foreign exchange contracts | 17.2 | (4.8) | — | Commission revenue | ||||||||||||||||||||||
| (0.5) | — | Compensation expense | ||||||||||||||||||||||||
| (0.3) | 0.1 | Operating expense | ||||||||||||||||||||||||
| Total | $ | 8.3 | $ | (5.9) | $ | 0.1 | ||||||||||||||||||||
| Three-month period ended June 30, 2024 | ||||||||||||||||||||||||||
| Interest rate contracts | $ | (3.6) | $ | (0.3) | $ | — | Interest expense | |||||||||||||||||||
| Foreign exchange contracts | (0.4) | (1.0) | — | Commission revenue | ||||||||||||||||||||||
| (0.4) | 0.2 | Compensation expense | ||||||||||||||||||||||||
| (0.4) | 0.2 | Operating expense | ||||||||||||||||||||||||
| Total | $ | (4.0) | $ | (2.1) | $ | 0.4 | ||||||||||||||||||||
| Six-month period ended June 30, 2025 | ||||||||||||||||||||||||||
| Interest rate contracts | $ | (21.6) | $ | (0.6) | $ | — | Interest expense | |||||||||||||||||||
| Foreign exchange contracts | 27.9 | (5.2) | — | Commission revenue | ||||||||||||||||||||||
| (1.1) | 0.1 | Compensation expense | ||||||||||||||||||||||||
| (0.7) | 0.1 | Operating expense | ||||||||||||||||||||||||
| Total | $ | 6.3 | $ | (7.6) | $ | 0.2 | ||||||||||||||||||||
| Six-month period ended June 30, 2024 | ||||||||||||||||||||||||||
| Interest rate contracts | $ | (2.9) | $ | (0.6) | $ | — | Interest expense | |||||||||||||||||||
| Foreign exchange contracts | (3.8) | (0.8) | — | Commission revenue | ||||||||||||||||||||||
| (0.9) | 0.5 | Compensation expense | ||||||||||||||||||||||||
| (0.7) | 0.4 | Operating expense | ||||||||||||||||||||||||
| Total | $ | (6.7) | $ | (3.0) | $ | 0.9 |
(1)For the three and six-month periods ended June 30, 2025, the amount excluded from the assessment of hedge effectiveness for our foreign exchange contracts recognized in accumulated other comprehensive loss was a loss of $0.1 million and $0.2 million, respectively. For the three and six-month periods ended June 30, 2024, the amount excluded from the assessment of hedge effectiveness for our foreign exchange contracts recognized in accumulated other comprehensive loss was a loss of $0.1 million and a gain of $0.2 million, respectively.
We estimate that approximately $37.1 million of pretax gain currently included within accumulated other comprehensive income will be reclassified into earnings in the next twelve months.
12. Commitments, Contingencies and Off-Balance Sheet Arrangements
In connection with our investing and operating activities, we have entered into certain contractual obligations and commitments. Our future minimum cash payments, including interest, associated with our contractual obligations pursuant
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to the Senior Notes, Note Purchase Agreements, Credit Agreement, Premium Financing Debt Facility, operating leases and purchase obligations at June 30, 2025 were as follows (in millions):
| Payments Due by Period | ||||||||||||||||||||||||||||||||||||||||||||
| Contractual Obligations | 2025 | 2026 | 2027 | 2028 | 2029 | Thereafter | Total | |||||||||||||||||||||||||||||||||||||
| Senior Notes | $ | — | $ | — | $ | 750.0 | $ | — | $ | 750.0 | $ | 8,050.0 | $ | 9,550.0 | ||||||||||||||||||||||||||||||
| Note Purchase Agreements | — | 640.0 | 478.0 | 200.0 | 350.0 | 1,655.0 | 3,323.0 | |||||||||||||||||||||||||||||||||||||
| Credit Agreement | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Premium Financing Debt Facility | 157.2 | — | — | — | — | — | 157.2 | |||||||||||||||||||||||||||||||||||||
| Interest on debt | 342.9 | 611.5 | 593.0 | 539.2 | 528.5 | 6,589.4 | 9,204.5 | |||||||||||||||||||||||||||||||||||||
| Total debt obligations | 500.1 | 1,251.5 | 1,821.0 | 739.2 | 1,628.5 | 16,294.4 | 22,234.7 | |||||||||||||||||||||||||||||||||||||
| Operating lease obligations | 61.2 | 122.6 | 99.9 | 71.3 | 52.7 | 176.2 | 583.9 | |||||||||||||||||||||||||||||||||||||
| Less sublease arrangements | (1.2) | (2.2) | (1.9) | (1.3) | (1.0) | — | (7.6) | |||||||||||||||||||||||||||||||||||||
| Outstanding purchase obligations | 167.9 | 197.1 | 156.0 | 40.2 | 26.8 | 54.3 | 642.3 | |||||||||||||||||||||||||||||||||||||
| Total contractual obligations | $ | 728.0 | $ | 1,569.0 | $ | 2,075.0 | $ | 849.4 | $ | 1,707.0 | $ | 16,524.9 | $ | 23,453.3 |
The amounts presented in the table above may not necessarily reflect our actual future cash funding requirements, because the actual timing of the future payments made may vary from the stated contractual obligation.
