Havas Turns Profit, Posts Strongest Quarter In 4 Years

Havas returned to profitability in 2004, reporting net income of $45 million compared to a loss of $520.1 million in the year-earlier period.

Organic growth for the year rose 2 percent, including a 4.6 percent hike in the fourth quarter—Havas’ strongest quarterly growth since Q1, 2001. The French holding company also increased its operating margin to 13.2 percent, compared to 8.3 percent in 2003. Those margins rose to 14.2 percent in the second half, compared to 8.4 percent in the second half of 2003.

Still, these improving numbers do not reflect the impending departures of Intel’s $300 million in global business and Volkswagen’s $500 million North American media assignment. However, Havas did pull in nearly $2 billion in new business last year, including Charles Schwab, Pfizer, Vonage, Tyson Foods, Novartis and Diageo.

Havas also ended 2004 with a stronger balance sheet, reducing its debt by nearly two thirds—from $842.1 million to $296.5 million. Last month, Havas reported ’04 revenue of $1.91 billion, a gain of 2 percent, calculated at constant rates of exchange.