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Willis Group Holdings reports net loss from continuing operations, higher organic growth for 2013 Q3


October 30, 2013   by Canadian Underwriter


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Willis Group Holdings plc posted a net loss from continuing operations of $27 million in the third quarter of 2013, but reports that organic growth continues to increase.

The $27 million net loss from continuing operations was reported after Willis Group recorded a $60 million loss related to early extinguishment of debt and an expense of $1 million for related fees, notes a statement from the global risk advisor, insurance and reinsurance broker.

Willis Group recorded 2013 Q3 organic commissions and fees growth of 5.7% relative to the third quarter of 2012, with all of its three business units contributing positively to this performance. More specifically, Willis North America contributed growth of 3.9% (growth was reported across most of North America’s geographic regions), Willis International contributed growth of 7.8% (growth ranged from flat for operations in Western Europe to high double digits for operations in Asia), and Willis Global contributed growth of 6.4% (growth was led by Willis Re, which recorded growth in the high single digits), the statement adds.

Insurance broker Willis announces financials

Total reported commissions and fees improved from $749 in the third quarter of 2012 to $791 million in the third quarter of 2013.

“Once again we delivered strong top line results, our fourth consecutive quarter of mid-single digit organic growth with positive contributions from each of our businesses,” Dominic Casserley, CEO of Willis Group, says in the statement.

“We believe this is in line with the goals we laid out at our Investor Conference in July of growing revenues with positive operating leverage to improve cash flow and deliver strong shareholder returns,” Casserley adds.

Total revenues – which include commissions and fees, investment income and other income – were also up in 2013 Q3 compared to the year ago quarter. For the quarter ending September 30, 2013, total revenues were $795, 5.4% more than in 2012 Q3.

Other results for 2013 Q3 compared to 2012 Q3 include the following:

•total reported expenses – which include salaries and benefits, other operating expenses, depreciation expense, amortization of intangible assets, and gains and losses on disposal of operations – were $720 million compared to $684 million, an increase of 5.3%;

•other operating expenses were $144 million compared to $146 million, a decrease of 1.4%; and

•after adjusting for certain items, other operating expenses were $8 million or 5.9% higher compared to the year ago period (the increase was primarily driven by higher business development expenses and professional fees).

Looking at financial results for the nine months ending September 30, 2013, Willis Group Holdings reported net income from continuing operations of $297 million compared to $358 million for the same period in 2012.

With regard to total commissions and fees, these were $2,722 million for the first nine months of 2013 compared to $2,591 million for the first nine months of 2012.


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