Senior Notes, Note Purchase Agreements, Credit Agreement and Premium Financing Debt Facility - See Note 6 to these unaudited consolidated financial statements for a summary of the amounts outstanding under the Senior Notes, Note Purchase Agreements, the Credit Agreement and Premium Financing Debt Facility.
Operating Lease Obligations - Our corporate segment’s executive offices and certain subsidiary and branch facilities of our brokerage and risk management segments are located in a building we own at 2850 Golf Road, Rolling Meadows, Illinois, where we have approximately 360,000 square feet of space.
We generally operate in leased premises at our other locations. Certain of these leases have options permitting renewals for additional periods. In addition to minimum fixed rentals, a number of leases contain annual escalation clauses which are generally related to increases in an inflation index.
We have leased certain office space to several non-affiliated tenants under operating sublease arrangements. In the normal course of business, we expect that certain of these leases will not be renewed or replaced. We adjust charges for real estate taxes and common area maintenance annually based on actual expenses, and we recognize the related revenues in the year in which the expenses are incurred. These amounts are not included in the minimum future rentals to be received in the contractual obligations table above.
Outstanding Purchase Obligations - The amount disclosed in the contractual obligations table above represents the aggregate amount of unrecorded purchase obligations that we had outstanding at June 30, 2025. These obligations represent agreements to purchase goods or services that were executed in the normal course of business.
Off-Balance Sheet Commitments - Our total unrecorded commitments associated with outstanding letters of credit, financial guarantees and funding commitments as of June 30, 2025 were as follows (in millions):
| Amount of Commitment Expiration by Period | Total Amounts Committed | |||||||||||||||||||||||||||||||||||||||||||
| Off-Balance Sheet Commitments | 2025 | 2026 | 2027 | 2028 | 2029 | Thereafter | ||||||||||||||||||||||||||||||||||||||
| Letters of credit | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 14.2 | $ | 14.2 | ||||||||||||||||||||||||||||||
| Financial guarantees | — | — | — | — | — | 28.6 | 28.6 | |||||||||||||||||||||||||||||||||||||
| Total commitments | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 42.8 | $ | 42.8 |
Since commitments may expire unused, the amounts presented in the table above do not necessarily reflect our actual future cash funding requirements. See the Off‑Balance Sheet Debt section below for a discussion of our letters of credit. All of the letters of credit represent multiple year commitments that have annual, automatic renewing provisions and are classified by the latest commitment date.
Since January 1, 2002, we have acquired 770 companies, all of which were accounted for using the acquisition method for recording business combinations. Substantially all of the purchase agreements related to these acquisitions contain provisions for potential earnout obligations. For all of our acquisitions made in the period from 2021 to 2025 that contain
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potential earnout obligations, such obligations are measured at fair value as of the acquisition date and are included on that basis in the recorded purchase price consideration for the respective acquisition. The amounts recorded as earnout payables are primarily based upon estimated future potential operating results of the acquired entities over a two- to three-year period subsequent to the acquisition date. The aggregate amount of the maximum earnout obligations related to these acquisitions was $1,411.5 million, of which $600.3 million was recorded in our consolidated balance sheet as of June 30, 2025 based on the estimated fair value of the expected future payments to be made, of which approximately $546.7 million can be settled in cash or stock at our option and $53.6 million must be settled in cash.
Off-Balance Sheet Debt - Our unconsolidated investment portfolio includes investments in enterprises where our ownership interest is between 1% and 50%, in which management has determined that our level of influence and economic interest is not sufficient to require consolidation. As a result, these investments are accounted for under the equity method. None of these unconsolidated investments had any outstanding debt at June 30, 2025 or December 31, 2024, that was recourse to us.
