Shareholders' Equity

6 Months Ended

Jun. 30, 2020

Shareholders’ Equity

Ordinary Shares

Aon has a share repurchase program authorized by the Company’s Board of Directors (the “Repurchase Program”). The Repurchase Program was established in April 2012 with $5.0 billion in authorized repurchases, and was increased by $5.0 billion in authorized repurchases in each of November 2014 and June 2017 for a total of $15.0 billion in repurchase authorizations. The Repurchase Program was adopted by Aon plc’s Board of Directors on April 1, 2020.

Under the Repurchase Program, the Company’s Class A Ordinary Shares may be repurchased through the open market or in privately negotiated transactions, from time to time, based on prevailing market conditions, and will be funded from available capital.

The following table summarizes the Company’s share repurchase activity (in millions, except per share data):


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Shares repurchased	—		5.8		2.2		6.4
Average price per share	$	—	$	183.23	$	212.78	$	181.07
Costs recorded to retained earnings
Total repurchase cost	$	—	$	1,050	$	461	$	1,150
Additional associated costs	—		6		2		7
Total costs recorded to retained earnings	$	—	$	1,056	$	463	$	1,157

At June 30, 2020, the remaining authorized amount for share repurchases under the Repurchase Program was $1.6 billion. Under the Repurchase Program, the Company has repurchased a total of 130.9 million shares for an aggregate cost of approximately $13.4 billion. Due to COVID-19, the Company temporarily suspended share repurchases.

Net Income Per Share

Weighted average ordinary shares outstanding are as follows (in millions):


	Three Months Ended June 30,			Six Months Ended June 30,
	2020	2019	2020	2019
Basic weighted average ordinary shares outstanding	232.7	240.6	233.0	241.4
Dilutive effect of potentially issuable shares	0.9	2.2	1.1	1.8
Diluted weighted average ordinary shares outstanding	233.6	242.8	234.1	243.2

Potentially issuable shares are not included in the computation of Diluted net income per share attributable to Aon shareholders if their inclusion would be antidilutive. There were 0.1 million shares and no shares excluded from the calculation for the three and six months ended June 30, 2020, respectively. There were no shares excluded from the calculation for the three and six months ended June 30, 2019.

Accumulated Other Comprehensive Loss

Changes in Accumulated other comprehensive loss by component, net of related tax, are as follows (in millions):


	Change in Fair Value of Financial Instruments ⁽¹⁾		Foreign Currency Translation Adjustments		Postretirement Benefit Obligation ⁽²⁾		Total
Balance at December 31, 2019	$	(12)	$	(1,305)	$	(2,716)	$	(4,033)


Other comprehensive income (loss) before reclassifications, net	(11)		(308)		(1)		(320)
Amounts reclassified from accumulated other comprehensive income
Amounts reclassified from accumulated other comprehensive income	11		—		63		74
Tax expense	(2)		—		(15)		(17)
Amounts reclassified from accumulated other comprehensive income, net⁽³⁾	9		—		48		57
Net current period other comprehensive income (loss)	(2)		(308)		47		(263)
Balance at June 30, 2020	$	(14)	$	(1,613)	$	(2,669)	$	(4,296)


	Change in Fair Value of Financial Instruments ⁽¹⁾		Foreign Currency Translation Adjustments		Postretirement Benefit Obligation ⁽²⁾		Total
Balance at December 31, 2018	$	(15)	$	(1,319)	$	(2,575)	$	(3,909)


Other comprehensive income (loss) before reclassifications, net	(8)		28		5		25
Amounts reclassified from accumulated other comprehensive income
Amounts reclassified from accumulated other comprehensive income	8		—		52		60
Tax expense	(1)		—		(12)		(13)
Amounts reclassified from accumulated other comprehensive income, net⁽³⁾	7		—		40		47
Net current period other comprehensive income (loss)	(1)		28		45		72
Balance at June 30, 2019	$	(16)	$	(1,291)	$	(2,530)	$	(3,837)

(1)Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Revenue, Interest expense, and Compensation and benefits in the Condensed Consolidated Statements of Income. Refer to Note 14 “Derivatives and Hedging” for further information regarding the Company’s derivative and hedging activity.

(2)Reclassifications from this category included in Accumulated other comprehensive loss are recorded in Other income (expense) in the Condensed Consolidated Statements of Income.

(3)It is the Company’s policy to release income tax effects from Accumulated other comprehensive loss using the portfolio approach.