UK will still be under tremendous pressure in 2010, says chief exec
Aon posted a rise in adjusted profit for the fourth quarter – but suffered a drop in revenue in the UK.
Aon Risk Services, the retail broking arm, battled a weak economy, soft pricing and decreased new business in the UK last year.
Fourth-quarter revenue plunged 9% to $186m (£119m), compared with the same period in 2008. It meant overall revenue for the UK in 2009 fell 6% to $650m compared with 2008.
Chief executive Greg Case said the UK was “under a tremendous amount of pressure and we don’t see that moving anywhere in the near term”.
But he remained upbeat, saying despite tough trading conditions the group performed strongly. Total revenue in 2009 increased 1% to $7.6bn.
“Colleagues globally have done an outstanding job supporting our clients in a very challenging year, and we begin 2010 in a position of strength in the industry,” Case said.
“Recent investments across our organisation in construction, professional liability, claims consulting and key talent continue to strengthen our client-serving capability, while our restructuring programmes continue to deliver additional cost savings and margin improvement.
“With the achievement of a 20% adjusted pre-tax margin in brokerage for 2009, we are establishing a new long-term pre-tax margin target of 25% for the brokerage segment.
“The outlook for this year will continue to remain tough as historically low interest rates squeeze investment returns and the pricing continues to remain relatively soft.”
Chief financial officer Christa Davies said: “We’re going to be fighting headwinds in 2010 just as we did in 2009.”