TOKYO: Dentsu, the Japanese agency holding group, posted a loss of 20.5 billion yen ($212m; €156.0m; £140.4m) during the last financial year, and predicts that the period to March 2010 is unlikely to see an upturn in its fortunes.

The company's net sales fell by 8.3% to 1.88 trillion yen for the 12 months to March this year, with gross profit down 8.9% to 314.4 billion yen, and its operating income off by 23.1% to 43.18 billion yen. 

It also saw the value of its investments decline by 51 billion yen, including a drop off in the market price of the 15% stake it holds in fellow marketing services conglomerate Publicis Groupe.

Dentsu reports that total adspend fell by 7.6% in Japan last year, with online and satellite media spending among the few areas to improve, up by 16.3% and 12.1% year-on-year respectively.

The Japanese government forecasts that the country's economy will contract by 3.3% in 2009, and the Japan Center for Economic Research predicts adspend will fall 14.8% in the next fiscal year.

As such, Dentsu warned business conditions will remain "extremely severe" and clients "broadly conservative in their advertising spending."

The world's fifth-largest holding group thus expects its net sales to fall by a further 13.4% in an annual basis, with operating income falling by 63.4%, and to post a net income of 11.4 billion yen.

Data sourced from Denstu/AdAge; additional content by WARC staff