WTW Reports Third Quarter 2024 Earnings
WTW reported strong Q3 2024 results with revenue increasing 6% to $2.3 billion. While the company recorded a diluted loss per share of $16.44 due to non-cash losses related to TRANZACT sale, adjusted diluted EPS grew 31% to $2.93. The Health, Wealth & Career segment revenue rose 4% to $1.33 billion, while Risk & Broking segment revenue increased 10% to $940 million. Operating margin was -33.5%, but adjusted operating margin improved 190 basis points to 18.1%. Cash flows from operating activities reached $913 million for the nine months ended September 30, 2024. The company maintains its full-year 2024 guidance targeting revenue of $9.9 billion or greater.
WTW ha riportato risultati solidi per il terzo trimestre del 2024, con un incremento del fatturato del 6% a 2.3 miliardi di dollari. Sebbene l'azienda abbia registrato una perdita diluita per azione di $16.44 a causa di perdite non monetarie legate alla vendita di TRANZACT, l'EPS diluito rettificato è aumentato del 31%, raggiungendo $2.93. I ricavi del segmento Salute, Benessere e Carriera sono aumentati del 4% a $1.33 miliardi, mentre i ricavi del segmento Rischio e Brokerage sono aumentati del 10% a $940 milioni. Il margine operativo era del -33.5%, ma il margine operativo rettificato è migliorato di 190 punti base, raggiungendo il 18.1%. I flussi di cassa delle attività operative hanno raggiunto $913 milioni per i nove mesi terminati il 30 settembre 2024. L'azienda mantiene le previsioni per l'intero anno 2024, puntando a un fatturato di $9.9 miliardi o superiore.
WTW reportó resultados sólidos para el tercer trimestre de 2024, con un aumento del 6% en los ingresos, alcanzando $2.3 mil millones. Aunque la compañía registró una pérdida diluida por acción de $16.44 debido a pérdidas no monetarias relacionadas con la venta de TRANZACT, el EPS diluido ajustado creció un 31%, alcanzando $2.93. Los ingresos del segmento de Salud, Bienestar y Carrera aumentaron un 4% a $1.33 mil millones, mientras que los ingresos del segmento de Riesgo y Corretaje se incrementaron en un 10% a $940 millones. El margen operativo fue del -33.5%, pero el margen operativo ajustado mejoró 190 puntos base, alcanzando el 18.1%. Los flujos de efectivo de las actividades operativas alcanzaron $913 millones para los nueve meses que finalizaron el 30 de septiembre de 2024. La compañía mantiene su guía para todo el año 2024, con una meta de ingresos de $9.9 mil millones o más.
WTW는 2024년 3분기 강력한 실적을 보고했으며, 수익이 6% 증가하여 23억 달러에 달했습니다. TRANZACT 판매와 관련된 비현금 손실로 인해 주당 희석 손실이 $16.44로 기록되었지만, 조정된 희석 주당순이익(EPS)은 31% 증가하여 $2.93에 도달했습니다. 건강, 부, 경력 부문의 수익은 4% 증가하여 $13.3억 달러가 되었고, 리스크 및 브로킹 부문의 수익은 10% 증가하여 $9.4억 달러에 이릅니다. 운영 마진은 -33.5%였으나, 조정된 운영 마진은 190 베이시스 포인트 개선되어 18.1%에 달했습니다. 2024년 9월 30일 종료된 9개월 동안 운영 활동으로부터의 현금 흐름은 $9.13억 달러에 도달했습니다. 회사는 전체 연도 2024에 대한 가이드를 유지하고 있으며, 수익 목표는 99억 달러 이상입니다.
WTW a annoncé des résultats solides pour le troisième trimestre 2024, avec une augmentation des revenus de 6% à 2,3 milliards de dollars. Bien que la société ait enregistré une perte diluée par action de 16,44 $ en raison de pertes non monétaires liées à la vente de TRANZACT, le BPA dilué ajusté a augmenté de 31% pour atteindre 2,93 $. Les revenus du segment Santé, Richesse et Carrière ont augmenté de 4% pour atteindre 1,33 milliard de dollars, tandis que les revenus du segment Risque et Courtage ont augmenté de 10% pour atteindre 940 millions de dollars. La marge d'exploitation était de -33,5%, mais la marge d'exploitation ajustée a progressé de 190 points de base pour atteindre 18,1%. Les flux de trésorerie provenant des activités d'exploitation ont atteint 913 millions de dollars pour les neuf mois se terminant le 30 septembre 2024. L'entreprise maintient ses prévisions pour l'année entière 2024, visant un chiffre d'affaires de 9,9 milliards de dollars ou plus.
WTW berichtete für das dritte Quartal 2024 von starken Ergebnissen, mit einem Umsatzanstieg von 6% auf 2,3 Milliarden Dollar. Obwohl das Unternehmen einen verwässerten Verlust pro Aktie von 16,44 $ aufgrund von nicht finanziellen Verlusten im Zusammenhang mit dem Verkauf von TRANZACT verzeichnete, stieg das angepasste verwässerte EPS um 31% auf 2,93 $. Der Umsatz im Bereich Gesundheit, Wohlstand und Karriere stieg um 4% auf 1,33 Milliarden Dollar, während der Umsatz im Bereich Risiko und Brokerage um 10% auf 940 Millionen Dollar zunahm. Die operative Marge betrug -33,5%, aber die angepasste operative Marge verbesserte sich um 190 Basispunkte auf 18,1%. Die Cashflows aus operativen Tätigkeiten betrugen 913 Millionen Dollar für die neun Monate bis zum 30. September 2024. Das Unternehmen hält an seiner Prognose für das Jahr 2024 fest und strebt einen Umsatz von 9,9 Milliarden Dollar oder mehr an.
- Revenue grew 6% to $2.3 billion
- Adjusted diluted EPS increased 31% to $2.93
- Adjusted operating margin improved 190 basis points to 18.1%
- Risk & Broking segment revenue grew 10% to $940 million
- Operating cash flow increased to $913 million from $823 million YoY
- Reported diluted loss per share of $16.44
- Operating margin declined to -33.5% from 7.3% YoY
- Net loss of $1.67 billion compared to $139 million profit last year
- Benefits Delivery & Outsourcing experienced organic revenue decline
Insights
Strong Q3 results with
Key positives include robust performance in Risk & Broking segment with
However, the
The earnings report reveals strong market positioning and execution across key business segments. Health, Wealth & Career segment's growth reflects successful client retention and global expansion, particularly in benefits management. The Risk & Broking segment's impressive
The transformation program is tracking well toward its
- Revenue1 increased
6% to$2.3 billion for the quarter with organic growth of6% for the quarter - Diluted Loss2 per Share was
$16.44 for the quarter - Adjusted Diluted Earnings per Share were
$2.93 for the quarter, up31% from prior year - Operating Margin2 was (33.5)% for the quarter
- Adjusted Operating Margin was
18.1% for the quarter, up 190 basis points from prior year
LONDON, Oct. 31, 2024 (GLOBE NEWSWIRE) -- WTW (NASDAQ: WTW) (the “Company”), a leading global advisory, broking and solutions company, today announced financial results for the third quarter ended September 30, 2024.
