Aon sees improvement despite slight drop in income

Aon Corporation (NYSE: AOC)’s net income in 2006 Q1 dropped slightly to US$198 million from its 2005 Q1 net income of US$200 million.

According to the company, the net income fell as a result of: restructuring charges of US$0.06 per share in 2006 Q1; a 2006 Q1 gain of US$0.07 per share related to a previously sold claims business; the revaluation of Endurance Specialty Holdings warrants, which resulted in a loss of US$0.03 per share in 2006 Q1 and a gain of US$0.03 in 2005 Q1.

As a result of these events, Aon says its adjusted earnings per share for the first quarter 2006 is US$0.60 per share, representing an increase of 18% over the prior year.

Greg Case, Aon’s president and CEO, says the company’s core operating performance exceeded expectations and was materially better than the previous year.

“Each of our operating segments showed margin improvement on positive organic growth,” he said. “Americas-Brokerage, led by our U.S. retail brokerage business, performed well, and our consulting and underwriting businesses showed improved growth.”

The company reported an increase in its insurance underwriting revenue of 7%, reaching US$841 million in the quarter, with segment organic revenue growth (based on written premiums and fees) of 13%.