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Towers Watson & Co has a market cap of $4.63 billion; its shares were traded at around $63.74 with a P/E ratio of 15.1 and P/S ratio of 1.4. The dividend yield of Towers Watson & Co stocks is 0.6%. Towers Watson & Co had an annual average earning growth of 13.9% over the past 10 years. GuruFocus rated Towers Watson & Co the business predictability rank of 4-star.
Highlight of Business Operations:Revenue for the three months ended December 31, 2011 was $879.7 million, an increase of $89.0 million, or 11%, compared to $790.7 million for the three months ended December 31, 2010. Revenue for the six months ended December 31, 2011 was $1.7 billion, an increase of $148.0 million, or 10%, compared to $1.5 billion for the six months ended December 31, 2010. Our revenue growth reflects increased revenue from both new and existing clients. All of our segments experienced organic growth in the second quarter of our fiscal year 2012. Revenue from our two recent acquisitions, Aliquant and EMB, also contributed to the increase in revenue. On an organic basis, which excludes the effects of acquisitions and currency, revenue increased 6% for both the three and six months ended December 31, 2011 compared to the three and six months ended December 31, 2010.
Salaries and employee benefits were $535.3 million for the second quarter of fiscal year 2012 compared to $499.4 million for the second quarter of fiscal year 2011, an increase of $35.9 million, or 7%. On a constant currency basis, salaries and employee benefits increased by 6%. This increase was primarily driven by an increase in base salary of $26.5 million attributable to a 9% increase in headcount and a 4% increase in base salary. Our EMEA and APAC operations accounted for 57% of our headcount increases as of December 31, 2011 compared to December 31, 2010. In addition, bonus and benefits expense and other employee compensation increased $14.8 million as a result of our increase in headcount and also due to deferred payments and earn-out payments related to our acquisition of EMB. Our discretionary annual bonus is based on pre-bonus profitability and can fluctuate based on the operating results of the company. Stock-based compensation decreased $5.8 million in the current quarter primarily due to our use of the graded-vesting method of recording expense related to the restricted stock units issued to employees of Towers Perrin in the Merger. As a percentage of revenue, salaries and employee benefits decreased to 61% for the second quarter of fiscal year 2012 from 63% for the second quarter of fiscal year 2011.
Salaries and employee benefits were $1.0 billion for the first half of fiscal year 2012 compared to $991.1 million for the first half of fiscal year 2011, an increase of $41.7 million, or 4%. On a constant currency basis, salaries and employee benefits increased by 2%. This increase was primarily driven by an increase in base salary of $56.8 million attributed to a 4% increase in headcount and a 4% increase in base salary. Our EMEA and APAC operations accounted for 80% of our headcount increase as of December 31, 2011 compared to June 30, 2011 as a result of our acquisition of EMB in January 2011 and also as we have increased resources in certain of our practices in response to new business opportunities. In addition, bonus and benefit expense and other employee compensation increased $14.1 million as a result of our increase in headcount and also due to deferred payments and earn-out payments related to our acquisition of EMB. We expect to continue hiring new associates to address pockets of opportunities as they arise throughout our business. Our discretionary annual bonus is based on pre-bonus profitability and can fluctuate based on the operating results of the company. Our stock-based compensation decreased $14.3 million in the current year primarily due to our use of the graded-vesting method of recording expense related to the restricted stock units issued to employees of Towers Perrin in the Merger. Our pension expense decreased $15.0 million due to the remeasurement of our U.S. pension and post-retirement plans in September 2010. The plan changes substantially reduced plan obligations associated with future pay and health care cost increases. As a percentage of revenue, salaries and employee benefits decreased to 61% for the first half of fiscal year 2012 from 64% for the first half of fiscal year 2011.
Occupancy expense for the second quarter of fiscal year 2012 decreased $3.7 million, or 10%, to $32.7 million, compared to $36.3 million for the second quarter of fiscal year 2011. Occupancy expense for the first half of fiscal year 2012 decreased $3.8 million, or 5%, to $68.1 million, compared to $71.8 million for the first half of fiscal year 2011. The decrease in both periods was due to rent reductions from integrating our offices post-Merger, amortization of the fair value of acquired lease intangibles and tenant improvement allowances. As a percentage of revenue, occupancy expense decreased to 4% for the three and six months ended December 31, 2011 compared to 5% for the three and six months ended December 31, 2010.
Transaction and integration expense for the second quarter of fiscal year 2012 was $22.9 million, compared to $30.7 million for the second quarter of fiscal year 2011, a decrease of $7.8 million, or 25%. Transaction and integration expense for the first half of fiscal year 2012 was $43.8 million, compared to $48.4 million for the first half of fiscal year 2011, a decrease of $4.6 million, or 10%. The decrease was principally due to fees paid to terminate our external information technology service provider relationship in the prior year offset by increased information technology integration projects in the current year. As a percentage of revenue, transaction and integration expenses were 3% for the three and six months ended December 31, 2011 compared to 4% and 3% for the three and six months ended December 31, 2010.
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