Arthur Gallagher posts profit on revenue gain

Arthur J. Gallagher & Co., the world's fourth-largest insurance broker, rose the most six months as the company posted a first-quarter profit on increased revenue after buying smaller rivals.

The broker gained $2.72, or 14 percent, to $21.77 in New York Stock Exchange composite trading at 10:25 a.m., the fourth- biggest increase in the Standard and Poor's Midcap 400 Index. Net income of $26.4 million compares with a $6 million loss in the year-earlier period, the firm said. Acquisitions made in the prior 12 months contributed $38 million in revenue to the brokerage segment, or about 13 percent of the unit's total.

"We are seeing the benefits of our efforts in 2008" to expand through acquisitions, said J. Patrick Gallagher Jr., the Itasca-based company's chief executive officer, in a statement late yesterday announcing results.

The insurance broker has fallen 12 percent in the past 12 months, beating than the 34 percent decline in the Midcap Index.