Omnicom PR firms report slight growth in Q4

The holding company's PR agencies, which include FleishmanHillard, Ketchum, and Porter Novelli, saw organic revenue increases of 0.1% and 0.3% for the fourth quarter and full year, respectively.

NEW YORK: Omnicom Group’s public relations firms reported a 0.1% organic revenue increase in the fourth quarter to $362.8 million.

The holding company’s PR agencies within Omnicom Public Relations Group include FleishmanHillard, Porter Novelli, Ketchum, Portland, Marina Maher Communications, Cone, and Mercury.

PR revenue comprised 8.7% of Omnicom’s quarterly sales. Advertising made up the majority of its revenue at 54.1% in the quarter.

"The more growth, the better, but we weren’t unhappy because it was a challenging year for all the holding companies," said Omnicom Public Relations Group CEO Karen van Bergen, who cited group new business wins from Johnson & Johnson, Pfizer, and PepsiCo.

The holding company as a whole reported global revenue of $4.2 billion for the fourth quarter, up 1.6% organically from the last year. Net income in Q4 plunged 27.4% to $254.4 million, with the holding company noting the impact of the recently signed tax reform law. Operating profit in Q4 was $620.1 million.

The holding company beat Wall Street expectations for net income, but fell short on revenue, according to the Associated Press.

North America recorded almost $2.3 billion in revenue in Q4, representing an 0.8% decline in organic growth. European revenue increased by 8.2%, while the U.K. was down 0.7%, and Latin American revenue decreased by 0.3% organically.

For all of 2017, Omnicom’s PR firms were up 0.3% organically to almost $1.4 billion. PR accounted for 9% of the company’s billings last year.

The holding company’s revenue in 2017 increased 3% organically to $15.3 billion; Omnicom also posted net income of nearly $1.1 billion

All regions saw organic growth increases for 2017. North America was up 0.6%, the U.K. by 5.1%, Europe by 8%, Asia-Pacific by 5.8%, Latin America by 0.6%, and the Middle East and Africa by 12.5%.

"For 2018, we’re cautiously optimistic," van Bergen said. "There’s a little bit of an uptick, you certainly see that in the U.K., which had a great year in 2017. We’re kind of optimistic about the economic climate. It’s another election year, which is always good for our business, and I think we’ve been able to focus on investing in talent and data-driven marketing."

Van Bergen highlighted collaboration between the group’s agencies, such as the purpose practice Porter Novelli launched with Cone Communications this week.

Ketchum replaced CEO Rob Flaherty with Barri Rafferty, the first woman to be the chief executive of a top five firm, late last year. Asked if there will be additional leadership changes, Van Bergen said, "None that I know of."

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