NEW YORK: Omnicom Group Inc. reported growth in its 2007 earnings. Despite gloomy economic forecasts, the holding company's net income increased by nearly 13% compared to 2006.
For the company's PR holdings, which include Fleishman-Hillard, Ketchum, and Porter Novelli, revenues increased 11.1% over the year, to $1.3 billion. The company saw a 9.6% increase in the fourth quarter of 2007 alone, compared to the Q4 PR earnings of 2006. Organic revenue, a figure that excludes recent acquisitions and foreign currency adjustments, increased by 6.6%.
Overall, net income grew from $864 million to $975 million over the year, while diluted earnings per share increased by 18%. Shares in 2007 averaged $2.95 per share, up from $2.50 in 2006.
Over the year, worldwide revenue increased by 11.6%, from $11.3 billion in 2006 to 12.6 billion in 2007. Domestic revenues increased by 8.2%, from $6.1 billion to $6.7 billion, while international revenue grew from $5.1 billion to 5.9 billion, a 15.6% increase.
Omnicom's earnings were notable considering its holdings focus so exclusively on marketing, advertising, and communications, three disciplines that tend to get squeezed during economic downturns. During an analyst conference call, Reuters reported the company's CEO John Wren said, “[Clients] are concerned with the effectiveness of the marketing efforts. That has been a theme for a long time, but it gets punctuated a bit when you have unsettling economic times.” However, he added that he hasn't seen “any major or serious cutbacks in spending as of today.”