Willis Towers Watson Plc Q3 FY2024 earnings call

• Strong third quarter performance with 6% organic revenue growth, 10% in Risk & Broking and 4% in HWC. Adjusted operating margin expanded 190 basis points to 18.1%. Adjusted diluted earnings per share $2.93, up 31% y-o-y. Free cash flow $807 million for nine months, up 14% y-o-y. • In HWC, 4% organic growth with Health up 6%, Wealth 3%, Career 7%. Introduced new solutions like virtual captive and workforce management proposition. • Risk & Broking had 10% organic growth, specialty businesses driving growth. Transformation program realized $52 million incremental annualized savings, cumulative $446 million. • Portfolio management: Sold TRANZACT, acquired minority stake in atomos.

Health, Wealth & Career (HWC) had 4% organic revenue growth. Health grew 6%, Wealth 3%, Career 7%. BD&O had a 1% decline. Risk & Broking had 10% organic revenue growth. HWC's operating margin was 24.7%, up 90 basis points. Risk & Broking's operating margin expanded 240 basis points to 18.1%.

• Adjusted tax rate expected to be moderately more favorable. • Share repurchase guidance increased to $900 million from $750 million. • Sale of TRANZACT expected to be accretive to organic growth, adjusted operating margins, and free cash flow margin. • Anticipate TRANZACT sale to not impact 2024 financial targets as full-year results expected to be booked.

• Regulatory approvals and closing conditions for TRANZACT sale. • Potential impact of global rate changes on CRB businesses. • Uncertainties related to future tax rates and their impact on financials.

Q: Clarify impact of TRANZACT sale on Q3 organic results and free cash flow A: TRANZACT was a 70 basis point headwind on HWC organic growth and 50 basis points at enterprise level. Excluding TRANZACT in 2025 expected to positively impact organic growth, margins, and free cash flow margin Q: Impact of new hires and growth in exposure units on Risk & Broking organic growth A: Growth driven by client retention, new business, and strategic investments in talent; rate and book of business activity not meaningfully impacting organic growth Q: Margin guide, tax guidance, and share repurchase guidance A: Margin expansion opportunities from talent productivity, Transformation savings, M&A; tax rate expected more favorable; share repurchase guidance raised to $900 million Q: Magnitude of tax shields from TRANZACT sale and future tax rate pressure A: Capital losses from TRANZACT sale can only offset US capital gains; future tax rate discussed on full-year call with focus on managing tax rate risks Q: Hiring pace and Transformation program cash impact A: Hiring opportunistic, aligned with business strategy; Transformation program cash impact consistent with prior years, some bleeding into 2025 Q: Market competitiveness in London and impact on CRB A: Global market stabilizing to softening; commercial rates decreasing, specialty lines stable except political risks and trade credit; growth driven by retention and new business Q: TRANZACT inclusion in results and 4Q margins A: TRANZACT included until sale closes, expected to have full-year results impact; 4Q margins not significantly impacted due to timing of sale Q: M&A activity impact and consulting demand in ICT A: Potential rebound in global M&A, especially in Europe; ICT consulting demand tempered, but technology solutions in demand with cyclical nature Q: TRANZACT seasonality effect and specialization strategy for client retention A: Supplemental slides show TRANZACT seasonality impact; specialization strategy via industry verticals, local specialties, tailored solutions for clients Q: Transformation program impact on 2025 margins and capital allocation for 2025 A: Transformation program tailwinds continue into early 2025; open to inorganic growth opportunities aligning with portfolio and margin goals Q: Middle markets strategy and TRANZACT impact on free cash flow margin A: Already operate in middle markets, see growth potential; TRANZACT impact on 2024 free cash flow margin less than historical, accretion expected in 2025 Q: Healthcare consulting impact of regulatory changes and pension derisking with Boeing A: Regulatory changes beneficial for healthcare consulting; Boeing situation highlights role in pension solutions, current interest rate environment driving pension derisking activity