Watson Wyatt Worldwide Reports Second Quarter EPS of $0.58 on Strong Revenue Growth.
Raises Fiscal 2007 Guidance
ARLINGTON, Va. -- Watson Wyatt Worldwide, Inc. (NYSE NYSE
See: New York Stock Exchange :WW), a leading international human capital and financial management consulting Noun 1. management consulting - a service industry that provides advice to those in charge of running a business
service industry - an industry that provides services rather than tangible objects firm, today announced financial results for the second quarter of fiscal year 2007, which ended December 31, 2006.
Revenues were $366.4 million for the quarter, an increase of 16% from the second quarter of fiscal 2006 revenues of $315.8 million. Income from continuing operations continuing operations
Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the for the second quarter of fiscal 2007 was $26.0 million, or $0.58 per diluted di·lute
tr.v. di·lut·ed, di·lut·ing, di·lutes
1. To make thinner or less concentrated by adding a liquid such as water.
2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, an increase from $17.2 million or $0.41 per diluted share in the prior-year second quarter.
All business segments reported increased revenues when compared to prior-year second quarter. Results for the quarter also include the dilutive effect Dilutive effect
Result of a transaction that decreases earnings per common share (EPS). of the 1.95 million contingent shares that we expect to issue related to the European acquisition. The contingent shares are not included in prior-year second quarter diluted earnings per share diluted earnings per share
An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of . For the quarter, exchange rates had a favorable fa·vor·a·ble
1. Advantageous; helpful: favorable winds.
2. Encouraging; propitious: a favorable diagnosis.
3. impact on revenues of approximately 4 percentage points and a positive impact of $0.04 per diluted share on net income.
"We had exceptional growth, with strong increases in each of our five segments," said John Haley John Haley former Little Rock lawyer, former attorney for Jim Guy Tucker and Jim Guy Tucker's co-defendant.
On February 20, 1998, John Haley pleaded guilty to one misdemeanor count tax fraud to the Internal Revenue Service. , president and chief executive officer. "We are doing a great job capitalizing on market opportunities due to our strong client relationships, value-added service A value-added service (VAS) is a telecommunications industry term for non-core services or, in short, all services beyond standard voice calls and fax transmissions. offerings and disciplined execution.
"One highlight was revenue growth of 47% in investment consulting, as we responded to significant demand for advice on better aligning pension plan assets with future obligations, involving complex risk-based investment strategies."
* Benefits Group revenues (representing 54% of second-quarter revenues) were $196.7 million for the second quarter of fiscal 2007, an increase of 11% (8% constant currency) from $176.6 million in the prior-year second quarter. The increase was largely due to increased demand for valuation and design work.
* Technology and Administration Solutions Group revenues (representing 11% of second-quarter revenues) were $41.5 million for the second quarter of fiscal 2007, an increase of 12% (8% constant currency) from $37.0 million in the prior-year second quarter. The increase resulted primarily from an increase in the number of projects in service. At December 31, 2006, 75 projects were in service in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , compared to 25 at December 31, 2005. We have an additional 60 projects in the implementation phase, compared to 51 at December 31, 2005. Our European business also achieved strong revenue growth.
* Human Capital Group revenues (representing 12% of second-quarter revenues) were $45.5 million for the second quarter of fiscal 2007, an increase of 19% (16% constant currency) from $38.2 million in the prior-year second quarter. Demand was strong across all of our compensation service lines, including executive compensation, sales effectiveness and strategic rewards. Data services also increased over prior year.
* Insurance & Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject.
Please [ improve this article] or discuss the issue on the talk page. Group revenues (representing 7% of second-quarter revenues) were $27.0 million for the second quarter of fiscal 2007, an increase of 19% (9% constant currency) from $22.6 million in the prior-year second quarter. The revenue increase was largely driven by an increase in life insurance consulting projects.
* Investment Consulting Group revenues (representing 9% of total revenues for the quarter) were $32.6 million for the second quarter of fiscal 2007, an increase of 53% (47% constant currency) from $21.3 million in the prior-year second quarter. The revenue increase was due to strong demand for all of our services, particularly investment strategy advice.
