AON - Earnings call transcript Q2 2022

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Operator

Good morning, and thank you for holding. Welcome to Aon plc's Second Quarter 2022 Conference Call. [Operator Instructions] I would also like to remind all parties that this call is being recorded. If anyone has an objection, you may disconnect your line at this time. It is important to note that some of the comments in today's call may constitute certain statements that are forward-looking in nature as defined by the Private Securities Reform Act of 1995. to to and results differ anticipated. subject cause that or are results actual materially statements certain uncertainties risks could those Such from historical concerning website. XXXX results differences well as cause press Information posted covering as that on been in our release quarter described the such second our having factors risk are could

Case, Aon plc. Thank Now it turn to of pleasure the call sir. CEO is my over to Greg you,

You may begin.

Gregory Case

Davies, I'm our Welcome everyone. and to second joined morning, by President. good call. Christa our and you, Andersen, Thank CFO; quarter Eric our conference

passion our of As United on organic line translated in the bringing our financial revenue delivering financial on year and growth. by platform. deepest growth highest-ever points year-to-date, of previous survey. financial quarters, from in quarter, in strategy to and demonstrating and adjusted in QX XX% XX%, or Services are we continued their of posted top and top consistent XX.X% into clients, our last and Business Organic EPS key operating progress Aon for and an second commitment our up colleague expressing best mid-single-digit a greater adjusted margin strength the of demonstrating recorded year, full latest with solution detailed delivered the Aon in XX This our the of quarter, appreciation metrics. guidance basis strength colleagues. was presentation ongoing X% growth of lines, our In dedication for revenue prior our the begin Their Aon extraordinary website. colleagues momentum against across in quarter, reflected inspiring. results, engagement We results our is geographies excellent And

and and client by from revenue areas investment business Risk CoverWallet revenue. to strong strength like the of solutions. our of retention highlighting delivered Commercial Turning core within growth, renewals, digital strength organic driven X% ongoing

exposure. help for clients In inflation opportunity are for addition, to an increased continue dynamic Reinsurance organic renewal in revenue select be growth delivered us ensure a external trends, X% covered to market.

continued our of Solutions work to resilience. data, health net resulting XX% costs Within driven new strong and Our competitive core in Capital team talent changes, inflation manage and support generation. growth well-being with very Health increasing employee regulatory organic retention advice revenue well-being. and growth a demand plans, advisory client as strong ongoing and expertise, by high firm's especially and benefits in related wage analytics demand, remains delivered solutions, health capability care the and clients Human Solutions, return-to-work brought and growth, with in full to they market, highly business

and Health, Finally, address performance our for like clients the continued them are for Wealth client solution impact to making strong organic additional efficiently results as QX reflects factors our benefits regions solutions, important deliver recent regulatory market conditions, core teams costs, lines. ever work risk for the optimal opportunity and Across strength transfer. across employees. changes to external Overall, increasing than year-to-date growth pension their and Solutions business of it provide in Wealth and X% in more core delivered and investment retirement from our with ongoing to help

business that external for While trends opportunities positive some the factors, broader and plans. uncertainty economy challenge there the health are economic is of to our around create

of cash greater in free double-digit ability margin improvement organic Mid-single-digit our our results the growth, X confident to growth. full revenue remain deliver or financial we year, each For commitments; flow in and

and Property areas by delivering them. to our On Aon's Intellectual making backed are assets. highlight new of insurance investment, is up financing. On or giving fund meaningful solution of IP-backed Solutions solutions, $X where and X growth we'd IP, serving entrepreneurs progress topic like innovation, climate. that the categories better Intellectual among in enables as are ownership threshold crossed the and property first-of-its-kind IP-rich clients demanding start-up without is an many businesses exciting we QX team billion debt IP that using insured team the in marked milestone to a debt

our one Let company. supported a highlight recent team me opportunity high-growth hardware where technology

the Given the solution while transaction high-risk class. $XXX innovative and an insurance intangible we've meet were equity to funding application for able had growth, its capital model company schools to derisk business growth its asset with company's company avenues The dilution. chose to growth The available. multiple minimizing this stage, financing secure million an to markets needs, allowed

