Publicis Income to Fall 12% - Will Morgan Get It Right This Time?

09 May 2003

Paris-headquartered agency holding company Publicis Groupe may see its global revenues fall by twelve percent in the year’s first quarter, divines investment bank Morgan Stanley – which two weeks ago got it’s prognostication badly wrong with WPP Group’s first quarter results [WAMN: 28-Apr-03].

According to a note released Thursday, the bank’s seers predict that Publicis' organic revenues will fall by only 1.7% during Q1 2003 – but the group (number four in the agency world rankings) will take a hammering from the recent rise in the value of the euro against other world currencies – especially the dollar. The effect of this, prophesied Morgan, will be “punitive”.

WAMN may have to eat its words - but it believes Publicis’ wily chairman/ceo Maurice Levy will have seen the exchange-rate Exocet on its early-warning radar and taken evasive action. The group’s Q1 results will be unveiled on May 13.

Meantime, a word of praise from on high. “Publicis remains our most preferred of the European agency stocks that we cover.” The Morgan note continued in its throttled English.“Given the recent rally, we would expect the market to pause for new news from the first-quarter 2003 results, but given that we expect that news to be positive, we remain confident with our 'overweight' rating and €24 price target.”

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