At June 30, 2025, we had posted one letter of credit totaling $0.4 million, in the aggregate, related to our self‑insurance deductibles, for which we had a recorded liability of $11.3 million. We have an equity investment in a rent-a-captive facility, which we use as a placement facility for certain of our insurance brokerage operations. At June 30, 2025, we had posted eight letters of credit totaling $13.0 million to allow certain of our captive operations to meet minimum statutory surplus requirements plus additional collateral related to premium and claim funds held in a fiduciary capacity and one letter of credit totaling $0.8 million for collateral related to claim funds held in a fiduciary capacity by a recent acquisition. These letters of credit have never been drawn upon.
Litigation, Regulatory and Taxation Matters - We routinely are involved in legal proceedings, claims, disputes, regulatory matters and governmental inspections or investigations arising in the ordinary course of or incidental to our business, including errors and omissions (which we refer to as E&O) claims and those noted below in this section. We record accruals in the unaudited consolidated financial statements for pending litigation when we determine that an unfavorable outcome is probable and the amount of the loss can be reasonably estimated. For the matters we disclose that do not include an estimate of the amount of loss or range of losses, such an estimate is not possible or is immaterial, and we may be unable to estimate the possible loss or range of losses that could potentially result from the application of non-monetary remedies, unless disclosed below. We currently believe that the ultimate outcome of these proceedings, individually and in the aggregate, will not materially harm our financial position, results of operations or cash flows. However, legal proceedings and government investigations are subject to inherent uncertainties, and unfavorable rulings or other adverse events could occur, including the payment of substantial monetary damages or an injunction or other order prohibiting us from selling one or more products at all or in particular ways, precluding particular business practices or requiring other remedies, which may result in a material adverse impact on our business, results of operations or financial position.
As previously disclosed, our IRC 831(b) (or “micro-captive”) advisory services business has been under a promoter investigation by the IRS since 2013. Among other matters, the IRS is investigating whether we have been acting as a tax shelter promoter in connection with these operations. Additionally, the IRS is conducting a criminal investigation related to IRC 831(b) micro-captive underwriting enterprises. We have been advised that we are not a target of the criminal investigation. We are fully cooperating with both matters.
Contingent Liabilities - We purchase insurance to provide protection from E&O claims that may arise during the ordinary course of business. Currently we retain the first $15.0 million of each and every E&O claim. In addition, we retain, in aggregate, up to another $2.0 million between $15.0 million and $100.0 million, plus up to another $10.0 million between $100.0 million and $225.0 million, and up to another $20.0 million between $225.0 million and $400.0 million. We have historically maintained self-insurance reserves for the portion of our E&O exposure that is not insured. We periodically determine a range of possible reserve levels using actuarial techniques that rely heavily on projecting historical claim data into the future. Our E&O reserve in the June 30, 2025 consolidated balance sheet is above the lower end of the most recently determined actuarial range by $5.9 million and below the upper end of the actuarial range by $8.1 million. We can make no assurances that the historical claim data used to project the current reserve levels will be indicative of future claim activity. Thus, the E&O reserve level and corresponding actuarial range could change in the future as more information becomes known, which could materially impact the amounts reported and disclosed herein.
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13. Supplemental Disclosures of Cash Flow Information
| Six-month period ended June 30, | ||||||||||||||
| Supplemental disclosures of cash flow information (in millions): | 2025 | 2024 | ||||||||||||
| Interest paid | $ | 224.0 | $ | 162.1 | ||||||||||
| Income taxes paid, net | 206.1 | 167.8 |
The following is a reconciliation of our end of period cash, cash equivalents, restricted cash and fiduciary cash balances as presented in the consolidated statement of cash flows for the six-month periods ended June 30, 2025 and 2024 (in millions):
| June 30, | |||||||||||
| 2025 | 2024 | ||||||||||
| Cash and cash equivalents - non-restricted cash | $ | 14,068.3 | $ | 1,219.2 | |||||||
| Cash and cash equivalents - restricted cash | 231.2 | 196.1 | |||||||||
| Total cash and cash equivalents | 14,299.5 | 1,415.3 | |||||||||
| Fiduciary cash | 6,507.0 | 5,422.5 | |||||||||
| Total cash, cash equivalents, restricted cash and fiduciary cash | $ | 20,806.5 | $ | 6,837.8 |
Total cash and cash equivalents, restricted cash and fiduciary cash at June 30, 2025 and June 30, 2024, include $15,047.9 million and $1,947.4 million, respectively, of income earning money market accounts. The increase in cash invested in money market accounts between years is primarily due to the proceeds received from the AssuredPartners Financing ($13.5 billion) and proceeds received in January 2025 from the exercise by the underwriters of the overallotment provision related to the follow-on-common stock offering ($1.28 billion). Refer to Note 3 for more information regarding the AssuredPartners Financing. The dividend income on money market accounts was recorded in interest income, premium finance and other income in our consolidated statement of earnings, which increased $288.1 million during the six-month period ended June 30, 2025 ($287.2 million of which related to the proceeds from the AssuredPartners Financing) to $480.1 million for the period ended June 30, 2025 compared to $192.0 million for the period ended June 30, 2024.
