Willis organic growth up 6.3% but UK declines

Willis reported organic growth in commissions and fees of 6.3% in the second quarter, a big improvement on the 1.5% reported in the same period last year.

However, the UK continues to underwhelm, after commissions and fees declined to low single-digit figures.

Of the broker’s three main business units, Willis Global was the powerhouse, expanding 10.3%. It was followed by Willis North America at 5.5% and Willis International, which includes the UK, at 2.6%.

Overall, Willis posted net income of $105m (£68m), narrowly down on the $107m in the same period last year.

The performance of $0.59 net income per diluted share narrowly beat analysts’ expectations of $0.58 per share.

A key issue for Willis will be how it tackles expenses. Total reported expenses were $719 million in the second quarter of 2013, compared with $663 million in the second quarter of 2012, an increase of 8.4%.

Had the change in remuneration policy been effective from January 1, 2012, salaries and benefits in the second quarter of 2012 would have been approximately $12 million, or 2.4%, higher.

“We continued to build on our solid performance at the end of last year and through the first half of 2013, delivering our third consecutive quarter of robust top line growth,” said Willis chief executive Dominic Casserley.

“I am pleased with the progress we made in our adjusted operating income, after considering the unfavourable foreign exchange and the uneven comparison resulting from the recent change to our compensation policy.

“Across our company, our associates are looking forward to continuing our positive momentum throughout the remainder of 2013.”