Willis Q4 Reported Revenues Down in 2005 Compared to Prior Year

February 8, 2006

Willis Group Holdings Ltd. reported results for the quarter and year ended Dec. 31, 2005.

Separately, the Board of Directors approved a 9 percent increase in the regular quarterly cash dividend on the company’s common stock to $0.235 per share, an annual rate of $0.94 per share. The dividend is payable on April 14, 2006 to shareholders of record on March 31, 2006.

Commenting on the results, Joe Plumeri, chairman and CEO said, “Our results in the fourth quarter and throughout 2005 were the direct result of hard work in a year filled with challenges and opportunities. Our 8 percent organic growth in commissions and fees reflects the strength of our sales culture. Our essential investments during the year helped us attract and retain the industry’s best talent and enhance our value proposition for our clients.”

Total reported revenues for the quarter ended Dec. 31, 2005 decreased 4 percent to $562 million, from $588 million for the same period last year. The effect of foreign currency translation decreased reported revenues 3 percent and net disposal of operations reduced reported revenues by 3 percent.

Organic growth in commissions and fees excluding volume and profit-based contingent commissions and other market remuneration was 8 percent in the fourth quarter, comprised of approximately 9 percent in net new business and a negative 1 percent impact from declining insurance premium rates and other market factors.

Net income for the quarter ended Dec. 31, 2005 was $60 million, or $0.38 per diluted share, compared with $108 million, or $0.65 per diluted share, a year ago.

Reported (and adjusted) operating margin was 19.0 percent for the quarter ended Dec. 31, 2005, compared with a 28.9 percent reported and 27.9 percent adjusted operating margin for the same period last year. Approximately 5 percent of the decline in adjusted operating margin was due to the elimination of contingent commissions and the decline in other market remuneration. The remainder of the decline was due to higher compensation costs, the effect of foreign currency translation and Stewart Smith, which was sold in April 2005.

Total reported revenues for the year ended Dec. 31, 2005 were $2,267 million, compared to $2,275 million for the corresponding period in 2004. Foreign currency translation had no net impact on reported revenues and acquisitions net of disposal of operations added 1 percent.

Organic growth in commissions and fees excluding volume and profit-based contingent commissions and other market remuneration was 5 percent for the 12 months, comprised of approximately 6 percent in net new business and a negative 1 percent impact from declining insurance premium rates and other market factors.

Reported net income for the year ended Dec. 31, 2005 after net gain on disposal of operations and first quarter charges for regulatory settlements and related expenses, severance costs and other provisions was $300 million, or $1.83 per diluted share, compared to $427 million, or $2.54 per diluted share, a year ago.

Adjusted operating margin, excluding regulatory settlements and related expenses, severance costs and other provisions and net gain on disposal of operations, was 22.5 percent for the year ended Dec. 31, 2005 compared with 28.8 percent for the same period last year.

Approximately 4 percent of the decline in adjusted operating margin was due to the elimination of contingent commissions and the decline in other market remuneration. The remainder of the decline was due to higher compensation costs, the effect of foreign currency translation and Stewart Smith, which was sold in April 2005.

In conclusion, Plumeri added, “Looking ahead, our goal is to achieve sustainable long-term growth for Willis. We welcome 2006 as a year for us to move forward. We are making the right investments in our company, enhancing our client advocacy program and increasing productivity and efficiency. We will continue to execute on our plan and remain focused on being a leader in the insurance brokerage industry.”

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