Havas, Aegis see organic revenues slide

18 May 2009

LONDON/SURESNES, Paris: Havas and Aegis, the marketing services conglomerates, both posted declines in organic revenues during the first quarter of 2009, but expressed the expectation that new business wins would help boost their figures for the year as a whole.

Havas, the Paris-based holding group, saw total revenues fall to €325 million ($438m; £288m) from the comparative figure of €345m it recorded in Q1 last year.

Organic revenues fell by 8.4% year-on-year, a result the company attributed in part to a decline in spending among its clients in the financial and healthcare sectors, down 20% and 11% respectively.

In Asia Pacific, its organic sales fell by a quarter, largely due to the loss of a major account with computer manufacturer Dell, with North American sales also sliding by 9.2%.

Latin America posted a more modest decline of 2.5%, while Europe was down 7.6%, though the company noted a relatively strong performance in the UK, where revenues fell by just 1.6%.

Overall, its digital revenues increased by 7% on an organic basis, and now contribute 16% of the group's total revenues.

Net new business wins for the first quarter also reached €507m, down just €3m on an annual basis, with new accounts from clients including CBS Films and Novartis should help "offset" the loss of accounts for Carrefour and Radio Shack, Havas said.

Aegis recorded a 6.5% increase in revenues on a reported basis, but this equated to a decline of 11.6% when taken to exclude currency fluctuations and new acquisitions.

On an organic basis, and when excluding currency movement and acquisitions, Aegis Media saw revenues decline 13.1% from January to March this year, with Synovate down 12.0%. 

However, Aegis reported new business wins totalling $1.05bn in the first quarter, including new accounts from Kellogg and Vodafone, which the company said would "offset the impact of the earlier losses for the rest of the year."

John Napier, its chairman and interim ceo, argued that as "visibility remains limited across the industry" the company aims to "broadly maintain the full year underlying operating profit margins through continuing careful management of our businesses."

Data sourced from Aegis/Havas; additional content by WARC staff