NEW YORK: Interpublic Group's revenue for the third quarter increased 6.3% to $1.51 billion compared to the third quarter of 2003, but the company remains heavily in debt.
CEO and president David Bell said, "Our results this quarter are decidedly mixed," and described the holding company's ongoing turnaround efforts as "messy" and "unpredictable."
Investors absorbed a loss of $1.40 per share in the quarter, driven largely by goodwill impairment charges of $310 million at IPG's The Partnership division, and $132 million at its Constituency Management Group (CMG). CMG contains the company's large PR firms, including Weber Shandwick, Golin Harris, and MWW.
IPG's operating margin fell to a negative 27.8%, compared with negative 12.1% in the third quarter of last year. The company's total debt improved to $2.3 billion, down from $2.5 billion a year ago.
According to Bell, the heavy impairment charges were an ongoing result of "an aggressive acquisitions culture in the '90s."
Bell added that he and IPG chairman Michael Roth will increase their personal work with clients. Harris Diamond, CEO of CMG as well as WS, said he expects all of IPG's major PR clients to receive that hands-on attention from IPG's leadership.