Havas, the world’s sixth largest advertising holding company, on Thursday reported disappointing Q2 results and announced an impending reorganization.

The group’s flagship networks, Arnold Worldwide Partners and Euro RSCG, encountered a tougher second quarter environment in Europe than stateside. And Havas’s traditional bulwark against the cycles of the advertising economy – the usually robust marketing services sector – also disappointed.

Revenue was €433.6 million ($485.9m; £302.49m), down 7.8% on an organic basis after factoring out currency fluctuations and the effect of acquisitions. Income fell 12.6% in Europe but only 2.1% in North America; and while traditional advertising and media slipped only 2.2% marketing services dived 13%.

Aggregated first half revenues sagged to €835.6 million, down year-on-year by nearly 19% - mainly attributable, says Havas, to the ongoing rise of the euro against the dollar and the pound sterling. At constant exchange rates, Havas’s revenue was down by just 7.8%.

The impending reorganization will focus on Euro RSCG as Havas’s main global player, repositioning Arnold as a diaspora of smaller creative hotshops active only in key markets, notably the USA, UK and France.

Some businesses presently part of Arnold will switch to the Euro RSCG network and, assures Havas ceo Alain de Pouzilhac, none will be sold or shuttered. He also promised there will be no staff layoffs related to the reorganization. Full details of the revamp will be unveiled September 18.

Much of the “strong deterioration” in Europe was centered on the UK, especially the marketing services sector. “Marketing services are suffering more,” said de Pouzilhac . “A lot of clients have postponed, frozen or stopped investment.”

Meantime, Havas’s problems provided the entrail-rakers with the offal of their trade. “It’s looking a bit more like it’s specific to Havas,” opined WestLB analyst Jonathan Helliwell, noting that larger rival Omnicom Group reported a more “steady” performance earlier this week. “It looks a bit like the big guys are pulling away from Havas.”

Data sourced from: The Wall Street Journal Online; additional content by WARC staff