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Exhibit 99.1

 

Investor Relations

 

News from Aon

 

Aon Reports Fourth Quarter and Full Year 2011 Results

 

- Total revenue increased 3% to $3.0 billion with organic revenue growth of 3% -

- EPS from continuing operations increased 22% to $0.82 -

 

Fourth Quarter Summary

 

·                  EPS from continuing operations, adjusted for certain items, increased 15% to $0.97

·                  Risk Solutions revenue increased 3% to $1.8 billion with organic revenue growth of 3%

·                  Risk Solutions operating margin was 18.9% and the operating margin, adjusted for certain items, decreased 10 basis points to 21.8%

·                  HR Solutions revenue increased 3% to $1.2 billion with organic revenue growth of 3%

·                  HR Solutions operating margin was 11.3% and the operating margin, adjusted for certain items, decreased 120 basis points to 12.4%

·                  Subsequent to the close of the fourth quarter, the Company announced the intention to change its jurisdiction of incorporation from Delaware to the U.K., pending shareholder approval and satisfaction of other conditions

 

CHICAGO, IL — February 3, 2012 - Aon Corporation (NYSE: AON) today reported results for the fourth quarter and full year ended December 31, 2011.

 

Net income attributable to Aon stockholders from continuing operations increased 19% to $277 million or $0.82 per share, compared to $232 million or $0.67 per share for the prior year quarter.  Net income per share attributable to Aon stockholders from continuing operations, adjusted for certain items, increased 15% to $0.97, compared to $0.84 in the prior year quarter.  Certain items that impacted fourth quarter results and comparisons with the prior year quarter are detailed in the “Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share” on page 14 of this press release.

 

“Our fourth quarter results reflect 15 percent growth in earnings as highlighted by organic growth across all major businesses and the continued delivery of synergy savings related to Aon Hewitt,” said Greg Case, president and chief executive officer.  “While macro economic conditions remain challenging globally, we are firmly on track to deliver improved growth in 2012, our restructuring programs will deliver cost savings and we have solid financial flexibility that will drive increased shareholder value, as highlighted by the repurchase of $828 million of common stock in 2011.”

 



 

FOURTH QUARTER FINANCIAL SUMMARY

 

Total revenue increased 3% to $3.0 billion from the prior year quarter driven primarily by a 3% increase in organic revenue.

 

Total operating expenses increased 3%, or $72 million, to $2.6 billion due primarily to a 3% increase in organic revenue, a $21 million increase in intangible asset amortization expense and $18 million of non-cash charges related to the write-off of accounts receivable primarily from the years 2001 to 2004, partially offset by benefits related to the restructuring programs a $15 million unfavorable impact from foreign currency exchange rates, and a $14 million decline in restructuring costs.

 

Depreciation expense decreased 3%, or $2 million, to $56 million compared to the prior year quarter.

 

Intangible asset amortization expense increased 31%, or $21 million, to $89 million compared to the prior year quarter due primarily to a $22 million increase relating to assets recognized from the merger with Hewitt.

 

Restructuring expenses were $43 million compared to $57 million in the prior year quarter.  In the fourth quarter, the Company incurred $25 million of costs under the Aon Hewitt restructuring program and $21 million of costs under the Aon Benfield restructuring program primarily related to workforce reduction.  The Company has completed all restructuring activities and incurred 100% of the total costs for the 2007 restructuring program and has incurred approximately 96% of the total costs necessary to deliver the remaining $22 million of restructuring savings for the Aon Benfield restructuring program.  An analysis of restructuring-related costs is detailed on page 16 of this release.

 

Restructuring savings in the fourth quarter related to the 2007 restructuring program are estimated at $134 million compared to $128 million in the prior year quarter.  Of the restructuring savings in the fourth quarter, $113 million were related to the Risk Solutions segment.  Before any potential reinvestment of savings, the 2007 restructuring delivered cumulative expense savings of $536 million in 2011.

 

Restructuring savings in the fourth quarter related to the Aon Benfield restructuring program are estimated at $33 million compared to $27 million in the prior year quarter.  Before any potential reinvestment of savings, the Benfield restructuring program is expected to deliver cumulative expense savings of $144 million in 2012 related to the Risk Solutions segment.

 

Restructuring savings in the fourth quarter related to the Aon Hewitt restructuring program are estimated at $43 million compared to $4 million in the prior year quarter.  The Company expects to deliver cumulative expense savings of $355 million in 2013 related to the merger with Hewitt, including $280 million related to the restructuring program and $75 million in additional synergy savings from areas such as information technology, procurement and public company costs.  Associated with the transfer of the Health and Benefits business effective January 1, 2012, approximately $20 million of the estimated savings under the Aon Hewitt restructuring program will be achieved in the Risk Solutions segment.

 

2



 

Currency fluctuations in the fourth quarter had a $0.01 favorable impact on adjusted net income from continuing operations per diluted share when the Company translates prior year quarter results at current quarter foreign exchange rates.

 

Effective tax rate on net income from continuing operations declined to 27.0% in the fourth quarter compared to 32.8% in the prior year quarter.  The prior year quarter was unfavorably impacted by certain deferred tax adjustments.  The Company anticipates an effective tax rate on net income from continuing operations of approximately 29.0% in 2012.

 

Average diluted shares outstanding decreased to 337.9 million in the fourth quarter compared to 346.7 million in the prior year quarter due primarily to the Company’s share repurchase program in 2011.  The Company did not repurchase shares during the fourth quarter due to the subsequent announcement of the relocation of the corporate headquarters.  The Company has approximately $1.2 billion of common stock remaining under the share repurchase program.

 

FOURTH QUARTER SEGMENT REVIEW

 

Certain noteworthy items impacted operating income and operating margins in the fourth quarter of 2011 and 2010.  The fourth quarter segment reviews provided below include supplemental information related to organic revenue, adjusted operating income and operating margin, which is described in detail on the “Reconciliation of Non-GAAP Measures - Organic Revenue” on page 13 and “Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share” on page 14 of this press release.

 

RISK SOLUTIONS

 

 

 

 

 

 

 

 

 

 

 

Less:

 

 

 

(millions)

 

Fourth Quarter Ended

 

 

 

Less:

 

Acquisitions,

 

 

 

Commissions, 

 

Dec 31,

 

Dec 31,

 

%

 

Currency

 

Divestitures,

 

Organic

 

Fees and Other

 

2011

 

2010

 

Change

 

Impact

 

Other

 

Revenue

 

Retail

 

$

1,466

 

$

1,417

 

3

%

(1

)%

2

%

2

%

Reinsurance

 

344

 

336

 

2

 

 

(2

)

4

 

Subtotal

 

$

1,810

 

$

1,753

 

3

%

 

 

3

%

Investment Income

 

13

 

12

 

8

 

 

 

 

 

 

 

Total Revenue

 

$

  1,823

 

$

1,765

 

3

%

 

 

 

 

 

 

 

Risk Solutions total revenue increased 3% to $1.8 billion compared to the prior year quarter due primarily to 3% organic growth in commissions and fees.

 

Retail Brokerage organic revenue increased 2% reflecting revenue growth in both the Americas and International businesses.  Americas organic revenue increased 3% primarily as a result of strong management of the renewal book portfolio in Latin America and the U.S. and solid new business growth in both Canada and Latin America.  International organic revenue increased 1% driven by strong growth in Asia and emerging markets, partially offset by challenging macro-economic conditions in continental Europe.  Reinsurance organic revenue increased 4% due primarily to strong growth in capital market transactions and advisory business and modest growth in global facultative placements.

 

3



 

 

 

Fourth Quarter Ended

 

 

 

 

 

Dec 31,

 

Dec 31,

 

%

 

(millions)

 

2011

 

2010

 

Change

 

Revenue

 

$

1,823

 

$

1,765

 

3

%

Expenses

 

 

 

 

 

 

 

Compensation and benefits

 

1,006

 

958

 

5

 

Other expenses

 

472

 

433

 

9

 

Total operating expenses

 

1,478

 

1,391

 

6

%

 

 

 

 

 

 

 

 

Operating income

 

$

345

 

$

374

 

(8

)%

Operating margin

 

18.9

%

21.2

%

 

 

 

 

 

 

 

 

 

 

Operating income - adjusted

 

$

397

 

$

387

 

3

%

Operating margin - adjusted

 

21.8

%

21.9

%

 

 

 

Compensation and benefits for the fourth quarter increased 5%, or $48 million, compared to the prior year quarter due primarily to 3% organic revenue growth and a $30 million increase in restructuring costs, partially offset by benefits related to the restructuring programsOther expenses for the fourth quarter increased 9%, or $39 million, primarily due to $18 million of non-cash charges related to the write-off of accounts receivable primarily from the years 2001 to 2004, 3% organic revenue growth and $4 million of integration costs related to the recent acquisition of Glenrand M-I-B.

 

Fourth quarter operating income decreased 8% to $345 million.  Adjusting for certain items detailed on page 14 of this press release, operating income increased 3%, or $10 million compared to the prior year quarter, and operating margin decreased 10 basis points to 21.8% due primarily to a 20 basis point unfavorable impact for integration costs related to recent acquisitions.

 

HR SOLUTIONS

 

(millions)

 

Fourth Quarter Ended

 

 

 

Less:

 

Less:
Acquisitions,

 

 

 

Commissions, 

 

Dec 31,

 

Dec 31,

 

%

 

Currency

 

Divestitures,

 

Organic

 

Fees and Other

 

2011

 

2010

 

Change

 

Impact

 

Other

 

Revenue

 

Consulting Services

 

$

581

 

$

579

 

%

%

(2

)%

2

%

Outsourcing

 

605

 

580

 

4

 

 

 

4

 

Intersegment

 

(5

)

(8

)

N/A

 

N/A

 

N/A

 

N/A

 

Subtotal

 

$

1,181

 

$

1,151

 

3

%

 

 

3

%

Investment Income

 

1

 

 

N/A

 

 

 

 

 

 

 

Total Revenue

 

$

1,182

 

$

1,151

 

3

%

 

 

 

 

 

 

 

HR Solutions total revenue increased 3% to $1.2 billion compared to the prior year quarter due primarily to 3% organic growth in commissions and fees.

 

Organic revenue in Consulting Services increased 2% driven primarily by growth in health and benefits and investment management consulting, partially offset by a decline in retirement consulting.  Organic revenue in Outsourcing increased 4% due primarily to new client wins in HR business process outsourcing and health care exchanges, partially offset by price compression and client losses in benefits administration.

 

4



 

 

 

Fourth Quarter Ended

 

 

 

 

 

Dec 31,

 

Dec 31,

 

%

 

(millions)

 

2011

 

2010

 

Change

 

Revenue

 

$

1,182

 

$

1,151

 

3

%

Expenses

 

 

 

 

 

 

 

Compensation and benefits

 

695

 

737

 

(6

)

Other expenses

 

354

 

328

 

8

 

Total operating expenses

 

1,049

 

1,065

 

(2

)%

 

 

 

 

 

 

 

 

 

 

Operating income

 

$

133

 

$

86

 

55

%

Operating margin

 

11.3

%

7.5

%

 

 

 

 

 

 

 

 

 

 

Operating income - adjusted

 

$

147

 

$

157

 

(6

)%

Operating margin - adjusted

 

12.4

%

13.6

%

 

 

 

Compensation and benefits for the fourth quarter decreased 6%, or $42 million, from the prior year quarter due primarily to benefits related to the Aon Hewitt restructuring program and a $39 million decline in restructuring costs, partially offset by 3% organic revenue growth and investment in the business.  Other expenses increased 8%, or $26 million, from the prior year quarter due primarily to a $22 million increase in intangible asset amortization expense and 3% organic revenue growth, partially offset by benefits related to the Aon Hewitt restructuring program.

 

Fourth quarter operating income increased 55% to $133 million.  Adjusting for certain items detailed on page 14 of this press release, operating income decreased 6%, or $10 million, to $147 million and operating margin decreased 120 basis points to 12.4% versus the prior year quarter due primarily to a 190 basis point impact from intangible asset amortization expense, investment in the business and an unfavorable revenue mix shift, partially offset by benefits related to the restructuring program.

 

5



 

INCOME FROM CONTINUING OPERATIONS

 

 

 

Fourth Quarter Ended

 

 

 

 

 

Dec 31,

 

Dec 31,

 

%

 

(millions)

 

2011

 

2010

 

Change

 

Risk Solutions

 

$

345

 

$

374

 

(8

)%

HR Solutions

 

133

 

86

 

55

 

Unallocated expenses

 

(43

)

(38

)

13

 

Operating income from continuing operations before tax

 

$

435

 

$

422

 

3

%

Interest income

 

4

 

6

 

(33

)

Interest expense

 

(59

)

(65

)

(9

)

Other income (expense)

 

4

 

(3

)

233

 

Income from continuing operations before tax

 

$

384

 

$

360

 

7

%

 

Unallocated expenses increased $5 million to $43 million including costs for project-related work.   Interest income decreased $2 million to $4 million due to lower average interest rates.  Interest expense decreased $6 million to $59 million due primarily to a decline in the average rate on total debt outstanding.  Other income of $4 million in the fourth quarter includes gains on certain Company owned life insurance plans, partially offset by losses on the Company’s ownership in certain private equity securities and other long-term investments.  The prior year quarter included a loss of $8 million on extinguishment of debt and losses related to certain long-term investments, partially offset by gains related to the Company’s ownership in certain insurance investment funds.

