Marsh & McLennan Companies, Inc.

Consolidated Statements of Income

(In millions, except per share data)

(Unaudited)

Three Months Ended
March 31,

2025

2024

Revenue

$

7,061

$

6,473

Expense:

Compensation and benefits

3,850

3,470

Other operating expenses

1,206

1,078

Operating expenses

5,056

4,548

Operating income

2,005

1,925

Other net benefit credits

43

67

Interest income

19

37

Interest expense

(245

)

(159

)

Investment income

5

1

Income before income taxes

1,827

1,871

Income tax expense

415

447

Net income before non-controlling interests

1,412

1,424

Less: Net income attributable to non-controlling interests

31

24

Net income attributable to the Company

$

1,381

$

1,400

Net income per share attributable to the Company:

- Basic

$

2.81

$

2.84

- Diluted

$

2.79

$

2.82

Average number of shares outstanding:

- Basic

492

492

- Diluted

495

497

Shares outstanding at March 31

493

493

Marsh & McLennan Companies, Inc.

Supplemental Information - Revenue Analysis

Three Months Ended March 31

(Millions) (Unaudited)

The Company advises clients in 130 countries. As a result, foreign exchange rate movements may impact period over period comparisons of revenue. Similarly, certain other items such as acquisitions and dispositions, including transfers among businesses, may impact period over period comparisons of revenue. Non-GAAP underlying revenue measures the change in revenue from one period to the next by isolating these impacts.

Components of Revenue Change*

Three Months Ended
March 31,

% Change
GAAP
Revenue*

Currency
Impact

Acquisitions/
Dispositions/
Other Impact**

Non-GAAP
Underlying
Revenue

2025

2024

Risk and Insurance Services

Marsh (a)

$

3,453

$

3,003

15

%

(2

)%

12

%

5

%

Guy Carpenter

1,206

1,148

5

%

(1

)%

1

%

5

%

Subtotal

4,659

4,151

12

%

(2

)%

9

%

5

%

Fiduciary interest income

103

122

Total Risk and Insurance Services

4,762

4,273

11

%

(2

)%

9

%

4

%

Consulting

Mercer (b)

1,496

1,425

5

%

(2

)%

3

%

4

%

Oliver Wyman Group

818

789

4

%

(1

)%

1

%

4

%

Total Consulting

2,314

2,214

5

%

(2

)%

2

%

4

%

Corporate Eliminations

(15

)

(14

)

Total Revenue

$

7,061

$

6,473

9

%

(2

)%

7

%

4

%

Revenue Details

The following table provides more detailed revenue information for certain of the components presented above:

Components of Revenue Change*

Three Months Ended
March 31,

% Change
GAAP
Revenue*

Currency
Impact

Acquisitions/
Dispositions/
Other Impact**

Non-GAAP
Underlying
Revenue

2025

2024

Marsh:

EMEA

$

1,059

$

1,025

3

%

(3

)%

—

6

%

Asia Pacific

335

336

—

(2

)%

(1

)%

4

%

Latin America

124

125

(1

)%

(9

)%

—

8

%

Total International

1,518

1,486

2

%

(3

)%

—

6

%

U.S./Canada (a)

1,935

1,517

28

%

—

24

%

4

%

Total Marsh

$

3,453

$

3,003

15

%

(2

)%

12

%

5

%

Mercer:

Wealth (b)

$

670

$

672

—

(2

)%

(1

)%

3

%

Health (b)

608

538

13

%

(2

)%

8

%

7

%

Career

218

215

2

%

(2

)%

5

%

(1

)%

Total Mercer

$

1,496

$

1,425

5

%

(2

)%

3

%

4

%

(a)

Acquisitions, dispositions and other in 2025 includes the impact of McGriff.

(b)

Acquisitions, dispositions and other in 2024 includes a net gain from the sale of the U.K. pension administration and U.S. health and benefits administration businesses, that comprised of a gain in Wealth, offset by a loss in Health.

*

Rounded to whole percentages. Components of revenue may not add due to rounding.

**

Acquisitions, dispositions and other includes the impact of current and prior year items excluded from the calculation of non-GAAP underlying revenue for comparability purposes. Details on these items are provided in the reconciliation of non-GAAP revenue to GAAP revenue tables included in this release.

Marsh & McLennan Companies, Inc.

Reconciliation of Non-GAAP Measures

Three Months Ended March 31

(Millions) (Unaudited)

Overview

The Company reports its financial results in accordance with accounting principles generally accepted in the United States (referred to in this release as in accordance with "GAAP" or "reported" results). The Company also refers to and presents certain additional non-GAAP financial measures, within the meaning of Regulation G and item 10(e) Regulation S-K in accordance with the Securities Exchange Act of 1934. These measures are: non-GAAP revenue, adjusted operating income (loss), adjusted operating margin, adjusted income, net of tax and adjusted earnings per share (EPS). The Company has included reconciliations of these non-GAAP financial measures to the most directly comparable financial measure calculated in accordance with GAAP in the following tables.

