IPG Reports 9 Percent Revenue Decline for 2002

NEW YORK Interpublic Group’s worldwide revenue plunged 9 percent in 2002, due largely to “significant difficulties” in McCann-Erickson WorldGroup and the motor sports division of sports marketing arm Octagon, IPG said on Thursday.

“We’re very much a work in progress at Interpublic, to say the least,” said Bell, in his opening remarks to analysts on a conference call, in which he alluded to IPG’s past problems as well as his early priorities. “Clearly a lot of work remains to be done and I intend to bring a real sense of urgency in getting on it with it.”

IPG reported 2002 revenue of $6.2 billion, down from $6.7 billion in 2001. Still, through cost cutting, IPG managed to produce net income of $99.5 million; in 2001, the company reported a net loss of $534.5 million after recognizing large merger and restructuring charges.

IPG restated the size of its loss in Octagon motor sports at $135.8 million. A previous estimate, covering the first three quarters of 2002, was $58.4 million. IPG is seeking to unload the U.K. operation, which includes racetracks, but thus far has found no takers.

In the fourth quarter of 2002, IPG’s revenue fell 4 percent, to $1.6 billion from $1.7 billion in the same period of 2001. Operating income for the quarter plummeted 46 percent, to $119.3 million from a restated $219.7 million in 2001. Net income totalled $20.3 million — down 79 percent from the $96.4 million recorded in the same period of 2001.

When the market closed, IPG’s share price hovered near its 52-week low of $8.60, which was set on Feb. 13.