Omnicom Posts 10% 1Q Revenue Gain

NEW YORK Buoyed by a strong domestic performance, Omnicom Group today said its first-quarter global net income rose 10 percent to nearly $166 million on a 7 percent revenue gain to $2.56 billion, compared to the same period a year ago.

Domestic revenue for the quarter improved 9 percent to more than $1.4 billion, while international revenue rose 4 percent to $1.13 billion, compared to the first three months of 2005.

“We’re very pleased with the company’s performance in the first quarter,” said Omnicom CEO John Wren today during a call with analysts. “The momentum from last year is continuing in the first four months of 2006.” Wren specifically noted Bank of America, which provided a boost during the last two quarters of 2005, as a catalyst for growth in the first quarter of this year.

Wren noted that Omnicom is making progress in its expansion in China and other parts of Asia, is ahead of schedule on its global expansion for media agency PHD, and continues to attract “the best talent in the marketplace.”

He paused during the call to say, “One sad note in the quarter. Our colleague [DDB Worldwide CEO] Ken Kaess passed away after a brave battle with cancer.” Kaess died in late March at age 51 and was succeeded as CEO by Interbrand’s Chuck Brymer.

By segment, traditional advertising revenue rose more than 5 percent in the quarter, lagging behind CRM (up 10 percent) and specialty marketing (up more than 7 percent). Public relations increased 2 percent.

Diluted earnings per share in the first quarter rose 13 percent to 93 cents per share, compared to the same period a year ago.

Omnicom, the largest agency holding company, outpaced No. 2 WPP Group, which last week reported a 5 percent like-for-like quarterly revenue gain to $2.6 billion [Adweek Online, April 21].