Havas Hirings Hammer H1 Profits

29 September 2006

SURESNES, France: Operating income in the half-year to June 30 fell by a swingeing 34% at Havas, the globe's fifth-largest marketing services conglomerate and owner of the Euro RSCG and Media Planning Group networks.

H1 operating income plunged to €56 million ($71.1m; £37.9m) from €75m, while organic revenues hit a plateau at €719m. Net income at €21m was down from €34m a year before and net debt rose substantially to €648m at June 30, from €492m in 2005.

According to the company, which is chaired by its largest shareholder Vincent Bolloré, the downturn is mainly attributable to talent hirings, especially in the area of new business. These costs depleted operating margins from 10.8% to 7.7% during the period.

However, business gains soared over the same timespan, rising year-on-year from €500m in new billings to around €900m.

Data sourced from Financial Times Online; additional content by WARC staff