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Aon Q4 Profit Rises On Higher Organic Revenue Growth

Aon Q4 Profit Rises On Higher Organic Revenue Growth
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2/1/2013 7:42 AM ET

Risk and insurance brokerage service provider Aon Plc (AON: Quote) reported Friday a higher profit for its fourth quarter, boosted by improved performance in its Risk solutions and HR Solutions segments. Both adjusted earnings per share and top line beat Wall Street analysts' estimates.

President and Chief Executive Greg Case stated, "Our results reflect earnings growth of nine percent driven by a higher rate of organic revenue growth across each segment, strong free cash flow growth and effective capital management.."

For the fourth quarter, net income attributable to shareholders rose to $305 million or $0.93 per share from $277 million or $0.82 per share a year ago.

Adjusted for certain items, attributable net income totaled $416 million or $1.27 per share, 9 percent higher than last year's $1.16 per share. On average, 20 analysts polled by Thomson Reuters expected earnings of $1.26 per share for the quarter. Analysts' estimates typically exclude one-time items.

Quarterly revenue of $3.12 billion were 4 percent higher than last year's $2.99 billion, while analysts estimated revenues of $3.07 billion. The revenue growth was driven by a 4 percent increase in organic revenue.

Risk solutions segment's revenue increased 2 percent as Retail Brokerage revenue improved in both the Americas and International businesses. The company experienced strong growth across Asia and emerging markets and modest growth in continental Europe.

HR Solutions segment's revenue increased 7 percent due to organic growth in commissions and fees and favorable impact from acquisitions.

For fiscal year 2012, attributable net income increased 1 percent to $993 million and earnings per share rose 4 percent to $2.99. Adjusted earnings increased 1 percent to $1.4 billion and earnings per share grew 4 percent to $4.21. Annual revenues went up 2 percent to $11.5 billion as increase in organic revenue was partially offset by unfavorable currency impact.

Looking ahead, Case said, "As we look ahead to 2013, we have positioned our industry-leading platform for solid long-term growth, improved operational performance, strong free cash flow growth and effective capital management."

Aon shares closed Thursday's trading at $57.74, up $0.02 or 0.03 percent.

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by RTT Staff Writer

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