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Zacks estimates Willis Group Holdings EPS

Best insurance stock today - Zacks estimates Willis Group Holdings EPS : Willis Group Holdings plc (WSH - Analyst Report) reported fourth-quarter 2012 adjusted cyberspace income from continuing operations of 45 cents per share, surpassing the Zacks Consensus Estimate past times a penny. Results were inwards draw alongside the year-ago earnings.

Including goodwill harm accuse of $2.62 per share, write-off of unamortized cash retentiveness awards of 79 cents, 2012 cash bonus accrual of $1 per share, insurance recovery of ii cents, loss on disposal of operations of 1 cent, deferred taxation valuation allowance of 64 cents too dilutive touching on of potentially issuable shares of vi cents, Willis Group incurred a loss of $4.65 per share, compared alongside an income of fourteen cents inwards the prior-year quarter.

Operational Performance

Total revenue inwards the quarter increased 6.3% twelvemonth over twelvemonth to $871 i G m due to higher commissions too fees. Commissions too fees improved 7% twelvemonth over twelvemonth to $867 i G m inwards the quarter.

Investment income
plummeted 100% twelvemonth over twelvemonth to $4 million, attributable to lower cyberspace yields on cash too cash equivalents.

Total expense shot upwardly 123% twelvemonth over twelvemonth to $1.6 billion, primarily due to an increment inwards salaries too benefits, too goodwill harm charge.

In the quarter nether review, adjusted operating income was $166 million, upwardly 8.5% twelvemonth over year. Operating margin expanded xl footing points to 19.1%.

Quarterly Segment Update

Global: Organic growth inwards commissions too fees was 11.6% inwards the quarter, piece reported growth was 11.3%. Organic growth was primarily driven past times improve results across all lines of business.

Operating margin was 19.7%, expanding 340 footing points twelvemonth over year.

North America: Commissions too fees, on an organic basis, grew 5%, piece on a reported footing grew 4.7%.

Operating margin inwards the quarter contracted 250 footing points to 17.2%.

International: On an organic basis, commissions too fees increased 7.4% twelvemonth over year, piece on a reported basis, it increased 6.4%. Latin America reported strong double-digit growth, piece Europe too U.K. reported mid-single digit growth. Asia recorded depression single-digit growth.

Operating margin was 23.6%, contracting 270 footing points.

Full twelvemonth Highlights

Adjusted cyberspace income from continuing operations of $2.58 per part were inwards draw alongside the Zacks Consensus Estimate. Earnings declined 5.8% over 2011.

Including goodwill harm accuse of $2.60 per share, write-off of unamortized cash retentiveness awards of 78 cents, 2012 cash bonus accrual of 99 cents, insurance recovery of iii cents, loss on disposal of operations of ii cents, Republic of Republic of India JV short town of vi cents, write-off of uncollectible accounts receivable remainder too legal fees of five cents, deferred taxation valuation allowance of 64 cents too the dilutive touching on of potentially issuable shares of vi cents, Willis Group incurred a loss of $2.58 per share, compared alongside an income of $1.15 inwards 2011.

Cost Savings Initiative

Management is reviewing the organizational blueprint too expects to bring down headcount. The review volition hold upwardly completed inwards the foremost quarter of 2013. As a effect Willis Group expects to incur a pre-tax accuse of well-nigh $35 i G m to $45 i G m inwards the foremost quarter of 2013.

Nevertheless, stimulate inwards the minute quarter, the companionship expects to realize toll savings, primarily through headcount reduction, of closed to $20 i G m to $25 i G m inwards 2013. Moreover, it expects annualized toll savings of closed to $25 i G m to $30 million.

Financial Update

Willis exited 2012 alongside cash too cash equivalents of $500 million, upwardly 14.7% twelvemonth over year.

Long-term debt slid 0.7% to $2.3 billion from 2011 end.

Cash menses from operating activities inwards 2012 was $524 million, upwardly 19.4%.

Dividend Update

In February 2013, the board of directors approved a 3.7% increment inwards the quarterly cash dividend. Willis volition pay the increased dividend of 28 cents on April 15, 2013 to shareholders of tape equally on Mar 29, 2013. The annualized dividend comes to $1.12 per share.

Performance of other insurance brokers

Marsh & McLennan Companies, Inc. (MMC - Analyst Report) reported its fourth-quarter 2012 operating net turn a profit of 52 cents per share, inwards draw alongside the Zacks Consensus Estimate.

However, the results were slightly higher than the year-ago quarter’s net turn a profit of 46 cents per share.

Arthur J Gallagher & Co. (AJG - Snapshot Report) reported net turn a profit of 39 cents inwards the 4th quarter, a penny higher upwardly the Zacks Consensus Estimate too upwardly 11% twelvemonth over year.

Aon plc (AON - Snapshot Report) posted net turn a profit of $1.27 per share, exceeding the Zacks Consensus Estimate past times 1.6% too the year-ago net turn a profit past times 31%.

Zacks Rank

Willis Group currently carries a Zacks Rank #3 (Hold)

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