WTW earnings decline, sees second-half acceleration

Global broker WTW reported a decline in second-quarter net income but the group says it’s tackling a transformation program with urgency and is well-placed despite a difficult economic backdrop.

Total revenue for the June quarter declined 3% to $US2.03 billion ($2.91 billion), while net income declined 39% to $US114 million ($163.6 million).

The company says on an organic basis revenues increased 3%, it expects to deliver mid-single digit growth for the full year, and it has increased its target for savings from the transformation program.

“Looking forward, the progress we have made investing in new solutions and talent positions us well to accelerate our growth in the second half of 2022, and we expect our business to remain resilient in this unsettled economic environment,” WTW CEO Carl Hess said.

WTW has this year reorganised its operations into a Risk & Broking business segment and a Health, Wealth & Career segment.

Risk & Broking revenue fell 4% to $US852 million ($1.2 billion), while rising 3% on an organic basis. Operating income fell to $US168 million ($241 million) from $US204 million ($293 million).

On an organic basis, Insurance Consulting and Technology grew primarily as a result of new software sales as well as increased advisory work, the company says.

Corporate Risk & Broking generated revenue growth across all regions, mainly driven by global lines, principally from new business. Notable areas were aerospace, natural resources, and financial, executive and professional risks (FINEX).

Health, Wealth and Career reported a 2% rise in organic revenues, while operating income was little changed.

“We continued to build momentum and execute on our strategic priorities in the second quarter, delivering results that were in line with our expectations,” Mr Hess said.