NEW YORK: Interpublic Group posted third quarter revenues of $1.45 billion, up very slightly from $1.44 billion in the third quarter of last year. Organic revenue in the quarter increased 2.7%
IPG's net loss in the quarter was $6.1 million, a significant improvement over a net loss of $102.8 million in the third quarter of 2005. For the first three quarters, the company's net loss stands at $131.2 million, down from $255 million in the same period last year.
Total revenue for the first nine months stands at $4.31 billion, down from $4.38 billion in the same period last year. Constituency Management Group, the IPG segment that contains its large PR agencies, tallied revenue of $227.2 million in the quarter, up less than 1% from the previous year.
In a conference call, IPG CFO Frank Mergenthaler cited "strong growth from our PR businesses like Weber Shandwick and GolinHarris," and "strong organic growth in our PR and branding businesses" as positive factors for the holding company in the third quarter.
Weber Shandwick CEO Harris Diamond, who also leads IPG's CMG division, said that "almost all" of the holding company's PR agencies experienced a strong quarter.
"We had terrific growth in the third quarter," he said, attributing it to "strong organic business from a lot of clients, good new business, just overall a terrific picture globally and in the US."
IPG also revealed today that a review of its past stock options practices, undertaken in light of the backdating scandals afflicting wide swaths of corporate America, found "deficiencies in the administrative processes and the controls" related to options granted from 1996-2002. As a result, IPG said it has adjusted its deficit by $26.4 million.
All options granted since 2002 were done correctly, the company said.
Mergenthaler said that the problems in the earlier options grants were "symptomatic of a company with poor controls."