Towers Watson & Co. (NASDAQ:TW) Q3 2015 Earnings Conference Call - Final Transcript
May 05, 2015 • 09:00 am ET
Good day, ladies and gentlemen, and welcome to the Towers Watson Third Quarter Fiscal Year 2015 Earnings Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will be given at that time. (Operator Instructions). As a reminder, today's program is being recorded.
I would like to introduce your host for today's program, Aida Sukys, Director of IR. Please go ahead.
Welcome to the Towers Watson earnings call. I'm here today with John Haley, Towers Watson's CEO; and Roger Millay, our CFO. Please refer to our website for this morning's press release. Today's call is being recorded and will be available for replay via telephone for the next two days by dialing 404-537-3406, conference ID 23646444. The replay will also be available for the next three months on our website.
(Forward-Looking Cautionary Statements) After our prepared remarks, we'll open the conference call up for your questions.
Now I'll turn the call over to John Haley.
Today, we'll review our results for the third quarter of fiscal 2015 and our guidance for the remainder of the fiscal year. Before reviewing the detailed quarterly results, I'd like to mention the Saville Consulting Acquisition which was announced on April 27. Saville Consulting adds market leading assessment tools which enhance our already comprehensive suite of HR solutions and advisory services. With that combination, we can better access the fastest growing part of the Talent and Rewards market related to talent management and technology.
This acquisition will allow us to deliver products that should grow significantly over the next several years consistent with our overall long-term growth portfolio strategy. For the third consecutive quarter, we've posted strong organic revenue growth. Reported revenues for the quarter were $921 million, an increase of 2% over the prior year third quarter reported revenues and up 7% on an organic and constant currency basis. Our organic growth rate adjusts for changes in foreign currency exchange rates, acquisitions and divestitures.
Our EBITDA for the quarter was $205 million or 22% of revenues. The prior year third quarter adjusted EBITDA was $183 million or 20% of revenues. Continued strong top-line results and the focus on cost efficiencies have helped to drive EBITDA and margin. For the quarter, diluted earnings per share were $1.49 and adjusted diluted earnings per share were $1.63. Every region experienced revenue growth this quarter. We're especially pleased to see that EMEA posted strong results for two consecutive quarters now.
Revenue growth plus cost management over the last two quarters have generated the strongest margins in more than two years. Once again, the Benefits Exchange Solutions and Talent and Rewards segments delivered strong results. Strength in retirement, healthcare consulting and pension administration drove revenue growth and benefits.
An increase in transaction work demand for technology and timing of survey delivery drove the Talent and Rewards segment revenue growth. A strong fall enrollment season for the Retiree and Active Exchanges and an expanded client base in Health and Welfare Administration,