Omnicom PR revenue dips 0.4% in Q3

The PR segment experienced a revenue drop in its first earnings report since Omnicom CEO John Wren said the holding company was "adjusting some of the leadership at its PR firms" after a disappointing Q2.

NEW YORK: Omnicom Group’s PR firms reported an organic revenue drop of 0.4% in the third quarter to $345.9 million.

The PR segment’s revenue was down compared with Q3 2016, in which it was up 4.4% over the year prior.

The holding company owns and operates PR firms including FleishmanHillard, Ketchum, Marina Maher Communications, and Porter Novelli.

"Omnicom PR Group reported slightly negative growth year-over-year in Q3, a result of a difficult comparison due to the 2016 election season," said Omnicom Public Relations Group CEO Karen van Bergen. "On balance, our data-driven, integrated offering continues to resonate with clients, which has played through in a number of extremely exciting and high-profile opportunities that we are pursuing with passion."

She added that Omnicom’s PR firms saw a "particularly strong performance" from agencies in the U.K. in Q3.

Omnicom’s other business segments achieved organic revenue gains in the quarter. Advertising was up 4.7% to $1.9 billion, while CRM increased 0.1% to $1.1 billion, and specialty communications grew 5.1% to $278.1 million.

Broken down geographically, North American organic growth was 2.1% to $2.1 billion, while U.K. growth was 3.8% to $357.6 million and the Asia-Pacific market experienced 1.4% organic growth to $411.2 million. Latin American revenue was down 5.4% organically to $117.7 million and the Middle East and Africa decreased 1.6% to $65.4 million.

Revenue for the holding company as a whole was up 2.8% organically compared with Q3 2016 to $3.7 billion. Revenue dropped 1.9% on a non-organic basis in the period. (Organic revenue growth represents change without taking into account the impact of acquisitions and disposals).

Omnicom’s operating profit increased by 2.4% to $464.2 million in the period, while net income grew by 3.9% to $263.6 million.

The results were posted a quarter after Omnicom CEO John Wren said the holding company was "adjusting some of the leadership" at its PR firms after a second quarter in which revenue was down 0.3% organically. Wren noted on the company’s Q2 earnings call that its PR, shopper marketing, and branding businesses "dragged down" the holding company’s performance in the quarter.

"In PR, what we’re doing is adjusting some of the leadership — typically you can take our people and you can see that we have hunters and farmers; sometimes we get too many farmers in a place," he said on the Q2 earnings call.

This story was updated on October 18 with quotes from van Bergen.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Would you like to post a comment?

Please Sign in or register.