The Company believes these non-GAAP financial measures provide useful supplemental information that enables investors to better compare the Company’s performance across periods. Management also uses these measures internally to assess the operating performance of its businesses and to decide how to allocate resources. However, investors should not consider these non-GAAP measures in isolation from, or as a substitute for, the financial information that the Company reports in accordance with GAAP. The Company's non-GAAP measures include adjustments that reflect how management views its businesses, and may differ from similarly titled non-GAAP measures presented by other companies.

In the first quarter of 2025, the Company changed its methodology to report adjusted operating income (loss), adjusted income, net of tax and adjusted EPS to exclude the impact of intangible amortization and other net benefit credits. Prior year results are presented using the new methodology for comparative purposes.

Adjusted Operating Income (Loss) and Adjusted Operating Margin

Adjusted operating income (loss) is calculated by excluding the impact of certain noteworthy items and identified intangible amortization expense from the Company's GAAP operating income (loss). The following tables reconcile adjusted operating income (loss) to GAAP operating income (loss) on a consolidated and reportable segment basis for the three months ended March 31, 2025 and 2024. The following tables also present adjusted operating margin. For the three months ended March 31, 2025 and 2024, adjusted operating margin is calculated by dividing the sum of adjusted operating income by consolidated or segment adjusted revenue. The Company's adjusted revenue used in the determination of adjusted operating margin is calculated by excluding the impact of certain noteworthy items from the Company's GAAP revenue.

Risk & Insurance
Services

Consulting

Corporate/
Eliminations

Total

Three Months Ended March 31, 2025

Operating income (loss)

$

1,613

$

456

$

(64

)

$

2,005

Operating margin

33.9

%

19.7

%

N/A

28.4

%

Add (deduct) impact of noteworthy items:

Restructuring (a)

23

8

1

32

Changes in fair value of contingent consideration

3

6

—

9

McGriff integration and retention related costs

69

—

—

69

Acquisition related costs

7

2

—

9

Gain on consolidation and disposal of business (b)

(28

)

—

—

(28

)

Total noteworthy items

74

16

1

91

Identified intangible amortization expense

120

19

—

139

Operating income adjustments

194

35

1

230

Adjusted operating income (loss)

$

1,807

$

491

$

(63

)

$

2,235

Adjusted operating margin

38.2

%

21.2

%

N/A

31.8

%

Three Months Ended March 31, 2024

Operating income (loss)

$

1,565

$

432

$

(72

)

$

1,925

Operating margin

36.6

%

19.5

%

N/A

29.7

%

Add (deduct) impact of noteworthy items:

Restructuring

22

11

9

42

Changes in fair value of contingent consideration

5

1

—

6

Acquisition and disposition related costs (c)

1

21

—

22

Disposal of business (b)

—

(21

)

—

(21

)

Total noteworthy items

28

12

9

49

Identified intangible amortization expense

79

11

—

90

Operating income adjustments

107

23

9

139

Adjusted operating income (loss)

$

1,672

$

455

$

(63

)

$

2,064

Adjusted operating margin

39.1

%

20.7

%

N/A

32.0

%

(a)

Costs in 2025 primarily include severance and lease exit charges for remaining restructuring activities.

(b)

Gain on sale of a business and a gain on remeasurement of an investment. In 2024, amount includes the net gain on sale of the Mercer U.K. pension administration and U.S. health and benefits administration businesses. These amounts are included in revenue in the consolidated statements of income and excluded from non-GAAP revenue and adjusted revenue used in the calculation of adjusted operating margin.

(c)

Primarily reflects exit costs for the disposition of the Mercer U.K. pension administration and U.S. health and benefits administration businesses.

Marsh & McLennan Companies, Inc.

Reconciliation of Non-GAAP Measures

Three Months Ended March 31

(In millions, except per share data)

(Unaudited)

Adjusted income, net of tax is calculated as the Company's GAAP income from continuing operations, adjusted to reflect the after tax impact of the operating income adjustments in the preceding tables and the additional items listed below. Adjusted EPS is calculated by dividing the Company’s adjusted income, net of tax, by the average number of shares outstanding-diluted for the relevant period. The following tables reconcile adjusted income, net of tax to GAAP income from continuing operations and adjusted EPS to GAAP EPS for the three months ended March 31, 2025 and 2024.

