After missing profit estimates in Q1 2014, one the broker giant announced it will be relocating 16 per cent of its workforce.
Willis Group Holdings announced it will eliminate and relocate some 3,500 workers after its second consecutive first quarter of missed profits. The moves are expected to affect 16 per cent of Willis’ international workforce of 21,700.
According to CEO Dominic Casserley, employees in “support roles” will be moved to lower-cost locations like Mumbai and Nashville, Tenn. The moves, which were originally announced in July 2013, are expected to save the company roughly $420 million through 2017 and $300 million each year following.
Willis will also eliminate jobs to reduce overall headcount, though company spokespeople have not indicated how many jobs would be cut or where the losses would be concentrated.
The brokerage’s decision follows a first-quarter net income of $1.36 per share, missing the Zacks Consensus Estimate by 4.9 per cent. In the prior-year quarter, net income lagged by 6.9 per cent.
Willis was closer to analyst estimates of $1.098 billion for quarterly revenue, missing it just slightly at $1.097 billion.
Meanwhile, total expenses of $771 million at Willis remained nearly flat year-over-year.
“We began 2014 with another quarter of solid mid-single digit revenue growth and positive contributions from each of our segments,” said Casserley said. “Adjusted operating income matched the prior year, as we continued to invest in higher growth regions such as emerging markets, businesses such as Global Wealth Solutions in Asia, and client service improvements such as our Connecting Willis initiative.”
