Omnicom Profits Rise by 2.5% in 2008

11 February 2009

NEW YORK: Omnicom Group, the advertising agency holding group, posted an increase in profits of 2.5% to just over $1 billion (€770m; £675m) in 2008, with worldwide revenues also up by 5.2% to $13.4bn for the year as a whole, despite a difficult last quarter.

Omnicom, which operates in over 100 countries and has more than 5,000 worldwide, is increasingly focusing on providing integrated marketing services, as well as pursuing further acquisitions as it seeks to diversify its operations.

According to the company's figures, global net income was up on the $975 million recorded in 2007 despite a drop off of 13.7% in Q4 last year to $271 million.

Similarly, worldwide revenues were also up on the total of $12.7bn posted in 2007 even though the company posted a revenue decline of 7% in the final three months of 2008 to a total $3.37bn.

Its US revenues increased by 2.8% to $6.89bn last year, with international revenues up 8% to $6.46bn for 2008 as a whole.

In-keeping with broader trends, its domestic revenues dipped by 4% in Q4 2008 to $1.76bn, while international revenues declined by 9.5% to $1.6bn.

While its earnings per share figures for 2008 were slightly ahead of analysts' forecasts, the holding company could still be in for a challenging 2009, as according to current estimates, its earnings per share, which reached $3.17 in 2008, are unlikely to surpass this figure again until 2012.

John Wren, president/ceo of Omnicom, predicted "the first nine months of this year are going to be difficult", but added that he also expects some renewed economic impetus in the fourth quarter as a result of the US government's stimulus package.

Data sourced from Omnicom Group; additional content by WARC staff