Three Months Ended
March 31, 2025

Three Months Ended
March 31, 2024

Amount

Adjusted
EPS

Amount

Adjusted
EPS

Net income before non-controlling interests, as reported

$

1,412

$

1,424

Less: Non-controlling interest, net of tax

31

24

Subtotal

$

1,381

$

2.79

$

1,400

$

2.82

Operating income adjustments

$

230

$

139

Other net benefit credits

(43

)

(67

)

Investments adjustment

(2

)

(1

)

Income tax effect of adjustments (a)

(50

)

(18

)

135

0.27

53

0.10

Adjusted income, net of tax

$

1,516

$

3.06

$

1,453

$

2.92

(a)

For items with an income tax impact, the tax effect was calculated using an estimated effective tax rate for each item based on jurisdiction with a blended rate for items occurring in multiple jurisdictions.

Marsh & McLennan Companies, Inc.

Supplemental Information

Three Months Ended March 31

(Millions) (Unaudited)

Three Months Ended
March 31,

2025

2024

Consolidated

Compensation and benefits

$

3,850

$

3,470

Other operating expenses

1,206

1,078

Total expenses

$

5,056

$

4,548

Depreciation and amortization expense

$

88

$

99

Identified intangible amortization expense

139

90

Total

$

227

$

189

Risk and Insurance Services

Compensation and benefits

$

2,451

$

2,118

Other operating expenses

698

590

Total expenses

$

3,149

$

2,708

Depreciation and amortization expense

$

50

$

46

Identified intangible amortization expense

120

79

Total

$

170

$

125

Consulting

Compensation and benefits

$

1,363

$

1,314

Other operating expenses

495

468

Total expenses

$

1,858

$

1,782

Depreciation and amortization expense

$

24

$

37

Identified intangible amortization expense

19

11

Total

$

43

$

48

Marsh & McLennan Companies, Inc.

Consolidated Balance Sheets

(Millions)

(Unaudited)
March 31,
2025

December 31,
2024

ASSETS

Current assets:

Cash and cash equivalents

$

1,604

$

2,398

Cash and cash equivalents held in a fiduciary capacity

11,579

11,276

Net receivables

7,872

7,156

Other current assets

1,406

1,287

Total current assets

22,461

22,117

Goodwill and intangible assets

28,274

28,126

Fixed assets, net

840

859

Pension related assets

2,021

1,914

Right of use assets

1,477

1,498

Deferred tax assets

250

237

Other assets

1,692

1,730

TOTAL ASSETS

$

57,015

$

56,481

LIABILITIES AND EQUITY

Current liabilities:

Short-term debt

$

1,667

$

519

Accounts payable and accrued liabilities

3,450

3,402

Accrued compensation and employee benefits

1,798

3,620

Current lease liabilities

327

325

Accrued income taxes

554

376

Dividends payable

400

—

Fiduciary liabilities

11,579

11,276

Total current liabilities

19,775

19,518

Long-term debt

18,862

19,428

Pension, post-retirement and post-employment benefits

832

840

Long-term lease liabilities

1,563

1,590

Liabilities for errors and omissions

309

305

Other liabilities

1,406

1,265

Total equity

14,268

13,535

TOTAL LIABILITIES AND EQUITY

$

57,015

$

56,481

Marsh & McLennan Companies, Inc.

Consolidated Statements of Cash Flows

(Millions) (Unaudited)

Three Months Ended
March 31,

2025

2024

Operating cash flows:

Net income before non-controlling interests

$

1,412

$

1,424

Adjustments to reconcile net income to cash provided by operations:

Depreciation and amortization

227

189

Non-cash lease expense

73

67

Share-based compensation expense

112

103

Net (gain) on investments, disposition of assets and other

(39

)

(28

)

Changes in assets and liabilities:

Accrued compensation and employee benefits

(1,858

)

(1,779

)

Provision for taxes, net of payments and refunds

178

209

Net receivables

(599

)

(742

)

Other changes to assets and liabilities

9

(59

)

Contributions to pension and other benefit plans in excess of current year credit

(55

)

(88

)

Operating lease liabilities

(82

)

(77

)

Net cash used by operations

(622

)

(781

)

Financing cash flows:

Purchase of treasury shares

(300

)

(300

)

Net proceeds from issuance of commercial paper

1,048

50

Proceeds from issuance of debt

—

989

Repayments of debt

(505

)

(1,004

)

Net issuance of common stock from treasury shares

(9

)

(56

)

Net distributions of non-controlling interests and deferred/contingent consideration

(53

)

(19

)

Dividends paid

(405

)

(354

)

Change in fiduciary liabilities

86

829

Net cash (used for) provided by financing activities

(138

)

135

Investing cash flows:

Capital expenditures

(55

)

(87

)

Purchases of long-term investments and other

(10

)