solution awareness, a make IP-backed equity work debt Going option team renewable for we that impressive many this protect energy insurance carriers note, making new the down-round climate, distribution One and growth evolving start-up on clients equity-driven supporting client as business. initiatives. forward, potential continue we're forgo progress to build our our journey industry-leading net with impact and conditions potential and Carbon. and XXXX, XXXX in reduced by chain, with additional X. scale zero Aon XXXX valuations, smaller the pleased footprint our Aon's funding. of provides number as our accelerate of to participating reduced so is lenders progress on XXXX, economic emissions In with with and space we alignment current our commitment work X in as in and highlight emissions. We're increase on reduced XX% Today, of ownership March to supply travel, far to to our Scope investment. report baseline, working targets will On X COVID-XX. estate we real be we part Aon's decarbonized great made start progress We'll from X, greener science-based our Zero that for we've carbon and made to an and

actions impact topics, as commitment which strategy. ESG our details embedded our as recent ESG on overall well report climate Our and our are in

in to investing transition. and them by climate For and risk. something communicate our do on quantify report clients, and this building this their lower prepare about comes down understand We helping positioning to and risk resiliency, it carbon

proprietary we're very mitigate our analytics, potential and transfer. future partnerships, we can and and to new track positioned quantify our record current well of valuation developing our climate paired clients' Given then them risks which data help and with risks, underwriting models,

energy For $XX Reinsurance to investment expect Aon exceeds required United by another grow alone, in market placement Similarly, with investment the and there $XX challenging onshore of And solutions obtain XXXX, to construction the growing we by is Recently, despite coverage billion of today for technology example, renewable offshore construction, Equity nearly meaningful this wind manufacturing $XXX a could addressable and ongoing serve today investment billion and facilities. rapidly of across these conditions. market $XXX Commercial today billion grow ensure in that and over in to development. team in solar and operation solar, billion our facilitated XXXX. farms, one we largest world's to to Risk

projects areas necessary to and Further continue only more and and new enable like size, energy for capture innovation renewable make projects scale these these other in the to in will the carbon need increase. complexity, expertise in to more and grow storage, As technologies risk will existing financing technologies economically innovation hydrogen innovation even require attractive.

bring in risks demonstrating moves enable Our reduce continued ability helps continued delivered In helps our strong to we decarbonization. new and operating ultimately quarter, new investment and progress toward momentum in financial a summary, key of metrics. solutions

as model, operating our Services, Aon United they us changing and very a to position strategy conditions. in Business face strong places by supported Aon clients economic Our support

climate. very strategy on solutions is enables our achieve as areas, the colleague delivers in us that while high both and in results addition, engagement our a innovative intellectual core priority property In also like investing client team and in to growth today, new

in and performance strong the year. commitment our Finally, financial QX our reinforces year-to-date to achieving objectives for our

the turn shareholder creation. her outlook over to like call our performance Christa for and value thoughts on I'd Now for to long-term continued Christa?

Christa Davies

morning, everyone. so Thanks and Greg, much, good

building delivered in both of per and year, XX through earnings of share half the this momentum margin first As Greg first year. translated forward half We the points year-to-date. I performance as look Through the organic we our adjusted double-digit growth. quarter the revenue through adjusted to XXXX, the highlighted, of basis rest expansion growth of reflect on progress we X% into continued the and on

growth revenue QX in X% year-to-date. was both As noted, and Greg organic

which long versus expect X% of conditions. economic X% includes around continue year-to-date $X see rate to insured business, strong. growth and through reported We Interest revenue full that risk our mid-single million and and greater instance, Inflation impact people like in by and note remains driven Broadly, liabilities. our makes mentioned, XXXX to organic which stronger primarily insurance FX, workforce the I respect modest unfavorable changes also over on QX fiduciary are revenue and QX more a solutions note Further, advice in growth current offer areas term. digit and pension tailwinds values, dollar increases valuable fiduciary currencies investment reduced for clients, volatility as has in and a an from costs the derisking. pricing, I from or income most U.S. and increases year we year-to-date. we impact pension benefit continued $X we've to would positioned investment million positive of even Greg with well for in resilience income to uniquely and

drive investment resumption technology an adjusted We performance. Aon margins T&E. operating XX.X%, the growth growth, Services efficiencies organic long-term by increase through our of Business first of and in basis ongoing half growth to overcoming of the year, of platform; revenue includes XX some Moving driven strong points, and expense operating with which delivered colleagues, to operational from improvement