 

2011 FULL YEAR SUMMARY

 

Total revenue for 2011 increased 33% to $11.3 billion due to a 29% increase in commissions and fees resulting from acquisitions, primarily Hewitt, net of dispositions, a 2% increase in organic revenue driven by Risk Solutions, and a 2% favorable impact from foreign currency exchange rates. Risk Solutions total revenue increased 6% to $6.8 billion and HR Solutions total revenue increased 113% to $4.5 billion as a result of the merger with Hewitt.

 

Net income attributable to Aon stockholders for 2011 increased 39% to $979 million compared to $706 million for the prior year.  Net income attributable to Aon stockholders from continuing operations increased 33% to $975 million compared to $733 million for the prior year.  Net income attributable to Aon stockholders, adjusted for certain items, increased 21% to $1.1 billion compared to $929 million for the prior year.  Certain items that impacted full year results and comparisons against the prior year are detailed in the “Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share” on page 14 of this press release.

 

Net income attributable to Aon stockholders for 2011 increased 21% to $2.87 per share compared to $2.37 per share for the prior year.  Net income attributable to Aon stockholders from continuing operations increased 16% to $2.86 per share compared to $2.46 per share for the prior year.  Net income attributable to Aon stockholders, adjusted for certain items, increased 5% to $3.29 per share compared to $3.12 per share for the prior year.  Certain items that impacted full year results and comparisons against the prior year are detailed in the “Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings per Share” on page 14 of this press release.

 

During 2011, the Company repurchased approximately 16.4 million shares of common stock for $828 million at an average price of $50.39 per share.

 

 

6



 

SUBSEQUENT ANNOUNCEMENT

 

On January 13, 2012, the Company announced, as an important part of its global growth strategy, it intends to change its jurisdiction of incorporation from Delaware to the U.K. and move its corporate headquarters to London.  The proposed transaction requires shareholder approval and is expected to close in the second quarter of 2012 subject to the satisfaction of other conditions.

 

CHANGES TO DISCLOSURE IN 2012

 

Effective January 1, 2012, the Company moved the global Aon Hewitt Health and Benefits businesses from the HR Solutions segment into the Risk Solutions segment.  This move will allow the businesses to benefit from a broader global distribution channel and to promote the Company’s deep health and benefits capabilities in data and analytics with clients and insurance carriers.

 

Effective January 1, 2012, the Company will begin reporting adjusted results that exclude the impact of non-cash intangible asset amortization and certain one-time items.

 

Historical selected financial information for the years 2009, 2010 and 2011, that fully reflect the disclosure changes for both the Health and Benefits transfer and for intangible amortization, are provided on pages 19-22 of this press release.

 

Conference Call, Presentation Slides and Webcast Details

 

The Company will host a conference call on Friday, February 3, 2012 at 7:30 a.m. central time.  Interested parties can listen to the conference call via a live audio webcast and view the presentation slides at www.aon.com.

 

About Aon

 

Aon Corporation (NYSE: AON) is the leading global provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services.  Through its more than 61,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative and effective risk and people solutions and through industry-leading global resources and technical expertise.  Aon has been named repeatedly as the world’s best broker, best insurance intermediary, reinsurance intermediary, captives manager and best employee benefits consulting firm by multiple industry sources.  Visit http://www.aon.com for more information on Aon.

 

Safe Harbor Statement

 

This communication contains certain statements related to future results, or states our intentions, beliefs and expectations or predictions for the future which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from either historical or anticipated results depending on a variety of factors. Potential factors that could impact results include: the planned change in global headquarters and jurisdiction of incorporation (the “Reorganization”) may not be approved by Aon’s stockholders; changes in circumstances beyond Aon’s control, including changes in foreign or domestic laws, regulatory actions, orders or rulings by foreign or domestic governmental entities, Aon’s possible removal from the S&P 500 stock index and the possibility that the Class A Ordinary Shares of Aon’s U.K. successor will not be eligible for acceptance by DTC may

 

7



 

effectively preclude Aon from completing the Reorganization or reduce or eliminate the benefits Aon expects to achieve from the Reorganization; the possibility that the expected efficiencies and cost savings from the merger with Hewitt Associates Inc. (“Hewitt”) will not be realized, or will not be realized within the expected time period; the risk that the Aon and Hewitt businesses will not be integrated successfully; general economic conditions in different countries in which Aon does business around the world; changes in global equity and fixed income markets that could affect the return on invested assets; fluctuations in exchange and interest rates that could influence revenue and expense; rating agency actions that could affect Aon’s ability to borrow funds; funding of Aon’s various pension plans; our ability to implement restructuring initiatives and other initiatives intended to yield cost savings, and the ability to achieve those cost savings; changes in the competitive environment; changes in commercial property and casualty markets and commercial premium rates that could impact revenues; continued compliance with settlement agreements related to compliance with the U.S. Foreign Corrupt Practices Act and non-U.S. anti-corruption laws; the impact of investigations brought by U.S. state attorneys general, U.S. state insurance regulators, U.S. federal prosecutors, U.S. federal regulators, and regulatory authorities in the U.K. and other countries; the impact of class actions and individual lawsuits including client class actions, securities class actions, derivative actions and ERISA class actions; the cost of resolution of other contingent liabilities and loss contingencies, including potential liabilities arising from error and omissions claims against Aon; the extent to which Aon retains existing clients and attracts new businesses; the extent to which Aon manages certain risks created in connection with the various services, including fiduciary and advisory services, among others, that Aon currently provides, or will provide in the future, to clients; the extent to which Aon retains existing employees and attracts new personnel, including potential difficulties in executive succession planning related to our need to attract talent to London if the reorganization is completed; Aon’s ability to maintain the security and privacy of confidential information belonging to its clients or their personnel; Aon’s ability to innovate and keep pace with rapid and continuing changes in technology, industry standards and client preferences; the impact of, and potential challenges in complying with, legislation and regulation in the jurisdictions in which Aon operates, particularly given the global scope of Aon’s  businesses and the possibility of conflicting regulatory requirements across jurisdictions in which Aon does business; changes in costs or assumptions associated with our outsourcing and consulting engagements that affect the profitability of these engagements; and the implementation of changes to the methods in which Aon internally process and monitors transactions. Further information concerning Aon and its business, including factors that potentially could materially affect Aon’s financial results, is contained in Aon’s and, historically, Hewitt’s filings with the SEC. See Aon’s Annual Report on Form 10-K and Annual Report to Stockholders for the fiscal year ended December 31, 2010 and Quarterly Reports on Form 10-Q for the subsequent fiscal quarters and other public filings with the SEC for a further discussion of these and other risks and uncertainties applicable to our businesses. Aon does not undertake, and expressly disclaims, any duty to update any forward-looking statement whether as a result of new information, future events or changes in their respective expectations, except as required by law.

 

Additional Information

 

This communication is being made in respect of a proposed corporate reorganization involving Aon Corporation (“Aon”), which will result in Aon’s stockholders holding Class A Ordinary Shares in a newly-formed public limited company organized under English law.  In connection with the proposed reorganization, Aon Global Limited, a subsidiary of Aon (which will become a public limited company) (“Aon UK”) has filed with the SEC a registration statement on Form S-4 that included a preliminary proxy statement/prospectus, and each of Aon and Aon UK may be filing with the SEC other documents regarding the proposed reorganization.  At the appropriate time, the definitive proxy statement/prospectus regarding the proposed reorganization will be mailed to Aon stockholders.

 

8



 

Before making any voting or investment decision, investors and stockholders are urged to read carefully in their entirety the definitive proxy statement/prospectus regarding the proposed reorganization and any other relevant documents filed by either Aon or Aon UK with the SEC when they become available because they will contain important information about the proposed transaction.  You may obtain copies of all documents filed with the SEC regarding this transaction, free of charge, at the SEC’s website (www.sec.gov) or from Aon by accessing Aon’s website at www.aon.com under the heading “Investor Relations” and then under the link “SEC Filings” or by directing a request to 200 E. Randolph Street, Chicago, Illinois 60601, Attention: Investor Relations.

 

Aon and Aon UK and their respective directors and executive officers and certain other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction.  You can find information about Aon’s directors and executive officers in its definitive proxy statement filed with the SEC on April 8, 2011.  Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC when they become available. You can obtain free copies of these documents using the contact information above.

 

Explanation of Non-GAAP Measures

 

This communication includes supplemental information related to organic revenue and several additional measures including expenses, margins and income per share, that exclude the effects of restructuring charges, transaction and integration costs and certain other noteworthy items that affected results for the comparable periods.  Organic revenue excludes from reported revenues the impact of foreign exchange, acquisitions, divestitures, transfers between business units, reimbursable expenses and unusual items.  The impact of foreign exchange is determined by translating last year’s revenue, expense or net income at this year’s foreign exchange rates.  Reconciliations are provided in the attached schedules.  Supplemental organic revenue information and additional measures that exclude the effects of the restructuring charges and certain other items do not affect net income or any other GAAP reported amounts.  Management believes that these measures are important to make meaningful period-to-period comparisons and that this supplemental information is helpful to investors.  They should be viewed in addition to, not in lieu of, the Company’s Consolidated Financial Statements.  Industry peers provide similar supplemental information regarding their performance, although they may not make identical adjustments.

 

#

 

Investor Contact:

Media Contact:

Scott Malchow

David Prosperi

Vice President, Investor Relations

Vice President, Global Public Relations

312-381-3983

312-381-2485

 

9



 

Aon Corporation

Consolidated Statements of Income (Unaudited)

 

 

 

Fourth Quarter Ended

 

Twelve Months Ended

 

(millions except per share data)

 

Dec. 31,
2011

 

Dec. 31,
2010

 

Percent
Change

 

Dec. 31,
2011

 

Dec. 31,
2010

 

Percent
Change

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fees and other

 

$

2,980

 

$

2,897

 

3

%

$

11,235

 

$

8,457

 

33

%

Fiduciary investment income

 

14

 

12

 

17

 

52

 

55

 

(5

)

Total revenue

 

2,994

 

2,909

 

3

 

11,287

 

8,512

 

33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

1,724

 

1,715

 

1

 

6,567

 

5,097

 

29

 

Other general expenses

 

835

 

772

 

8

 

3,114

 

2,189

 

42

 

Total operating expenses

 

2,559

 

2,487

 

3

 

9,681

 

7,286

 

33

 

Operating income

 

435

 

422

 

3

 

1,606

 

1,226

 

31

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

4

 

6

 

(33

)

18

 

15

 

20

 

Interest expense

 

(59

)

(65

)

(9

)

(245

)

(182

)

35

 

Other income (expense)

 

4

 

(3

)

233

 

5

 

 

N/A

 

Income from continuing operations before income taxes

 

384

 

360

 

7

 

1,384

 

1,059

 

31

 

Income taxes (1) 

 

104

 

118

 

(12

)

378

 

300

 

26

 

Income from continuing operations

 

280

 

242

 

16

 

1,006

 

759

 

33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) from discontinued operations before income taxes

 

 

(1

)

100

 

5

 

(39

)

113

 

Income taxes (2) 

 

 

 

N/A

 

1

 

(12

)

108

 

Income (loss) from discontinued operations

 

 

(1

)

100

 

4

 

(27

)

115

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

280

 

241

 

16

 

1,010

 

732

 

38

 

Less: Net income attributable to the noncontrolling interests

 

3

 

10

 

(70

)

31

 

26

 

19

 

Net income attributable to Aon stockholders

 

$

277

 

$

231

 

20

%

$

979

 

$

706

 

39

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to Aon stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

277

 

$

232

 

19

%

$

975

 

$

733

 

33

%

Income (loss) from discontinued operations

 

 

(1

)

100

 

4

 

(27

)

115

 

Net income

 

$

277

 

$

231

 

20

%

$

979

 

$

706

 

39

%

Basic net income (loss) per share attributable to Aon stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.84

 

$

0.68

 

24

%

$

2.91

 

$

2.50

 

16

%

Income (loss) from discontinued operations

 

 

 

N/A

 

0.01

 

(0.09

)

111

 

Net income

 

$

0.84

 

$

0.68

 

24

%

$

2.92

 

$

2.41

 

21

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income (loss) per share attributable to Aon stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.82

 

$

0.67

 

22

%

$

2.86

 

$

2.46

 

16

%

Income (loss) from discontinued operations

 

 

 

N/A

 

0.01

 

(0.09

)

111

 

Net income

 

$

0.82

 

$

0.67

 

22

%

$

2.87

 

$

2.37

 

21

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - diluted

 

337.9

 

346.7

 

(3

)%

340.9

 

298.1

 

14

%

 


(1)   Tax rate for continuing operations is 27.0% and 32.8% for the fourth quarters ended December 31, 2011 and 2010, respectively, and 27.3% and 28.4% for the twelve months ended December 31, 2011 and 2010, respectively.