We have a qualified contributory savings and thrift 401(k) plan covering the majority of our domestic employees. For eligible employees who have met the plan’s age and service requirements to receive matching contributions, we historically have matched 100% of pretax and Roth elective deferrals up to a maximum of 5.0% of eligible compensation, subject to federal limits on plan contributions and not in excess of the maximum amount deductible for federal income tax purposes. Beginning in 2021, the amount matched by the Company will be discretionary and annually determined by management. Employees must be employed and eligible for the plan on the last day of the plan year to receive a matching contribution, subject to certain exceptions enumerated in the plan document. Matching contributions are subject to a five-year graduated vesting schedule and can be funded in cash or the common stock of the Company. We expensed (net of plan forfeitures) $59.8 million and $56.0 million related to the plan in the six-month periods ended June 30, 2025 and 2024, respectively. During 2024, our management authorized the 5.0% employer matching contribution on eligible compensation to the 401(k) plan for the 2024 plan year to be funded with our common stock, which was funded in February 2025. During 2023, our management authorized the 5.0% employer matching contribution on eligible compensation to the 401(k) plan for the 2023 plan year to be funded with our common stock, which was funded in February 2024.
14. Accumulated Other Comprehensive Loss
The after-tax components of our accumulated other comprehensive loss attributable to controlling interests consist of the following (in millions):
| Pension Liability | Foreign Currency Translation | Fair Value of Derivative Investments | Accumulated Comprehensive Loss | ||||||||||||||||||||
| Balance as of December 31, 2024 | $ | (23.2) | $ | (1,232.8) | $ | 104.9 | $ | (1,151.1) | |||||||||||||||
| Net change in period | (4.7) | 644.9 | 10.6 | 650.8 | |||||||||||||||||||
| Balance as of June 30, 2025 | $ | (27.9) | $ | (587.9) | $ | 115.5 | $ | (500.3) |
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The foreign currency translation during the six-month period ended June 30, 2025 relates to the net impact of changes in the value of the local currencies relative to the U.S. dollar for our operations in Australia, Canada, the Caribbean, India, New Zealand, the U.K. and other non-U.S. locations. The reporting currency for our financial statements is the U.S. dollar. Certain of our assets, liabilities, expenses and revenues are denominated in currencies other than the U.S. dollar, primarily the Australian dollar, British pound, Canadian dollar and New Zealand dollar. To prepare our unaudited consolidated financial statements, we must translate those assets, liabilities, expenses and revenues into U.S. dollars at the applicable exchange rates. Assets and liabilities of non-U.S. dollar functional currency operations are translated into U.S. dollars at end-of-period exchange rates while revenues, expenses and cash flows are translated at average monthly exchange rates over the period. Equity is translated at historical exchange rates and the resulting cumulative translation adjustments are included as a component of accumulated other comprehensive loss in the consolidated balance sheet. The net change in the foreign currency translation during the six-month period ended June 30, 2025 primarily relates to goodwill (see Note 5 for the impact on goodwill) and amortizable intangible assets held by operations with a non-U.S. dollar functional currency.
During the six-month periods ended June 30, 2025 and 2024, $7.6 million and $3.0 million of expense, respectively, related to the fair value of derivative investments, was reclassified from accumulated other comprehensive loss to the statement of earnings. During the six-month periods ended June 30, 2025 and 2024, no amounts related to foreign currency translation were reclassified from accumulated other comprehensive loss to the statement of earnings.
15. Segment Information
We have three reportable segments: brokerage, risk management and corporate.
The brokerage segment is primarily comprised of our retail and wholesale insurance and reinsurance brokerage operations. The brokerage segment (which comprises our retail property/casualty, wholesale, reinsurance, benefits and captive operations) generates revenues through commissions paid by underwriting enterprises and through fees charged to our clients. Our brokers, agents and administrators act as intermediaries between underwriting enterprises and our clients and we do not assume net underwriting risks.
