Decaux paints mixed picture

16 October 2009

PARIS: The trading climate in the global advertising market has improved slightly in recent weeks, but worldwide revenues will still fall by around 10% this year, Jean Charles Decaux, co-chief executive of JCDecaux, has said.

Carat, the media agency owned by Aegis, recently predicted that total adspend levels will decrease by 9.8% this year, before returning to modest growth of around 1% in 2010.

JCDecaux, the world's second largest outdoor advertising company, has also previously forecast that its sales for the third quarter of this year will replicate the slide of 13.8% posted during the first half of 2009.

More positively, its co-chief executive has now argued that "what we are clearly seeing are signs activity is stabilising. It would be premature to speak of a real market recovery."

"But in developed countries such as France and even in emerging countries like China, we see a business trend in September that is showing a sharp improvement from the first half."

According to Decaux, the final three months of this year will be essential in determining if "we go from a deterioration to a stabilisation and a recovery or if we stabilise at a low point."

The Paris-based firm boosted its share in Wall, a German out-of-home specialist, from 40% to over 90% last month, but plans to be "selective" when making any future acquisitions, he added.

Earlier this week, Maurice Lévy, ceo of Publicis Groupe, told French newspaper Les Echos that "we reached a low at the end of June, while the market has continued to fall at least until September."

"I think the market will remain negative at least until next summer, and will only turn positive in the second half of 2010, helped, it must be said, by a favourable basis for comparison."

Looking even further ahead, Lévy suggested his replacement as chief executive would probably be an internal appointment, rather than someone from outside the holding group's ranks.

"There are a few very good candidates within the company. I don't think the supervisory board will have to look elsewhere," he said.

Data sourced from Reuters; additional content by Warc staff