(2)   Tax rate for discontinued operations is not meaningful for the fourth quarter ended December 31, 2011 and 34.0% for the fourth quarter ended December 2010, and 25.7% and 31.8% for the twelve months ended December 31, 2011 and 2010, respectively.

 

10



 

Aon Corporation

Revenue from Continuing Operations (Unaudited)

 

 

 

Fourth Quarter Ended

 

Twelve Months Ended

 

(millions)

 

Dec. 31,
2011

 

Dec. 31,
2010

 

Percent
Change

 

Organic
Revenue (1)

 

Dec. 31,
2011

 

Dec. 31,
2010

 

Percent
Change

 

Organic
Revenue (1)

 

Commissions, Fees and Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Solutions

 

$

1,810

 

$

1,753

 

3

%

3

%

$

6,766

 

$

6,369

 

6

%

2

%

HR Solutions

 

1,181

 

1,151

 

3

 

3

 

4,500

 

2,110

 

113

 

 

Total Operating Segments

 

$

2,991

 

$

2,904

 

3

%

3

%

$

11,266

 

$

8,479

 

33

%

2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fiduciary Investment Income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Solutions

 

$

13

 

$

12

 

8

%

 

 

$

51

 

$

54

 

(6

)%

 

 

HR Solutions

 

1

 

 

N/A

 

 

 

1

 

1

 

 

 

 

Total Operating Segments

 

$

14

 

$

12

 

17

%

 

 

$

52

 

$

55

 

(5

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Solutions

 

$

1,823

 

$

1,765

 

3

%

 

 

$

6,817

 

$

6,423

 

6

%

 

 

HR Solutions

 

1,182

 

1,151

 

3

 

 

 

4,501

 

2,111

 

113

 

 

 

Intersegment

 

(11

)

(7

)

57

 

 

 

(31

)

(22

)

41

 

 

 

Total

 

$

2,994

 

$

2,909

 

3

%

 

 

$

11,287

 

$

8,512

 

33

%

 

 

 


(1)          Organic revenue excludes the impact of foreign exchange, acquisitions, divestitures, transfers, reimbursable expenses and unusual items.  Change in organic revenue, a non-GAAP measure, is reconciled to the corresponding U.S. GAAP percent change in revenue on page 13 of this release.

 

11



 

Aon Corporation

Segments (Unaudited)

 

 

 

Fourth Quarter Ended

 

Twelve Months Ended

 

Risk Solutions

(millions)

 

Dec. 31,

2011

 

Dec. 31,

2010

 

Percent

Change

 

Dec. 31,

2011

 

Dec. 31,

2010

 

Percent

Change

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fees and other

 

$

1,810

 

$

1,753

 

3

%

$

6,766

 

$

6,369

 

6

%

Fiduciary investment income

 

13

 

12

 

8

 

51

 

54

 

(6

)

Total revenue

 

1,823

 

1,765

 

3

 

6,817

 

6,423

 

6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

1,006

 

958

 

5

 

3,825

 

3,664

 

4

 

Other general expenses

 

472

 

433

 

9

 

1,678

 

1,565

 

7

 

Total operating expenses

 

1,478

 

1,391

 

6

 

5,503

 

5,229

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

$

345

 

$

374

 

(8

)%

$

1,314

 

$

1,194

 

10

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating margin

 

18.9

%

21.2

%

 

 

19.3

%

18.6

%

 

 

 

 

 

Fourth Quarter Ended

 

Twelve Months Ended

 

HR Solutions

(millions)

 

Dec. 31,

2011

 

Dec. 31,

2010

 

Percent

Change

 

Dec. 31,

2011

 

Dec. 31,

2010

 

Percent

Change

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fees and other

 

$

1,181

 

$

1,151

 

3

%

$

4,500

 

$

2,110

 

113

%

Fiduciary investment income

 

1

 

 

N/A

 

1

 

1

 

 

Total revenue

 

1,182

 

1,151

 

3

 

4,501

 

2,111

 

113

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

695

 

737

 

(6

)

2,640

 

1,316

 

101

 

Other general expenses

 

354

 

328

 

8

 

1,413

 

561

 

152

 

Total operating expenses

 

1,049

 

1,065

 

(2

)

4,053

 

1,877

 

116

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

$

133

 

$

86

 

55

%

$

448

 

$

234

 

91

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating margin

 

11.3

%

7.5

%

 

 

10.0

%

11.1

%

 

 

 

 

 

Fourth Quarter Ended

 

Twelve Months Ended

 

Total Operating Income (Loss)

(millions)

 

Dec. 31,

2011

 

Dec. 31,

2010

 

Percent

Change

 

Dec. 31,

2011

 

Dec. 31,

2010

 

Percent

Change

 

Risk Solutions

 

$

345

 

$

374

 

(8

)%

$

1,314

 

$

1,194

 

10

%

HR Solutions

 

133

 

86

 

55

 

448

 

234

 

91

 

Unallocated

 

(43

)

(38

)

13

 

(156

)

(202

)

(23

)

Total operating income

 

$

435

 

$

422

 

3

%

$

1,606

 

$

1,226

 

31

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating margin

 

14.5

%

14.5

%

 

 

14.2

%

14.4

%

 

 

 

12



 

Aon Corporation

Reconciliation of Non-GAAP Measures - Organic Revenue (Unaudited)

 

 

 

Fourth Quarter Ended

 

(millions)

 

Dec. 31,

2011

 

Dec. 31,

2010

 

Percent

Change

 

Less:

Currency

Impact (1)

 

Less:

Acquisitions,

Divestitures &

Other

 

Organic

Revenue

(2)

 

Commissions, Fees and Other

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Solutions Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail brokerage

 

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

$

750

 

$

700

 

7

%

(1

)%

5

%

3

%

International

 

716

 

717

 

 

 

(1

)

1

 

Total Retail brokerage

 

1,466

 

1,417

 

3

 

(1

)

2

 

2

 

Reinsurance brokerage

 

344

 

336

 

2

 

 

(2

)

4

 

Total Risk Solutions

 

1,810

 

1,753

 

3

 

 

 

3

 

HR Solutions Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

Consulting services

 

581

 

579

 

 

 

(2

)

2

 

Outsourcing

 

605

 

580

 

4

 

 

 

4

 

Intrasegment

 

(5

)

(8

)

N/A

 

N/A

 

N/A

 

N/A

 

Total HR Solutions

 

1,181

 

1,151

 

3

 

 

 

3

 

Total Operating Segments

 

$

2,991

 

$

2,904

 

3

%

%

%

3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Twelve Months Ended

 

(millions)

 

Dec. 31,

2011

 

Dec. 31,

2010

 

Percent

Change

 

Less:

Currency

Impact (1)

 

Less:

Acquisitionz,

Divestitures &

Other

 

Organic

Revenue

(2)

 

Commissions, Fees and Other

 

 

 

 

 

 

 

 

 

 

 

 

 

Risk Solutions Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail brokerage

 

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

$

2,605

 

$

2,377

 

10

%

1

%

6

%

3

%

International

 

2,698

 

2,548

 

6

 

4

 

(1

)

3

 

Total Retail brokerage

 

5,303

 

4,925

 

8

 

3

 

2

 

3

 

Reinsurance brokerage

 

1,463

 

1,444

 

1

 

2

 

(1

)

 

Total Risk Solutions

 

6,766

 

6,369

 

6

 

3

 

1

 

2

 

HR Solutions Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

Consulting services

 

2,251

 

1,387

 

62

 

2

 

59

 

1

 

Outsourcing

 

2,272

 

731

 

211

 

 

211

 

 

Intrasegment

 

(23

)

(8

)

N/A

 

N/A

 

N/A

 

N/A

 

Total HR Solutions

 

4,500

 

2,110

 

113

 

2

 

111

 

 

Total Operating Segments

 

$

11,266

 

$

8,479

 

33

%

2

%

29

%

2

%

 


(1)           Currency impact is determined by translating last year’s revenue at this year’s foreign exchange rates.

 

(2)           Organic revenue excludes the impact of foreign exchange, acquisitions, divestitures, transfers, reimbursable expenses and unusual items.

 

13



 

Aon Corporation

Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings Per Share (Unaudited) (1)

 

 

 

Fourth Quarter Ended December 31, 2011

 

Twelve Months Ended December 31, 2011

 

(millions)

 

Risk
Solutions

 

HR
Solutions

 

Unallocated
Income &
Expense

 

Total

 

Risk
Solutions

 

HR
Solutions

 

Unallocated
Income &
Expense

 

Total

 

Revenue

 

$

1,823

 

$

1,182

 

$

(11

)

$

2,994

 

$

6,817

 

$

4,501

 

$

(31

)

$

11,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as reported

 

$

345

 

$

133

 

$

(43

)

$

435

 

$

1,314

 

$

448

 

$

(156

)

$

1,606

 

Restructuring charges

 

34

 

9

 

 

43

 

24

 

89

 

 

113

 

Legacy receivables write-off

 

18

 

 

 

18

 

18

 

 

 

18

 

Transaction related costs - proxy

 

 

 

3

 

3

 

 

 

3

 

3

 

Hewitt related costs

 

 

5

 

 

5

 

 

47

 

 

47

 

Operating income (loss) - as adjusted

 

$

397

 

$

147

 

$

(40

)

$

504

 

$

1,356

 

$

584

 

$

(153

)

$

1,787

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating margins - as adjusted

 

21.8

%

12.4

%

N/A

 

16.8

%

19.9

%

13.0

%

N/A

 

15.8

%

 

 

 

Fourth Quarter Ended December 31, 2010

 

Twelve Months Ended December 31, 2010

 

(millions)

 

Risk
Solutions

 

HR
Solutions

 

Unallocated
Income &
Expense

 

Total

 

Risk
Solutions

 

HR
Solutions

 

Unallocated
Income &
Expense

 

Total

 

Revenue

 

$

1,765

 

$

1,151

 

$

(7

)

$

2,909

 

$

6,423

 

$

2,111

 

$

(22

)

$

8,512

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as reported

 

$

374

 

$

86

 

$

(38

)

$

422

 

$

1,194

 

$

234

 

$

(202

)

$

1,226

 

Restructuring charges

 

4

 

53

 

 

57

 

110

 

62

 

 

172

 

Pension adjustment

 

 

 

 

 

 

 

49

 

49

 

Hewitt related costs

 

 

18

 

3

 

21

 

 

19

 

21

 

40

 

Anti-bribery and compliance initiatives

 

9

 

 

 

9

 

9

 

 

 

9

 

Operating income (loss) - as adjusted

 

$

387

 

$

157

 

$

(35

)

$

509

 

$

1,313

 

$

315

 

$

(132

)

$

1,496

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating margins - as adjusted

 

21.9

%

13.6

%

N/A

 

17.5

%

20.4

%

14.9

%

N/A

 

17.6

%

 

 

 

Fourth Quarter Ended

 

Twelve Months Ended

 

 

 

December 31,

 

December 31,

 

(millions except per share data)

 

2011

 

2010

 

2011

 

2010

 

Operating income - as adjusted

 

$

504

 

$

509

 

$

1,787

 

$

1,496

 

Interest income

 

4

 

6

 

18

 

15

 

Interest expense

 

(59

)

(65

)

(245

)

(182

)

Hewitt related costs

 

 

 

 

14

 

Interest expense - as adjusted

 

(59

)

(65

)

(245

)

(168

)

 

 

 

 

 

 

 

 

 

 

Other (expense) income - as reported

 

4

 

(3

)

5

 

 

Loss on Debt Extinguishment

 

 

 

19

 

 

Other (expense) income - as adjusted

 

4

 

(3

)

24

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations before income taxes - as adjusted

 

453

 

447

 

1,584

 

1,343

 

Income taxes (2)

 

122

 

146

 

432

 

388

 

Income from continuing operations - as adjusted

 

331

 

301

 

1,152

 

955

 

Less: Net income attributable to noncontrolling interests

 

3

 

10

 

31

 

26

 

Income from continuing operations attributable to Aon stockholders - as adjusted

 

$

328

 

$

291

 

$

1,121

 

$

929

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share from continuing operations - as adjusted

 

$

0.97

 

$

0.84

 

$

3.29

 

$

3.12

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - diluted

 

337.9

 

346.7

 

340.9

 

298.1

 

 


(1)          Certain noteworthy items impacting operating income in 2011 and 2010 are described in this schedule.  The items shown with the caption “as adjusted” are non-GAAP measures.