“We had another strong quarter fueled by revenue growth, operating leverage and the success of our Transformation program. Our revenue growth of
Consolidated Results
As reported, USD millions, except %
| Key Metrics | Q3-24 | Q3-23 | Y/Y Change |
| Revenue1 | Reported | ||
| (Loss)/Income from Operations2 | NM | ||
| Operating Margin2 % | (33.5)% | NM | |
| Adjusted Operating Income | |||
| Adjusted Operating Margin % | 190 bps | ||
| Net (Loss)/Income2 | NM | ||
| Adjusted Net Income | |||
| Diluted EPS2 | NM | ||
| Adjusted Diluted EPS |
| 1 | The revenue amounts included in this release are presented on a U.S. GAAP basis except where stated otherwise. This excludes reinsurance revenue which is reported in discontinued operations. The segment discussion is on an organic basis. |
| 2 | Loss from Operations, Operating Margin, Net Loss and Diluted EPS for the third quarter of 2024 include pre-tax non-cash losses and impairment charges of over |
| NM | Not meaningful. |
Revenue was
Net Loss for the third quarter of 2024 was
Cash Flow and Capital Allocation
Cash flows from operating activities were
Third Quarter 2024 Segment Highlights
Health, Wealth & Career ("HWC")
As reported, USD millions, except %
| Health, Wealth & Career | Q3-24 | Q3-23 | Y/Y Change |
| Total Revenue | Reported | ||
| Operating Income | |||
| Operating Margin % | 90 bps |
The HWC segment had revenue of
Operating margins in the HWC segment increased 90 basis points from the prior-year third quarter to
Risk & Broking ("R&B")
As reported, USD millions, except %
| Risk & Broking | Q3-24 | Q3-23 | Y/Y Change |
| Total Revenue | Reported | ||
| Operating Income | |||
| Operating Margin % | 240 bps |
The R&B segment had revenue of
Operating margins in the R&B segment increased 240 basis points from the prior-year third quarter to
2024 Outlook
Based on current and anticipated market conditions, the Company's full-year targets for 2024, consistent with those targets that have been previously provided, are as follows. Refer to the Supplemental Slides for additional detail.
- Expect to deliver revenue of
$9.9 billion or greater and mid-single digit organic revenue growth for the full year 2024 - Expect to deliver adjusted operating margin of
23.0% -23.5% for the full year 2024 - Expect to deliver adjusted diluted earnings per share of
$16.00 -$17.00 for the full year 2024 - Expect approximately
$88 million in non-cash pension income for the full year 2024 - Expect a foreign currency headwind on adjusted earnings per share of approximately
$0.06 for the full year 2024 at today’s rates, down from$0.10 previously - Expect to deliver approximately
$450 million of cumulative run-rate savings from the Transformation program by the end of 2024 with total program costs of$1.17 5 billion.
Outlook includes Non-GAAP financial measures. We do not reconcile forward-looking Non-GAAP measures for reasons explained below.
In addition, WTW will host an Investor Day on Tuesday, December 3, 2024 beginning at approximately 9:00 a.m. Eastern Time. A live webcast presentation will be available at www.wtwco.com and a replay of the webcast will be available on the Company’s website following the event.
Conference Call
The Company will host a live webcast and conference call to discuss the financial results for the third quarter 2024. It will be held on Thursday, October 31, 2024, beginning at 9:00 a.m. Eastern Time. A live broadcast of the conference call will be available on WTW’s website here. The conference call will include a question-and-answer session. To participate in the question-and-answer session, please register here. An online replay will be available at www.wtwco.com shortly after the call concludes.
About WTW
At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organizations sharpen their strategy, enhance organizational resilience, motivate their workforce and maximize performance. Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success—and provide perspective that moves you. Learn more at www.wtwco.com.
WTW Non-GAAP Measures
In order to assist readers of our consolidated financial statements in understanding the core operating results that WTW’s management uses to evaluate the business and for financial planning, we present the following non-GAAP measures: (1) Constant Currency Change, (2) Organic Change, (3) Adjusted Operating Income/Margin, (4) Adjusted EBITDA/Margin, (5) Adjusted Net Income, (6) Adjusted Diluted Earnings Per Share, (7) Adjusted Income Before Taxes, (8) Adjusted Income Taxes/Tax Rate, (9) Free Cash Flow and (10) Free Cash Flow Margin.
We believe that those measures are relevant and provide pertinent information widely used by analysts, investors and other interested parties in our industry to provide a baseline for evaluating and comparing our operating performance, and in the case of free cash flow, our liquidity results.
Within the measures referred to as ‘adjusted’, we adjust for significant items which will not be settled in cash, or which we believe to be items that are not core to our current or future operations. Some of these items may not be applicable for the current quarter, however they may be part of our full-year results. Additionally, we have historically adjusted for certain items which are not described below, but for which we may adjust in a future period when applicable. Items applicable to the quarter or full year results, or the comparable periods, include the following:
- Restructuring costs and transaction and transformation – Management believes it is appropriate to adjust for restructuring costs and transaction and transformation when they relate to a specific significant program with a defined set of activities and costs that are not expected to continue beyond a defined period of time, or significant acquisition-related transaction expenses. We believe the adjustment is necessary to present how the Company is performing, both now and in the future when the incurrence of these costs will have concluded.
- Impairment – Adjustment to remove the non-cash goodwill impairment associated with our Benefits, Delivery and Administration reporting unit related to the pending divestiture of our TRANZACT business.
- Provisions for specified litigation matters – We will include provisions for litigation matters which we believe are not representative of our core business operations. Among other things, we determine this by reference to the amount of the loss (net of insurance and other recovery receivables) and by reference to whether the matter relates to an unusual and complex scenario that is not expected to be repeated as part of our ongoing, ordinary business. These amounts are presented net of insurance and other recovery receivables. See the footnotes to the respective reconciliation tables below for more specificity on the litigation matter excluded from adjusted results.
- Gains and losses on disposals of operations – Adjustment to remove the gains or losses resulting from disposed operations that have not been classified as discontinued operations.
- Tax effect of significant adjustments – Relates to the incremental tax expense or benefit resulting from significant or unusual events including significant statutory tax rate changes enacted in material jurisdictions in which we operate, internal reorganizations of ownership of certain businesses that reduced the investment held by our U.S.-controlled subsidiaries and the recovery of certain refunds or payment of taxes related to businesses in which we no longer participate.
We evaluate our revenue on an as reported (U.S. GAAP), constant currency and organic basis. We believe presenting constant currency and organic information provides valuable supplemental information regarding our comparable results, consistent with how we evaluate our performance internally.
