Willis Sees Third Quarter Gains

For the nine months, income rose $117 million, from a $25 million loss for 2001 to $92 million.

Net income per share for the third quarter rose 74 cents, going from a 55 cent loss in 2001 to 19 cents. For the nine months, per share results rose 76 cents, going from a loss of 19 cents to 57 cents per share.

Revenues increased 20 percent for the third quarter and 21 percent for the nine months.

Revenues rose $65 million for the third quarter, going from $325 million in 2001 to $390 million. For the nine months, revenues increased $215 million, rising from $1.04 billion in 2001 to $1.25 billion.

The London-headquartered firm said as part of its 1998 buyout arrangement KKR, the firm recorded an $18 million non-cash charge for performance stock options for the third quarter, compared to $145 million for the same period in 2001.

For the nine months, Willis has recorded a $114 million charge compared to $145 million for 2001. The firm said it has recorded $272 million of the charge, or 81 percent. The balance is to be recognized through 2004, the firm said.

Joe Plumeri, chairman and chief executive officer for the firm, said in an investors conference call that "we are building this [firm] quarter by quarter, in the right way, and continuing to build a great company." He said this is a work in progress and "we can do better."

Willis said it is continuing to work on its acquisition strategy, increasing its majority interest in a German subsidiary, Willis GmbH & Co. KG, to 78 percent, completing two acquisitions in Sweden, and increasing ownership to 100 percent for units in Australia and Indonesia.

Mr. Plumeri added that the firm has increased the fees it charges by 10-to-15 percent in response to the broker's increased workload. He also noted that Willis had not increased its fees for a number of years during the soft market.

Mr. Plumeri, responding to a question, said the firm will not entertain plans to enter the Bermuda market and take on any underwriting risk as its competitors Marsh and Aon have done in the reinsurance arena.

Answering a question concerning passage of a terrorism backstop bill in the United States, Mr. Plumeri said he did not believe passage would affect rates but would open capacity to those who have not been able to obtain coverage.