 

(2)          The effective tax rate for continuing operations is 27.0% and 32.8% for the fourth quarters ended December 31, 2011 and 2010, respectively, and 27.3% and 28.4% for the twelve months ended December 31, 2011 and 2010, respectively.  All adjusting items are generally taxed at the effective tax rate.  However, the twelve months ended December 31, 2010 U.S. GAAP effective tax rate was adjusted to 28.9% to exclude the impact of the 40% tax rate applied to the a $49 million U.S. pension expense adjustment for prior years recorded in the second quarter 2010.

 

14



 

Aon Corporation

Reconciliation of Non-GAAP Measures - Operating Income and Diluted Earnings Per Share Adjusted for Intangible Asset Amortization (Unaudited) (1)

 

 

 

Fourth Quarter Ended December 31, 2011

 

Twelve Months Ended December 31, 2011

 

(millions)

 

Risk
Solutions

 

HR
Solutions

 

Unallocated
Income &
Expense

 

Total

 

Risk
Solutions

 

HR
Solutions

 

Unallocated
Income &
Expense

 

Total

 

Revenue

 

$

1,823

 

$

1,182

 

$

(11

)

$

2,994

 

$

6,817

 

$

4,501

 

$

(31

)

$

11,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as reported

 

$

345

 

$

133

 

$

(43

)

$

435

 

$

1,314

 

$

448

 

$

(156

)

$

1,606

 

Restructuring charges

 

34

 

9

 

 

43

 

24

 

89

 

 

113

 

Intangible asset amortization

 

27

 

62

 

 

89

 

110

 

252

 

 

362

 

Legacy receivables write-off

 

18

 

 

 

18

 

18

 

 

 

18

 

Transaction related costs - proxy

 

 

 

3

 

3

 

 

 

3

 

3

 

Hewitt related costs

 

 

5

 

 

5

 

 

47

 

 

47

 

Operating income (loss) - as adjusted

 

$

424

 

$

209

 

$

(40

)

$

593

 

$

1,466

 

$

836

 

$

(153

)

$

2,149

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating margins - as adjusted

 

23.3

%

17.7

%

N/A

 

19.8

%

21.5

%

18.6

%

N/A

 

19.0

%

 

 

 

Fourth Quarter Ended December 31, 2010

 

Twelve Months Ended December 31, 2010

 

(millions)

 

Risk
Solutions

 

HR
Solutions

 

Unallocated
Income &
Expense

 

Total

 

Risk
Solutions

 

HR
Solutions

 

Unallocated
Income &
Expense

 

Total

 

Revenue

 

$

1,765

 

$

1,151

 

$

(7

)

$

2,909

 

$

6,423

 

$

2,111

 

$

(22

)

$

8,512

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as reported

 

$

374

 

$

86

 

$

(38

)

$

422

 

$

1,194

 

$

234

 

$

(202

)

$

1,226

 

Restructuring charges

 

4

 

53

 

 

57

 

110

 

62

 

 

172

 

Intangible asset amortization

 

28

 

40

 

 

68

 

108

 

46

 

 

154

 

Pension adjustment

 

 

 

 

 

 

 

49

 

49

 

Hewitt related costs

 

 

18

 

3

 

21

 

 

19

 

21

 

40

 

Anti-bribery and compliance initiatives

 

9

 

 

 

9

 

9

 

 

 

9

 

Operating income (loss) - as adjusted

 

$

415

 

$

197

 

$

(35

)

$

577

 

$

1,421

 

$

361

 

$

(132

)

$

1,650

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating margins - as adjusted

 

23.5

%

17.1

%

N/A

 

19.8

%

22.1

%

17.1

%

N/A

 

19.4

%

 

 

 

Fourth Quarter Ended
December 31,

 

Twelve Months Ended
December 31,

 

(millions except per share data)

 

2011

 

2010

 

2011

 

2010

 

Operating income - as adjusted

 

$

593

 

$

577

 

$

2,149

 

$

1,650

 

Interest income

 

4

 

6

 

18

 

15

 

Interest expense

 

(59

)

(65

)

(245

)

(182

)

Hewitt related costs

 

 

 

 

14

 

Interest expense - as adjusted

 

(59

)

(65

)

(245

)

(168

)

 

 

 

 

 

 

 

 

 

 

Other (expense) income - as reported

 

4

 

(3

)

5

 

 

Loss on Debt Extinguishment

 

 

 

19

 

 

Other (expense) income - as adjusted

 

4

 

(3

)

24

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations before income taxes - as adjusted

 

542

 

515

 

1,946

 

1,497

 

Income taxes (2)

 

146

 

169

 

531

 

433

 

Income from continuing operations - as adjusted

 

396

 

346

 

1,415

 

1,064

 

Less: Net income attributable to noncontrolling interests

 

3

 

10

 

31

 

26

 

Income from continuing operations attributable to Aon stockholders - as adjusted

 

$

393

 

$

336

 

$

1,384

 

$

1,038

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share from continuing operations - as adjusted

 

$

1.16

 

$

0.97

 

$

4.06

 

$

3.48

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - diluted

 

337.9

 

346.7

 

340.9

 

298.1

 

 


(1)          Certain noteworthy items impacting operating income in 2011 and 2010 are described in this schedule.  The items shown with the caption “as adjusted” are non-GAAP measures.

 

(2)          The effective tax rate for continuing operations is 27.0% and 32.8% for the fourth quarters ended December 31, 2011 and 2010, respectively, and 27.3% and 28.4% for the twelve months ended December 31, 2011 and 2010, respectively.  All adjusting items are generally taxed at the effective tax rate.  However, the twelve months ended December 31, 2010 U.S. GAAP effective tax rate was adjusted to 28.9% to exclude the impact of the 40% tax rate applied to the a $49 million U.S. pension expense adjustment for prior years recorded in the second quarter 2010.

 

15



 

Aon Corporation

Restructuring Plans (Unaudited) (1)

 

Aon Hewitt Restructuring Plan

 

By Type:

 

 

 

Actual

 

 

 

(millions)

 

Full Year
2010

 

Fourth
Quarter
2011

 

Full Year
2011

 

Total to
Date

 

Estimated
Total

 

Workforce reduction

 

$

49

 

$

25

 

$

64

 

$

113

 

$

180

 

Lease consolidation

 

3

 

(1

)

32

 

35

 

95

 

Asset impairments

 

 

 

7

 

7

 

47

 

Other costs associated with restructuring

 

 

1

 

2

 

2

 

3

 

Total restructuring and related expenses

 

$

52

 

$

25

 

$

105

 

$

157

 

$

325

 

 

 

 

 

 

 

 

 

 

 

 

 

By Segment: (2)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HR Solutions

 

52

 

10

 

90

 

142

 

297

 

Risk Solutions

 

 

15

 

15

 

15

 

28

 

Total restructuring and related expenses

 

$

52

 

$

25

 

$

105

 

$

157

 

$

325

 

 

Aon Benfield Restructuring Plan

 

By Type:

 

 

 

 

 

Operations

 

 

 

(millions)

 

Purchase
Price
Allocation (3)

 

Full
Year
2009

 

Full
Year
2010

 

Fourth
Quarter
2011

 

Full Year
2011

 

Total
Operations
to Date

 

Estimated
Total

 

Workforce reduction

 

$

32

 

$

38

 

$

15

 

$

19

 

$

33

 

$

118

 

$

125

 

Lease consolidation (4)

 

20

 

14

 

7

 

2

 

(15

)

26

 

26

 

Asset impairments

 

 

2

 

2

 

 

 

4

 

4

 

Other costs associated with restructuring

 

1

 

1

 

2

 

 

1

 

5

 

5

 

Total restructuring and related expenses

 

$

53

 

$

55

 

$

26

 

$

21

 

$

19

 

$

153

 

$

160

 

 

2007 Restructuring Plan

 

By Type:

 

 

 

Actual

 

(millions)

 

Inception to
2010

 

Fourth
Quarter
2011

 

Full Year
2011

 

Total

 

Workforce reduction

 

$

506

 

$

(2

)

$

(2

)

$

504

 

Lease consolidation (4)

 

153

 

(1

)

(9

)

144

 

Asset impairments

 

39

 

 

 

39

 

Other costs associated with restructuring

 

50

 

 

 

50

 

Total restructuring and related expenses

 

$

748

 

$

(3

)

$

(11

)

$

737

 

 


(1)          In the Consolidated Statements of Income, workforce reductions are included in “Compensation and benefits”;  lease consolidations, asset impairments, and other costs associated with restructuring are included in “Other general expenses”.

 

(2)          Costs included in the Risk Solutions segment are associated with the transfer of the Health and Benefits Consulting business from HR Solutions to Risk Solutions effective January 1, 2012

 

(3)          Represents costs associated with the execution of restructuring activity identified at the acquisition date (November 30, 2008).

 

(4)          Includes impact of reoccupying previously vacated leased properties.  Total restructuring reversal was $28 million, of which $19 million was related to the Aon Benfield Restructuring Plan and $9 million was related to the 2007 Restructuring Plan.

 

16



 

Aon Corporation

Consolidated Statements of Financial Position (Unaudited)

 

 

 

As of

 

(millions) 

 

December 31,
2011

 

December 31,
2010

 

 

 

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

Current Assets

 

 

 

 

 

Cash and cash equivalents

 

$

272

 

$

346

 

Short-term investments

 

785

 

785

 

Receivables, net

 

3,183

 

2,701

 

Fiduciary assets (1) 

 

10,838

 

10,063

 

Other current assets

 

427

 

624

 

Total Current Assets

 

15,505

 

14,519

 

Goodwill

 

8,770

 

8,647

 

Intangible assets, net

 

3,276

 

3,611

 

Fixed assets, net

 

783

 

781

 

Investments

 

239

 

312

 

Deferred tax assets

 

258

 

305

 

Other non-current assets

 

721

 

807

 

Total Assets

 

$

29,552

 

$

28,982

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

Current Liabilities

 

 

 

 

 

Fiduciary liabilities

 

$

10,838

 

$

10,063

 

Short-term debt and current portion of long-term debt

 

337

 

492

 

Accounts payable and accrued liabilities

 

1,832

 

1,810

 

Other current liabilities

 

753

 

584

 

Total Current Liabilities

 

13,760

 

12,949

 

Long-term debt

 

4,155

 

4,014

 

Deferred tax liabilities

 

301

 

663

 

Pension and other post employment liabilities

 

2,192

 

1,896

 

Other non-current liabilities

 

1,024

 

1,154

 

Total Liabilities

 

21,432

 

20,676

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

STOCKHOLDER’S EQUITY

 

 

 

 

 

Common stock-$1 par value

 

386

 

386

 

Additional paid-in capital

 

4,021

 

4,000

 

Retained earnings

 

8,594

 

7,861

 

Accumulated other comprehensive loss

 

(2,370

)

(1,917

)

Treasury stock at cost

 

(2,553

)

(2,079

)

Total Aon Stockholders’ Equity

 

8,078

 

8,251

 

Noncontrolling interests

 

42

 

55

 

Total Equity

 

8,120

 

8,306

 

Total Liabilities and Equity

 

$

29,552

 

$

28,982

 

 


(1) Includes short-term investments:  2011 - $4,190, 2010 - $3,489.