We consider Constant Currency Change, Organic Change, Adjusted Operating Income/Margin, Adjusted EBITDA/Margin, Adjusted Net Income, Adjusted Diluted Earnings Per Share, Adjusted Income Before Taxes, Adjusted Income Taxes/Tax Rate and Free Cash Flow to be important financial measures, which are used to internally evaluate and assess our core operations and to benchmark our operating and liquidity results against our competitors. These non-GAAP measures are important in illustrating what our comparable operating and liquidity results would have been had we not incurred transaction-related and non-recurring items. Reconciliations of these measures are included in the accompanying tables with the following exception: The Company does not reconcile its forward-looking non-GAAP financial measures to the corresponding U.S. GAAP measures, due to variability and difficulty in making accurate forecasts and projections and/or certain information not being ascertainable or accessible; and because not all of the information, such as foreign currency impacts necessary for a quantitative reconciliation of these forward-looking non-GAAP financial measures to the most directly comparable U.S. GAAP financial measure, is available to the Company without unreasonable efforts. For the same reasons, the Company is unable to address the probable significance of the unavailable information. The Company provides non-GAAP financial measures that it believes will be achieved, however it cannot accurately predict all of the components of the adjusted calculations and the U.S. GAAP measures may be materially different than the non-GAAP measures.
Our non-GAAP measures and their accompanying definitions are presented as follows:
Constant Currency Change – Represents the year-over-year change in revenue excluding the impact of foreign currency fluctuations. To calculate this impact, the prior year local currency results are first translated using the current year monthly average exchange rates. The change is calculated by comparing the prior year revenue, translated at the current year monthly average exchange rates, to the current year as reported revenue, for the same period. We believe constant currency measures provide useful information to investors because they provide transparency to performance by excluding the effects that foreign currency exchange rate fluctuations have on period-over-period comparability given volatility in foreign currency exchange markets.
Organic Change – Excludes the impact of fluctuations in foreign currency exchange rates, as described above and the period-over-period impact of acquisitions and divestitures on current-year revenue. We believe that excluding transaction-related items from our U.S. GAAP financial measures provides useful supplemental information to our investors, and it is important in illustrating what our core operating results would have been had we not included these transaction-related items, since the nature, size and number of these transaction-related items can vary from period to period.
Adjusted Operating Income/Margin – (Loss)/Income from operations adjusted for impairment, amortization, restructuring costs, transaction and transformation and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted operating income margin is calculated by dividing adjusted operating income by revenue. We consider adjusted operating income/margin to be important financial measures, which are used internally to evaluate and assess our core operations and to benchmark our operating results against our competitors.
Adjusted EBITDA/Margin – Net (Loss)/Income adjusted for provision for income taxes, interest expense, impairment, depreciation and amortization, restructuring costs, transaction and transformation, gains and losses on disposals of operations and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted EBITDA Margin is calculated by dividing adjusted EBITDA by revenue. We consider adjusted EBITDA/margin to be important financial measures, which are used internally to evaluate and assess our core operations, to benchmark our operating results against our competitors and to evaluate and measure our performance-based compensation plans.
Adjusted Net Income – Net (Loss)/Income Attributable to WTW adjusted for impairment, amortization, restructuring costs, transaction and transformation, gains and losses on disposals of operations and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results and the related tax effect of those adjustments and the tax effects of internal reorganizations. This measure is used solely for the purpose of calculating adjusted diluted earnings per share.
Adjusted Diluted Earnings Per Share – Adjusted Net Income divided by the weighted-average number of ordinary shares, diluted. Adjusted diluted earnings per share is used to internally evaluate and assess our core operations and to benchmark our operating results against our competitors.
Adjusted Income Before Taxes – (Loss)/Income from operations before income taxes adjusted for impairment, amortization, restructuring costs, transaction and transformation, gains and losses on disposals of operations and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results. Adjusted income before taxes is used solely for the purpose of calculating the adjusted income tax rate.
Adjusted Income Taxes/Tax Rate – Benefit from/(provision for) income taxes adjusted for taxes on certain items of impairment, amortization, restructuring costs, transaction and transformation, gains and losses on disposals of operations, the tax effects of internal reorganizations, and non-recurring items that, in management’s judgment, significantly affect the period-over-period assessment of operating results, divided by adjusted income before taxes. Adjusted income taxes is used solely for the purpose of calculating the adjusted income tax rate. Management believes that the adjusted income tax rate presents a rate that is more closely aligned to the rate that we would incur if not for the reduction of pre-tax income for the adjusted items and the tax effects of internal reorganizations, which are not core to our current and future operations.
Free Cash Flow – Cash flows from operating activities less cash used to purchase fixed assets and software for internal use. Free Cash Flow is a liquidity measure and is not meant to represent residual cash flow available for discretionary expenditures. Management believes that free cash flow presents the core operating performance and cash-generating capabilities of our business operations.
Free Cash Flow Margin – Free Cash Flow as a percentage of revenue, which represents how much of revenue would be realized on a cash basis. We consider this measure to be a meaningful metric for tracking cash conversion on a year-over-year basis due to the non-cash nature of our pension income, which is included in our GAAP and Non-GAAP earnings metrics presented herein.
These non-GAAP measures are not defined in the same manner by all companies and may not be comparable to other similarly titled measures of other companies. Non-GAAP measures should be considered in addition to, and not as a substitute for, the information contained within our condensed consolidated financial statements.
WTW Forward-Looking Statements
This document contains ‘forward-looking statements’ within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934, which are intended to be covered by the safe harbors created by those laws. These forward-looking statements include information about possible or assumed future results of our operations. All statements, other than statements of historical facts, that address activities, events, or developments that we expect or anticipate may occur in the future, including such things as our outlook, plans and references to future performance, including our future financial and operating results (including our revenue, costs, or margins), short-term and long-term financial goals, plans, objectives, expectations and intentions, including with respect to organic revenue growth, free cash flow generation, adjusted net revenue, adjusted operating margin and adjusted earnings per share; future share repurchases; demand for our services and competitive strengths; strategic goals; existing and evolving business strategies including those related to acquisition and disposition activity; the benefits of new initiatives; the growth of our business and operations; the sustained health of our product, service, transaction, client, and talent assessment and management pipelines; our ability to successfully manage ongoing leadership, organizational, and technology changes, including investments in improving systems and processes; our ability to implement and realize anticipated benefits of any cost-savings initiatives including our multi-year operational transformation program; the potential impact of natural or man-made disasters like health pandemics and other world health crises; future capital expenditures; ongoing working capital efforts; the impact of changes to tax laws on our financial results; and our recognition of future impairment charges or write-off of receivables, are forward-looking statements. Also, when we use words such as ‘may’, ‘will’, ‘would’, ‘anticipate’, ‘believe’, ‘estimate’, ‘expect’, ‘intend’, ‘plan’, ‘continues’, ‘seek’, ‘target’, ‘goal’, ‘focus’, ‘probably’, or similar expressions, we are making forward-looking statements. Such statements are based upon the current beliefs and expectations of our management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. All forward-looking disclosure is speculative by its nature.
