WTW’s CEO Haley extols ‘healthy growth’ and excitement about TRANZACT acquisition in Q2 2019 results
Broker Willis Towers Watson (WTW) reported “healthy growth” and expressed excitement about the completion of the TRANZACT acquisition, as the company unveiled its second quarter results for 2019.
Total revenue increased by 3 percent to $2.04 billion in the second three months of 2019 up from $1.99 billion for the same period in 2018.
Organic revenue growth overall was 6 percent in Q2 2019, representing a higher rate of increase than the 3 percent growth recorded in the same three months a year earlier.
Net income more than doubled to $138 million compared with $58 million reported in Q2 2018 the year before.
The broker saw organic growth across all segments with Investment, Risk & Reinsurance (IRR) up the most by 8 percent in Q2 2019 compared with 1 percent growth in Q2 the year before. The company said IRR posted strong organic revenue growth across all Businesses, including Wholesale and Investment, which “rebounded nicely” in Q2. “Growth was driven by favorable renewal factors, client retention, and strong new business wins,” WTW said.
Organic growth for Corporate Risk & Broking (CRB) increased 5 percent in Q2 2019, from 2 percent the year before, with “solid organic revenue growth delivered across all geographies led by North America”.
Human Capital and Benefits (HCB) organic growth increased by 5 percent in Q2 2019 up from 3 percent in the same quarter in 2018. It said HCB organic revenue growth was led by Health and Benefits driven by growth in specialty products and new local and global appointments. Other Businesses in HCB experienced modest growth, while Retirement experienced a slight decline as a result of non-recurring work in the comparable period.
The Benefits Delivery & Administration segment saw organic growth of 6 percent in Q2 but this was a reduction from the 9 percent growth delivered in the same three months a year earlier.
John Haley, chief executive of WTW, said he was pleased with the company’s financial results for the second quarter and first half of fiscal 2019.
“For the second quarter, we delivered 6 percent organic revenue growth, and each of our business segments demonstrated healthy growth in revenue and operating income margin, contributing to a double-digit increase in adjusted operating income growth for the overall company.
“We are also excited to announce the successful completion of the TRANZACT acquisition, which will rapidly accelerate Willis Towers Watson’s direct-to-consumer US healthcare strategy and significantly strengthen Willis Towers Watson’s growth profile in the healthcare space. This acquisition coupled with our highly differentiated capabilities and disciplined management of the business, leaves us confident in our ability to continue to drive sustainable, profitable growth and deliver value for our clients and shareholders.”
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