Willis Towers Watson(WTW) - 2024 Q1 - Quarterly Results

Financial Performance - Revenue for Q1 2024 was $2.34 billion, a 4% increase from $2.24 billion in Q1 2023, with organic growth of 5%[4] - Net Income for Q1 2024 decreased by 6% to $194 million compared to $206 million in Q1 2023[7] - Adjusted Diluted EPS for Q1 2024 was $3.29, up 16% from $2.84 in Q1 2023[4] - Adjusted Operating Income increased by 16% to $483 million, with an Adjusted Operating Margin of 20.6%, up 200 basis points year-over-year[4] - Total revenue for the three months ended March 31, 2024, was $2,341 million, representing a 4% increase compared to $2,244 million in the same period of 2023[46] - Adjusted net income for Q1 2024 was $341 million, compared to $306 million in Q1 2023, reflecting an increase of 11.4%[53] - Adjusted EBITDA for Q1 2024 was $568 million, with a margin of 24.3%, compared to $503 million and a margin of 22.4% in Q1 2023[54] - Net income attributable to WTW for Q1 2024 was $190 million, down from $203 million in Q1 2023, representing a decrease of 6.4%[59] Segment Performance - The Health, Wealth & Career segment reported revenue of $1.34 billion, a 4% increase, with an operating margin of 25.1%[11] - The Risk & Broking segment achieved revenue of $978 million, an 8% increase, with an operating margin of 20.8%[13] - Segment operating income for Health, Wealth & Career was $336 million, up from $309 million in the prior year, while Risk & Broking segment operating income increased to $203 million from $180 million[48] - The overall segment operating income for the company reached $539 million, compared to $489 million in the same quarter of 2023[48] - The operating margin for the Health, Wealth & Career segment improved to 25.1% from 24.0%, and Risk & Broking segment margin increased to 20.8% from 19.9%[49] Cash Flow and Assets - Cash flows from operating activities were $24 million for Q1 2024, down from $134 million in Q1 2023, with Free Cash Flow at $(9) million[10] - Free cash flow for Q1 2024 was negative $9 million, a significant decline from $92 million in Q1 2023[57] - Total assets as of March 31, 2024, were $30,237 million, an increase from $29,090 million as of December 31, 2023[62] - Long-term debt increased to $5,307 million as of March 31, 2024, compared to $4,567 million at the end of 2023[62] - Total cash, cash equivalents, and restricted cash at the end of the period increased to $5,251 million from $4,362 million, representing a year-over-year increase of 20.3%[67] - Cash and cash equivalents for the three months ended March 31, 2024, were $1,893 million, up from $1,135 million in the same period of 2023, indicating a growth of 66.7%[67] Future Outlook - The company expects full-year 2024 revenue of $9.9 billion or greater, with mid-single digit organic revenue growth[15] - Adjusted diluted earnings per share for the full year 2024 are projected to be between $15.40 and $17.00[15] - The company anticipates approximately $425 million in cumulative run-rate savings from the Transformation program by the end of 2024[23] - The company anticipates ongoing investments in technology and systems to enhance operational efficiency and support growth strategies[39] Risks and Strategic Focus - The company faces risks related to macroeconomic trends, including inflation and geopolitical events, which could impact financial performance[39] - The completed sale of Willis Re to Gallagher is part of the company's strategic focus on optimizing its business portfolio[39] Other Financial Metrics - Interest income for the three months ended March 31, 2024, was $43 million, compared to $32 million in the same period of 2023[47] - Organic revenue growth for total revenue, excluding interest income contribution, was 4% for the three months ended March 31, 2024[46] - The U.S. GAAP tax rate for Q1 2024 was 19.9%, slightly higher than 19.5% in Q1 2023[56] - The company incurred restructuring costs of $18 million in Q1 2024, compared to $3 million in Q1 2023, indicating increased operational adjustments[55] - The increase in total cash, cash equivalents, and restricted cash for the period was $1,506 million, compared to a decrease of $380 million in the prior year[67] - The net cash from financing activities was $1,556 million, a significant increase from a net cash used of $453 million in the prior period[66] - The overall increase in cash, cash equivalents, and other restricted cash was $487 million, contrasting with a decrease of $130 million in the previous year[67] - The effect of exchange rate changes on cash, cash equivalents, and restricted cash was a decrease of $47 million[67] - The beginning cash, cash equivalents, and restricted cash balance was $3,792 million, compared to $4,721 million at the beginning of the previous year[67]