Publicis: Q3 Organic Growth Near 5 Percent

NEW YORK Publicis Groupe reported flat third-quarter revenue of approximately $1.2 billion compared to the same period a year ago. The Paris-based holding company, however, said organic revenue rose nearly 5 percent, compared to 4.5 percent in the second quarter and 4.4 percent in the first quarter. Revenue for the first nine months was also flat at about $3.5 billion. Organic growth rose 4.6 percent. Results were tempered by the weakness of the U.S. dollar. That negative impact totaled $49.5 million in the quarter and $173.9 million in the nine months. Publicis said that while ad spending in North America, which accounts for 43.9 percent of the company's revenue, continues to show healthy growth, the rapid quarter-over-quarter increases of last year make current comparisons seem more moderate. U.S. organic growth slowed in the third quarter, while it increased in Europe, which has been slower to emerge from the recession. In a conference call with investors, CEO Maurice Levy attributed the U.S. slowdown to "our mix of clients and businesses." He added, "You shouldn't draw conclusions for the fourth quarter." Publicis, for instance, didn't enjoy as much of an Olympics boost in the U.S. compared to competitors Omnicom and WPP, he said. Elsewhere, the company saw market improvement in Latin America and in the Asia Pacific region. New business in the third quarter was comparable to the year-ago period, with Publicis companies ringing up $670 million, with 51 percent of that in advertising and 49 percent in media planning and buying. In the first nine months, Publicis generated $2.6 billion, again nearly equally divided between advertising and media business. On the call, Levy sounded particularly upbeat about the fourth quarter, saying the company already has booked $1.7 billion in new business wins, including the worldwide consolidation of most of Sanofi-Aventis brands; most of Nestle's worldwide media; and the ad account for Renault in Spain, where the marketer ranks among the country's largest advertisers. Levy did say, however, that he is "a little cautious" because clients often adjust budgets in anticipation of their final results. But the Publicis CEO, who has said he's looking for 3-4 percent growth in 2005, told investors that he remains confident about 2005. "We're not very bullish, but we're quite optimistic," Levy said.

Brand Marketing

Publicis: Q3 Organic Growth Near 5 Percent

Noreen O'Leary

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Noreen O'Leary