Havas Suffers 8.4% Q1 Organic Decline

PARIS Havas said its first-quarter revenue dropped 6 percent to $440 million, from $467.2 million in the same period a year ago. Organically, the company’s revenue declined by 8.4 percent, with the company blaming comparisons with a strong Q1 ’08 when Havas posted a 7.4 percent increase.

The French parent of Euro RSCG Worldwide, MPG and Arnold said the results reflected reduced client spending in the financial and healthcare sectors, which dropped 20 percent and 11 percent, respectively. Those declines were particularly heavy in the U.S. Havas also cited the impact of Euro RSCG’s loss of Dell’s Asia-Pacific account last June — which will be felt until the end of the second quarter — and a slowdown in southern Europe, where Havas has of late been increasing market share.
 
The company noted, however, that its digital businesses achieved a 7 percent Q1 organic rise and now accounts for over 16 percent of the group’s total revenue.
 
Organic growth in Europe, dragged down by countries like Spain and Portugal, fell 7.6 percent; North America was off 9.2 percent and the rest of the world declined 12.6 percent. (Of that latter drop, organic growth in Asia slowed 24.7 percent — without the Dell loss, the decline would have been 8 percent; in Latin America, the company is benefiting from Mexico-driven media growth and suffered a modest 2.5 percent decline.)
 
Havas said Q1 new business gains, at $686.6 million, were about even with the year-earlier period. The addition of accounts like CBS Films, Telefonica, GSK, Novartis, DBS Bank, Sprint and Pepe Jeans helped offset the losses of Carrefour and RadioShack.

Agency holding companies in general reported down first quarters.

Related:

Complete Havas Q1 Results

$207 Mil. Full-Year Loss for Dentsu

Holding Co. Numbers Paint Bleak Picture