Aon Reports Second Quarter Results.CHICAGO--(BUSINESS WIRE)--Aug. 5, 1998--Aon Corporation (Aon) today announced financial results for the quarter ended June June: see month. 30, 1998. Net income per share for the quarter was $0.81, up 40% from $0.58 before special charges a year earlier. Total revenue for the quarter was $1.6 billion, up 14% from $1.4 billion reported in the second quarter of 1997. Net income for the quarter was $140 million. For the first six months of 1998, net income per share was $1.61, up 46% from $1.10 before special charges a year earlier. Total revenue was up 15% to $3.2 billion from $2.8 billion. Net income for the first six months was $278 million. Patrick G. Ryan Ryan may refer to: Places
"Revenue growth in brokerage BROKERAGE, contracts. The trade or occupation of a broker; the commissions paid to a broker for his services. and consulting stemmed stemmed adj. 1. Having the stems removed. 2. Provided with a stem or a specific type of stem. Often used in combination: stemmed goblets; long-stemmed roses. from a combination of organic growth and acquisitions. Revenue remains under pressure due to the soft underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. cycle. However, margins improved due to the benefits of consolidation. "Cash flow remains strong; trailing twelve-month EBITA EBITA Earnings Before Interest Taxes Amortization (earnings before special charges, interest, taxes and amortization of intangible assets Intangible Asset An asset that is not physical in nature. Notes: Examples are things like copyrights, patents, intellectual property, and goodwill. These are the opposite of tangible assets. ) was $1.0 billion compared to $753 million a year ago. "We continue to invest in people, systems and product development to ensure that we meet our clients' growing needs on a global basis." Aon Corporation is a holding company that comprises a family of insurance brokerage, consulting and insurance underwriting subsidiaries. Aon's common stock (Symbol: AOC AOC, n an acronym for the Aromatherapy Organizations Council. ) is listed on the New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , Chicago Chicago, city, United States Chicago (shĭkä`gō, shĭkô`gō), city (1990 pop. 2,783,726), seat of Cook co., NE Ill., on Lake Michigan; inc. 1837. and London stock exchanges London Stock Exchange London marketplace for securities. It was formed in 1773 by a group of stockbrokers who had been doing business informally in local coffeehouses. . -0-
Aon Corporation
Consolidated Summary of Operations
Second Quarter Ended Six Months Ended
---------------------- -----------------------
(millions except June 30, Percent June 30, Percent
per share data) 1998 1997 Change 1998 1997 Change
---------------------- -----------------------
Revenue
Brokerage
commissions
and fees $1,059.5 $885.0 19.7% $2,055.7 $1,726.7 19.1%
Premiums and other 423.4 421.9 0.4 840.2 816.3 2.9
Investment income 140.1 117.6 19.1 288.6 235.8 22.4
---------------------- -------------------------
Total revenue (1) 1,623.0 1,424.5 13.9 3,184.5 2,778.8 14.6
---------------------- -------------------------
Expenses
General expenses 1,125.4 996.6 12.9 2,193.7 1,954.2 12.3
Benefits to
policyholders 226.8 215.6 5.2 452.7 420.8 7.6
Amortization of
intangible assets 31.2 33.4 (6.6) 60.7 64.7 (6.2)
---------------------- -------------------------
Total expenses (1) 1,383.4 1,245.6 11.1 2,707.1 2,439.7 11.0
---------------------- -------------------------
Income Before Special
Charges 239.6 178.9 33.9 477.4 339.1 40.8
Special charges - 27.0 - - 172.0 -
---------------------- ------------------------
Income Before Income
Tax and Minority
Interest 239.6 151.9 57.7 477.4 167.1 185.7
Provision for income
tax 89.8 57.0 57.5 179.0 62.7 185.5
---------------------- ------------------------
Income Before Minority
Interest 149.8 94.9 57.9 298.4 104.4 185.8
Minority interest -
8.205% trust
preferred capital
securities (10.3) (10.7) N/A (20.6) (19.5) N/A
---------------------- ------------------------
Net Income $139.5 $84.2 65.7% $277.8 $84.9 227.2%
====================== ========================
Preferred stock
dividends (0.7) (3.3) N/A (1.3) (6.7) N/A
---------------------- ------------------------
Net Income Available
for Common
Stockholders $138.8 $80.9 71.6% $276.5 $78.2 253.6%
====================== ========================
Net Income Per Share:
Basic net income per
share $0.82 $0.48 70.8% $1.64 $0.47 248.9%
====================== ========================
Dilutive net income
per share:
Net income excluding
special charges $0.81 $0.58 39.7% $1.61 $1.10 46.4%
Special charges - (0.10) - - (0.64) -
---------------------- ------------------------
Dilutive net income
per share $0.81 $0.48 68.8% $1.61 $0.46 250.0%
====================== ========================
Average common and
common equivalent
shares
outstanding (2) 172.2 169.6 171.7 169.5
--------------- ----------------
(1) Prior period revenue and expenses have been restated to conform to
the 1998 presentation.
(2) Represents the dilutive average common and common stock equivalent
shares outstanding.
Aon Corporation
Major Lines of Business
Second Quarter Ended Six Months Ended
------------------------- ------------------------
(millions) June 30, Percent June 30, Percent
1998 1997 Change 1998 1997 Change
------------------------- ------------------------
Revenue
-------
Insurance brokerage
and consulting
services:
Insurance and
other services $953.8 $778.8 22.5% $1,843.9 $1,530.4 20.5%
Consulting 155.2 144.2 7.6 305.3 273.3 11.7
------------------------ ------------------------
Total revenue (1) 1,109.0 923.0 20.2 2,149.2 1,803.7 19.2
------------------------ ------------------------
Insurance underwriting:
Direct sales - life,
accident and
health 261.2 259.7 0.6 518.9 514.4 0.9
Extended warranty 157.0 147.8 6.2 316.4 277.2 14.1
Other 64.3 66.2 (2.9) 122.2 127.5 (4.2)
------------------------ ------------------------
Total revenue 482.5 473.7 1.9 957.5 919.1 4.2
------------------------ ------------------------
Corporate and other 31.5 27.8 13.3 77.8 56.0 38.9
------------------------ ------------------------
Total revenue $1,623.0 $1,424.5 13.9% $3,184.5 $2,778.8 14.6%
======================== ========================
Income Before Income Tax
------------------------
Insurance brokerage
and consulting
services $196.9 $127.4 54.6% $380.2 $236.0 61.1%
Special charges - - - - (145.0) -
-------------------- ------------------------
Including special
charges 196.9 127.4 54.6 380.2 91.0 317.8
Insurance underwriting 69.1 70.5 (2.0) 133.6 135.3 (1.3)
Corporate and other (26.4) (19.0) N/A (36.4) (32.2) N/A
Special charges - (27.0) - - (27.0) -
--------------------- ------------------------
Including special
charges (26.4) (46.0) N/A (36.4) (59.2) N/A
--------------------- ------------------------
Total income before
income tax $239.6 $151.9 57.7% $477.4 $167.1 185.7%
===================== ========================
(1) Includes investment income, primarily relating to fiduciary funds,
of $50 million and $38 million for the second quarter ended June
30, 1998 and 1997, respectively, and $94 million and $77 million
for the six months ended June 30, 1998 and 1997, respectively.
CONTACT: Aon Corporation, Chicago John F. Roskopf, 312/701-3983 |
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