Credit: Josiah Farrow via Unsplash
Omnicom, comparing its business to before the integration of IPG, posted organic revenue growth of 6.1% to just under $US6 billion in the June quarter for core operations, excluding those businesses marked for sale.
The global advertising group’s adjusted EBITA (earnings before interest, taxes and amortisation) margin increased to 17.8% from 15.9%, mainly due to “cost reduction synergies”. Integration and acquisition-related costs came in at $US87.1 million.
Operating expenses increased by $US2.1 billion to $US5.6 billion compared to the same quarter last year.
Included in operating expenses are $US40.1 million of integration and transaction costs related to the acquisition of IPG, and $47 million of repositioning costs.
Salary and service costs increased $US1.8 billion to $US4.7 billion.
The company, now the world’s biggest advertising holding company, has a target of $US1.5 billion in savings from the takeover of IPG, starting with $US900 million this year.
"Our second quarter results reflect the momentum of the new Omnicom,” said CEO John Wren, citing the 6.1% organic growth in core operations.
"We are built for an era where speed, integration, and scale matter most. Our wins this quarter demonstrate that.
“Clients are consolidating more work with us because they see the competitive advantage our connected capabilities deliver.
“Looking ahead, we will strengthen our position as an integrated growth partner by focusing on three key areas: leading in agentic marketing transformation, expanding and deepening our partnerships with existing and new clients, and helping clients win across the new consumer engagement models in sports and entertainment, social and creator, connected commerce, and AI-driven discovery."
Integrated Media at 52% was the biggest part of Omnicom's business followed by advertising at 15.7%.
The US contributed 59% of revenue, Euro Markets & Other Europe 13.8%, the UK 9.3%, 3.8% Asia Pacific, 2.1% Latin America, 2.1%, for the Middle East & Africa; and 3%for Other North America.
Slides form the results presentation:
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