Weber CEO: IPG PR firms maintain Q1 growth in Q2

Interpublic's CMG unit, which includes most of its PR firms, reported 2.8% organic year-over-year revenue growth in Q2 2016, to $369.4 million - Weber's Andy Polansky says organic growth at his firm was in high single digits.

Andy Polansky
Andy Polansky

NEW YORK: Weber Shandwick CEO Andy Polansky said PR firms within IPG’s Constituency Management Group bucked the division's overall Q2 performance to post high-single-digit as-reported growth and mid-single-digit organic growth.

He said Weber itself recorded high-single-digit organic growth, on top of double-digit year-over-year organic growth in the equivalent quarter last year.

CMG, which contains most of Interpublic’s PR firms, reported 2.8% organic growth in second quarter trading to June 30, 2016, for revenues of $369.4 million.

The period was compared to the second quarter of 2015, when CMG reported a 2.3% organic revenue increase over the year prior.

CMG contains PR firms Weber Shandwick, Golin, DeVries, Current, The Axis Agency, and Creation; as well as other marketing firms such as Jack Morton, FutureBrand, and Octagon. Spong and PMK-BNC sit outside CMG.

"All our agencies are performing well, have a strong go-to market strategy, and are winning market share," Polansky said.

He added that Weber had double-digit growth in 17 markets, led by India, Chicago, Japan, Korea, the U.K., Germany, and California.

From a practice perspective, Weber saw "very strong" organic growth in consumer and healthcare. Due to Weber’s Mediaco unit and broader digital and social capabilities, digital accounts for approximately 30% of the firm’s revenue and continues to be a big growth engine for the firm, Polansky noted.

He explained he is cautiously optimistic about the remainder of the year, adding that Weber continues to see a healthy pipeline and strong prospects for continued organic growth.

"There are macroeconomic concerns around Brexit and we continue to keep an eye on markets like China and Brazil," Polansky said. "But we continue to perform well in the face of those dynamics."

Interpublic's Integrated Agency Networks division, which includes advertising and media firms such as McCann Worldgroup, FCB, MullenLowe, and IPG MediaBrands, achieved organic revenue growth of 3.9% in the quarter to $1.5 billion.

IPG as a whole reported organic year-over-year revenue growth of 2.2% to $1.92 billion, including a 4.6% uptick in the U.S., in Q2. Operating income was up to $224.8 million from $215.8 million in the same quarter last year.

Net income was $156.9 million, up from $121.2 million in the same quarter in 2015. Operating margin for the quarter was 11.7%, compared with 11.5% in 2015.

Organic revenue was up 3.7% internationally in Q2, including 1.2% in the U.K., 0.5% in Continental Europe, (3.2%) in Asia-Pacific, 15.9% in Latin America, and 7.3% in all other markets.

*Organic revenue represents change without taking into account the impact of currency changes, acquisitions or disposals.

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