(10

)

Sales of long-term investments

84

4

Dispositions

25

26

Acquisitions, net of cash and cash held in a fiduciary capacity acquired

(18

)

(301

)

Net cash provided by (used for) investing activities

26

(368

)

Effect of exchange rate changes on cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity

243

(228

)

(Decrease) in cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity

(491

)

(1,242

)

Cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity at beginning of period

13,674

14,152

Cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity at end of period

$

13,183

$

12,910

Reconciliation of cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity to the Consolidated Balance Sheets

Balance at March 31,

2025

2024

(In millions)

Cash and cash equivalents

$

1,604

$

1,452

Cash and cash equivalents held in a fiduciary capacity

11,579

11,458

Total cash, cash equivalents, and cash and cash equivalents held in a fiduciary capacity

$

13,183

$

12,910

Marsh & McLennan Companies, Inc.

Reconciliation of Non-GAAP Measures

Three Months Ended March 31

(Millions) (Unaudited)

Non-GAAP revenue isolates the impact of foreign exchange rate movements and certain transaction-related items from the current period GAAP revenue. The non-GAAP revenue measure is presented on a constant currency basis, excluding the impact of foreign currency fluctuations. The Company isolates the impact of foreign exchange rate movements period over period, by translating the current period foreign currency GAAP revenue into U.S. Dollars based on the difference in the current and corresponding prior period exchange rates. Similarly, certain other items such as acquisitions and dispositions, including transfers among businesses, may impact period over period comparisons of revenue and are consistently excluded from current and prior period GAAP revenues for comparability purposes. Percentage changes, referred to as non-GAAP underlying revenue, are calculated by dividing the period over period change in non-GAAP revenue by the prior period non-GAAP revenue.

The following table provides the reconciliation of GAAP revenue to non-GAAP revenue:

2025

2024

Three Months Ended March 31,

GAAP
Revenue

Currency
Impact

Acquisitions/
Dispositions/
Other Impact

Non-GAAP
Revenue

GAAP
Revenue

Acquisitions/
Dispositions/
Other Impact

Non-GAAP
Revenue

Risk and Insurance Services

Marsh (a)

$

3,453

$

53

$

(365

)

$

3,141

$

3,003

$

(8

)

$

2,995

Guy Carpenter

1,206

13

(15

)

1,204

1,148

—

1,148

Subtotal

4,659

66

(380

)

4,345

4,151

(8

)

4,143

Fiduciary interest income

103

1

(5

)

99

122

—

122

Total Risk and Insurance Services

4,762

67

(385

)

4,444

4,273

(8

)

4,265

Consulting

Mercer (b)

1,496

32

(70

)

1,458

1,425

(22

)

1,403

Oliver Wyman Group

818

8

(9

)

817

789

(4

)

785

Total Consulting

2,314

40

(79

)

2,275

2,214

(26

)

2,188

Corporate Eliminations

(15

)

—

—

(15

)

(14

)

—

(14

)

Total Revenue

$

7,061

$

107

$

(464

)

$

6,704

$

6,473

$

(34

)

$

6,439

Revenue Details

The following table provides more detailed revenue information for certain of the components presented above:

2025

2024

Three Months Ended March 31,

GAAP
Revenue

Currency
Impact

Acquisitions/
Dispositions/
Other Impact

Non-GAAP
Revenue

GAAP
Revenue

Acquisitions/
Dispositions/
Other Impact

Non-GAAP
Revenue

Marsh:

EMEA

$

1,059

$

28

$

2

$

1,089

$

1,025

$

(1

)

$

1,024

Asia Pacific

335

8

—

343

336

(4

)

332

Latin America

124

11

—

135

125

—

125

Total International

1,518

47

2

1,567

1,486

(5

)

1,481

U.S./Canada (a)

1,935

6

(367

)

1,574

1,517

(3

)

1,514

Total Marsh

$

3,453

$

53

$

(365

)

$

3,141

$

3,003

$

(8

)

$

2,995

Mercer:

Wealth (b)

$

670

$

15

$

(60

)

$

625

$

672

$

(66

)

$

606

Health (b)

608

12

—

620

538

44

582

Career

218

5

(10

)

213

215

—

215

Total Mercer

$

1,496

$

32

$

(70

)

$

1,458

$

1,425

$

(22

)

$

1,403

(a)

Acquisitions, dispositions and other in 2025 includes the impact of McGriff.

(b)

Acquisitions, dispositions and other in 2024 includes a net gain of $21 million from the sale of the U.K. pension administration and U.S. health and benefits administration businesses, that comprised of a $66 million gain in Wealth, offset by a $45 million loss in Health.

Note: Amounts in the tables above are rounded to whole numbers.