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Outsourcing Town Hall Q4 2012. Outsourcing Town Hall Q2 2012. Topics . Financial Results & Business Snapshots Technology HR BPO. Proprietary & Confidential . Financials & Business Snapshots. Key Metrics*– Aon Delivered S ignificant P rogress in Q4 & 2012 . Organic Revenue

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Outsourcing Town Hall Q2 2012

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Outsourcing town hall q2 2012

Outsourcing Town Hall

Q4 2012

Outsourcing Town Hall

Q2 2012


Topics

Topics

Financial Results & Business Snapshots

Technology

HR BPO

Proprietary & Confidential


Outsourcing town hall q2 2012

Financials & Business Snapshots


Key metrics aon delivered s ignificant p rogress in q4 2012

Key Metrics*– Aon Delivered Significant Progress in Q4 & 2012

  • Organic Revenue

  • Solid growth across both Risk and HR Solutions in Q4, including strong growth in Consulting Services of +8%

  • Rate of organic revenue for 2012 has improved to +4% from +2% in 2011, 0% in ‘2010 and -1% in 2009

  • Operating Margin

  • In Q4, a +50bps increase in HR Solutions was primarily offset by higher unallocated expenses

  • For 2012, Risk Solutions increased+10bps as organic growth and restructuring savings more than offset significant investments in the business

  • EPS

  • In Q4, organic revenue, restructuring savings, lower effective tax rate and effective capital management drove 9% growth

  • Repurchased approximately $500 million of ordinary shares in Q4 and $1.1 billion in 2012

  • Free Cash Flow

  • Improved working capital performance (predominantly accounts receivable) more than offset an increase in pension contributions

  • Record cash flow from operations of $1.4 billion in 2012

  • *The key metrics above are non-GAAP measures that are reconciled in the appendix of this presentation

  • Organic revenue excludes the impact of foreign exchange, acquisitions, divestitures, transfers, reimbursable expenses and unusual items. Change in organic revenue, a non-GAAP measure, is reconciled to the corresponding U.S. GAAP percent change in revenue in Appendix A of this presentation

  • Certain noteworthy items impacted Operating Income and Earnings per Share in the fourth quarter and full year of 2012 and 2011. A Reconciliation of Non-GAAP Measures for Operating income and Diluted Earnings per Share is in Appendix B of this presentation

  • Free cash flow is defined as cash flow from operations less capital expenditures. This non-GAAP measure does not imply or represent a precise calculation of residual cash flow available for discretionary expenditures. A reconciliation can be found in Appendix A of this presentation

Proprietary & Confidential


Organic revenue solid g rowth a cross e ach s egment

Organic Revenue¹ – Solid Growth Across Each Segment

  • Q4

  • Americas: Solid growth across all regions: Latin America, U.S. retail and Canada

  • International: Strong growth across Asia and emerging markets and modest growth in continental Europe, partly offset by a modest decline in Australia

  • Reinsurance: Strong growth in treaty globally driven by a favorable impact from pricing in the near-term and new business, partially offset by a significant decline in capital markets transactions and advisory business

  • Q4

  • Consulting: Strong growth in investment consulting, pension administration services and talent and rewards consulting 

  • Outsourcing: Strong growth from HC exchanges, new client wins and demand for discretionary services in HR business process outsourcing, partly offset by a modest decline in benefits administration

  • Organic revenue excludes the impact of foreign exchange, acquisitions, divestitures, transfers, reimbursable expenses and unusual items. Change in organic revenue, a non-GAAP measure, is reconciled to the corresponding U.S. GAAP percent change in revenue in Appendix A of this presentation

Proprietary & Confidential


Q4 2012 aon financials

Q4 2012 Aon Financials

5


Insert business financials here

INSERT BUSINESS FINANCIALS HERE

Note to presenters: We can not show specific financial results for Benefits, HR BPO, Exchanges, or Emerging Solutions due to external reporting guidelines. However, leaders in each organization will receive a separate slide for reporting their results. Insert the appropriate slide here based on your audience.

Proprietary & Confidential


Aon risk solutions full year 2012 snapshot

Aon Risk Solutions Full-Year 2012 Snapshot

  • Challenging revenue and PTI in a number of businesses (i.e., Germany, Spain, UK Affinity, Latin America Affinity and Australia)

  • Overall weak new business in many geographies; overall improved in second half but was flat for the full year

  • Negative / minimal spread in key geographies constrained PTI and margin expansion

  • Salary increases (merits and off cycle increases) contributed to a 90 bp deterioration in the SIB-to-revenue ratio (our key metric determining margin) and put significant pressure on margins

  • Top-line growth of 3%, 3% Americas, 3% International

  • Strong double-digit growth in Asia, New Zealand, Latin America and EMEA AGRC and GRIP Solutions

  • Solid organic growth in US Affinity, France and emerging markets (Africa, Central and Eastern Europe)

  • Overall 7% revenue growth in Health & Benefits (4% Americas, 4% International 10% including EMEA 7%, Asia 23%, Pacific 9%)

  • Strong retention 92% and improved rollover 91% with slightly more favorable market environment

