It could prove to be a tough year for brokers but Willis Group Holdings Ltd showed last week that it was still able to grow revenues and profits despite falling rates.
The broker reported its first quarter 2007 results with overall revenues up from $671mn to $739mn and net income of $169mn against $140mn this time last year. This exceeded analyts’ expectations with a consensus of $730mn for the top line.
The firm said it was able to shrug off the pressures of falling commissions with new business gains which led to 6 percent organic growth in the quarter.
“Our results by every measure show we are off to a solid start in 2007, and we once again delivered good organic revenue growth despite a softening market,” said Joe Plumeri, chairman and chief executive.
Willis’ International division saw 8 percent organic growth, with North America 6 percent and Global at 3 percent.
The broker said it expects to “modestly” grow organic revenue and operating margins throughout 2007.
“Our plan is to continue to drive revenue growth despite softening insurance markets, while maintaining our expense discipline,” explained Plumeri.
The performance contrasts with top ten brokers Hilb Rogal & Hobbs and Arthur J Gallagher & Co, who reported profits below expectations as top line growth faltered in response to falling insurance rates (see story 13).
Willis’ rivals MMC and Aon report their quarterly results next month.