The travails at Interpublic Group are far from over. The globe’s second largest agency holding company (after Omnicom) moved out of the black and into the scarlet during the first quarter of 2003.
Posting a net loss of $8.6 million (€7.48m; £5.35m), or $0.02 per share, the result disappointed analysts who had raked their chicken giblets to come up with an eps of $0.11. In the comparable quarter last year IPG posted earnings of $59.8m ($0.16 per share).
Chairman/ceo David Bell, who moved into the hotseat only at the end of February conceded that the result was “disappointing and unacceptable”, pleading in mitigation that “turnrounds take time”. The group would soon reduce its $3.3 billion debt to a more sustainable level, he said, and “the balance sheet … should be where we want it by year end”.
IPG was also focusing on cost reduction and its core advertising, marketing and media planning businesses. Downsizing had resulted in substantial severance costs which, together with an $11m charge related to its troubled Octagon Motor Sports unit, had contributed to the current fiscal situation.
“We have major work ahead of us,” Bell said. “Interpublic is - and will remain - a work in progress.”
Data sourced from: Financial Times; additional content by WARC staff