Looking continue expansion discipline track XXXX growth forward, an term in deliver cost our in investments margin basis. record we long-term we over and long expect managing ROIC to of as the and on

year. we've reduction of throughout continued colleagues the investment As T&E margins course the the And we full and about year. previously communicated, of we think ongoing over in expect

advantage, platform high represents a especially a to Services continues be a competitive contributor margin expansion Business Aon key and markets. in to inflationary Our

scale platform Aon unlock as also it improvement our Business Services continuous to automate ability processes continues the firm. growth we our supports around and innovation enhance to opportunities, While day-to-day

rather and teams now opportunities commercial and attachments. and instance, automation Aon validate pulling from it saw specific We're our e-mails manually using insurance. Business data, to risk For automation extract the locate, to than Services

XX% requests hours, on total value-added team time further in colleagues spend and certificates with years, We're save high-quality of enhancements. processing Over more the representing will improving higher this insurance delivering enabling reduction activities to spent North engagement. time service service XX,XXX our our colleague before and American work client a

this of like platform operating and improvements a growth QX margin opportunities EPS key capture growth We around Aon double-digit to driver and ongoing strong the and income enables year-to-date. adjusted Business Services efficiency efficiency translated in of remains Our expansion. into XX% and firm find adjusted us XX%

in unfavorable noted in the impact QX unfavorable and an our stable of QX in $X.XX of $X.XX and XXXX. impact was at in share considered an QX per we'd $X.XX It's approximately in approximately share $X.XX earnings expect half FX $X.XX of As remain year-to-date. translation per rates, materials, share or today's second approximately per

cash XXXX compensation as year-to-date to given allocation. by in and cash primarily Turning capital decreased Free higher driven by flow higher financial payments as offset our free strong income incentive flow XX% million, $X,XXX to as QX, results operating growth. we described strong well receivables

and before, quarter-to-quarter, the year generation stronger half As lumpy flow cash first seasonally the free be free cash is we've half. flow the communicated can of in than second

to double-digit to XXXX. expect year full continue We cash the free for deliver flow growth

to Looking we expect improvement. to the growth and growth operating drive free over forward, by driven cash working long flow capital income term, continue

by growth significantly capital repurchase the client can to also the highlighted highest opportunity $X.X capabilities Given million believe to address $XXX free are and expect invest needs. flow we and year-to-date. our our undervalued XXXX content strong expect in We share capital inorganically billion unmet allocation. outlook we in remain today, beyond, for We and on cash organically in return continue share and continue to market to approximately to in for of quarter repurchase

that scalable to continues and evolving pipeline M&A challenges. priority our areas on Our will clients' our solution to be focused growing bring

capital portfolio all the We basis. an ROIC decisions on allocation continue manage actively will to and assess

Now balance debt balance debt of and turning remain through strength well-laddered to in maturity capacity. confident sheet risk our our profile. a sheet and the We liquidity manage

that our rates. rate interest average add to and fixed grows, our with EBITDA said while note weighted key volatility. we've continue the summary, in and that this debt debt note as improves progress also maturity results increase. of credit an maintaining rate financial historically, reduce rate is continued metrics. derisk strong all average XX liability we've a year-to-date demonstrate taken term investment-grade momentum and of to I'd ratings. interest pension Thinking our before, current I'd we'll And steps interest about approximately and against In quarter liability years. approximately As our our X.X% financial as

XXXX. our Aon deliver that, scenario. in to of the over signs any in guidance United turn economic While to operator, to remain we're Overall, and our seeing we our With be the take call confidence we'd for economic financial strength results our back business delighted I'll of firm confident and resilient, the strategy your us uncertainty, gives ability and in questions. our is

Operator

Our [Operator line of Greenspan question first comes Instructions] the Elyse with from Fargo. Wells

Elyse Greenspan

you could just into any And in like if the revenue growth yet. you of upon, go in recession a which into year how your quarter, expand of or Aon. signs had guys alluded given discretionary just saw impact around I'm to, is on business, impact to guys you're be there I an we slowdown you a that recession, do seeing you this Last could quarter not right just conference XX% believe call, for later your hoping your was on go of revenue. if pieces I the the assuming 'XX, now,