There are important risks, uncertainties, events and factors that could cause our actual results or performance to differ materially from those in the forward-looking statements contained in this document, including the following: our ability to successfully establish, execute and achieve our global business strategy as it evolves; our ability to fully realize the anticipated benefits of our growth strategy, including inorganic growth through acquisitions; our ability to make divestitures, including the pending sale of our TRANZACT business (inclusive of all the legal entities that comprise such business), or acquisitions, including our ability to integrate or manage acquired businesses or de-integrate businesses to be disposed, as well as our ability to identify and successfully execute on opportunities for strategic collaboration; our ability to consummate the pending sale of TRANZACT, and related incremental risks associated therewith including our ability to obtain approval (or for applicable waiting periods to expire) under the U.S. Hart-Scott-Rodino Antitrust Improvements Act of 1976; our ability to successfully manage ongoing organizational changes, including as part of our multi-year operational transformation program, investments in improving systems and processes, and in connection with our acquisition and divestiture activities, including the pending sale of TRANZACT, and related to changes in leadership in any of our businesses; risks relating to changes in our management structures and in senior leadership; our ability to achieve our short-term and long-term financial goals, such as with respect to our cash flow generation, and the timing with respect to such achievement; the risks related to changes in general economic conditions, business and political conditions, changes in the financial markets, inflation, credit availability, increased interest rates and changes in trade policies; the risks to our short-term and long-term financial goals from any of the risks or uncertainties set forth herein; the risks relating to the adverse impacts of macroeconomic trends, including inflation, changes in interest rates and trade policies, as well as political events, war, such as the Russia-Ukraine and Middle East conflicts, and other international disputes, terrorism, natural disasters, public health issues and other business interruptions on the global economy and capital markets, which could have a material adverse effect on our business, financial condition, results of operations, and long-term goals; our ability to successfully hedge against fluctuations in foreign currency rates; the risks relating to the adverse impacts of natural or man-made disasters such as health pandemics and other world health crises on the demand for our products and services, our cash flows and our business operations; material interruptions to or loss of our information processing capabilities, or failure to effectively maintain and upgrade our information technology resources and systems and related risks of cybersecurity breaches or incidents; our ability to comply with complex and evolving regulations related to data privacy, cybersecurity, and artificial intelligence; the risks relating to the transitional arrangements in effect subsequent to our previously-completed sale of Willis Re to Arthur J. Gallagher & Co.; significant competition that we face and the potential for loss of market share and/or profitability; the impact of seasonality and differences in timing of renewals and non-recurring revenue increases from disposals and book-of-business sales; the insufficiency of client data protection, potential breaches of information systems or insufficient safeguards against cybersecurity breaches or incidents; the risk of increased liability or new legal claims arising from our new and existing products and services, and expectations, intentions and outcomes relating to outstanding litigation; the risk of substantial negative outcomes on existing litigation or investigation matters; changes in the regulatory environment in which we operate, including, among other risks, the impacts of pending competition law and regulatory investigations; various claims, government inquiries or investigations or the potential for regulatory action; our ability to integrate direct-to-consumer sales and marketing solutions with our existing offerings and solutions; disasters or business continuity problems; our ability to successfully enhance our billing, collection and other working capital efforts, and thereby increase our free cash flow; our ability to properly identify and manage conflicts of interest; reputational damage, including from association with third parties; reliance on third-party service providers and suppliers; the loss of key employees or a large number of employees and rehiring rates; our ability to maintain our corporate culture; doing business internationally, including the impact of foreign currency exchange rates; compliance with extensive government regulation; the risk of sanctions imposed by governments, or changes to associated sanction regulations (such as sanctions imposed on Russia) and related counter-sanctions; our ability to effectively apply technology, data and analytics changes for internal operations, maintaining industry standards and meeting client preferences; changes and developments in the insurance industry or the U.S. healthcare system, including those related to Medicare, any legislative actions from the current U.S. Congress, the recent Final Rule from the Centers for Medicare & Medicaid Services for contract year 2025 and any judicial claims, rulings and appeals related thereto, and any other changes and developments in legal, regulatory, economic, business or operational conditions that could impact our Medicare benefits businesses such as TRANZACT; the inability to protect our intellectual property rights, or the potential infringement upon the intellectual property rights of others; fluctuations in our pension assets and liabilities and related changes in pension income, including as a result of, related to, or derived from movements in the interest rate environment, investment returns, inflation, or changes in other assumptions that are used to estimate our benefit obligations and their effect on adjusted earnings per share; our capital structure, including indebtedness amounts, the limitations imposed by the covenants in the documents governing such indebtedness and the maintenance of the financial and disclosure controls and procedures of each; our ability to obtain financing on favorable terms or at all; adverse changes in our credit ratings; the impact of recent or potential changes to U.S. or foreign laws, and the enactment of additional, or the revision of existing, state, federal, and/or foreign laws and regulations, recent judicial decisions and development of case law, other regulations and any policy changes and legislative actions, including those that may impose additional excise taxes or impact our effective tax rate; U.S. federal income tax consequences to U.S. persons owning at least
The foregoing list of factors is not exhaustive and new factors may emerge from time to time that could also affect actual performance and results. For more information, please see Part I, Item 1A in our Annual Report on Form 10-K, and our subsequent filings with the SEC. Copies are available online at www.sec.gov or www.wtwco.com.
Although we believe that the assumptions underlying our forward-looking statements are reasonable, any of these assumptions, and therefore also the forward-looking statements based on these assumptions, could themselves prove to be inaccurate. Given the significant uncertainties inherent in the forward-looking statements included in this document, our inclusion of this information is not a representation or guarantee by us that our objectives and plans will be achieved.
Our forward-looking statements speak only as of the date made, and we will not update these forward-looking statements unless the securities laws require us to do so. With regard to these risks, uncertainties and assumptions, the forward-looking events discussed in this document may not occur, and we caution you against unduly relying on these forward-looking statements.
