IPG Narrows Q2 Net Loss

NEW YORK Interpublic Group today reported a net loss of $5.4 million for the second quarter of 2004, despite a 3 percent increase in revenue. IPG attributed the loss to charges related to restructuring and buying its way out of Formula One racing obligations.

Another factor dragging down results was a 9 percent increase in office and general expenses, due largely to the cost of bringing IPG into compliance with Sarbanes-Oxley accounting rules.

The $5.4 million quarterly loss represented an improvement compared to the same period a year ago, when the company registered a loss of $13.5 million.

IPG recorded Q2 2004 revenue of $1.54 billion, up from $1.49 billion in the same period last year. And for the first time since 2001, IPG posted positive organic revenue growth, though it was up only one-half of 1 percent.

“A number of companies, in advertising, (customer relationship management) and public relations, posted strong top line domestic results,” said IPG chief executive David Bell, in a statement. “I’m pleased with our progress in closing the growth gap with the competition.”

The charge related to cutting ties with Formula One Administration Ltd. amounted to $80 million for the quarter.

For the first six months of 2004, IPG suffered a net loss of $22.3 million, a slight increase from the $22.1 million net loss in the same period last year. First-half revenue grew 3.5 percent from $1.62 billion in 2003 to $1.67 billion this year.