Gregory Case

start and Eric last just reinforce go with to we'll We Christa tried Elyse, convey maybe this quarter. and that to well. quarter, I'll as

it in the we expect evolving, at look through it quarter, quarter, shows into and and the we As through the very year and world, place, first well a shown during stands positioned. XXXX. really second unique the incredibly as in is we're And

across Services interest to investment course, comes business. these the invest If chain aspects, react coming that current things then our continuing supply And book part a and have pieces opportunity as talked climate that positive where and their of our also Aon growing all are people of business. And and areas of and clients are at, the that's resilience, really to Business underlying great around cyber are looking It inflation board on solutions our Christa implement enables to and core risks operate you board clients, going on rates, look we across business impact and described, a efficiently. risk about, globally, us our support have through. through businesses, the finally, at the while

at we what So and you're a free drive growth improvement us seeing double-digit margin mid-single-digit level. a organic and improve do greater or do. flow We growth, cash

would standpoint? that's So global else and understand where to sure think But as what anything we make you we add Eric, economy. about sort you look from we client want convey the of a

Eric Andersen

a on challenging and workforce on facing Sure, Elyse, the And a impact, Greg. like look, you like change, irrespective changing major wealth Aon costs, can of for health fashion. that built all of climate the also moments broader and come pulls our areas question. market, all in growing care say, the I would model built regulation risks, on, way it's great uncertainty, different areas innovative on where that have together well-being, issues actually solutions talent economic the in conditions. focus geopolitical that this, go would are integrating teams are of clients we've resilience, trying is firm one a up say, our to I deliver capabilities for it unified with all United like clients

getting isn't less world risky. the think we any So

for And to continue our grow so the to us opportunity business. is there

Christa Davies

provides us. highlighted, of continues inflationary impact insurance investment of market And that on liability, has mentioned GDP, impacts impact impact, line on of And modest the revenue as drivers XXX potential Business and also while income. our We've investment inflation, insured wages, correlate bottom on million medical tailwinds that pensions. all which base. and our have pressures asset point with some strong; positively increase to our values, offset cost our business in GDP. value, Services which support remain line interest cash growth pricing, which talked also components; and rates Elyse, Greg We've underlying two basis finally, business. efficiency mitigate our growth about positively many while a just which Each increases costs, top made $XX really that is contributions I'd drive up fiduciary It rates interest positive for to add decreases helping and and things own Aon unfunded decreases our pension to through exposures,

of that has confident very and opportunity volatility us creates So for other with the as that really clients, Eric we're for Greg creates industries challenges highlighted. these actually and fact trends,

Elyse Greenspan

prepared question, of Christa, mentioned reason. about receivables And year your That's my the in the you second remarks, to like in and cash the part talked slowdown helpful. start flow free then as

you double-digit back strong cash flow you is think as the be still going double-digit about think you'll I target of think right this So do half to it's XXXX. enough year, hit the for growth the that year? decided

Christa Davies

due We as is flat. cash DSO stronger -- are And second way, impacted first revenue which described, half certainly really double-digit was is flow flow. achieving higher really. was by the absolutely organic confident would note, growth we receivables, for always by growth. I two first than And half half to really cash things; XXXX about stronger you actually

not to much by our collect strong payments receivables in but we and So was impacted keeping accelerate have XXXX had also plan a we're very accelerating which rewarding compensation up, And we're it colleagues. been doing what is faster. and exactly that, a we incentive performance, from

free very cash year beyond, the flow about we're XXXX so And and double-digit growth for confident and beyond. XXXX full

a excited got return our is and cash capital about that deploying strong share opportunity M&A we're we've flow outlook, on really across So which organically sale. and highest very in repurchase, in free

Elyse Greenspan

last one following And quick thing. Great.

I of basis. other just to sales. row a know ongoing model the of in on quarters business The you a line in did in Should for that gains line, past, some assume that you told see couple X we going income kind forward? us an

Christa Davies

What saw manage as assume do. was that X this you portfolio in quarter line would we ongoing to to on the basically. We continuing us

small a revenue on higher return opportunities. lower in growth, continue in return And divestment lower capital we margin, is capital this on divest, margin, invest higher to continue growth, and opportunities. higher We to revenue lower

to going continue would at forward. I it model so X And

Operator

of from JPMorgan. Jimmy with next the Our line Bhullar question comes

Jimmy Bhullar

questions. a couple had of I

First, on margins.

in improve to margins expect you and mentioned thereafter. XXXX You

I to be the a them. increase half and think than seasonally, first potential in expect with half, maybe pressures, half second well as if do improve you seeing last margins second weaker you're with but should year versus the in some -- inflationary T&E