Contact
INVESTORS
Claudia De La Hoz | Claudia.Delahoz@wtwco.com
| WTW Supplemental Segment Information (In millions of U.S. dollars) (Unaudited) | |||||||||||||||||||||||
| REVENUE | |||||||||||||||||||||||
| Components of Revenue Change(i) | |||||||||||||||||||||||
| Less: | Less: | ||||||||||||||||||||||
| Three Months Ended September 30, | As Reported | Currency | Constant Currency | Acquisitions/ | Organic | ||||||||||||||||||
| 2024 | 2023 | % Change | Impact | Change | Divestitures | Change | |||||||||||||||||
| Health, Wealth & Career | |||||||||||||||||||||||
| Revenue excluding interest income | $ | 1,320 | $ | 1,275 | 4 | % | 0 | % | 3 | % | 0 | % | 4 | % | |||||||||
| Interest income | 8 | 7 | |||||||||||||||||||||
| Total | 1,328 | 1,282 | 4 | % | 0 | % | 3 | % | 0 | % | 4 | % | |||||||||||
| Risk & Broking | |||||||||||||||||||||||
| Revenue excluding interest income | $ | 911 | $ | 830 | 10 | % | 0 | % | 10 | % | 0 | % | 10 | % | |||||||||
| Interest income | 29 | 25 | |||||||||||||||||||||
| Total | 940 | 855 | 10 | % | 0 | % | 10 | % | 0 | % | 10 | % | |||||||||||
| Segment Revenue | $ | 2,268 | $ | 2,137 | 6 | % | 0 | % | 6 | % | 0 | % | 6 | % | |||||||||
| Reimbursable expenses and other | 15 | 22 | |||||||||||||||||||||
| Interest income | 6 | 7 | |||||||||||||||||||||
| Revenue | $ | 2,289 | $ | 2,166 | 6 | % | 0 | % | 6 | % | 0 | % | |||||||||||
| Components of Revenue Change(i) | |||||||||||||||||||||||
| Less: | Less: | ||||||||||||||||||||||
| Nine Months Ended September 30, | As Reported | Currency | Constant Currency | Acquisitions/ | Organic | ||||||||||||||||||
| 2024 | 2023 | % Change | Impact | Change | Divestitures | Change | |||||||||||||||||
| Health, Wealth & Career | |||||||||||||||||||||||
| Revenue excluding interest income | $ | 3,898 | $ | 3,766 | 4 | % | 0 | % | 4 | % | 0 | % | 4 | % | |||||||||
| Interest income | 26 | 18 | |||||||||||||||||||||
| Total | 3,924 | 3,784 | 4 | % | 0 | % | 4 | % | 0 | % | 4 | % | |||||||||||
| Risk & Broking | |||||||||||||||||||||||
| Revenue excluding interest income | $ | 2,811 | $ | 2,607 | 8 | % | 0 | % | 8 | % | 0 | % | 8 | % | |||||||||
| Interest income | 86 | 52 | |||||||||||||||||||||
| Total | 2,897 | 2,659 | 9 | % | 0 | % | 9 | % | 0 | % | 9 | % | |||||||||||
| Segment Revenue | $ | 6,821 | $ | 6,443 | 6 | % | 0 | % | 6 | % | 0 | % | 6 | % | |||||||||
| Reimbursable expenses and other | 56 | 90 | |||||||||||||||||||||
| Interest income | 18 | 36 | |||||||||||||||||||||
| Revenue | $ | 6,895 | $ | 6,569 | 5 | % | 0 | % | 5 | % | 0 | % | |||||||||||
(i) Components of revenue change may not add due to rounding.
(ii) Interest income did not contribute to organic change for the three and nine months ended September 30, 2024.
BOOK-OF-BUSINESS SETTLEMENTS AND INTEREST INCOME
| Three Months Ended September 30, | ||||||||||||||||||||||||||||||||
| HWC | R&B | Corporate | Total | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||||
| Book-of-business settlements | $ | 3 | $ | — | $ | 4 | $ | 1 | $ | — | $ | — | $ | 7 | $ | 1 | ||||||||||||||||
| Interest income | 8 | 7 | 29 | 25 | 6 | 7 | 43 | 39 | ||||||||||||||||||||||||
| Total | $ | 11 | $ | 7 | $ | 33 | $ | 26 | $ | 6 | $ | 7 | $ | 50 | $ | 40 | ||||||||||||||||
| Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||
| HWC | R&B | Corporate | Total | |||||||||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||||||||
| Book-of-business settlements | $ | 3 | $ | — | $ | 8 | $ | 11 | $ | — | $ | — | $ | 11 | $ | 11 | ||||||||||||||||
| Interest income | 26 | 18 | 86 | 52 | 18 | 36 | 130 | 106 | ||||||||||||||||||||||||
| Total | $ | 29 | $ | 18 | $ | 94 | $ | 63 | $ | 18 | $ | 36 | $ | 141 | $ | 117 | ||||||||||||||||
SEGMENT OPERATING INCOME (i)
| Three Months Ended September 30, | |||||||||
| 2024 | 2023 | ||||||||
| Health, Wealth & Career | $ | 329 | $ | 305 | |||||
| Risk & Broking | 170 | 134 | |||||||
| Segment Operating Income | $ | 499 | $ | 439 | |||||
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Health, Wealth & Career | $ | 941 | $ | 836 | ||||
| Risk & Broking | 575 | 459 | ||||||
| Segment Operating Income | $ | 1,516 | $ | 1,295 | ||||
(i) Segment operating income excludes certain costs, including amortization of intangibles, restructuring costs, transaction and transformation expenses, certain litigation provisions, and to the extent that the actual expense based upon which allocations are made differs from the forecast/budget amount, a reconciling item will be created between internally-allocated expenses and the actual expenses reported for U.S. GAAP purposes.
SEGMENT OPERATING MARGINS
| Three Months Ended September 30, | ||||
| 2024 | 2023 | |||
| Health, Wealth & Career | ||||
| Risk & Broking | ||||
| Nine Months Ended September 30, | ||||
| 2024 | 2023 | |||
| Health, Wealth & Career | ||||
| Risk & Broking | ||||
RECONCILIATIONS OF SEGMENT OPERATING INCOME TO (LOSS)/INCOME FROM OPERATIONS BEFORE INCOME TAXES
| Three Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Segment Operating Income | $ | 499 | $ | 439 | ||||
| Impairment(i) | (1,042 | ) | — | |||||
| Amortization | (56 | ) | (62 | ) | ||||
| Restructuring costs | (8 | ) | (17 | ) | ||||
| Transaction and transformation(ii) | (74 | ) | (113 | ) | ||||
| Unallocated, net(iii) | (85 | ) | (88 | ) | ||||
| (Loss)/Income from Operations | (766 | ) | 159 | |||||
| Interest expense | (65 | ) | (61 | ) | ||||
| Other (loss)/income, net | (1,163 | ) | 66 | |||||
| (Loss)/income from operations before income taxes | $ | (1,994 | ) | $ | 164 | |||
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Segment Operating Income | $ | 1,516 | $ | 1,295 | ||||
| Impairment(i) | (1,042 | ) | — | |||||
| Amortization | (176 | ) | (203 | ) | ||||
| Restructuring costs | (29 | ) | (30 | ) | ||||
| Transaction and transformation(ii) | (296 | ) | (265 | ) | ||||
| Unallocated, net(iii) | (247 | ) | (211 | ) | ||||
| (Loss)/Income from Operations | (274 | ) | 586 | |||||
| Interest expense | (197 | ) | (172 | ) | ||||
| Other (loss)/income, net | (1,113 | ) | 126 | |||||
| (Loss)/income from operations before income taxes | $ | (1,584 | ) | $ | 540 | |||
(i) Represents the non-cash goodwill impairment associated with our BDA reporting unit related to the pending divestiture of our TRANZACT business.
(ii) In 2024 and 2023, in addition to legal fees and other transaction costs, includes primarily consulting fees and compensation costs related to the Transformation program.