Outlook for Fiscal Year 2007
For fiscal year 2007, the company expects revenues to be in the range of $1.43 billion to $1.46 billion, an increase from previous guidance of $1.40 billion to $1.43 billion. Earnings per diluted share for the year are expected to be in the range of $2.41 to $2.44, an increase from previous guidance of $2.26 to $2.29. The increase in guidance is based on the company's strengthening performance and the acquisition of our Dutch affiliate, Watson Wyatt Brans & Co. that was completed on February 1, 2007. This guidance assumes an exchange rate of 1.90 U.S. dollars to the British pound.
For the third quarter of fiscal 2007, the company expects revenue to be in the range of $370 million to $374 million. In addition, the company expects third quarter earnings per diluted share to be in the range of $0.61 to $0.63.
The company will host a live webcast and conference call to discuss the financial results for the second quarter of fiscal 2007. It will be held on Thursday, February 8, 2007, beginning at 9:00 a.m. Eastern Time, and can be accessed via the Internet by going to www.watsonwyatt.com. The replay of the webcast will be available two hours after the live call for a period of three months. The replay also will be available for one week after the call by dialing 617-801-6888 and using confirmation number 25009461.
Forward-Looking Statements forward-looking statement
A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections.
Statements in this press release regarding projections and expectations of future earnings, revenues, operations, business trends and other such items are forward-looking statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. A number of risks and uncertainties exist which could cause actual results to differ materially from the results reflected in these forward-looking statements. Such factors include but are not limited to the company's ability to integrate the business of Watson Wyatt LLP LLP - Lower Layer Protocol into our own business, processes and systems, and achieve the anticipated results; our continued ability to recruit and retain qualified associates; the success of our marketing, client development and sales programs after the business combination; our ability to maintain client relationships and to attract new clients after the business combination; declines in demand for our services; outcomes of pending or future litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute.
When a person begins a civil lawsuit, the person enters into a process called litigation. and the availability and capacity of professional liability insurance to fund pending or future judgments or settlements; the ability of the company to obtain professional liability insurance; a significant decrease in the demand for the consulting, actuarial ac·tu·ar·y
n. pl. ac·tu·ar·ies
A statistician who computes insurance risks and premiums.
[Latin and other services we offer as a result of changing economic conditions or other factors; actions by competitors offering human resources The fancy word for "people." The human resources department within an organization, years ago known as the "personnel department," manages the administrative aspects of the employees. consulting services Noun 1. consulting service - service provided by a professional advisor (e.g., a lawyer or doctor or CPA etc.)
service - work done by one person or group that benefits another; "budget separately for goods and services" , including public accounting and consulting firms Noun 1. consulting firm - a firm of experts providing professional advice to an organization for a fee
business firm, firm, house - the members of a business organization that owns or operates one or more establishments; "he worked for a , technology consulting firms and internet/intranet development firms; our ability to achieve cost reductions after the business combination; foreign currency exchange and interest rate fluctuations; exposure to Watson Wyatt LLP liabilities that have not been expressly assumed; general economic and business conditions that adversely affect us or our clients after the business combination; the level of capital resources required for future acquisitions and business opportunities; regulatory developments abroad and domestically that impact our business practices; legislative and technological developments that may affect the demand for or costs of our services; and other factors discussed under "Risk Factors" in the company's Annual Report on Form 10-K Form 10-K
A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information.
See 10-K. for the year ended June 30, 2006 and filed on September 1, 2006, with the Securities and Exchange Commission. These statements are based on assumptions that may not come true. All forward-looking disclosure is speculative by its nature. The company undertakes no obligation to update any of the forward-looking information included in this report, whether as a result of new information, future events, changed expectations or otherwise.
About Watson Wyatt Worldwide
Watson Wyatt (NYSE:WW) is the trusted business partner to the world's leading organizations on people and financial issues. The firm's global services include: managing the cost and effectiveness of employee benefit programs; developing attraction, retention and reward strategies; advising pension plan sponsors and other institutions on optimal investment strategies; providing strategic and financial advice to insurance and financial services companies; and delivering related technology, outsourcing and data services. Watson Wyatt has 6,300 associates in 30 countries and is located on the Web at www.watsonwyatt.com.
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