Christa Davies

growth, and are the much right strong don't margin seen We of the so We agree we in points margin for shift half which very we prepared Services, mentioned Business revenue margins continued the full focused portfolio committed to We've mix expect organic driven question. Aon basis growth; certainly here. benefits margin for give and expansion revenue I you see productivity of expansion, in that the areas; our year, through higher guidance XXXX. Thank specifically year first and expanding year to XX absolutely by our remarks. higher-margin full to our

So XXXX margin expansion. again, to completely committed full year

Jimmy Bhullar

obviously, now, Okay. And theoretically, haven't have and think too while understandable high a fiduciary seen pickup. of I up, how on for pick investment much it a but should rates it's income, been we

just if current or years two could outlook So if lag what wondering is rates comment on maybe income, for stay interest now. year fiduciary from I'm a you expected the investment the and around levels

Christa Davies

Yes.

prepared So short U.S. for line the the line rates, as XX% investments U.S. the of I interest and is this about is mentioned I point in basis in top that behalf are end on million us. and bottom every remarks, of in XXX XX% in plans increase assets the our $XX outside and curve, of terms my note

was Our $X for fiducial investment income million. QX

is increasing it so rates as interest And rise.

Operator

question with next Piper line from comes Paul the Sandler. Our of Newsome

Paul Newsome

of your as sort business of maybe does of then the Aon the So further be the sensitivity. we Elyse's relative M&A, in is on look as how about not? would change or of contrast way of M&A the magnitude you versus why desire end very And versus think into And follow-up, of of sensitivity? kind the today -- any a think it sort strategy kind with to us the remind why today recessions, we sort And helpful. the change up be would And we should to economic of just any recession sensitivity that because about question different? materially the mix I wanted past could follow back. if in economic

Gregory Case

take me important. let's categories, those both Paul, of big X both

D&O really the we how ways stronger to different costs and first and D&O Aon risk our and mid-single-digit convey meaning the and why of cuts ability solutions changes that ideas for the that across connecting we're to On is we're trying which fundamentally outlook or Eric's evolving our really enhance the been talk it around in getting what than day really described this our does had some of and And -- client is we've across fundamentally with it before. also firm core business about bringing ideas future. mix, in clients we clients. in solutions world That grow That's and the stronger. ever it's the we're point Chris approach really around clients in confident piece, capability before. piece. And different when connect the and existed for and United capability, serve to every bring with haven't to on and them sort in fundamentally areas, environments but things clients core, quite to people across variable we done greater growth also working our new all time, is in reinforced it's the We're

which are discretionary, up evolve it's the but aspects and year additional leadership does exceptionally the views? as strengthen. before, level. we're really just and and those continues that to client change So confident, is a But over digit And service there are But Overall, at I capability for client time. it time. mid-single time show said over over why, positive, thoughts

Christa Davies

there grew cash stronger we that Aon XXX margins expanded X% we We And basis performance. strongly. free pretty And add global are It you revenue us Thanks this unusual. the than Greg. organically design for grew those say company over is grew was X worst two was Paul, two our And XXXX make could if XXXX, you during very without over really CAGR years, back like I a would and Aon. that would points, economic without so those by to what much, XXXX environment, interest inflation XXXX, environment flow reported in rates, which things recession years. to and to go that is a economic

which is first levels, values, The inflation, I employment positive revenue, asset increasing cetera. revenue, described, impact a on has our as et

a interest Greg on basis XXX highlighted, positive second increase is And fiduciary interest investments $XX point the bottom top million line impact line which a mentioned, has The as rates. income, in our investment as and is for I third, rates, investment Eric climate, times of highlighted, bring is different and our us who, us in whether United, that's a supply resilience, need together allows Aon serve pension -- workforce which chain, number to to of volatility, in derisking, clients more, capability areas.

