Omnicom PR revenue down in third quarter

NEW YORK: Omnicom Group's PR revenue was down 0.3% organically in the third quarter of 2012 to $313.8 million, compared with the previous year.

NEW YORK: Omnicom Group's PR revenue was down 0.3% organically in the third quarter of 2012 to $313.8 million, compared with the previous year.

In Q3, PR's performance was outpaced by Omnicom's advertising and CRM agencies, which reported 5.7% and 2.4% year-over-year organic growth, respectively. PR made up 9.2% of Omnicom's business in the period, with advertising accounting for 46.6%, CRM making up 37.1%, and specialty marketing earning 7.1% of the total.

The holding company owns and operates Fleishman-Hillard, Ketchum, Porter Novelli, Cone Communications, Marina Maher Communications, Mercury Public Affairs, and London-based agency Portland in its Diversified Agency Services unit.

The holding company's third-quarter PR growth was down significantly from that of Q3 2011, when it increased 4.2% organically year-over-year. In July, PRWeek reported that Omnicom's PR revenue grew 0.9% organically in the second quarter of 2012, compared with the previous year.

Fleishman president and CEO Dave Senay said his agency “outperformed Omnicom's PR segment reporting quarter after quarter, year after year, by a factor of two times, three times, four times, even five times, and this quarter was no different.”

Fleishman and marketing agency GMR Marketing acquired Amos Content Group in August to create a content strategy and creation service called Freshwire.

Tyson Foods selected Fleishman as global AOR for integrated corporate communications in July. The agency also won work for General Motors, aluminum company Novelis, financial services firm State Street, and Korean business conglomerate Hanwha Group, Senay said.

Ketchum CEO Rob Flaherty also said that “we outperformed that number and are having a very strong year.”  He added that his agency won business from Michelin, US Cellular, and the National Pork Board.

In the third quarter, the Centers for Medicare & Medicaid Services awarded two contracts to Ketchum worth just less than $7 million to promote electronic health record programs. The agency also won new business from Morton Salt in August, and it was named PR AOR for antifreeze manufacturer and auto parts and chemicals marketer Old World Industries earlier this month.

Across marketing disciplines, Omnicom reported US organic revenue growth of 3.1%, year-over-year, to $1.75 billion in the third quarter. It reported a 1.8% organic revenue decrease in Euro currency markets, 0.1% organic drop in the UK, and 10.2% organic growth in the rest of the world.

Overall, Omnicom reported a 0.8% increase in worldwide revenue to $3.4 billion in the third quarter. Net income rose 0.1% in the period to $203.9 million, year-over-year. Operating income was up 3.7% to $387.3 million.

Broken down by industry, Omnicom reported 13% third-quarter growth in the food and beverage sector, year-over-year, while pharma and health grew 10%. The financial services, consumer products, technology, and automobile sectors each saw 9% growth.

Acting Porter CEO Michael Ramah declined to comment beyond the earnings report.

Omnicom VP of global communications Joanne Trout also declined to comment.

Organic growth represents change in revenue without measuring the impact of acquisitions or disposals.

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