NEW YORK: The PR firms within Interpublic Group’s Constituency Management Group posted a slight revenue decrease in the fourth quarter and all of 2017 on both an as-reported and organic basis, Weber Shandwick CEO Andy Polansky said on Wednesday.
"That compares to mid-single-digit growth in Q4 2016 and full-year 2016, so [there were] tough comparisons," Polansky said.
The PR firms in CMG are Weber, Golin, DeVries Global, Current, Creation, and the Axis Agency. The unit also includes marketing specialist firms such as Jack Morton, FutureBrand, and Octagon. Other Interpublic PR firms operate outside of CMG.
Interpublic’s CMG unit reported an organic revenue increase of 3.3% in Q4 to $409.3 million but was flat for full-year 2017 to $1.5 billion.
In 2017, Current was a "standout performer," and DeVries registered "solid growth," said Polansky. He noted that healthcare work was particularly strong across the CMG portfolio.
"With respect to 2018, while we continue to see some caution in the market, the tone of the business has become more positive," he said. "Weber and Golin are both poised for a strong 2018, due to some significant wins in Q4. [The two firms have] very strong competitive positions in the market."
Weber has beefed up its consulting capabilities and MediaCo unit over the last year, along with the firm’s specialties in healthcare, tech, and financial services, Polansky explained.
Late last year, Weber acquired Resolute Digital and Bomoda to expand its global data science, analytics, search, and performance marketing capabilities.
Flipside, the U.K.-based mobile agency Weber acquired in September 2016, provided a boost in business and capabilities for the firm and was "catalytic" for Weber in the U.K., said Polansky.
In 2017, Weber’s international markets performed well, posting double-digit growth in EMEA and "good gains" in Asia Pacific, Polansky said. Weber continues to see double-digit growth in Mexico, India, the U.K., and Sweden.
"While we had some softness in our North American business, it was concentrated in a few markets," Polansky said.
For the holding company as a whole, Interpublic Group’s fourth-quarter revenue was up 3.3% organically to $2.3 billion, with operating income of $518.3 million and net income of $316.6 million. For all of last year, revenue increased 1.8% organically to $7.9 billion; operating income was $973.6 million and net income was $579 million.
The holding company’s revenue performance was mixed in the fourth quarter by geography, up 3.7% organically in the U.S., down 0.4% in the U.K., increasing by 7.9% in continental Europe, and dropping by 0.9% in Asia-Pacific.
U.S. revenue increased by 2.2% for all of 2017 and was up by 1.1% in the U.K. and 3.5% in continental Europe. Revenue decreased by 1.6% organically in Asia-Pacific last year.
Interpublic's overall numbers beat analysts' expectations. CEO Michael Roth predicted on the company's earnings call that it would turn the corner in 2018, saying, "We expect to gradually put the slower growth of 2017 behind us," according to Reuters.