So navigate good and with ability flow reiterating about we growth. is have full year why we very year feel full our guidance margin for to the single-digit through, growth, double-digit we're and beyond, free revenue which cash for expansion XXXX the organic

Gregory Case

maybe to also And take other and we're question, thinking what equally come minute back so your we will M&A, important, about a if Paul it. how and then to up we're around could

allocation, things We M&A thinking how terrific. the some on are seeing overall there's to elsewhere, a helpful revolving But because we're on But it, just really with capital done we're some you and that seeing examples recently. just front. we've about market. It's and Eric, start it's opportunity then maybe

Eric Andersen

to… like you would Christa,

Christa Davies

Greg, continue operate Absolutely. to disciplined continuing where Tyche, business, on our a to And across areas I very And resilience, in on et say other growth of CoverWallet, we capital. need, with number great then inorganically margin invest pipeline enormous client with of we really seeing climate, expansion, analytics organically areas cetera. return supply workforce chain, would data we're and look, in way And our I'll a just digital and great M&A are say firstly, strong. is

our free X XX. We expect of So because very we flow will our best remain share cash as at for undervalued generate repurchase remain XXXX, we full use highest remain we year strong pricing of today. and undervalued peak cash

And highest so or any continue us very, organically in it for has to to invest capital share very And opportunities, remains attractive the and our Aon. the the M&A it invest of a repurchase to opportunity little Eric, in because investments we these the in on return be business you M&A, because maybe talk a of But this. great can lot of more share are bit in middle including repurchase you in that's about bar. in across

Eric Andersen

I'll way predominantly about business the the Tyche And was do we we of capability for And around together. capital to a non-life for tie reserving and Tyche maybe enhancing Christa. that Sure, platform remember, those the on it some to just But around touch need on life as beyond better pricing, side. just their really going sheets the these time and acquired large captive, modeling are that and that these insurers is big across self-insurance, etcetera as platform how able optimize with we ultimately, the we strategies corporate to where reinsurance own over balance see to corporates of to it. risk extend be looking insurance, clients many information do pieces

of capability we that team been them Tyche. you our mindset, just capabilities working also firm. it's interested insurance talent last Aon an worth I kind firm ability be So of provide the to in involved on of why across and we've use think the across to were and United integrate months asset them impact firm in been like broader acquire one confidence and a ability how that in build the the reinsurance getting the to broader to And add that, couple the once we that that to able over is existing broader what leverage actually across use has that areas that their our clients of from so saying just angle, then capability but

Operator

question Our Evercore Motemaden the David ISI. from line next with of comes

David Motemaden

discretionary was around on the talk terms you're if wondering those seeing businesses, in business. second some of I parts can of specifically your the you quarter? you last Christa, of in commentary made discretionary what about demand just quarter, leading indicators

Christa Davies

Sure.

business, our quarter, we're the full we is strong growth started the guidance across growth the So organic with. in greater very for exactly look, mid-single-digit seeing, or X% reiterating what And of growth outlook year, you're the David, year-to-date. revenue X% year growth

strong and greater lot are to services discretionary continue volatility, times offering So of from the in in the areas, a core demand we're areas because see demand. of in David, clients of clients we in the really,

which volatility, is chain, that's are whether disruption. so of times supply in that's derisking, with by opportunities buyout many so end; supply creating And attention clients that's from areas there resilience workforce that pension for demand chain whether market whether increased of volatility;

David Motemaden

it. Got

just I'd And Okay. or And just and Aon question on about is last headcount, made enhance helping That's around comments interesting productivity. focusing new think more ask last some helpful. you productivity. Services on I -- spoke had Business asked you Greg, quarter, this on call, a Christa, I question how

look can if me there So outlook maybe productivity. productivity? years could And you are of increased just and forward, going help several just -- sort just I'm last you about have producer metrics share at those you the how much wondering any internally on the think on producer over just

Gregory Case

David, firm. been to to love our investing continue talent. are and Everything the continues question colleagues do Aon And attracting as the heart our retaining and back around we it's more be. clients. Christa support But at strategy we in the to described, I And thanks. as to effectively. described for invest and It's do forever in comes that substantially capability very talent. we We they of

consider a that on allow across for for that. capability last our tremendous with love they do clients. easier They And yes, easier we is table developing and helping us about it's we a client more the it content Productivity are to new time, ideas, talked outcome. So it. productivity. When and them colleagues makes do

ever an not really It's individual in better. described And making So I level working talent recorded just but at poll from our we've engagement better, bigger, why, to is just talent survey. that. highest-ever bringing we the QX, as had do yes, in, not it but

was where reacting volunteer that to in line So pre-pandemic. our the from example, it standpoint way for with you back of how attrition, are is see colleagues And that.

all it's we'll take overall other you So do talent investments, wherever to very, coming see? leadership. And an client to, to sort from are need What so and positively very to a us continue level, and to support talent reinforce things and day together our Eric, business perspective. each every at of energy leading our you're efforts we support make fundamental.

