EX-99.2 4 a05-4590_1ex99d2.htm EX-99.2

Exhibit 99.2

 

Aon Corporation

Consolidated Summary of Operations

 

 

 

Fourth Quarter Ended

 

Twelve Months Ended

 

(millions except per share data)

 

Dec. 31,
2004

 

Dec. 31,
2003 (1)

 

Percent
Change

 

Dec. 31,
2004

 

Dec. 31,
2003 (1)

 

Percent
Change

 

 

 

(Revised)

 

 

 

 

 

(Revised)

 

 

 

 

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

Brokerage commissions and fees

 

$

1,853

 

$

1,820

 

2

%

$

7,060

 

$

6,797

 

4

%

Premiums and other

 

687

 

669

 

3

 

2,788

 

2,609

 

7

 

Investment income

 

122

 

87

 

40

 

324

 

312

 

4

 

Total revenue

 

2,662

 

2,576

 

3

 

10,172

 

9,718

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

General expenses

 

1,964

 

1,849

 

6

 

7,406

 

7,013

 

6

 

Benefits to policyholders

 

362

 

390

 

(7

)

1,516

 

1,427

 

6

 

Interest expense (2)

 

35

 

22

 

59

 

136

 

101

 

35

 

Amortization of intangible assets

 

11

 

17

 

(35

)

54

 

60

 

(10

)

Provision for New York and other state settlements

 

180

 

—

 

N/A

 

180

 

—

 

N/A

 

Unusual credits - World Trade Center

 

—

 

(60

)

N/A

 

—

 

(14

)

N/A

 

Total expenses

 

2,552

 

2,218

 

15

 

9,292

 

8,587

 

8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations before income tax and minority interest

 

110

 

358

 

(69

)

880

 

1,131

 

(22

)

Provision for income tax (3)

 

26

 

133

 

(80

)

303

 

419

 

(28

)

Income from continuing operations before minority interest

 

84

 

225

 

(63

)

577

 

712

 

(19

)

Minority interest - 8.205% trust preferred capital securities (2)

 

—

 

(9

)

N/A

 

—

 

(36

)

N/A

 

Income from continuing operations

 

84

 

216

 

(61

)

577

 

676

 

(15

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from discontinued operations, net of tax

 

(3

)

(1

)

N/A

 

(31

)

(48

)

N/A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

81

 

$

215

 

(62

)%

$

546

 

$

628

 

(13

)%

Preferred stock dividends

 

(1

)

(1

)

—

 

(3

)

(3

)

—

 

Net income available for common stockholders

 

$

80

 

$

214

 

(63

)%

$

543

 

$

625

 

(13

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.26

 

$

0.67

 

(61

)%

$

1.80

 

$

2.12

 

(15

)%

Discontinued operations

 

(0.01

)

—

 

N/A

 

(0.10

)

(0.15

)

N/A

 

Net income

 

$

0.25

 

$

0.67

 

(63

)%

$

1.70

 

$

1.97

 

(14

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.25

 

$

0.65

 

(62

)%

$

1.72

 

$

2.04

 

(16

)%

Discontinued operations

 

(0.01

)

—

 

N/A

 

(0.09

)

(0.14

)

N/A

 

Net income

 

$

0.24

 

$

0.65

 

(63

)%

$

1.63

 

$

1.90

 

(14

)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted average common and common equivalent shares outstanding (4)

 

336.4

 

333.3

 

 

 

336.6

 

331.8

 

 

 

 

(1)          Certain amounts relating to discontinued operations have been reclassified to conform to the 2004 presentation.

 

(2)          Upon the adoption of FIN 46 on December 31, 2003, Aon was required to deconsolidate its trust preferred capital securities, which was offset by an increase in notes payable.  Beginning in 2004, no after-tax interest on the capital securities will be reported; however, pretax interest expense on the notes payable of $15 million and $58 million for fourth quarter and year ended December 31, 2004, respectively, is reported as part of interest expense.

 

(3)          The effective tax rate was 23.6% and 37% for the quarters ended December 31, 2004 and 2003, respectively, and 34.4% and 37% for the years ended December 31, 2004 and 2003, respectively.

 

(4)          In accordance with EITF 04-08, the diluted net income per share calculation for the fourth quarters and years ended December 31, 2004 and 2003 includes 14 million additional shares related to the potential conversion of 3.5% Senior Convertible Debentures. In addition, the net income used in the calculation includes after-tax interest expense of approximately $2 million for the fourth quarters ended December 31, 2004 and 2003, and approximately $7 million for the years ended December 31, 2004 and 2003.