The risk management segment provides contract claim settlement and administration services for commercial, nonprofit, captive and public sector entities, and various organizations that choose to self-insure some or all of their property/casualty coverages and for underwriting enterprises that choose to outsource some or all of their property/casualty claims departments. These operations also provide claims management, loss control consulting and insurance property appraisal services. Revenues are principally generated on a negotiated per-claim or per-service fee basis. Our risk management segment also provides risk management consulting services that are recognized as the services are delivered.
Revenues in the corporate segment consists of other income related to the run-off of clean energy and legacy investments. In addition, the corporate segment reports the financial information related to our debt, external acquisition-related expenses, other corporate costs and the impact of foreign currency remeasurements.
Allocations of interest income and certain expenses are based on reasonable assumptions and estimates primarily using revenue, headcount and other information. We allocate the provision for income taxes to the brokerage and risk management segments using the local country statutory rates. Reported operating results by segment would change if different methods were applied.
Our Chief Operating Decision Maker (which we refer to as CODM), who is our Chairman and Chief Executive Officer, analyzes and evaluates the operating performance of the three reportable segments presented below. We have disclosed for each reportable segment the significant expense categories that are reviewed by the CODM and there are no additional significant expenses within the expense categories presented in the tables below. The key areas of focus by the CODM for allocation of resources are revenues from each reportable segment, as well as their compensation and operating expenses.
Financial information relating to our segments for the three and six-month periods ended June 30, 2025 and 2024 as follows
(in millions):
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| Three-Month Period Ended June 30, 2025 | Brokerage | Risk Management | Corporate | Total | ||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||
| Commissions | $ | 1,807.5 | $ | — | $ | — | $ | 1,807.5 | ||||||||||||||||||
| Fees | 579.1 | 383.3 | — | 962.4 | ||||||||||||||||||||||
| Supplemental revenues | 102.8 | — | — | 102.8 | ||||||||||||||||||||||
| Contingent revenues | 72.7 | — | — | 72.7 | ||||||||||||||||||||||
| Interest income, premium finance revenues and other income | 223.5 | 8.6 | 0.4 | 232.5 | ||||||||||||||||||||||
| Revenues before reimbursements | 2,785.6 | 391.9 | 0.4 | 3,177.9 | ||||||||||||||||||||||
| Reimbursements | — | 42.9 | — | 42.9 | ||||||||||||||||||||||
| Total revenues | 2,785.6 | 434.8 | 0.4 | 3,220.8 | ||||||||||||||||||||||
| Compensation | 1,526.2 | 243.6 | 33.6 | 1,803.4 | ||||||||||||||||||||||
| Operating | 368.9 | 72.9 | 77.5 | 519.3 | ||||||||||||||||||||||
| Reimbursements | — | 42.9 | — | 42.9 | ||||||||||||||||||||||
| Interest | — | — | 158.6 | 158.6 | ||||||||||||||||||||||
| Depreciation | 38.1 | 9.9 | 1.7 | 49.7 | ||||||||||||||||||||||
| Amortization | 174.3 | 6.8 | — | 181.1 | ||||||||||||||||||||||
| Change in estimated acquisition earnout payables | (6.3) | 0.7 | — | (5.6) | ||||||||||||||||||||||