Eric Andersen

exciting. really and been come I spend buckets. Greg. us they time which a would investments, in great to question a we we have that's important and on. one lot making say really Thanks, are And of like X It's

value to just bringing Tyche, great firm, broader perspective be people need it making leverage talent United and talent focus technology think well. CoverWallet, areas in where can leadership, I Aon critical can that of to, and that organically making And from using investing some the The think the get climate, people the industry we it but focused areas to we've not the across been clients client we we're all talent the model about M&A, real we're investing up we're challenges. analytics, on world and clients, got little as a about, on we've then making so provide only their with with that but last talking I understanding in a client-specific the but think, picking sure of that like industry. really to that clients value. through of And embed same first expertise that especially cyber, around deep then to able Greg, it a use also sure who the is expertise point, bit And we is perspective your progress. we all add IP, in the firm types the third, critical, We're have and in best in talked

Gregory Case

now you phenomenal, a go you us in in left. go It's great time, But go two we're to back an on Tyche. category. Eric, cyber both time, put made if front. the as back today CoverWallet serve acquisition Also talking position to of back we investments and M&A XXX front in examples the in have sort been and unbelievable clients in

ago. We years about few a haven't on time calls quite for these talked some

capability threshold on XXX of we what And property. the out what world-class intellectual now across truly example the years, IP debt. billion working colleagues a Now with we've after and evolved of on sort $X a put seeing, on sort number we're was today of the

the you we into are and area did highlight fundamental, that this. seeing reinforces results that that progression. these also might us things an think capability So too, want carefully, because track on talent. expect, helps as And all and are we're is Services touch Aon do in it the that to I to Business just scale David, that we again, Christa come

to ABS a you for do Christa, about want So minute? talk

Christa Davies

Aon Services. Yes. Look, strategy of really a Business is our talent important part

scale As it's increase but faster. and much will innovation heard And before, trends operations, margin and to offset long-term just power our drive people, talent enable the expansion. for us enabling us helps not Services to which core Business drive efficiency wage to inflation, you've in us enabling we see around which in say growth driving of the efficiency Aon to continue invest

Business Aon excited us really we're accelerate about So Services, helps United. Aon

Operator

of with question line Shields next from comes Meyer Our the KBW.

Meyer Shields

first growth. I guess, about mean X I impacted We've GDP relative politically. right to how Symantec contracting mean, that of aside, you, you your through quarters Study real I gone half results expectations? now. the game don't Can talk

Gregory Case

ahead, Christa. Mark? Go

Christa Davies

Yes.

with, we've at cash continue X% QX, growth. year, full the the really exactly revenue beginning So growth, free we strong growth, of double-digit seen year-to-date. for look, greater flow revenue start for and to X% guidance And the full the in X% organic would in QX, we year did as mid-single I expand digital, year reiterate margin

income; the it's investment in or pension increased of terms chain, So on driving what seeing and positively side revenue rates, which us say? fiduciary our both driving resilience, needing in times volatility would you it's impact, interest whether levels, in up supply corporate we're Meyer, installation, driving asset the clients employment values, Greg, revenue positively opportunities, whether which But workforce up of on derisking volatility. it's revenues; impacts up obviously whether more

Gregory Case

for of seen accomplish different every we we've to the lots Meyer, well. just you've of that think mid- to can, of digit for it And terms you reinforce the way I performance that. just greater ways been to year and ongoing trying captured able perspectives single it. some and in in or

You've seen the performance.

by top flow see as line growth, about described and You've just it's when think cash not way, well. growth, growth also as Christa the we income operating it's free growth,

Meyer Shields

No, helpful. Okay. that's

a say, technologies question time? how like maybe us on over can or, I consumer evolving hoping we've talking just detailed should was CoverWallet. I Second, about how more little you update bit because is use that been customer CoverWallet, willingness to

Gregory Case

take Excellent. Eric, why one? don't you that

Eric Andersen

ways will. great a X I we're Greg, and use about there's It's question it. you something really excited as Sure, And platform. a

we're how which a to direct-to-consumer. is have or that dealerships actually think CoverWallet what BXBXC that large companies was we You whether distribution the we you, perspective of base or to provide to of where when continues to use and they issues clients continues people, of on CoverWallet be existing bring where sort our acquired a opportunity broad have seeing direct-to-consumer, versus number great grow. it, what to it's of need it their a from product a own, rideshare But