(iii) Includes certain costs, primarily related to corporate functions which are not directly related to the segments, and certain differences between budgeted expenses determined at the beginning of the year and actual expenses that we report for U.S. GAAP purposes.
WTW
Reconciliations of Non-GAAP Measures
(In millions of U.S. dollars, except per share data)
(Unaudited)
RECONCILIATIONS OF NET (LOSS)/INCOME ATTRIBUTABLE TO WTW TO ADJUSTED DILUTED EARNINGS PER SHARE
| Three Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Net (loss)/income attributable to WTW | $ | (1,675 | ) | $ | 136 | |||
| Adjusted for certain items: | ||||||||
| Impairment | 1,042 | — | ||||||
| Amortization | 56 | 62 | ||||||
| Restructuring costs | 8 | 17 | ||||||
| Transaction and transformation | 74 | 113 | ||||||
| Loss/(gain) on disposal of operations | 1,190 | (41 | ) | |||||
| Tax effect on certain items listed above(ii) | (396 | ) | (51 | ) | ||||
| Adjusted Net Income | $ | 299 | $ | 236 | ||||
| Weighted-average ordinary shares, diluted | 102 | 105 | ||||||
| Diluted (Loss)/Earnings Per Share | $ | (16.44 | ) | $ | 1.29 | |||
| Adjusted for certain items:(iii) | ||||||||
| Impairment | 10.23 | — | ||||||
| Amortization | 0.55 | 0.59 | ||||||
| Restructuring costs | 0.08 | 0.16 | ||||||
| Transaction and transformation | 0.73 | 1.07 | ||||||
| Loss/(gain) on disposal of operations | 11.68 | (0.39 | ) | |||||
| Tax effect on certain items listed above(ii) | (3.89 | ) | (0.48 | ) | ||||
| Adjusted Diluted Earnings Per Share(iii) | $ | 2.93 | $ | 2.24 | ||||
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Net (loss)/income attributable to WTW | $ | (1,344 | ) | $ | 433 | |||
| Adjusted for certain items: | ||||||||
| Impairment | 1,042 | — | ||||||
| Amortization | 176 | 203 | ||||||
| Restructuring costs | 29 | 30 | ||||||
| Transaction and transformation | 296 | 265 | ||||||
| Provision for specified litigation matter(i) | 13 | — | ||||||
| Loss/(gain) on disposal of operations | 1,190 | (44 | ) | |||||
| Tax effect on certain items listed above(ii) | (492 | ) | (128 | ) | ||||
| Tax effect of significant adjustments | (7 | ) | 2 | |||||
| Adjusted Net Income | $ | 903 | $ | 761 | ||||
| Weighted-average ordinary shares, diluted | 103 | 107 | ||||||
| Diluted (Loss)/Earnings Per Share | $ | (13.11 | ) | $ | 4.06 | |||
| Adjusted for certain items:(iii) | ||||||||
| Impairment | 10.17 | — | ||||||
| Amortization | 1.72 | 1.90 | ||||||
| Restructuring costs | 0.28 | 0.28 | ||||||
| Transaction and transformation | 2.89 | 2.48 | ||||||
| Provision for specified litigation matter(i) | 0.13 | — | ||||||
| Loss/(gain) on disposal of operations | 11.61 | (0.41 | ) | |||||
| Tax effect on certain items listed above(ii) | (4.80 | ) | (1.20 | ) | ||||
| Tax effect of significant adjustments | (0.07 | ) | 0.02 | |||||
| Adjusted Diluted Earnings Per Share(iii) | $ | 8.81 | $ | 7.13 | ||||
(i) Represents a provision related to potential litigation arising out of a structured insurance program originally placed for a client over 15 years ago. The program is of a type and complexity that was highly bespoke to the client and for that reason is unlikely to be exactly replicated elsewhere. Because of this, while we do not believe the potential litigation is material, we believe excluding this matter from adjusted results makes results more comparable from period to period and more representative of our core business operations.
(ii) The tax effect was calculated using an effective tax rate for each item.
(iii) Per share values and totals may differ due to rounding.
RECONCILIATIONS OF NET (LOSS)/INCOME TO ADJUSTED EBITDA
| Three Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Net (Loss)/Income | $ | (1,672 | ) | (73.0 | )% | $ | 139 | 6.4 | % | ||
| Provision for income taxes | (322 | ) | 25 | ||||||||
| Interest expense | 65 | 61 | |||||||||
| Impairment | 1,042 | — | |||||||||
| Depreciation | 60 | 60 | |||||||||
| Amortization | 56 | 62 | |||||||||
| Restructuring costs | 8 | 17 | |||||||||
| Transaction and transformation | 74 | 113 | |||||||||
| Loss/(gain) on disposal of operations | 1,190 | (41 | ) | ||||||||
| Adjusted EBITDA and Adjusted EBITDA Margin | $ | 501 | 21.9 | % | $ | 436 | 20.1 | % | |||
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| Net (Loss)/Income | $ | (1,336 | ) | (19.4 | )% | $ | 441 | 6.7 | % | ||
| Provision for income taxes | (248 | ) | 99 | ||||||||
| Interest expense | 197 | 172 | |||||||||
| Impairment | 1,042 | — | |||||||||
| Depreciation | 176 | 184 | |||||||||
| Amortization | 176 | 203 | |||||||||
| Restructuring costs | 29 | 30 | |||||||||
| Transaction and transformation | 296 | 265 | |||||||||
| Provision for specified litigation matter(i) | 13 | — | |||||||||
| Loss/(gain) on disposal of operations | 1,190 | (44 | ) | ||||||||
| Adjusted EBITDA and Adjusted EBITDA Margin | $ | 1,535 | 22.3 | % | $ | 1,350 | 20.6 | % | |||
(i) Represents a provision related to potential litigation arising out of a structured insurance program originally placed for a client over 15 years ago. The program is of a type and complexity that was highly bespoke to the client and for that reason is unlikely to be exactly replicated elsewhere. Because of this, while we do not believe the potential litigation is material, we believe excluding this matter from adjusted results makes results more comparable from period to period and more representative of our core business operations.
RECONCILIATIONS OF (LOSS)/INCOME FROM OPERATIONS TO ADJUSTED OPERATING INCOME
| Three Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (Loss)/Income from operations and Operating margin | $ | (766 | ) | (33.5 | )% | $ | 159 | 7.3 | % | ||
| Adjusted for certain items: | |||||||||||
| Impairment | 1,042 | — | |||||||||
| Amortization | 56 | 62 | |||||||||
| Restructuring costs | 8 | 17 | |||||||||
| Transaction and transformation | 74 | 113 | |||||||||
| Adjusted operating income and Adjusted operating income margin | $ | 414 | 18.1 | % | $ | 351 | 16.2 | % | |||
| Nine Months Ended September 30, | |||||||||||
| 2024 | 2023 | ||||||||||
| (Loss)/Income from operations and Operating margin | $ | (274 | ) | (4.0 | )% | $ | 586 | 8.9 | % | ||
| Adjusted for certain items: | |||||||||||
| Impairment | 1,042 | — | |||||||||
| Amortization | 176 | 203 | |||||||||
| Restructuring costs | 29 | 30 | |||||||||
| Transaction and transformation | 296 | 265 | |||||||||
| Provision for specified litigation matter(i) | 13 | — | |||||||||
| Adjusted operating income and Adjusted operating income margin | $ | 1,282 | 18.6 | % | $ | 1,084 | 16.5 | % | |||
(i) Represents a provision related to potential litigation arising out of a structured insurance program originally placed for a client over 15 years ago. The program is of a type and complexity that was highly bespoke to the client and for that reason is unlikely to be exactly replicated elsewhere. Because of this, while we do not believe the potential litigation is material, we believe excluding this matter from adjusted results makes results more comparable from period to period and more representative of our core business operations.
