Aon Expects Improved 1Q Earnings

During a stockholders' conference broadcast over the Web today, Patrick G. Ryan, chairman and chief executive officer of Aon, said the results were helped by a one-time pretax income item of $48 million resulting from a tax settlement, which translates to 11 cents per share.

Without the item, the firm's per share earnings would range between 45 to 48 cents, below earnings expectations of 55 cents per share.

Aon said it plans to release its first-quarter results on April 30.

While much of the brokerage firm operations performed well, increased costs in compensation due to the firms business transformation, changes in an insurance carrier relationship, and below expectations revenue growth in the firm's operating segment contributed to pressures on earnings.

Aon also announced that as part of the company's restructuring, which entails the spin-off of its underwriting division, Combined, into a separate company, shareholders will receive a 3-to-1 split in shares with 1 share of Combined to 3 shares of Aon.

Mr. Ryan said the initial dividend payment, after the spinoff, is planned to be 15 cents per share per quarter for Aon, and 11 cents per share per quarter for Combined. However, he said, each company will set its dividend payments independently.

Aon said it plans to recommend to the Board of Directors today a dividend payment of 22.5 cents per share prior to the spin-off, payable on May 15 to stockholders of record as of May 2.