 

17



 

Aon Corporation

Consolidated Statements of Cash Flows (Unaudited)

 

 

 

Fourth Quarter Ended

 

Twelve Months Ended

 

(millions) 

 

December 31,
2011

 

December 31,
2010

 

December 31,
2011

 

December 31,
2010

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

 

 

 

 

 

Net income

 

$

280

 

$

241

 

$

1,010

 

$

732

 

Adjustments to reconcile net income to cash provided by operating activities:

 

 

 

 

 

 

 

 

 

(Gain) loss from sales of businesses, net

 

(2

)

3

 

(6

)

43

 

Depreciation of fixed assets

 

56

 

58

 

220

 

151

 

Amortization of intangible assets

 

89

 

68

 

362

 

154

 

Stock compensation expense

 

56

 

55

 

235

 

221

 

Deferred income taxes

 

143

 

63

 

146

 

76

 

Change in assets and liabilities:

 

 

 

 

 

 

 

 

 

Fiduciary receivables

 

(415

)

(878

)

(14

)

816

 

Short term investments - funds held on behalf of clients

 

(87

)

447

 

(713

)

(19

)

Fiduciary liabilities

 

502

 

431

 

727

 

(797

)

Receivables, net

 

(458

)

(29

)

(494

)

(69

)

Accounts payable and accrued liabilities

 

227

 

17

 

 

(280

)

Restructuring reserves

 

(5

)

(10

)

(73

)

(64

)

Current income taxes

 

(52

)

14

 

120

 

 

Pension and other post employment liabilities

 

(65

)

(35

)

(399

)

(130

)

Other assets and liabilities

 

(38

)

10

 

(103

)

(51

)

CASH PROVIDED BY OPERATIONS

 

231

 

455

 

1,018

 

783

 

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

 

 

 

 

 

Sales of long-term investments

 

87

 

8

 

190

 

90

 

Purchases of long-term investments

 

(2

)

(17

)

(30

)

(34

)

Net (purchases) sales of short-term investments - non-fiduciary

 

(184

)

1,355

 

(8

)

(337

)

Acquisition of businesses, net of cash acquired

 

(4

)

(1,998

)

(97

)

(2,078

)

Capital expenditures

 

(90

)

(65

)

(241

)

(180

)

CASH USED FOR INVESTING ACTIVITIES

 

(193

)

(717

)

(186

)

(2,539

)

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

 

 

 

 

 

Purchase of treasury stock

 

 

(150

)

(828

)

(250

)

Issuance of stock for employee benefit plans

 

36

 

96

 

201

 

194

 

Issuance of debt

 

101

 

1,100

 

1,673

 

2,905

 

Repayment of debt

 

(165

)

(735

)

(1,688

)

(816

)

Cash dividends to stockholders

 

(50

)

(52

)

(200

)

(175

)

Purchase of shares from non controlling interests

 

 

(9

)

(24

)

(15

)

Dividends paid to non controlling interests

 

(9

)

(5

)

(30

)

(20

)

CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES

 

(87

)

245

 

(896

)

1,823

 

 

 

 

 

 

 

 

 

 

 

Effect of Exchange Rate Changes on Cash and Cash Equivalents

 

26

 

28

 

(10

)

62

 

Net (Decrease) Increase in Cash and Cash Equivalents

 

(23

)

11

 

(74

)

129

 

Cash and Cash Equivalents at Beginning of Period

 

295

 

325

 

346

 

217

 

Cash and Cash Equivalents at End of Period

 

$

272

 

$

336

 

$

272

 

$

346

 

 

18



 

Aon Corporation

Reconciliation of Non-GAAP Measures - Historical Organic Revenue (Unaudited)

 

 

 

2011

 

2010

 

2009

 

 

 

Full year

 

Q4

 

Q3

 

Q2

 

Q1

 

Full Year

 

Q4

 

Q3

 

Q2

 

Q1

 

Full Year

 

Q4

 

Q3

 

Q2

 

Q1

 

Risk Solutions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Brokerage - Americas - as reported

 

3

%

3

%

4

%

3

%

4

%

0

%

3

%

1

%

2

%

-5

%

1

%

0

%

-1

%

3

%

2

%

Retail Brokerage - Americas - after H&B transfer

 

2

%

3

%

2

%

2

%

3

%

0

%

3

%

0

%

2

%

-4

%

1

%

-1

%

-1

%

2

%

3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Brokerage - International - as reported

 

3

%

1

%

4

%

3

%

3

%

0

%

6

%

0

%

-3

%

-2

%

-2

%

-2

%

-4

%

-3

%

-1

%

Retail Brokerage - International - after H&B transfer

 

3

%

1

%

3

%

3

%

4

%

1

%

6

%

1

%

-2

%

-2

%

-2

%

-1

%

-4

%

-3

%

0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retail Brokerage - Worldwide - as reported

 

3

%

2

%

4

%

3

%

3

%

0

%

4

%

0

%

-1

%

-3

%

-1

%

-1

%

-2

%

-1

%

0

%

Retail Brokerage - Worldwide - after H&B transfer

 

3

%

2

%

3

%

2

%

4

%

1

%

4

%

1

%

0

%

-3

%

-1

%

-1

%

-2

%

0

%

1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reinsurance Brokerage and Related Services

 

0

%

4

%

-1

%

-2

%

0

%

-3

%

-1

%

-4

%

-3

%

-4

%

0

%

-2

%

-4

%

4

%

1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Risk Solutions - as reported

 

2

%

3

%

3

%

2

%

2

%

0

%

3

%

-1

%

-1

%

-3

%

-1

%

-1

%

-3

%

0

%

1

%

Total Risk Solutions - after H&B transfer

 

2

%

2

%

2

%

1

%

3

%

0

%

3

%

0

%

-1

%

-3

%

-1

%

-1

%

-3

%

0

%

1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HR Solutions:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consulting Services - as reported

 

1

%

2

%

-2

%

0

%

4

%

1

%

2

%

1

%

2

%

-1

%

-2

%

-4

%

-5

%

-1

%

2

%

Consulting Services - after H&B Transfer

 

1

%

3

%

-1

%

1

%

2

%

1

%

1

%

-1

%

1

%

0

%

-5

%

-6

%

-7

%

-3

%

-3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Outsourcing - as reported

 

0

%

4

%

-2

%

0

%

-3

%

-1

%

-2

%

19

%

-1

%

-4

%

-4

%

-2

%

-5

%

-4

%

-4

%

Outsourcing - after H&B transfer

 

0

%

4

%

-2

%

0

%

-3

%

-1

%

-2

%

19

%

0

%

-5

%

-4

%

-3

%

-6

%

-4

%

-4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total HR Solutions - as reported

 

0

%

3

%

-2

%

0

%

0

%

1

%

0

%

4

%

2

%

-1

%

-2

%

-4

%

-5

%

-1

%

2

%

Total HR Solutions - after H&B transfer

 

1

%

4

%

-1

%

0

%

-1

%

0

%

0

%

3

%

1

%

-1

%

-5

%

-6

%

-7

%

-3

%

-4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Operating Segments Organic Growth in Revenue

 

2

%

3

%

1

%

1

%

2

%

0

%

2

%

0

%

-1

%

-3

%

-1

%

-2

%

-3

%

0

%

1

%

 

19


 


 

Aon Corporation

Segments and Non-GAAP Measures Adjusted (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1st Quarter ended March 31, 2009

 

2nd Quarter ended June 30, 2009

 

3rd Quarter ended September 30, 2009

 

4th Quarter ended December 31, 2009

 

Full Year ended December 31, 2009

 

(millions except per share data)

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Segments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

1,519

 

$

308

 

$

(6

)

$

1,821

 

$

1,558

 

$

300

 

$

5

 

$

1,863

 

$

1,469

 

$

308

 

$

1

 

$

1,778

 

$

1,686

 

$

350

 

$

23

 

$

2,059

 

$

6,232

 

$

1,266

 

$

23

 

$

7,521

 

Investment income

 

24

 

1

 

 

25

 

19

 

 

 

19

 

16

 

 

 

16

 

14

 

 

 

14

 

73

 

1

 

 

74

 

Total revenue

 

1,543

 

309

 

(6

)

1,846

 

1,577

 

300

 

5

 

1,882

 

1,485

 

308

 

1

 

1,794

 

1,700

 

350

 

23

 

2,073

 

6,305

 

1,267

 

23

 

7,595

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

837

 

162

 

15

 

1,014

 

932

 

184

 

18

 

1,134

 

909

 

198

 

12

 

1,119

 

1,099

 

210

 

21

 

1,330

 

3,777

 

754

 

66

 

4,597

 

Other general expenses

 

383

 

77

 

6

 

466

 

444

 

75

 

9

 

528

 

394

 

77

 

10

 

481

 

407

 

81

 

14

 

502

 

1,628

 

310

 

39

 

1,977

 

Total operating expenses

 

1,220

 

239

 

21

 

1,480

 

1,376

 

259

 

27

 

1,662

 

1,303

 

275

 

22

 

1,600

 

1,506

 

291

 

35

 

1,832

 

5,405

 

1,064

 

105

 

6,574

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

323

 

$

70

 

$

(27

)

$

366

 

$

201

 

$

41

 

$

(22

)

$

220

 

$

182

 

$

33

 

$

(21

)

$

194

 

$

194

 

$

59

 

$

(12

)

$

241

 

$

900

 

$

203

 

$

(82

)

$

1,021

 

Operating margin

 

20.9

%

22.7

%

 

 

19.8

%

12.7

%

13.7

%

 

 

11.7

%

12.3

%

10.7

%

 

 

10.8

%

11.4

%

16.9

%

 

 

11.6

%

14.3

%

16.0

%

 

 

13.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Health & Benefits Transfer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

136

 

$

(136

)

$

 

$

 

$

126

 

$

(126

)

$

 

$

 

$

125

 

$

(125

)

$

 

$

 

$

143

 

$

(143

)

$

 

$

 

$

530

 

$

(530

)

$

 

$

 

Investment income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

136

 

(136

)

 

 

126

 

(126

)

 

 

125

 

(125

)

 

 

143

 

(143

)

 

 

530

 

(530

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

64

 

(64

)

 

 

63

 

(63

)

 

 

66

 

(66

)

 

 

68

 

(68

)

 

 

261

 

(261

)

 

 

Other general expenses

 

41

 

(41

)

 

 

42

 

(42

)

 

 

41

 

(41

)

 

 

42

 

(42

)

 

 

166

 

(166

)

 

 

Total operating expenses

 

105

 

(105

)

 

 

105

 

(105

)

 

 

107

 

(107

)

 

 

110

 

(110

)

 

 

427

 

(427

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

31

 

$

(31

)

$

 

$

 

$

21

 

$

(21

)

$

 

$

 

$

18

 

$

(18

)

$

 

$

 

$

33

 

$

(33

)

$

 

$

 

$

103

 

$

(103

)

$

 

$

 

Operating margin

 

22.8

%

22.8

%

 

 

 

 

16.7

%

16.7

%

 

 

 

 

14.4

%

14.4

%

 

 

 

 

23.1

%

23.1

%

 

 

 

 

19.4

%

19.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

1,655

 

$

172

 

$

(6

)

$

1,821

 

$

1,684

 

$

174

 

$

5

 

$

1,863

 

$

1,594

 

$

183

 

$

1

 

$

1,778

 

$

1,829

 

$

207

 

$

23

 

$

2,059

 

$

6,762

 

$

736

 

$

23

 

$

7,521

 

Investment income

 

24

 

1

 

 

25

 

19

 

 

 

19

 

16

 

 

 

16

 

14

 

 

 

14

 

73

 

1

 

 

74

 

Total revenue

 

1,679

 

173

 

(6

)

1,846

 

1,703

 

174

 

5

 

1,882

 

1,610

 

183

 

1

 

1,794

 

1,843

 

207

 

23

 

2,073

 

6,835

 

737

 

23

 

7,595

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

901

 

98

 

15

 

1,014

 

995

 

121

 

18

 

1,134

 

975

 

132

 

12

 

1,119

 

1,167

 

142

 

21

 

1,330

 

4,038

 

493

 

66

 

4,597

 

Other general expenses

 

424

 

36

 

6

 

466

 

486

 

33

 

9

 

528

 

435

 

36

 

10

 

481

 

449

 

39

 

14

 

502

 

1,794

 

144

 

39

 

1,977

 

Total operating expenses

 

1,325

 

134

 

21

 

1,480

 

1,481

 

154

 

27

 

1,662

 

1,410

 

168

 

22

 

1,600

 

1,616

 

181

 

35

 

1,832

 

5,832

 

637

 

105

 

6,574

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

354

 

$

39

 

$

(27

)

$

366

 

$

222

 

$

20

 

$

(22

)

$

220

 

$

200

 

$

15

 

$

(21

)

$

194

 

$

227

 

$

26

 

$

(12

)

$

241

 

$

1,003

 

$

100

 

$

(82

)

$

1,021

 

Operating margin

 

21.1

%

22.5

%

 

 

19.8

%

13.0

%

11.5

%

 

 

11.7

%

12.4

%

8.2

%

 

 

10.8

%

12.3

%

12.6

%

 

 

11.6

%

14.7

%

13.6

%

 

 

13.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As Disclosed

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

1,543

 

$

309

 

$

(6

)

$

1,846

 

$

1,577

 

$

300

 

$

5

 

$

1,882

 

$

1,485

 

$

308

 

$

1

 

$

1,794

 

$

1,700

 

$

350

 

$

23

 

$

2,073

 

$

6,305

 

$

1,267

 

$

23

 

$

7,595

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as reported

 

323

 

70

 

(27

)

366

 

201

 

41

 

(22

)

220

 

182

 

33

 

(21

)

194

 

194

 

59

 

(12

)

241

 

900

 

203

 

(82

)

1,021

 

Restructuring charges

 

40

 

3

 

 

43

 

92

 

3

 

 

95

 

84

 

15

 

 

99

 

161

 

14

 

 

175

 

377

 

35

 

 

412

 

Pension curtailment/adjustment

 

(58

)

(21

)

(4

)

(83

)

4

 

1

 

 

5

 

 

 

 

 

 

 

 

 

(54

)

(20

)

(4

)

(78

)

Benfield integration costs

 

10

 

 

 

10

 

2

 

 

 

2

 

1

 

 

 

1

 

2

 

 

 

2

 

15

 

 

 

15

 

Anti-bribery and compliance initiatives

 

1

 

 

 

1

 

1

 

 

 

1

 

1

 

 

 

1

 

4

 

 

 

4

 

7

 

 

 

7

 

Operating income (loss) - as adjusted

 

$

316

 

$

52

 

$

(31

)

$

337

 

$

300

 

$

45

 

$

(22

)

$

323

 

$

268

 

$

48

 

$

(21

)

$

295

 

$

361

 

$

73

 

$

(12

)