RECONCILIATIONS OF GAAP INCOME TAXES/TAX RATE TO ADJUSTED INCOME TAXES/TAX RATE
| Three Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| (Loss)/income from operations before income taxes | $ | (1,994 | ) | $ | 164 | |||
| Adjusted for certain items: | ||||||||
| Impairment | 1,042 | — | ||||||
| Amortization | 56 | 62 | ||||||
| Restructuring costs | 8 | 17 | ||||||
| Transaction and transformation | 74 | 113 | ||||||
| Loss/(gain) on disposal of operations | 1,190 | (41 | ) | |||||
| Adjusted income before taxes | $ | 376 | $ | 315 | ||||
| (Benefit from)/provision for income taxes | $ | (322 | ) | $ | 25 | |||
| Tax effect on certain items listed above(ii) | 396 | 51 | ||||||
| Adjusted income taxes | $ | 74 | $ | 76 | ||||
| U.S. GAAP tax rate | 16.1 | % | 15.5 | % | ||||
| Adjusted income tax rate | 19.7 | % | 24.3 | % | ||||
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| (Loss)/income from operations before income taxes | $ | (1,584 | ) | $ | 540 | |||
| Adjusted for certain items: | ||||||||
| Impairment | 1,042 | — | ||||||
| Amortization | 176 | 203 | ||||||
| Restructuring costs | 29 | 30 | ||||||
| Transaction and transformation | 296 | 265 | ||||||
| Provision for specified litigation matter(i) | 13 | — | ||||||
| Loss/(gain) on disposal of operations | 1,190 | (44 | ) | |||||
| Adjusted income before taxes | $ | 1,162 | $ | 994 | ||||
| (Benefit from)/provision for income taxes | $ | (248 | ) | $ | 99 | |||
| Tax effect on certain items listed above(ii) | 492 | 128 | ||||||
| Tax effect of significant adjustments | 7 | (2 | ) | |||||
| Adjusted income taxes | $ | 251 | $ | 225 | ||||
| U.S. GAAP tax rate | 15.6 | % | 18.3 | % | ||||
| Adjusted income tax rate | 21.6 | % | 22.6 | % | ||||
(i) Represents a provision related to potential litigation arising out of a structured insurance program originally placed for a client over 15 years ago. The program is of a type and complexity that was highly bespoke to the client and for that reason is unlikely to be exactly replicated elsewhere. Because of this, while we do not believe the potential litigation is material, we believe excluding this matter from adjusted results makes results more comparable from period to period and more representative of our core business operations.
(ii) The tax effect was calculated using an effective tax rate for each item.
RECONCILIATION OF CASH FLOWS FROM OPERATING ACTIVITIES TO FREE CASH FLOW
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Cash flows from operating activities | $ | 913 | $ | 823 | ||||
| Less: Additions to fixed assets and software for internal use | (106 | ) | (116 | ) | ||||
| Free Cash Flow | $ | 807 | $ | 707 | ||||
| WILLIS TOWERS WATSON PUBLIC LIMITED COMPANY Condensed Consolidated Statements of Income (In millions of U.S. dollars, except per share data) (Unaudited) | ||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Revenue | $ | 2,289 | $ | 2,166 | $ | 6,895 | $ | 6,569 | ||||||||
| Costs of providing services | ||||||||||||||||
| Salaries and benefits | 1,396 | 1,359 | 4,135 | 4,019 | ||||||||||||
| Other operating expenses | 419 | 396 | 1,315 | 1,282 | ||||||||||||
| Impairment | 1,042 | — | 1,042 | — | ||||||||||||
| Depreciation | 60 | 60 | 176 | 184 | ||||||||||||
| Amortization | 56 | 62 | 176 | 203 | ||||||||||||
| Restructuring costs | 8 | 17 | 29 | 30 | ||||||||||||
| Transaction and transformation | 74 | 113 | 296 | 265 | ||||||||||||
| Total costs of providing services | 3,055 | 2,007 | 7,169 | 5,983 | ||||||||||||
| (Loss)/income from operations | (766 | ) | 159 | (274 | ) | 586 | ||||||||||
| Interest expense | (65 | ) | (61 | ) | (197 | ) | (172 | ) | ||||||||
| Other (loss)/income, net | (1,163 | ) | 66 | (1,113 | ) | 126 | ||||||||||
| (LOSS)/INCOME FROM OPERATIONS BEFORE INCOME TAXES | (1,994 | ) | 164 | (1,584 | ) | 540 | ||||||||||
| Benefit from/(provision for) income taxes | 322 | (25 | ) | 248 | (99 | ) | ||||||||||
| NET (LOSS)/INCOME | (1,672 | ) | 139 | (1,336 | ) | 441 | ||||||||||
| Income attributable to non-controlling interests | (3 | ) | (3 | ) | (8 | ) | (8 | ) | ||||||||
| NET (LOSS)/INCOME ATTRIBUTABLE TO WTW | $ | (1,675 | ) | $ | 136 | $ | (1,344 | ) | $ | 433 | ||||||
| (LOSS)/EARNINGS PER SHARE | ||||||||||||||||
| Basic (loss)/earnings per share | $ | (16.44 | ) | $ | 1.30 | $ | (13.11 | ) | $ | 4.08 | ||||||
| Diluted (loss)/earnings per share | $ | (16.44 | ) | $ | 1.29 | $ | (13.11 | ) | $ | 4.06 | ||||||
| Weighted-average ordinary shares, basic | 102 | 105 | 103 | 106 | ||||||||||||
| Weighted-average ordinary shares, diluted | 102 | 105 | 103 | 107 | ||||||||||||
| WILLIS TOWERS WATSON PUBLIC LIMITED COMPANY Condensed Consolidated Balance Sheets (In millions of U.S. dollars, except share data) (Unaudited) | ||||||||
| September 30, | December 31, | |||||||
| 2024 | 2023 | |||||||
| ASSETS | ||||||||
| Cash and cash equivalents | $ | 1,372 | $ | 1,424 | ||||
| Fiduciary assets | 9,176 | 9,073 | ||||||
| Accounts receivable, net | 2,118 | 2,572 | ||||||
| Prepaid and other current assets | 558 | 364 | ||||||
| Current assets held for sale | 1,089 | — | ||||||
| Total current assets | 14,313 | 13,433 | ||||||
| Fixed assets, net | 710 | 720 | ||||||
| Goodwill | 8,882 | 10,195 | ||||||
| Other intangible assets, net | 1,360 | 2,016 | ||||||
| Right-of-use assets | 539 | 565 | ||||||
| Pension benefits assets | 632 | 588 | ||||||
| Other non-current assets | 732 | 1,573 | ||||||
| Total non-current assets | 12,855 | 15,657 | ||||||
| TOTAL ASSETS | $ | 27,168 | $ | 29,090 | ||||
| LIABILITIES AND EQUITY | ||||||||
