Aon (AON) Q4 2024 earnings summary

Executive summary

• Achieved 6% organic revenue growth for both Q4 and full year 2024, with total revenue up 23% in Q4 and 17% for FY'24, driven by NFP acquisition and strong execution of the 3x3 Plan.

• Adjusted EPS grew 10% to $15.60 for 2024, with Q4 adjusted EPS up 14% to $4.42; free cash flow was $2.8B, down 11% year-over-year due to higher cash taxes and integration costs.

• NFP acquisition completed in April 2024, performed in line or better than expectations, contributing to margin expansion, top-line growth, and synergy realization.

• Company realigned into two segments: Risk Capital and Human Capital, reflecting strategic focus and supporting growth.

• Introduced 2025 guidance targeting mid-single-digit or greater organic revenue growth, margin expansion, strong adjusted EPS growth, and double-digit free cash flow growth.

Financial highlights

• Full-year 2024 total revenue reached $15.7B, up 17% year-over-year; Q4 revenue was $4.1B, up 23% year-over-year.

• Adjusted operating income for 2024 was $4.94B, up 17%; Q4 adjusted operating income was $1.38B, up 21% year-over-year.

• Adjusted operating margin for 2024 was 31.5%, with Q4 at 33.3%; full year operating margin was 24.4%.

• Free cash flow for 2024 was $2.8B, with a margin of 18%.

• Weighted average diluted shares outstanding increased to 218.3M due to NFP acquisition.

Outlook and guidance

• 2025 guidance: mid-single-digit or greater organic revenue growth, continued margin expansion, strong adjusted EPS growth, and double-digit free cash flow growth.

• Free cash flow in 2025 expected to support leverage objectives (2.8x–3.0x by Q4 2025), organic investments, tuck-in M&A, and $1B in share repurchases.

• NFP expected to contribute $300M to free cash flow in 2025; $80M in NFP revenue synergies and $45–$60M in EBITDA from NFP middle market acquisitions.

• Anticipate $150M in incremental restructuring savings and continued investment in growth areas.

• Tax rate guidance for 2025 is 19.5%–20.5%, reflecting geographic mix and policy changes.