$

422

 

$

1,245

 

$

218

 

$

(86

)

$

1,377

 

Operating margin - adjusted

 

20.5

%

16.8

%

 

 

18.3

%

19.0

%

15.0

%

 

 

17.2

%

18.0

%

15.6

%

 

 

16.4

%

21.2

%

20.9

%

 

 

20.4

%

19.7

%

17.2

%

 

 

18.1

%

Interest income

 

 

 

 

 

 

 

7

 

 

 

 

 

 

 

1

 

 

 

 

 

 

 

3

 

 

 

 

 

 

 

5

 

 

 

 

 

 

 

16

 

Interest expense

 

 

 

 

 

 

 

(29

)

 

 

 

 

 

 

(26

)

 

 

 

 

 

 

(32

)

 

 

 

 

 

 

(35

)

 

 

 

 

 

 

(122

)

Other income (expense)

 

 

 

 

 

 

 

(1

)

 

 

 

 

 

 

15

 

 

 

 

 

 

 

13

 

 

 

 

 

 

 

7

 

 

 

 

 

 

 

34

 

Income before income taxes - as adjusted

 

 

 

 

 

 

 

$

314

 

 

 

 

 

 

 

$

313

 

 

 

 

 

 

 

$

279

 

 

 

 

 

 

 

$

399

 

 

 

 

 

 

 

$

1,305

 

Income taxes (1)

 

 

 

 

 

 

 

90

 

 

 

 

 

 

 

86

 

 

 

 

 

 

 

75

 

 

 

 

 

 

 

103

 

 

 

 

 

 

 

354

 

Net income attributable to non-controlling interests

 

 

 

 

 

 

 

5

 

 

 

 

 

 

 

6

 

 

 

 

 

 

 

14

 

 

 

 

 

 

 

20

 

 

 

 

 

 

 

45

 

Income attributable to Aon stockholders - as adjusted

 

 

 

 

 

 

 

$

219

 

 

 

 

 

 

 

$

221

 

 

 

 

 

 

 

$

190

 

 

 

 

 

 

 

$

276

 

 

 

 

 

 

 

$

906

 

Diluted earnings per share - as adjusted

 

 

 

 

 

 

 

$

0.75

 

 

 

 

 

 

 

$

0.76

 

 

 

 

 

 

 

$

0.65

 

 

 

 

 

 

 

$

0.96

 

 

 

 

 

 

 

$

3.11

 

Weighted average common shares outstanding - diluted

 

 

 

 

 

 

 

292.0

 

 

 

 

 

 

 

292.7

 

 

 

 

 

 

 

292.1

 

 

 

 

 

 

 

287.8

 

 

 

 

 

 

 

291.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue, as reported

 

$

1,543

 

$

309

 

$

(6

)

$

1,846

 

$

1,577

 

$

300

 

$

5

 

$

1,882

 

$

1,485

 

$

308

 

$

1

 

$

1,794

 

$

1,700

 

$

350

 

$

23

 

$

2,073

 

$

6,305

 

$

1,267

 

$

23

 

$

7,595

 

Revenue, Heath & Benefits transfer

 

136

 

(136

)

 

 

126

 

(126

)

 

 

125

 

(125

)

 

 

143

 

(143

)

 

 

530

 

(530

)

 

 

Revenue - as restated

 

$

1,679

 

$

173

 

$

(6

)

$

1,846

 

$

1,703

 

$

174

 

$

5

 

$

1,882

 

$

1,610

 

$

183

 

$

1

 

$

1,794

 

$

1,843

 

$

207

 

$

23

 

$

2,073

 

$

6,835

 

$

737

 

$

23

 

$

7,595

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as adjusted

 

$

316

 

$

52

 

$

(31

)

$

337

 

$

300

 

$

45

 

$

(22

)

$

323

 

$

268

 

$

48

 

$

(21

)

$

295

 

$

361

 

$

73

 

$

(12

)

$

422

 

$

1,245

 

$

218

 

$

(86

)

$

1,377

 

Operating income (loss) - Health & Benefits

 

31

 

(31

)

 

 

21

 

(21

)

 

 

18

 

(18

)

 

 

33

 

(33

)

 

 

103

 

(103

)

 

 

Restructuring charges (credits) - Health & Benefits

 

 

 

 

 

 

 

 

 

 

 

1

 

(1

)

 

 

 

3

 

(3

)

 

 

 

4

 

(4

)

 

 

Amortization of intangible assets - reported

 

23

 

 

 

23

 

21

 

1

 

 

22

 

23

 

1

 

 

24

 

23

 

1

 

 

24

 

90

 

3

 

 

93

 

Amortization of intangible assets - H&B

 

 

 

 

 

1

 

(1

)

 

 

1

 

(1

)

 

 

1

 

(1

)

 

 

3

 

(3

)

 

 

Amortization of Intangible Assets

 

23

 

 

 

23

 

22

 

 

 

22

 

24

 

 

 

24

 

24

 

 

 

24

 

93

 

 

 

93

 

Operating income (loss) - as adjusted

 

$

370

 

$

21

 

$

(31

)

$

360

 

$

343

 

$

24

 

$

(22

)

$

345

 

$

311

 

$

29

 

$

(21

)

$

319

 

$

421

 

$

37

 

$

(12

)

$

446

 

$

1,445

 

$

111

 

$

(86

)

$

1,470

 

Operating margin - adjusted

 

22.0

%

12.1

%

 

 

19.5

%

20.1

%

13.8

%

 

 

18.3

%

19.3

%

15.8

%

 

 

17.8

%

22.8

%

17.9

%

 

 

21.5

%

21.1

%

15.1

%

 

 

19.4

%

Income before income taxes - as adjusted

 

 

 

 

 

 

 

$

337

 

 

 

 

 

 

 

$

335

 

 

 

 

 

 

 

$

303

 

 

 

 

 

 

 

$

423

 

 

 

 

 

 

 

$

1,398

 

Income taxes (1)

 

 

 

 

 

 

 

98

 

 

 

 

 

 

 

91

 

 

 

 

 

 

 

82

 

 

 

 

 

 

 

109

 

 

 

 

 

 

 

380

 

Net income attributable to non-controlling interests

 

 

 

 

 

 

 

5

 

 

 

 

 

 

 

6

 

 

 

 

 

 

 

14

 

 

 

 

 

 

 

20

 

 

 

 

 

 

 

45

 

Income attributable to Aon stockholders - as adjusted

 

 

 

 

 

 

 

$

234

 

 

 

 

 

 

 

$

238

 

 

 

 

 

 

 

$

207

 

 

 

 

 

 

 

$

294

 

 

 

 

 

 

 

$

973

 

Diluted earnings per share - as adjusted

 

 

 

 

 

 

 

$

0.80

 

 

 

 

 

 

 

$

0.81

 

 

 

 

 

 

 

$

0.71

 

 

 

 

 

 

 

$

1.02

 

 

 

 

 

 

 

$

3.34

 

Weighted average common shares outstanding - diluted

 

 

 

 

 

 

 

292.0

 

 

 

 

 

 

 

292.7

 

 

 

 

 

 

 

292.1

 

 

 

 

 

 

 

287.8

 

 

 

 

 

 

 

291.1

 

 


(1) The effective tax rate was 31.5% for the first quarter ended March 31, 2009, 27.1% for the second quarter ended June 30, 2009, 26.7% for the third quarter ended September 30, 2009, 25.4% for the fourth quarter ended December 31, 2009, and 28.2% for the year ended December 31, 2009. Reconciling items are generally taxed at the effective tax rate. However, the U.S. GAAP effective tax rates were adjusted to 28.7% as disclosed and 29.1% as restated for the first quarter 2009, and 27.1% as disclosed and 27.2% as restated for the full year 2009, respectively, to exclude the impact of the 40% tax rate applied to the $83 million U.S. pension expense adjustment for prior years.

 

20



 

Aon Corporation

Segments and Non-GAAP Measures Adjusted (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1st Quarter ended March 31, 2010

 

2nd Quarter ended June 30, 2010

 

3rd Quarter ended September 30, 2010

 

4th Quarter ended December 31, 2010

 

Full Year ended December 31, 2010

 

(millions except per share data)

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Segments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

1,574

 

$

322

 

$

(5

)

$

1,891

 

$

1,573

 

$

316

 

$

(6

)

$

1,883

 

$

1,469

 

$

321

 

$

(4

)

$

1,786

 

$

1,753

 

$

1,151

 

$

(7

)

$

2,897

 

$

6,369

 

$

2,110

 

$

(22

)

$

8,457

 

Investment income

 

13

 

 

 

13

 

14

 

1

 

 

15

 

15

 

 

 

15

 

12

 

 

 

12

 

54

 

1

 

 

55

 

Total revenue

 

1,587

 

322

 

(5

)

1,904

 

1,587

 

317

 

(6

)

1,898

 

1,484

 

321

 

(4

)

1,801

 

1,765

 

1,151

 

(7

)

2,909

 

6,423

 

2,111

 

(22

)

8,512

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

951

 

196

 

16

 

1,163

 

909

 

194

 

66

 

1,169

 

846

 

189

 

15

 

1,050

 

958

 

737

 

20

 

1,715

 

3,664

 

1,316

 

117

 

5,097

 

Other general expenses

 

379

 

77

 

12

 

468

 

373

 

78

 

10

 

461

 

380

 

78

 

30

 

488

 

433

 

328

 

11

 

772

 

1,565

 

561

 

63

 

2,189

 

Total operating expenses

 

1,330

 

273

 

28

 

1,631

 

1,282

 

272

 

76

 

1,630

 

1,226

 

267

 

45

 

1,538

 

1,391

 

1,065

 

31

 

2,487

 

5,229

 

1,877

 

180

 

7,286

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

257

 

$

49

 

$

(33

)

$

273

 

$

305

 

$

45

 

$

(82

)

$

268

 

$

258

 

$

54

 

$

(49

)

$

263

 

$

374

 

$

86

 

$

(38

)

$

422

 

$

1,194

 

$

234

 

$

(202

)

$

1,226

 

Operating margin

 

16.2

%

15.2

%

 

 

14.3

%

19.2

%

14.2

%

 

 

14.1

%

17.4

%

16.8

%

 

 

14.6

%

21.2

%

7.5

%

 

 

14.5

%

18.6

%

11.1

%

 

 

14.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Health & Benefits Transfer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

140

 

$

(140

)

$

 

$

 

$

129

 

$

(129

)

$

 

$

 

$

127

 

$

(127

)

$

 

$

 

$

170

 

$

(170

)

$

 

$

 

$

566

 

$

(566

)

$

 

$

 

Investment income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total revenue

 

140

 

(140

)

 

 

129

 

(129

)

 

 

127

 

(127

)

 

 

170

 

(170

)

 

 

566

 

(566

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

68

 

(68

)

 

 

64

 

(64

)

 

 

61

 

(61

)

 

 

82

 

(82

)

 

 

275

 

(275

)

 

 

Other general expenses

 

41

 

(41

)

 

 

43

 

(43

)

 

 

42

 

(42

)

 

 

52

 

(52

)

 

 

178

 

(178

)

 

 

Total operating expenses

 

109

 

(109

)

 

 

107

 

(107

)

 

 

103

 

(103

)

 

 

134

 

(134

)

 

 

453

 

(453

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

31

 

$

(31

)

$

 

$

 

$

22

 

$

(22

)

$

 

$

 

$

24

 

$

(24

)

$

 

$

 

$

36

 

$

(36

)

$

 

$

 

$

113

 

$

(113

)

$

 

$

 

Operating margin

 

22.1

%

22.1

%

 

 

 

 

17.1

%

17.1

%

 

 

 

 

18.9

%

18.9

%

 

 

 

 

21.2

%

21.2

%

 

 

 

 

20.0

%

20.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

1,714

 

$

182

 

$

(5

)

$

1,891

 

$

1,702

 

$

187

 

$

(6

)

$

1,883

 

$

1,596

 

$

194

 

$

(4

)

$

1,786

 

$

1,923

 

$

981

 

$

(7

)

$

2,897

 

$

6,935

 

$

1,544

 

$

(22

)

$

8,457

 

Investment income

 

13

 

 

 

13

 

14

 

1

 

 

15

 

15

 

 

 

15

 

12

 

 

 

12

 

54

 

1

 

 

55

 

Total revenue

 

1,727

 

182

 

(5

)

1,904

 

1,716

 

188

 

(6

)

1,898

 

1,611

 

194

 

(4

)

1,801

 

1,935

 

981

 

(7

)

2,909

 

6,989

 

1,545

 

(22

)

8,512

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

1,019

 

128

 

16

 

1,163

 

973

 

130

 

66

 

1,169

 

907

 

128

 

15

 

1,050

 

1,040

 

655

 

20

 

1,715

 

3,939

 

1,041

 

117

 

5,097

 

Other general expenses

 

420

 

36

 

12

 

468

 

416

 

35

 

10

 

461

 

422

 

36

 

30

 

488

 

485

 

