Aon CEO Case says merger with WTW 'more important than ever' amid COVID-19
Re/insurance broker Aon enjoyed a profit in the first quarter of 2020 and some revenue growth, but warned that these results are "not necessarily indicative" of what may be expected for the full year or any future period, given the economic uncertainty created by the COVID-19 pandemic.
Highlights of the first quarter included its definitive merger agreement with rival Willis Towers Watson, completion of acquisition of insurtech CoverWallet, and move of the jurisdiction from the UK to Ireland.
The company recently imposed a 20 percent pay cut on almost three quarter of its staff and 50 percent on top executives and board members to help deal with the impact of COVID-19 crisis.
Overall, the revenue increased by 2 percent to $3.2 billion, including organic revenue growth of 5 percent in the quarter, primarily driven by strong new business generation in Reinsurance Solutions and management of the renewal book globally in Health Solutions and Commercial Risk Solutions.
However, the growth was partially offset by a 2 percent unfavorable impact from foreign currency translation and a 1 percent unfavorable impact from divestitures, net of acquisitions.
The net income from continuing operations attributable to Aon shareholders was $773 million, compared to $659 million in the prior year period.
Chief executive Greg Case praised the "strong results", while emphasising the importance of its merger with WTW during the current market volatility.
"We are fortunate to operate from a position of strength, as demonstrated by the strong results our team delivered in the first quarter, including 5% organic revenue growth and substantial operating margin expansion of 200 basis points," said Case. "I want to thank our 50,000 colleagues around the world for their remarkable support of each other and our clients as we navigate through this humanitarian and economic crisis.
"Our Aon United Strategy and pending combination with Willis Towers Watson are more important than ever as we focus on accelerating innovation to bring the best of our firm to clients during this time of unprecedented volatility."
