Willis reports net income of US$70 million in Q2 2015 from US$47 million in Q2 2014

London, United Kingdom-based Willis Group Holdings plc, the global risk advisory, re/insurance broking, and human capital and benefits firm, has reported a net income of US$70 million in the second quarter of 2015, ending June 30, compared to net income of US$47 million in the same quarter in the prior year quarter.

Willis, which operates in every continent and has branches in Toronto, Calgary, Vancouver and Montreal, also reported that net income for the six months ending June 30 was US$280 million, compared with US$293 million in the same period a year ago. For the first half of 2015, total reported commissions and fees were down 1.1% to US$1,998 million compared to US$2,020 million for the same period in 2014. Underlying commissions and fees were up 5.6%.

“We are pleased with our underlying performance with underlying net income up 21% compared to last year,” said Willis Group CEO Dominic Casserley in a release. “We are also pleased with our organic performance, having achieved 200 basis points of positive spread. We have achieved this despite the well-anticipated headwinds we faced in this quarter from timing issues and uneven market conditions.”

For Willis’ North America segment specifically, organic commissions and fees grew 2.5% in Q2 2015 compared with Q2 2014. “Mid-single digit growth in Human Capital and double-digit growth in Surety were offset by modest declines in Construction primarily due to the non-recurrence of the strong flow of one-time projects in the second quarter of 2014,” Willis said in the release. “The segment’s underlying commissions and fees declined 2.3%, driven by the divestitures of several small, non-core businesses over the past 12 months.” [click image below to enlarge]

Second quarter 2015 total reported commissions and fees of US$917 million were down 1.3% from US$930 million in the second quarter of 2014, impacted by US$59 million from unfavourable foreign currency movements, Willis reported. Total commissions and fees were favourably impacted by a US$33 million period-over-period net increase from acquisitions and disposals completed during the past twelve months.

In addition, on a reported basis, Willis reported that total expenses increased US$30 million, or 3.8%, to US$817 million in the second quarter of 2015, from US$787 million in the second quarter of 2014. Total reported expense growth included US$14 million of M&A transaction-related expenses from the acquisitions of Miller Insurance Services and Gras Savoye and the proposed merger with Towers Watson, and a US$40 million period-over-period net increase in operating costs of acquisitions and disposals closed over the past 12 months.