276

 

11

 

772

 

1,743

 

383

 

63

 

2,189

 

Total operating expenses

 

1,439

 

164

 

28

 

1,631

 

1,389

 

165

 

76

 

1,630

 

1,329

 

164

 

45

 

1,538

 

1,525

 

931

 

31

 

2,487

 

5,682

 

1,424

 

180

 

7,286

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

288

 

$

18

 

$

(33

)

$

273

 

$

327

 

$

23

 

$

(82

)

$

268

 

$

282

 

$

30

 

$

(49

)

$

263

 

$

410

 

$

50

 

$

(38

)

$

422

 

$

1,307

 

$

121

 

$

(202

)

$

1,226

 

Operating margin

 

16.7

%

9.9

%

 

 

14.3

%

19.1

%

12.2

%

 

 

14.1

%

17.5

%

15.5

%

 

 

14.6

%

21.2

%

5.1

%

 

 

14.5

%

18.7

%

7.8

%

 

 

14.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As Disclosed

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

1,587

 

$

322

 

$

(5

)

$

1,904

 

$

1,587

 

$

317

 

$

(6

)

$

1,898

 

$

1,484

 

$

321

 

$

(4

)

$

1,801

 

$

1,765

 

$

1,151

 

$

(7

)

$

2,909

 

$

6,423

 

$

2,111

 

$

(22

)

$

8,512

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as reported

 

257

 

49

 

(33

)

273

 

305

 

45

 

(82

)

268

 

258

 

54

 

(49

)

263

 

374

 

86

 

(38

)

422

 

1,194

 

234

 

(202

)

1,226

 

Restructuring charges

 

69

 

7

 

 

76

 

29

 

2

 

 

31

 

8

 

 

 

8

 

4

 

53

 

 

57

 

110

 

62

 

 

172

 

Pension curtailment/adjustment

 

 

 

 

 

 

 

49

 

49

 

 

 

 

 

 

 

 

 

 

 

49

 

49

 

Hewitt related costs

 

 

 

 

 

 

 

 

 

 

1

 

18

 

19

 

 

18

 

3

 

21

 

 

19

 

21

 

40

 

Anti-bribery and compliance initiatives

 

 

 

 

 

 

 

 

 

 

 

 

 

9

 

 

 

9

 

9

 

 

 

9

 

Operating income (loss) - as adjusted

 

$

326

 

$

56

 

$

(33

)

$

349

 

$

334

 

$

47

 

$

(33

)

$

348

 

$

266

 

$

55

 

$

(31

)

$

290

 

$

387

 

$

157

 

$

(35

)

$

509

 

$

1,313

 

$

315

 

$

(132

)

$

1,496

 

Operating margin - adjusted

 

20.5

%

17.4

%

 

 

18.3

%

21.0

%

14.8

%

 

 

18.3

%

17.9

%

17.1

%

 

 

16.1

%

21.9

%

13.6

%

 

 

17.5

%

20.4

%

14.9

%

 

 

17.6

%

Interest income

 

 

 

 

 

 

 

1

 

 

 

 

 

 

 

4

 

 

 

 

 

 

 

4

 

 

 

 

 

 

 

6

 

 

 

 

 

 

 

15

 

Interest expense - as adjusted

 

 

 

 

 

 

 

(34

)

 

 

 

 

 

 

(33

)

 

 

 

 

 

 

(36

)

 

 

 

 

 

 

(65

)

 

 

 

 

 

 

(168

)

Other income (expense)

 

 

 

 

 

 

 

7

 

 

 

 

 

 

 

5

 

 

 

 

 

 

 

(9

)

 

 

 

 

 

 

(3

)

 

 

 

 

 

 

 

Income before income taxes - as adjusted

 

 

 

 

 

 

 

$

323

 

 

 

 

 

 

 

$

324

 

 

 

 

 

 

 

$

249

 

 

 

 

 

 

 

$

447

 

 

 

 

 

 

 

$

1,343

 

Income taxes (1)

 

 

 

 

 

 

 

80

 

 

 

 

 

 

 

89

 

 

 

 

 

 

 

73

 

 

 

 

 

 

 

146

 

 

 

 

 

 

 

388

 

Net income attributable to non-controlling interests

 

 

 

 

 

 

 

8

 

 

 

 

 

 

 

5

 

 

 

 

 

 

 

3

 

 

 

 

 

 

 

10

 

 

 

 

 

 

 

26

 

Income attributable to Aon stockholders - as adjusted

 

 

 

 

 

 

 

$

235

 

 

 

 

 

 

 

$

230

 

 

 

 

 

 

 

$

173

 

 

 

 

 

 

 

$

291

 

 

 

 

 

 

 

$

929

 

Diluted earnings per share - as adjusted

 

 

 

 

 

 

 

$

0.83

 

 

 

 

 

 

 

$

0.81

 

 

 

 

 

 

 

$

0.61

 

 

 

 

 

 

 

$

0.84

 

 

 

 

 

 

 

$

3.12

 

Weighted average common shares outstanding - diluted

 

 

 

 

 

 

 

283.4

 

 

 

 

 

 

 

282.6

 

 

 

 

 

 

 

282.2

 

 

 

 

 

 

 

346.7

 

 

 

 

 

 

 

298.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue, as reported

 

$

1,587

 

$

322

 

$

(5

)

$

1,904

 

$

1,587

 

$

317

 

$

(6

)

$

1,898

 

$

1,484

 

$

321

 

$

(4

)

$

1,801

 

$

1,765

 

$

1,151

 

$

(7

)

$

2,909

 

$

6,423

 

$

2,111

 

$

(22

)

$

8,512

 

Revenue, Heath & Benefits transfer

 

140

 

(140

)

 

 

129

 

(129

)

 

 

127

 

(127

)

 

 

170

 

(170

)

 

 

566

 

(566

)

 

 

Revenue - as restated

 

$

1,727

 

$

182

 

$

(5

)

$

1,904

 

$

1,716

 

$

188

 

$

(6

)

$

1,898

 

$

1,611

 

$

194

 

$

(4

)

$

1,801

 

$

1,935

 

$

981

 

$

(7

)

$

2,909

 

$

6,989

 

$

1,545

 

$

(22

)

$

8,512

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as adjusted

 

$

326

 

$

56

 

$

(33

)

$

349

 

$

334

 

$

47

 

$

(33

)

$

348

 

$

266

 

$

55

 

$

(31

)

$

290

 

$

387

 

$

157

 

$

(35

)

$

509

 

$

1,313

 

$

315

 

$

(132

)

$

1,496

 

Operating income (loss) - Health & Benefits

 

31

 

(31

)

 

 

22

 

(22

)

 

 

24

 

(24

)

 

 

36

 

(36

)

 

 

113

 

(113

)

 

 

Restructuring charges (credits) - Health & Benefits

 

2

 

(2

)

 

 

 

1

 

(1

)

 

 

 

 

 

 

 

 

2

 

(2

)

 

 

 

5

 

(5

)

 

 

Amortization of intangible assets - reported

 

26

 

1

 

 

27

 

28

 

1

 

 

29

 

27

 

3

 

 

30

 

28

 

40

 

 

68

 

109

 

45

 

 

154

 

Amortization of intangible assets - H&B

 

1

 

(1

)

 

 

1

 

(1

)

 

 

1

 

(1

)

 

 

2

 

(2

)

 

 

5

 

(5

)

 

 

Amortization of Intangible Assets

 

27

 

 

 

27

 

29

 

 

 

29

 

28

 

2

 

 

30

 

30

 

38

 

 

68

 

114

 

40

 

 

154

 

Operating income (loss) - as adjusted

 

$

386

 

$

23

 

$

(33

)

$

376

 

$

386

 

$

24

 

$

(33

)

$

377

 

$

318

 

$

33

 

$

(31

)

$

320

 

$

455

 

$

157

 

$

(35

)

$

577

 

$

1,545

 

$

237

 

$

(132

)

$

1,650

 

Operating margin - adjusted

 

22.4

%

12.6

%

 

 

19.7

%

22.5

%

12.8

%

 

 

19.9

%

19.7

%

17.0

%

 

 

17.8

%

23.5

%

16.0

%

 

 

19.8

%

22.1

%

15.3

%

 

 

19.4

%

Income before income taxes - as adjusted

 

 

 

 

 

 

 

$

350

 

 

 

 

 

 

 

$

353

 

 

 

 

 

 

 

$

279

 

 

 

 

 

 

 

$

515

 

 

 

 

 

 

 

$

1,497

 

Income taxes (1)

 

 

 

 

 

 

 

87

 

 

 

 

 

 

 

95

 

 

 

 

 

 

 

82

 

 

 

 

 

 

 

169

 

 

 

 

 

 

 

433

 

Net income attributable to non-controlling interests

 

 

 

 

 

 

 

8

 

 

 

 

 

 

 

5

 

 

 

 

 

 

 

3

 

 

 

 

 

 

 

10

 

 

 

 

 

 

 

26

 

Income attributable to Aon stockholders - as adjusted

 

 

 

 

 

 

 

$

255

 

 

 

 

 

 

 

$

253

 

 

 

 

 

 

 

$

194

 

 

 

 

 

 

 

$

336

 

 

 

 

 

 

 

$

1,038

 

Diluted earnings per share - as adjusted

 

 

 

 

 

 

 

$

0.90

 

 

 

 

 

 

 

$

0.90

 

 

 

 

 

 

 

$

0.69

 

 

 

 

 

 

 

$

0.97

 

 

 

 

 

 

 

$

3.48

 

Weighted average common shares outstanding - diluted

 

 

 

 

 

 

 

283.4

 

 

 

 

 

 

 

282.6

 

 

 

 

 

 

 

282.2

 

 

 

 

 

 

 

346.7

 

 

 

 

 

 

 

298.1

 

 


(1) The effective tax rate was 24.9% for the first quarter ended March 31, 2010, 24.5% for the second quarter ended June 30, 2010, 29.4% for the third quarter ended September 30, 2010, 32.8% for the fourth quarter ended December 31, 2010, and 28.4% for the year ended December 31, 2010. Reconciling items are generally taxed at the effective tax rate. However, the U.S. GAAP effective tax rates were adjusted to 27.5% as disclosed and 29.3% as restated for the second quarter 2010, and 28.9% as disclosed and as restated for the full year 2010, respectively, to exclude the impact of the 40% tax rate applied to the $49 million U.S. pension expense adjustment for prior years.

 

21



 

Aon Corporation

Segments and Non-GAAP Measures Adjusted (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1st Quarter ended March 31, 2011

 

2nd Quarter ended June 30, 2011

 

3rd Quarter ended September 30, 2011

 

4th Quarter ended December 31, 2011

 

Full Year ended December 31, 2011

 

(millions except per share data)

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Risk
Solutions

 

HR
Solutions

 

Unallocated

 

Continuing

 

Segments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reported

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

1,638

 

$

1,117

 

$

(7

)

$

2,748

 

$

1,716

 

$

1,090

 

$

(7

)

$

2,799

 

$

1,602

 

$

1,112

 

$

(6

)

$

2,708

 

$

1,810

 

$

1,181

 

$

(11

)

$

2,980

 

$

6,766

 

$

4,500

 

$

(31

)

$

11,235

 

Investment income

 

11

 

 

 

11

 

12

 

 

 

12

 

15

 

 

 

15

 

13

 

1

 

 

14

 

51

 

1

 

 

52

 

Total revenue

 

1,649

 

1,117

 

(7

)

2,759

 

1,728

 

1,090

 

(7

)

2,811

 

1,617

 

1,112

 

(6

)

2,723

 

1,823

 

1,182

 

(11

)

2,994

 

6,817

 

4,501

 

(31

)

11,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

921

 

653

 

23

 

1,597

 

967

 

622

 

23

 

1,612

 

931

 

670

 

33

 

1,634

 

1,006

 

695

 

23

 

1,724

 

3,825

 

2,640

 

102

 

6,567

 

Other general expenses

 

422

 

341

 

3

 

766

 

406

 

353

 

6

 

765

 

378

 

365

 

5

 

748

 

472

 

354

 

9

 

835

 

1,678

 

1,413

 

23

 

3,114

 

Total operating expenses

 

1,343

 

994

 

26

 

2,363

 

1,373

 

975

 

29

 

2,377

 

1,309

 

1,035

 

38

 

2,382

 

1,478

 

1,049

 

32

 

2,559

 

5,503

 

4,053

 

125

 

9,681

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

306

 

$

123

 

$

(33

)

$

396

 

$

355

 

$

115

 

$

(36

)

$

434

 

$

308

 

$

77

 

$

(44

)

$

341

 

$

345

 

$

133

 

$

(43

)

$

435

 

$

1,314

 

$

448

 

$

(156

)

$

1,606

 

Operating margin

 

18.6

%

11.0

%

 

 

14.4

%

20.5

%

10.6

%

 

 

15.4

%

19.0

%

6.9

%

 

 

12.5

%

18.9

%

11.3

%

 