And so or does our when the partners, we as great client value. large capability, to our for their colleagues give to business get growth with in value think relationships either trying provide to at clients those that it providing we're us way you have and this strategy to enterprise look we platform their ability drives they're to rounds that a a with these us and own real out clients

with arena some success So it. we to able DXC, BXBXC it the expand good are and as a having been into and we've bought it

Gregory Case

introducing is when And in really technology. you Meyer, not about about it, really this think --

and provide does really your service actually technology them that say. them think Eric just "Hey, anyone behind-the-scenes the We a can help manage [ph] the do not described, to a you it as get-goers world we something You're things that we is business tight their from clean, client. sitting on got, around behalf." That's that can massive. can interface globally. label saying, The I've Again, help essentially across with as

got your Now business, technology growth you're all the having growth our property that like intellectual and and ownership?" actually in behind colleagues, also to content "Hey, massive, reinforces way would a And who's someone you so that is a the equity essentially that that. behind is is not conversation. sees but The IP, capital technology, dilute conversation raise asking doesn't

introduction clients where And them helping is really through receptivity. that's And their so win of great business. in the found the technology to we

Operator

comes Our Goldman question Rob next with the Cox Sachs. from line of

Rob Cox

timing to in the growth core you how quarter? in and I Health driving color meaningful more of was Solutions the broadly, brokerage benefits health a and revenues get could what's quantify was if in the benefit on the hoping little business from strong the

Gregory Case

we health. the global love we it And Eric, with Rob. question, this so world on before, regions love the this as talked And category, across I a beyond progression going just about on in thoughts does cut area. specific Health. Excellent. But around really much

Eric Andersen

Sure.

And a moment, broad-based clients the it. Solutions segment also in employee really confident health mitigate part great all at when health; business resilience driven the growth the with renewals, having you well-being across our its terms think by broad look and project of Data costs at advisory really great retention, I the the piece human clients it's growth, the area, that certainly work capital of helping improving across health think with all we're but to care work of the come I growth long-term related of impact is in the has and we're geographies. outlook, well-being and employee geographies. The from and

Rob Cox

any there Got quarter, it. way in the on quantify is revenues timing the And benefit then on to that?

Christa Davies

Yes.

is, into we So QX what what say QX. from said but I haven't it's it, would have disclosed we come is,

but should amount otherwise than world, would QX in you small material see not expect. it's you So some

Rob Cox

some on to and a I if ability Okay. Got in hoping just pricing negotiate of lastly, versus doing businesses in And of light so it. And then you've businesses certain tire in was fee-based inflation. to Aon's just any greater question ask seen fee-based others. the success

Gregory Case

we sort in value context And we with understand having is they about support appreciate for the we that. Well, the I that the then the talk the to for have establish that, have what's and always conversation we clients provide create. them value, to build compensated value. of how our about teams are how And of them, fair value, we then

we that's something So been always do.

in rewarded about been that value. We to bring And anyone as than we else for value over so, have time. clients. it for want higher value is relates incremental doing Ours more clients to more to in

years this that. year to progression like we're before. we and last do had the continue so having And year, we And the just

Operator

Our last UBS. the comes Bloomer from of question with line Weston

Weston Bloomer

One follow-up on reinsurance. organic question within growth

weight. the You and more both facultative in half quarter. treaty facultative piece, transactional in the second nature growth highlighted strong understanding Swift, and it's in

year. XD of for worth outlook second pointing than your or growing on the placements Just currently? in facultative tailwinds Any is curious half faster facultative Or out? the slower

Eric Andersen

has where market, do And the their maintain facultative through of order they many great over to continue us years. that relationship. many client and in put of the it in insurers often the for you Facultative been the direct remediate business overall a use placements context of if portfolios, to their

go had So forward. value around that expect would with created to the continue fact great we and as it business, world we be continues for and us a that,

Operator

reached have turn closing this to Mr. we gentlemen, the over Case remarks. end and session. Ladies to I for question-and-answer like call back Greg of today's would

Gregory Case

say much next being everybody, just appreciate of to look discussion forward I to and part quarter. the to call our wanted you and very Thanks

Operator

concludes This today's conference.

this You may disconnect you your participation. of day. your Thank lines your time. the at rest for Enjoy

Aon (AON) 29 Jul 222022 Q2 Earnings call transcript