| Total expenses | 2,101.2 | 376.8 | 271.4 | 2,749.4 | ||||||||||||||||||||||
| Earnings (loss) before income taxes | 684.4 | 58.0 | (271.0) | 471.4 | ||||||||||||||||||||||
| Provision (benefit) for income taxes | 176.0 | 15.4 | (86.2) | 105.2 | ||||||||||||||||||||||
| Net earnings (loss) | 508.4 | 42.6 | (184.8) | 366.2 | ||||||||||||||||||||||
| Net earnings attributable to noncontrolling interests | 0.4 | — | — | 0.4 | ||||||||||||||||||||||
| Net earnings (loss) attributable to controlling interests | $ | 508.0 | $ | 42.6 | $ | (184.8) | $ | 365.8 | ||||||||||||||||||
| Net foreign exchange (loss) gain | $ | (0.2) | $ | 0.6 | $ | 25.3 | $ | 25.7 | ||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||
| United States | $ | 1,704.3 | $ | 343.9 | $ | 0.4 | $ | 2,048.6 | ||||||||||||||||||
| United Kingdom | 643.0 | 28.1 | — | 671.1 | ||||||||||||||||||||||
| Australia | 96.6 | 58.9 | — | 155.5 | ||||||||||||||||||||||
| Canada | 104.5 | 1.9 | — | 106.4 | ||||||||||||||||||||||
| New Zealand | 57.6 | 0.1 | — | 57.7 | ||||||||||||||||||||||
| Other foreign | 179.6 | 2.0 | — | 181.6 | ||||||||||||||||||||||
| Total revenues | $ | 2,785.6 | $ | 434.8 | $ | 0.4 | $ | 3,220.8 |
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| Six-Month Period Ended June 30, 2025 | Brokerage | Risk Management | Corporate | Total | ||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||
| Commissions | $ | 4,056.7 | $ | — | $ | — | $ | 4,056.7 | ||||||||||||||||||
| Fees | 1,199.3 | 747.9 | — | 1,947.2 | ||||||||||||||||||||||
| Supplemental revenues | 216.7 | — | — | 216.7 | ||||||||||||||||||||||
| Contingent revenues | 165.6 | — | — | 165.6 | ||||||||||||||||||||||
| Interest income, premium finance revenues and other income | 461.9 | 17.4 | 0.8 | 480.1 | ||||||||||||||||||||||
| Revenues before reimbursements | 6,100.2 | 765.3 | 0.8 | 6,866.3 | ||||||||||||||||||||||
| Reimbursements | — | 81.9 | — | 81.9 | ||||||||||||||||||||||
| Total revenues | 6,100.2 | 847.2 | 0.8 | 6,948.2 | ||||||||||||||||||||||
| Compensation | 3,143.4 | 474.7 | 83.0 | 3,701.1 | ||||||||||||||||||||||
| Operating | 715.3 | 143.7 | 150.7 | 1,009.7 | ||||||||||||||||||||||
| Reimbursements | — | 81.9 | — | 81.9 | ||||||||||||||||||||||
| Interest | — | — | 317.0 | 317.0 | ||||||||||||||||||||||
| Depreciation | 71.0 | 19.4 | 3.4 | 93.8 | ||||||||||||||||||||||
| Amortization | 377.9 | 12.5 | — | 390.4 | ||||||||||||||||||||||
| Change in estimated acquisition earnout payables | 9.1 | 1.1 | — | 10.2 | ||||||||||||||||||||||
| Total expenses | 4,316.7 | 733.3 | 554.1 | 5,604.1 | ||||||||||||||||||||||
| Earnings (loss) before income taxes | 1,783.5 | 113.9 | (553.3) | 1,344.1 | ||||||||||||||||||||||
| Provision (benefit) for income taxes | 459.0 | 30.2 | (220.2) | 269.0 | ||||||||||||||||||||||
| Net earnings (loss) | 1,324.5 | 83.7 | (333.1) | 1,075.1 | ||||||||||||||||||||||
| Net earnings attributable to noncontrolling interests | 4.9 | — | — | 4.9 | ||||||||||||||||||||||
| Net earnings (loss) attributable to controlling interests | $ | 1,319.6 | $ | 83.7 | $ | (333.1) | $ | 1,070.2 | ||||||||||||||||||
| Net foreign exchange gain | $ | 0.4 | $ | 0.6 | $ | 49.2 | $ | 50.2 | ||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||
| United States | $ | 3,835.5 | $ | 675.7 | $ | 0.8 | $ | 4,512.0 | ||||||||||||||||||
| United Kingdom | 1,318.5 | 49.4 | — | 1,367.9 | ||||||||||||||||||||||
| Australia | 165.2 | 115.1 | — | 280.3 | ||||||||||||||||||||||
| Canada | 203.5 | 3.7 | — | 207.2 | ||||||||||||||||||||||
