Publicis '09 revenues, profit down, organic growth recovering

PARIS: Revenues for the year were $6.2 billion,* down 4% from $6.4 billion in 2008, for Publicis Groupe, which owns MS&L Worldwide and Publicis Consultants.

PARIS: Revenues for the year were $6.2 billion,* down 4% from $6.4 billion in 2008, for Publicis Groupe, which owns MS&L Worldwide and Publicis Consultants. North America showed a 4% increase in revenue, up to $2.87 billion from $2.75 billion in 2008.

Net income fell 10%, to $549 million from $609 million in 2008.

The company's recently reorganized Specialized Agencies and Marketing Services (SAMS) group, which houses the communications business and all of digital, accounted for 44% of consolidated revenues for the year, up from 36% last year. Based on the numbers provided, the SAMS division posted $2.73 billion in revenue, up from $2.32 billion in 2008.

Olivier Fleurot, who was appointed last year to oversee Publicis' PR companies and is CEO of MS&L Group, declined to comment specifically on the company's PR revenues. Instead he emphasized that the three-month-old integration of its firms under the MS&L name is “working really well.”

"The real impact of the reorganization we will see this year,” he added.

Companywide, Q4 revenues were $1.74 billion, a 7.5% decline from $1.88 billion in Q4 2008. North American revenues were $746 million, a 7% drop from $801 million in Q4 2008. Digital played a major role in the year-end results for Publicis, accounting for about 22% of revenue in 2009, up from almost 19% of revenue in 2008. The company acquired Razorfish from Microsoft in October 2009.

"In 2009, we also continued to accelerate our digital transition," said Maurice Levy, chairman and CEO, in a webcast about the earnings. "Our target is for 25% of our revenue to come from digital media in 2010."

Organic growth was down 5.4% for the quarter, better than the 7.4% drop in organic growth for the third quarter. Excluding the effects of General Motors' bankruptcy, organic growth for the quarter was down 4.6%. For the year, organic growth was down 6.5%, or down 5.3% excluding the effects of GM. North America experienced a 4.2% drop in organic growth.

After hitting its lowest point in June, Publicis is seeing "a regular progression, a regular improvement," Levy said in the webcast. "The very first figures for January 2010 seem to be pointing in the same direction." The goal for the company is to return to positive organic growth, he added. Publicis noted it controlled costs with a selective hiring freeze, salary freeze, and reduction in workforce of more than 3,000 since last year

*All figures were converted to US dollars from euros using the XE currency converter.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Would you like to post a comment?

Please Sign in or register.