Aon’s Reinsurance Solutions division achieved organic revenue growth of 9% in the fourth quarter of 2022, while overall revenue increased by 2% year on year to $3.1 billion, reflecting organic revenue growth of 5%.
The $3.1 billion increase in total revenue reflects 5% organic revenue growth and a 1% positive impact from fiduciary investment income, which is partially offset by a 4% negative impact from foreign currency translation.
Total operating expenses in Q4 2022 increased 1% to $2.1 billion across the group, primarily due to an increase in expense associated with 5% organic revenue growth and investments in long-term growth. This was partially offset by a $102 million benefit from currency translation.
Overall, net income attributable to Aon shareholders fell 24% year on year to $657 million in the fourth quarter of 2022.
According to the global insurance and reinsurance broker’s fourth quarter 2022 results, its Reinsurance Solutions division contributed to the period’s solid revenue growth.
Revenue increased by 27% to $281 million in Q4 2022, up from $222 million the previous year, with 9% organic revenue growth reflecting double-digit growth in both the Strategy and Technology Group and faculty placements.
“Market impact was modestly positive on quarterly results,” says Aon. “The majority of revenue in our treaty portfolio is recurring in nature and is recorded in connection with the major renewal periods that occur throughout the first half of the year, while the second half of the year is primarily driven by facultative placements and more transactional capital markets.”
Revenue in the Health Solutions segment increased from $651 million in Q4 2021 to $678 million in Q4 2022, with organic revenue growth of 7% reflecting global growth in core health and benefits brokerage, driven by strong retention, new business generation, and renewal book portfolio management.
Revenue in Commercial Risk Solutions actually fell by 1% to $1.822 billion, despite Aon reporting organic revenue growth of 4% driven by strong retention, net new business generation, and renewal book portfolio management.
Aon’s Wealth Solutions division also reported a decrease in revenue in Q4 2022 to $353 million from $364 million in Q4 2021. Aon, on the other hand, claims that organic revenue growth was 6%, reflecting growth in Retirement, which was driven by higher demand and project-related work related to pension risk transfer, as well as the ongoing effects of regulatory changes.
“In the fourth quarter, our colleagues delivered 5% organic revenue growth, to finish a very strong year, contributing to full year organic revenue growth of 6%, margin expansion of 70 basis points to 30.8%, EPS growth of 12% to $13.39, and over $3 billion of free cash flow, an all-time high,” said Greg Case, CEO of Aon.
These results demonstrate the success of our Aon United strategy as we enter 2023 in a strong position to continue delivering results for clients, colleagues, and shareholders.”
Aon reported today that total revenue increased 2% year on year to $12.5 billion, reflecting 6% organic revenue growth and a 1% positive impact from fiduciary investment income, partially offset by a 4% negative impact from foreign currency translation and a 1% negative impact from acquisitions, divestitures, and other.
Net income for 2022 increased to $2.6 billion from $1.3 billion the previous year.
The Reinsurance Solutions division’s revenue increased by 10% to $2.2 billion for the fiscal year 2022. The Health Solutions division reported a 3% increase in revenue to $2.2 billion, Commercial Risk Solutions reported a 1% increase in revenue to $6.7 billion, and Wealth Solutions reported a 4% decrease in revenue to $1.4 billion.