Profits dip but revenues rise for Willis Towers Watson in Q2
Willis Towers Watson (WTW) reported a decrease in its profits but a healthy rise in its total revenues in the second quarter of 2016.
WTW’s net income decreased to $72 million in the period compared with $114 million in the same period of the previous year.
The company’s total revenues were $1.95 billion for the quarter, an increase of 8 percent (10 percent constant currency increase, 4 percent organic increase), compared with $1.8 billion in the same period of 2015.
In its corporate risk and broking segment enjoyed an increase of 7 percent (9 percent currency increase and 1 percent organic increase) in commissions and fees reaching $623 million. The company attributed this to its acquisition of Gras Savoye.
Its UK operations led organic growth as a result of new business in property/casualty, facultative and financial lines, the broker said.
Western Europe and its international units also contributed to growth mainly driven by new business in Iberia and CEEMEA. North America organic revenue declined slightly as a result of lower levels of new business.
Its investment, risk and reinsurance segment posted commissions and fees of $355 million in the quarter, an increase of 5 percent (7 percent constant currency increase and 5 percent) compared with $337 million in the prior-year second quarter.
This segment’s growth was due to the acquisition of Miller Insurance Services. The organic decline was primarily related to a decline in risk consulting projects, lower profit sharing on certain insurance contracts and a slow-down in Capital Markets due to a decline in M&A activity, the company said.
"I'm encouraged with the results this quarter for a number of reasons. We've made significant strides in our integration efforts, kept continued focus on the market and our clients, and won new business through the strong collaboration of our colleagues around the world,” said John Haley, WTW chief executive officer.
"I'm also very pleased with the results and continued development of the Exchange business. We still have work to do across the portfolio. Many of the actions and key integration initiatives under way may not immediately impact our results but are fundamental to our long-term success. As I work with our colleagues across the globe, I become more confident each quarter that we'll achieve our merger-related goals."
