WSW cites falloff abroad after IPG warns on profits

NEW YORK: In response to a profit warning by parent Interpublic Group (IPG) attributed in part to poor PR revenues, Weber Shandwick Worldwide (WSW) said that while its European business is soft, its US agencies are well focused.

NEW YORK: In response to a profit warning by parent Interpublic Group (IPG) attributed in part to poor PR revenues, Weber Shandwick Worldwide (WSW) said that while its European business is soft, its US agencies are well focused.

WSW CEO Harris Diamond said, "We're reasonably focused as to where the business is in the US, but Europe has some falloff, and is where we continue to see weakness." He declined to say whether any layoffs are planned.

IPG, whose holdings also include Golin/Harris, said PR revenues suffered from declines in the technology and financial services sectors. The company forecasted a 7% drop in revenue for the third quarter, and a 9% decline for the year.

The forecast follows a dismal first-half report from IPG rival WPP, which said in August that its PR and public affairs revenues had declined 11.2% for the period, year-on-year. Earlier that month, Omnicom reported a 10.7% drop in PR revenues for its second quarter, year-on-year.

IPG said its corporate identity, point of sale, and sports marketing businesses have also suffered, and the company continues to be dogged by an accounting glitch that resulted in an August earnings restatement.

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