GLOBAL – Hewitt Associates says its consulting profit rose 16% to $26m in the first quarter, while revenues at the division were up seven percent.

Consulting segment income rose to $26.0m from $22.4m in the first quarter of 2004. Consulting segment margin rose to 13.7% from 12.7%.

“The increased margin was primarily due to increases in the European region, driven by a combination of higher revenues and a low comparable in the prior-year quarter due to facility exit costs in that period,” the Illinois-based firm said.

Yesterday, rival firm Watson Wyatt & Co. said profits at its benefits group slipped more than five percent in the second quarter.

Hewitt’s consulting revenues increased seven percent to $190.0m. It said: “Growth in retirement plan management consulting and discretionary consulting services was offset by lower revenues in health benefit management consulting.”

Hewitt’s total net income was up 16% at $34.0m on revenues up 34% at $710.4m.

"Our first quarter results were good, and met early expectations that we had of the combination with Exult, particularly with respect to the success we've had integrating the companies thus far," said chairman and chief executive Dale Gifford.

"Outsourcing revenue growth and core earnings met our expectations, and our comprehensive HR BPO solution continues to gain traction, as evidenced by our strong backlog and growing pipeline of opportunities.”

For fiscal 2005, the company said it expects 4-8% growth in consulting revenues and 45-50% growth in outsourcing revenues.