For the nine months ended September 30, 2018, net income attributable to Willis Towers Watson was USD 606 million, an 88% increase from USD 323 million for the same period in the prior year. The figure included pre-tax USD 148 million of transaction and integration expenses. The net income for the same period was of USD 621 million, an increase from net income of USD 339 million for the same period in the prior year. Adjusted EBITDA for the nine months ended September 30, 2018 was USD 1.6 billion or 25.3% of revenue, an increase from Adjusted EBITDA of USD 1.4 billion, or 23.1% of revenue, for the same period in the prior year, representing an increase of 220 basis points in Adjusted EBITDA margin over the same period in the prior year.
"I'm extremely pleased with our third quarter results," said John HALEY, Willis Towers Watson's chief executive officer. "Overall, our performance reflects strong organic revenue growth, continued margin expansion, and double-digit growth in our adjusted earnings per share and free cash flow. Our results indicate that we have made substantial progress toward our goals for 2018 and we expect a strong finish to the year as we head into one of our seasonally strongest quarters."
Including the Revenue Standard
As of January 1, 2018, the Company adopted Accounting Standards Codification 606, Revenue from Contracts With Customers ("ASC 606"). The adoption of this new pronouncement had a material impact to the timing, amounts and classifications of certain results and balances within WTW's condensed consolidated financial statements in 2018. The full year financial results will generally be more comparable to the 2017 reported results, the company said.
With the impact of ASC 606, revenue was of USD 6.1 billion for the nine months ended September 30, 2018. The net income attributable to WTW was USD 317 million. Diluted earnings per share for the nine months ended September 30, 2018 were USD 2.39 and adjusted diluted earnings per share were USD 5.74. Net income attributable to Willis Towers Watson and diluted earnings per share for the nine months ended September 30, 2018 included pre-tax USD 148 million of transaction and integration expenses. For the nine months ended September 30, 2018, net income was USD 332 million. Adjusted EBITDA for the nine months ended September 30, 2018 was USD 1.3 billion, or 20.6% of revenue.
Outlook for 2018
Without the impact of ASC 606 for 2018, the Company continues to expect constant currency revenue growth of around 3%, and 4% on an organic basis, WTW has increased its Adjusted Diluted Earnings per Share to be in the range of USD 10.12 to USD 10.32. It has also adjusted the Tax guidance from a range of 22% to 23% to a range of 20% to 21% for 2018.
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