Arthur J Gallagher
said fourth-quarter earnings plunged more than 80% from a year ago, as the bottom line was hurt by losses on contingent commission matters and claims-handling obligations.
The insurance brokerage and risk-management firm earned $7.5 million, or 8 cents a share, compared with $49.1 million, or 52 cents a share, a year ago. After adjustments, earnings of 55 cents a share were 3 cents higher than the Thomson First Call consensus in the latest quarter.
Fourth-quarter revenue was up 1% to $376.1 million from $373.4 million a year ago. Analysts were expecting much higher revenue at $403.2 million.
The company said it had to deal with the unprecedented U.S. hurricane season and a softening insurance market in 2005. Gallagher added that it had settled issues regarding contingent commission matters and its open litigation.
For the full year, the company posted a profit of $30.8 million on revenue of $1.5 billion.
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