| New Zealand | 97.4 | 0.2 | — | 97.6 | ||||||||||||||||||||||
| Other foreign | 480.1 | 3.2 | — | 483.3 | ||||||||||||||||||||||
| Total revenues | $ | 6,100.2 | $ | 847.2 | $ | 0.8 | $ | 6,948.2 | ||||||||||||||||||
| At June 30, 2025 | ||||||||||||||||||||||||||
| Identifiable assets: | ||||||||||||||||||||||||||
| United States | $ | 26,335.0 | $ | 1,143.0 | $ | 15,234.0 | $ | 42,712.0 | ||||||||||||||||||
| United Kingdom | 22,802.8 | 433.5 | 9.7 | 23,246.0 | ||||||||||||||||||||||
| Australia | 1,982.5 | 393.8 | — | 2,376.3 | ||||||||||||||||||||||
| Canada | 1,908.0 | 7.3 | — | 1,915.3 | ||||||||||||||||||||||
| New Zealand | 859.5 | 11.7 | — | 871.2 | ||||||||||||||||||||||
| Other foreign | 8,847.1 | 25.2 | 129.4 | 9,001.7 | ||||||||||||||||||||||
| Total identifiable assets | $ | 62,734.9 | $ | 2,014.6 | $ | 15,373.1 | $ | 80,122.6 | ||||||||||||||||||
| Goodwill - net | $ | 13,282.9 | $ | 439.0 | $ | 18.4 | $ | 13,740.3 | ||||||||||||||||||
| Amortizable intangible assets - net | 4,932.4 | 199.2 | — | 5,131.6 |
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| Three-Month Period Ended June 30, 2024 | Brokerage | Risk Management | Corporate | Total | ||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||
| Commissions | $ | 1,661.8 | $ | — | $ | — | $ | 1,661.8 | ||||||||||||||||||
| Fees | 477.6 | 349.5 | — | 827.1 | ||||||||||||||||||||||
| Supplemental revenues | 88.7 | — | — | 88.7 | ||||||||||||||||||||||
| Contingent revenues | 59.8 | — | — | 59.8 | ||||||||||||||||||||||
| Interest income, premium finance revenues and other income | 88.4 | 9.1 | 1.1 | 98.6 | ||||||||||||||||||||||
| Revenues before reimbursements | 2,376.3 | 358.6 | 1.1 | 2,736.0 | ||||||||||||||||||||||
| Reimbursements | — | 39.4 | — | 39.4 | ||||||||||||||||||||||
| Total revenues | 2,376.3 | 398.0 | 1.1 | 2,775.4 | ||||||||||||||||||||||
| Compensation | 1,370.3 | 219.2 | 30.6 | 1,620.1 | ||||||||||||||||||||||
| Operating | 337.9 | 67.1 | 20.6 | 425.6 | ||||||||||||||||||||||
| Reimbursements | — | 39.4 | — | 39.4 | ||||||||||||||||||||||
| Interest | — | — | 94.3 | 94.3 | ||||||||||||||||||||||
| Depreciation | 32.3 | 6.8 | 1.7 | 40.8 | ||||||||||||||||||||||
| Amortization | 170.8 | — | — | 170.8 | ||||||||||||||||||||||
| Change in estimated acquisition earnout payables | 18.7 | 0.1 | — | 18.8 | ||||||||||||||||||||||
| Total expenses | 1,930.0 | 332.6 | 147.2 | 2,409.8 | ||||||||||||||||||||||
| Earnings (loss) before income taxes | 446.3 | 65.4 | (146.1) | 365.6 | ||||||||||||||||||||||
| Provision (benefit) for income taxes | 113.5 | 17.6 | (50.9) | 80.2 | ||||||||||||||||||||||
| Net earnings (loss) | 332.8 | 47.8 | (95.2) | 285.4 | ||||||||||||||||||||||
| Net earnings attributable to noncontrolling interests | 2.0 | — | — | 2.0 | ||||||||||||||||||||||
| Net earnings (loss) attributable to controlling interests | $ | 330.8 | $ | 47.8 | $ | (95.2) | $ | 283.4 | ||||||||||||||||||
| Net foreign exchange (loss) gain | $ | (0.7) | $ | — | $ | 2.4 | $ | 1.7 | ||||||||||||||||||
| Revenues: | — | |||||||||||||||||||||||||
| United States | $ | 1,394.6 | $ | 324.2 | $ | 1.1 | $ | 1,719.9 | ||||||||||||||||||
| United Kingdom | 574.6 | 14.0 | — | 588.6 | ||||||||||||||||||||||
| Australia | 90.9 | 56.0 | — | 146.9 | ||||||||||||||||||||||
| Canada | 110.3 | 1.7 | — | 112.0 | ||||||||||||||||||||||
| New Zealand | 55.9 | 2.1 | — | 58.0 | ||||||||||||||||||||||
| Other foreign | 150.0 | — | — | 150.0 | ||||||||||||||||||||||