  • Double digit percentage PTI expansion in US Retail, Canada, Latin America, France, Africa, and Asia driven by growth and positive spread

  • Progress on key initiatives: Aon Broking, Aon Client Promise, Aon GRIP, Working Capital/Cash and on our Talent agenda

Proprietary & Confidential


Aon benfield full year 2012 snapshot

Aon Benfield Full-Year 2012 Snapshot

  • Record levels of reinsurance capital putting pressure on rates in certain lines of business

  • Pricing under pressure in some sectors

  • Potential for adverse development related to Hurricane/Superstorm Sandy

  • Lower reinsurance demand due to sluggish insurer demand growth in difficult economic environment

  • Very competitive insurance landscape is also putting pressure on reinsurance demand

  • Annualized 5% organic revenue growth to USD1.5bn

  • Healthy 2% Q4 organic revenue growth to USD349m

  • 5thconsecutive quarter-on-quarter revenue growth across Treaty, Fac, Inpoint and capital markets business

  • 7th consecutive quarter of positive new business won in Treaty

  • The Aon Benfield platform is unique: scale + analytics = client value

  • Measurable success from our Articulating Value programme

Proprietary & Confidential


Aon hewitt full year 2012 snapshot

Aon Hewitt Full-Year 2012 Snapshot

Year over Year PTI and margin decline driven by:

Outsourcing compression/losses

PeopleSoft impacts

Slow first half growth in Consulting

Investments

Macroeconomic concerns impacted demand in EMEA and APAC

Colleague engagement lagging other progress

  • Good PTI performance to plan

  • Delivered solid growth of 4%

    • Outsourcing: HR BPO, Emerging Solutions and Exchanges

    • Consulting: U.S. Retirement, PRT, APAC, NA Communications

  • Growth rate accelerating in new areas: Investment Consulting, Pension De-Risking, Exchanges, Advisory

  • Regaining market innovator reputation

  • Near flawless enrollment season in Exchanges

  • Improvement in client retention and compression rates

  • Client satisfaction trending up

  • Turning the corner on PeopleSoft

9

Proprietary & Confidential


We exceeded our plan commitments on 2012 pre tax income

We Exceeded Our Plan Commitments on 2012 Pre-Tax Income

Much to be proud of this year, but still below our pre-tax income (PTI) results for 2011

$668MM

$651MM

$636MM

$605MM

2011 Actual

2012 Plan

2012 Stretch Target

2012 Actual

10


Aon hewitt s newest line of business health care exchanges

Aon Hewitt’s Newest Line of Business: Health Care Exchanges

Aon Hewitt Navigators

Corporate Exchange

New medical plan enrollments compared to our target

Missed appointments

Appointments completed on time

Customer satisfaction in interactions with benefits advisors

Total plan enrollments for medical, dental, and vision

Total AE calls taken across 3 Corporate Exchange clients

AE calls answered in 30 seconds or less

Portion of enrollments completed online

100,000

104.9%

0

36,000

AE Results

99.7%

95%

92%

94%

  • Convert strong client interest into confirmed wins

  • Scale our operations to support the high demand for this solution

  • Differentiate our solution in the market—we offer a real exchange with true competition between carriers

  • Aggressively grow through both business-to-business and direct-to- consumer strategies

  • Deploy a new platform and website to enhance retiree experience and team productivity

  • Ramp up for increased enrollment volume for 2013 AE (3x 2012 levels)

2013 Focus


Outsourcing town hall q2 2012

Technology


Improving the colleague e xperience t hrough t echnology

Improving the Colleague Experience Through Technology

  • Aon Technology continuously works to improve colleague productivity—offering enhanced collaboration, conferencing, and communication tools.

  • Between now and Q2 2014, there are a number of impactful changes planned, including:

    • Standardizing the Aon colleague desktop with Office 2010, Windows 7, and Aon AppStore.

    • Increasing access to corporate email, calendar, instant messaging, and contacts through various mobile technologies.

    • Making it easier to share files across the organization.

    • Expanding voice and video capabilities.

    • Standardizing North America printer, fax, copier, and scan equipment.

    • Ensuring the Global Service Desk offers the highest quality standards.

  • Visit the Colleague Technology Experience site to learn more and share your experiences.


Outsourcing town hall q2 2012

BPO

HR BPO


Hr bpo 2012 snapshot

HR BPO 2012 Snapshot

Client relationships very strong

Colleagues are the core of our business

Need to grow revenue and focus on margin

Proprietary & Confidential


Our new themes for 2013

Our New Themes for 2013

Proprietary & Confidential


Our b usiness p lan b alances the interests of o ur three p rimary s takeholders

Our Business Plan Balances the Interests of Our Three Primary Stakeholders

1

Fulfill our full promise to clients

Achieve the short and long term business plan

6

2

Deliver industry leading service excellence and operational effectiveness

Realize the return on our strategic and growth investments

5

Clients

Shareholders

Colleagues

Drive results through increased focus, business acumen and accountability

3

Foster a culture where colleagues can do their best work and new ideas are nurtured

4

17


2013 hr bpo goals

2013 HR BPO Goals

1

Clients

2

3

Colleagues

4

5

Shareholders

6


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