Dentsu Set for 14% Annual Profits Plunge

08 May 2002

Tokyo-headquartered ad agency giant Dentsu, number five in Advertising Age’s global league table and the largest shop in Japan where it dominates with 25% market share, is set to announce a 14% dive in full year pre-tax profit, local newspapers report.

This is expected to come in at ¥51,087 million ($397.8m; €437.01m; £272.0m) with global revenues down 2% to ¥1709.25 billion. The depressed numbers are blamed on cutbacks by clients in the communications and IT sectors. Another factor affecting income has been the decline in consumer goods advertising in Japan – the planet’s second largest ad market after the USA.

Dentsu warned of a profits shortfall earlier this year [WAMN: 26-Mar-02], although it expects a boost of up to ¥70bn in revenues from the soccer World Cup, to be held this month and next in Japan and South Korea.

Dentsu – which is backing Publicis’ acquisition of Bcom3 Group with a 15% stake in the merged entity – reported a year-on-year revenue fall of 15.2% in January and 7.5% in February.

Data sourced from: BrandRepublic (UK); additional content by WARC staff