| Total revenues | $ | 2,376.3 | $ | 398.0 | $ | 1.1 | $ | 2,775.4 |
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| Six-Month Period Ended June 30, 2024 | Brokerage | Risk Management | Corporate | Total | ||||||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||
| Commissions | $ | 3,655.4 | $ | — | $ | — | $ | 3,655.4 | ||||||||||||||||||
| Fees | 1,084.3 | 694.0 | — | 1,778.3 | ||||||||||||||||||||||
| Supplemental revenues | 182.6 | — | — | 182.6 | ||||||||||||||||||||||
| Contingent revenues | 145.8 | — | — | 145.8 | ||||||||||||||||||||||
| Interest income, premium finance revenues and other income | 173.1 | 17.4 | 1.5 | 192.0 | ||||||||||||||||||||||
| Revenues before reimbursements | 5,241.2 | 711.4 | 1.5 | 5,954.1 | ||||||||||||||||||||||
| Reimbursements | — | 78.0 | — | 78.0 | ||||||||||||||||||||||
| Total revenues | 5,241.2 | 789.4 | 1.5 | 6,032.1 | ||||||||||||||||||||||
| Compensation | 2,847.1 | 433.1 | 65.8 | 3,346.0 | ||||||||||||||||||||||
| Operating | 677.3 | 135.5 | 48.5 | 861.3 | ||||||||||||||||||||||
| Reimbursements | — | 78.0 | — | 78.0 | ||||||||||||||||||||||
| Interest | — | — | 186.5 | 186.5 | ||||||||||||||||||||||
| Depreciation | 65.1 | 17.7 | 3.4 | 86.2 | ||||||||||||||||||||||
| Amortization | 326.8 | 6.3 | — | 333.1 | ||||||||||||||||||||||
| Change in estimated acquisition earnout payables | 2.5 | 0.2 | — | 2.7 | ||||||||||||||||||||||
| Total expenses | 3,918.8 | 670.8 | 304.2 | 4,893.8 | ||||||||||||||||||||||
| Earnings (loss) before income taxes | 1,322.4 | 118.6 | (302.7) | 1,138.3 | ||||||||||||||||||||||
| Provision (benefit) for income taxes | 337.0 | 31.5 | (128.3) | 240.2 | ||||||||||||||||||||||
| Net earnings (loss) | 985.4 | 87.1 | (174.4) | 898.1 | ||||||||||||||||||||||
| Net earnings attributable to noncontrolling interests | 6.3 | — | — | 6.3 | ||||||||||||||||||||||
| Net earnings (loss) attributable to controlling interests | $ | 979.1 | $ | 87.1 | $ | (174.4) | $ | 891.8 | ||||||||||||||||||
| Net foreign exchange (loss) gain | $ | (0.7) | $ | — | $ | 2.4 | $ | 1.7 | ||||||||||||||||||
| Revenues: | ||||||||||||||||||||||||||
| United States | $ | 3,208.6 | $ | 644.7 | $ | 1.5 | $ | 3,854.8 | ||||||||||||||||||
| United Kingdom | 1,159.4 | 28.0 | — | 1,187.4 | ||||||||||||||||||||||
| Australia | 158.9 | 109.0 | — | 267.9 | ||||||||||||||||||||||
| Canada | 213.4 | 3.4 | — | 216.8 | ||||||||||||||||||||||
| New Zealand | 97.6 | 4.3 | — | 101.9 | ||||||||||||||||||||||
| Other foreign | 403.3 | — | — | 403.3 | ||||||||||||||||||||||
| Total revenues | $ | 5,241.2 | $ | 789.4 | $ | 1.5 | $ | 6,032.1 | ||||||||||||||||||
| At June 30, 2024 | ||||||||||||||||||||||||||
| Identifiable assets: | ||||||||||||||||||||||||||
| United States | $ | 25,435.7 | $ | 1,109.0 | $ | 2,440.9 | $ | 28,985.6 | ||||||||||||||||||
| United Kingdom | 21,785.7 | 124.4 | — | 21,910.1 | ||||||||||||||||||||||
| Australia | 1,960.7 | 426.4 | — | 2,387.1 | ||||||||||||||||||||||
| Canada | 1,939.6 | 4.8 | — | 1,944.4 | ||||||||||||||||||||||
| New Zealand | 820.8 | 18.8 | — | 839.6 | ||||||||||||||||||||||
| Other foreign | 6,834.2 | — | 106.7 | 6,940.9 | ||||||||||||||||||||||
| Total identifiable assets | $ | 58,776.7 | $ | 1,683.4 | $ | 2,547.6 | $ | 63,007.7 | ||||||||||||||||||
| Goodwill - net | $ | 11,559.7 | $ | 336.9 | $ | 18.9 | $ | 11,915.5 | ||||||||||||||||||
| Amortizable intangible assets - net | 4,276.7 | 112.7 | — | 4,389.4 |
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