 

14.5

%

19.3

%

10.0

%

 

 

14.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Health & Benefits Transfer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

202

 

$

(202

)

$

 

$

 

$

184

 

$

(184

)

$

 

$

 

$

155

 

$

(155

)

$

 

$

 

$

178

 

$

(178

)

$

 

$

 

$

719

 

$

(719

)

$

 

$

 

Investment income

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

(1

)

 

 

1

 

(1

)

 

 

Total revenue

 

202

 

(202

)

 

 

184

 

(184

)

 

 

155

 

(155

)

 

 

179

 

(179

)

 

 

720

 

(720

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

90

 

(90

)

 

 

91

 

(91

)

 

 

83

 

(83

)

 

 

90

 

(90

)

 

 

354

 

(354

)

 

 

Other general expenses

 

72

 

(72

)

 

 

74

 

(74

)

 

 

61

 

(61

)

 

 

59

 

(59

)

 

 

266

 

(266

)

 

 

Total operating expenses

 

162

 

(162

)

 

 

165

 

(165

)

 

 

144

 

(144

)

 

 

149

 

(149

)

 

 

620

 

(620

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

40

 

$

(40

)

$

 

$

 

$

19

 

$

(19

)

$

 

$

 

$

11

 

$

(11

)

$

 

$

 

$

30

 

$

(30

)

$

 

$

 

$

100

 

$

(100

)

$

 

$

 

Operating margin

 

19.8

%

19.8

%

 

 

 

 

10.3

%

10.3

%

 

 

 

 

7.1

%

7.1

%

 

 

 

 

16.8

%

16.8

%

 

 

 

 

13.9

%

13.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions, fee and other

 

$

1,840

 

$

915

 

$

(7

)

$

2,748

 

$

1,900

 

$

906

 

$

(7

)

$

2,799

 

$

1,757

 

$

957

 

$

(6

)

$

2,708

 

$

1,988

 

$

1,003

 

$

(11

)

$

2,980

 

$

7,485

 

$

3,781

 

$

(31

)

$

11,235

 

Investment income

 

11

 

 

 

11

 

12

 

 

 

12

 

15

 

 

 

15

 

14

 

 

 

14

 

52

 

 

 

52

 

Total revenue

 

1,851

 

915

 

(7

)

2,759

 

1,912

 

906

 

(7

)

2,811

 

1,772

 

957

 

(6

)

2,723

 

2,002

 

1,003

 

(11

)

2,994

 

7,537

 

3,781

 

(31

)

11,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation and benefits

 

1,011

 

563

 

23

 

1,597

 

1,058

 

531

 

23

 

1,612

 

1,014

 

587

 

33

 

1,634

 

1,096

 

605

 

23

 

1,724

 

4,179

 

2,286

 

102

 

6,567

 

Other general expenses

 

494

 

269

 

3

 

766

 

480

 

279

 

6

 

765

 

439

 

304

 

5

 

748

 

531

 

295

 

9

 

835

 

1,944

 

1,147

 

23

 

3,114

 

Total operating expenses

 

1,505

 

832

 

26

 

2,363

 

1,538

 

810

 

29

 

2,377

 

1,453

 

891

 

38

 

2,382

 

1,627

 

900

 

32

 

2,559

 

6,123

 

3,433

 

125

 

9,681

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

$

346

 

$

83

 

$

(33

)

$

396

 

$

374

 

$

96

 

$

(36

)

$

434

 

$

319

 

$

66

 

$

(44

)

$

341

 

$

375

 

$

103

 

$

(43

)

$

435

 

$

1,414

 

$

348

 

$

(156

)

$

1,606

 

Operating margin

 

18.7

%

9.1

%

 

 

14.4

%

19.6

%

10.6

%

 

 

15.4

%

18.0

%

6.9

%

 

 

12.5

%

18.7

%

10.3

%

 

 

14.5

%

18.8

%

9.2

%

 

 

14.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-GAAP

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As Disclosed

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

1,649

 

$

1,117

 

$

(7

)

$

2,759

 

$

1,728

 

$

1,090

 

$

(7

)

$

2,811

 

$

1,617

 

$

1,112

 

$

(6

)

$

2,723

 

$

1,823

 

$

1,182

 

$

(11

)

$

2,994

 

$

6,817

 

$

4,501

 

$

(31

)

$

11,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as reported

 

306

 

123

 

(33

)

396

 

355

 

115

 

(36

)

434

 

308

 

77

 

(44

)

341

 

345

 

133

 

(43

)

435

 

1,314

 

448

 

(156

)

1,606

 

Restructuring charges

 

7

 

23

 

 

30

 

(17

)

31

 

 

14

 

 

26

 

 

26

 

34

 

9

 

 

43

 

24

 

89

 

 

113

 

Legacy receivables write-off

 

 

 

 

 

 

 

 

 

 

 

 

 

18

 

 

 

18

 

18

 

 

 

18

 

Transaction related costs - proxy

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3

 

3

 

 

 

3

 

3

 

Hewitt related costs

 

 

15

 

 

15

 

 

5

 

 

5

 

 

22

 

 

22

 

 

5

 

 

5

 

 

47

 

 

47

 

Operating income (loss) - as adjusted

 

$

313

 

$

161

 

$

(33

)

$

441

 

$

338

 

$

151

 

$

(36

)

$

453

 

$

308

 

$

125

 

$

(44

)

$

389

 

$

397

 

$

147

 

$

(40

)

$

504

 

$

1,356

 

$

584

 

$

(153

)

$

1,787

 

Operating margin - adjusted

 

19.0

%

14.4

%

 

 

16.0

%

19.6

%

13.9

%

 

 

16.1

%

19.0

%

11.2

%

 

 

14.3

%

21.8

%

12.4

%

 

 

16.8

%

19.9

%

13.0

%

 

 

15.8

%

Interest income

 

 

 

 

 

 

 

6

 

 

 

 

 

 

 

4

 

 

 

 

 

 

 

4

 

 

 

 

 

 

 

4

 

 

 

 

 

 

 

18

 

Interest expense

 

 

 

 

 

 

 

(63

)

 

 

 

 

 

 

(63

)

 

 

 

 

 

 

(60

)

 

 

 

 

 

 

(59

)

 

 

 

 

 

 

(245

)

Other income (expense) - as adjusted

 

 

 

 

 

 

 

17

 

 

 

 

 

 

 

(4

)

 

 

 

 

 

 

7

 

 

 

 

 

 

 

4

 

 

 

 

 

 

 

24

 

Income before income taxes - as adjusted

 

 

 

 

 

 

 

$

401

 

 

 

 

 

 

 

$

390

 

 

 

 

 

 

 

$

340

 

 

 

 

 

 

 

$

453

 

 

 

 

 

 

 

$

1,584

 

Income taxes (1)

 

 

 

 

 

 

 

116

 

 

 

 

 

 

 

96

 

 

 

 

 

 

 

98

 

 

 

 

 

 

 

122

 

 

 

 

 

 

 

432

 

Net income attributable to non-controlling interests

 

 

 

 

 

 

 

9

 

 

 

 

 

 

 

9

 

 

 

 

 

 

 

10

 

 

 

 

 

 

 

3

 

 

 

 

 

 

 

31

 

Income attributable to Aon stockholders - as adjusted

 

 

 

 

 

 

 

$

276

 

 

 

 

 

 

 

$

285

 

 

 

 

 

 

 

$

232

 

 

 

 

 

 

 

$

328

 

 

 

 

 

 

 

$

1,121

 

Diluted earnings per share - as adjusted

 

 

 

 

 

 

 

$

0.80

 

 

 

 

 

 

 

$

0.83

 

 

 

 

 

 

 

$

0.69

 

 

 

 

 

 

 

$

0.97

 

 

 

 

 

 

 

$

3.29

 

Weighted average common shares outstanding - diluted

 

 

 

 

 

 

 

345.4

 

 

 

 

 

 

 

342.7

 

 

 

 

 

 

 

336.9

 

 

 

 

 

 

 

337.9

 

 

 

 

 

 

 

340.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue, as reported

 

$

1,649

 

$

1,117

 

$

(7

)

$

2,759

 

$

1,728

 

$

1,090

 

$

(7

)

$

2,811

 

$

1,617

 

$

1,112

 

$

(6

)

$

2,723

 

$

1,823

 

$

1,182

 

$

(11

)

$

2,994

 

$

6,817

 

$

4,501

 

$

(31

)

$

11,287

 

Revenue, Heath & Benefits transfer

 

202

 

(202

)

 

 

184

 

(184

)

 

 

155

 

(155

)

 

 

179

 

(179

)

 

 

720

 

(720

)

 

 

Revenue - as restated

 

$

1,851

 

$

915

 

$

(7

)

$

2,759

 

$

1,912

 

$

906

 

$

(7

)

$

2,811

 

$

1,772

 

$

957

 

$

(6

)

$

2,723

 

$

2,002

 

$

1,003

 

$

(11

)

$

2,994

 

$

7,537

 

$

3,781

 

$

(31

)

$

11,287

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss) - as adjusted

 

$

313

 

$

161

 

$

(33

)

$

441

 

$

338

 

$

151

 

$

(36

)

$

453

 

$

308

 

$

125

 

$

(44

)

$

389

 

$

397

 

$

147

 

$

(40

)

$

504

 

$

1,356

 

$

584

 

$

(153

)

$

1,787

 

Operating income (loss) - Health & Benefits

 

40

 

(40

)

 

 

19

 

(19

)

 

 

11

 

(11

)

 

 

30

 

(30

)

 

 

100

 

(100

)

 

 

Restructuring charges (credits) - Health & Benefits

 

14

 

(14

)

 

 

 

10

 

(10

)

 

 

 

14

 

(14

)

 

 

 

3

 

(3

)

 

 

 

41

 

(41

)

 

 

Amortization of intangible assets - reported

 

27

 

64

 

 

91

 

28

 

63

 

 

91

 

28

 

63

 

 

91

 

27

 

62

 

 

89

 

110

 

252

 

 

362

 

Amortization of intangible assets - H&B

 

4

 

(4

)

 

 

5

 

(5

)

 

 

5

 

(5

)

 

 

5

 

(5

)

 

 

19

 

(19

)

 

 

Amortization of Intangible Assets

 

31

 

60

 

 

91

 

33

 

58

 

 

91

 

33

 

58

 

 

91

 

32

 

57

 

 

89

 

129

 

233

 

 

362

 

Operating income (loss) - as adjusted

 

$

398

 

$

167

 

$

(33

)

$

532

 

$

400

 

$

180

 

$

(36

)

$

544

 

$

366

 

$

158

 

$

(44

)

$

480

 

$

462

 

$

171

 

$

(40

)

$

593

 

$

1,626

 

$

676

 

$

(153

)

$

2,149

 

Operating margin - adjusted

 

21.5

%

18.3

%

 

 

19.3

%

20.9

%

19.9

%

 

 

19.4

%

20.7

%

16.5

%

 

 

17.6

%

23.1

%

17.0

%

 

 

19.8

%

21.6

%

17.9

%

 

 

19.0

%

Income before income taxes - as adjusted

 

 

 

 

 

 

 

$

492

 

 

 

 

 

 

 

$

481

 

 

 

 

 

 

 

$

431

 

 

 

 

 

 

 

$

542

 

 

 

 

 

 

 

$

1,946

 

Income taxes (1)

 

 

 

 

 

 

 

142

 

 

 

 

 

 

 

118

 

 

 

 

 

 

 

125

 

 

 

 

 

 

 

146

 

 

 

 

 

 

 

531

 

Net income attributable to non-controlling interests

 

 

 

 

 

 

 

9

 

 

 

 

 

 

 

9

 

 

 

 

 

 

 

10

 

 

 

 

 

 

 

3

 

 

 

 

 

 

 

31

 

Income attributable to Aon stockholders - as adjusted

 

 

 

 

 

 

 

$

341

 

 

 

 

 

 

 

$

354

 

 

 

 

 

 

 

$

296

 

 

 

 

 

 

 

$

393

 

 

 

 

 

 

 

$

1,384

 

Diluted earnings per share - as adjusted

 

 

 

 

 

 

 

$

0.99

 

 

 

 

 

 

 

$

1.03

 

 

 

 

 

 

 

$

0.88

 

 

 

 

 

 

 

$

1.16

 

 

 

 

 

 

 

$

4.06

 

Weighted average common shares outstanding - diluted

 

 

 

 

 

 

 

345.4

 

 

 

 

 

 

 

342.7

 

 

 

 

 

 

 

336.9

 

 

 

 

 

 

 

337.9

 

 

 

 

 

 

 

340.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


(1) The effective tax rate was 29.0% for the first quarter ended March 31, 2011, 24.7% for the second quarter ended June 30, 2011, 28.9% for the third quarter ended September 30, 2011, 27.0% for the fourth quarter ended December 31, 2011, and 27.3% for the year ended December 31, 2011. Reconciling items are generally taxed at the effective tax rate.

 

22