| Fiduciary liabilities | $ | 9,176 | $ | 9,073 | ||||
| Deferred revenue and accrued expenses | 2,027 | 2,104 | ||||||
| Current debt | — | 650 | ||||||
| Current lease liabilities | 122 | 125 | ||||||
| Other current liabilities | 735 | 678 | ||||||
| Current liabilities held for sale | 475 | — | ||||||
| Total current liabilities | 12,535 | 12,630 | ||||||
| Long-term debt | 5,308 | 4,567 | ||||||
| Liability for pension benefits | 487 | 563 | ||||||
| Deferred tax liabilities | 94 | 542 | ||||||
| Provision for liabilities | 416 | 365 | ||||||
| Long-term lease liabilities | 556 | 592 | ||||||
| Other non-current liabilities | 202 | 238 | ||||||
| Total non-current liabilities | 7,063 | 6,867 | ||||||
| TOTAL LIABILITIES | 19,598 | 19,497 | ||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||
| EQUITY(i) | ||||||||
| Additional paid-in capital | 10,957 | 10,910 | ||||||
| (Accumulated deficit)/retained earnings | (650 | ) | 1,466 | |||||
| Accumulated other comprehensive loss, net of tax | (2,810 | ) | (2,856 | ) | ||||
| Treasury shares, at cost, 15,574 shares in 2024 | (5 | ) | — | |||||
| Total WTW shareholders' equity | 7,492 | 9,520 | ||||||
| Non-controlling interests | 78 | 73 | ||||||
| Total Equity | 7,570 | 9,593 | ||||||
| TOTAL LIABILITIES AND EQUITY | $ | 27,168 | $ | 29,090 | ||||
(i) Equity includes (a) Ordinary shares
| WILLIS TOWERS WATSON PUBLIC LIMITED COMPANY Condensed Consolidated Statements of Cash Flows (In millions of U.S. dollars) (Unaudited) | ||||||||
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| NET (LOSS)/INCOME | $ | (1,336 | ) | $ | 441 | |||
| Adjustments to reconcile net income to total net cash from operating activities: | ||||||||
| Depreciation | 176 | 184 | ||||||
| Amortization | 176 | 203 | ||||||
| Impairment | 1,042 | — | ||||||
| Non-cash restructuring charges | 17 | 19 | ||||||
| Non-cash lease expense | 76 | 83 | ||||||
| Net periodic benefit of defined benefit pension plans | (15 | ) | (20 | ) | ||||
| Provision for doubtful receivables from clients | 13 | 8 | ||||||
| Benefit from deferred income taxes | (379 | ) | (58 | ) | ||||
| Share-based compensation | 85 | 87 | ||||||
| Net loss/(gain) on disposal of operations | 1,190 | (44 | ) | |||||
| Non-cash foreign exchange (gain)/loss | (25 | ) | 1 | |||||
| Other, net | 32 | 21 | ||||||
| Changes in operating assets and liabilities, net of effects from purchase of subsidiaries: | ||||||||
| Accounts receivable | 271 | 261 | ||||||
| Other assets | (299 | ) | (175 | ) | ||||
| Other liabilities | (159 | ) | (191 | ) | ||||
| Provisions | 48 | 3 | ||||||
| Net cash from operating activities | 913 | 823 | ||||||
| CASH FLOWS USED IN INVESTING ACTIVITIES | ||||||||
| Additions to fixed assets and software for internal use | (106 | ) | (116 | ) | ||||
| Capitalized software costs | (83 | ) | (66 | ) | ||||
| Acquisitions of operations, net of cash acquired | (28 | ) | (6 | ) | ||||
| Proceeds from sale of operations | — | 86 | ||||||
| Cash and fiduciary funds transferred in sale of operations | — | (922 | ) | |||||
| Purchase of investments | (13 | ) | (6 | ) | ||||
| Net cash used in investing activities | (230 | ) | (1,030 | ) | ||||
| CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIES | ||||||||
| Senior notes issued | 746 | 748 | ||||||
| Debt issuance costs | (9 | ) | (7 | ) | ||||
| Repayments of debt | (653 | ) | (253 | ) | ||||
| Repurchase of shares | (506 | ) | (804 | ) | ||||
| Net proceeds/(payments) from fiduciary funds held for clients | 934 | (71 | ) | |||||
| Payments of deferred and contingent consideration related to acquisitions | (2 | ) | (8 | ) | ||||
| Cash paid for employee taxes on withholding shares | (30 | ) | (21 | ) | ||||
| Dividends paid | (265 | ) | (265 | ) | ||||
| Acquisitions of and dividends paid to non-controlling interests | (10 | ) | (47 | ) | ||||
| Net cash from/(used in) financing activities | 205 | (728 | ) | |||||
| INCREASE/(DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 888 | (935 | ) | |||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | 32 | (54 | ) | |||||
| CASH, CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD (i) | 3,792 | 4,721 | ||||||
| CASH, CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD (i) | $ | 4,712 | $ | 3,732 | ||||
(i) The amounts of cash, cash equivalents and restricted cash, their respective classification on the condensed consolidated balance sheets, as well as their respective portions of the increase or decrease in cash, cash equivalents and restricted cash for each of the periods presented have been included in the Supplemental Disclosures of Cash Flow Information section.
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
| Nine Months Ended September 30, | ||||||||
| 2024 | 2023 | |||||||
| Supplemental disclosures of cash flow information: | ||||||||
| Cash and cash equivalents | $ | 1,372 | $ | 1,247 | ||||
| Fiduciary funds (included in fiduciary assets) | 3,340 | 2,485 | ||||||
| Total cash, cash equivalents and restricted cash | $ | 4,712 | $ | 3,732 | ||||
| (Decrease)/increase in cash, cash equivalents and other restricted cash | $ | (54 | ) | $ | 5 | |||
| Increase/(decrease) in fiduciary funds | 942 | (940 | ) | |||||
| Total (i) | $ | 888 | $ | (935 | ) | |||
(i) Does not include the effect of exchange rate changes on cash, cash equivalents and restricted cash.
FAQ
What was WTW's revenue growth in Q3 2024?
Why did WTW report a net loss in Q3 2024?
What is WTW's revenue guidance for full-year 2024?
How much did WTW's adjusted operating margin improve in Q3 2024?
