Towers Watson Beats Q4 Expectations

Towers Watson & Co TW reported better-than-expected results for its fiscal fourth quarter. The Arlington, Virginia-based company posted quarterly net income of $89.1 million, or $1.28 per share, compared to $82.4 million, or $1.17 per share, in the year-ago period. Excluding items, the company's adjusted earnings rose 13 percent to $1.51 per share. Its revenue gained 1 percent year-over-year to $888.2 million. However, analysts were expecting earnings of $1.41 per share on revenue of $864.91 million. The average estimate among 5 Estimize users was for earnings of $1.43 per share and revenue of $868.96 million. Revenue from the Benefits segment slipped 2 percent to $473 million in the quarter, while revenue from the Exchange Solutions segment climbed 31 percent to $98 million. Revenue from the Risk and Financial Services segment declined 10 percent to $145 million, while revenue from the Talent and Rewards segment surged 11 percent to $145 million. Its adjusted EBITDA rose to $180 million from 169 million, while income from continuing operations gained to $89 million from $82 million. "We had a strong finish to a great fiscal year, and are extremely pleased with the quarterly results. This was a year marked by some significant milestones. We achieved record-setting quarterly results as a result of strong client focus and market demand, enhanced our product offerings with the Acclaris and Saville acquisitions, and saw strong growth in our OneExchange membership," said John Haley, Towers Watson's chief executive officer. For the first quarter of fiscal year 2016, Towers Watson projects adjusted earnings of $1.30 to $1.35 per share, on revenue of $870 million to $885 million. Analysts expected earnings of $1.38 per share on revenue of $891.6 million. Towers Watson shares fell 0.32 percent to close at $126.00 yesterday.