PR Firm Rankings - Odwyerpr.com

FEATURE
Optimism, revenue fuel 2010’s first quarter
Earnings released in April give hope that the ad, PR and
services sectors are poised for recovery.
By Greg Hazley and Kevin McCauley
April was a good month for
Omnicom, which beat Wall Street
expectations and posted a 5.9%
increase at its PR units — Fleishman-
Hillard, Ketchum, Porter Novelli, Cone and
Brodeur Worldwide — on $276 million in
revenue for Q1. Organic growth in PR
ticked up two percent.
Profit at Omnicom was flat at $163 million
on a 6.3% drop in revenue to $2.9 billion
as earnings-per-share beat the Street by
two cents. Overall, U.S. revenues grew 3.9
percent to $1.6B while international business
soared 9.3 percent to $1.3B.
Shares in Omnicom hit a 52-week high
in April following an upgrade to buy from
Deutsche Bank, which sees agencies “finally
starting to participate in the ad market
recovery already flagged by media owners
and increasingly the forecasters.”
French ad/PR conglomerate Havas said
North American revenue rose 5.2% during
the first quarter of 2010 noting a “significant
turnaround” in the region that fell
9.2% for the same period of 2009.
The parent company of the Euro RSCG
network said strong growth in advertising,
healthcare and corporate communications
sparked the regional climb.
Overall, revenue was up 1.4% to euro
329 million from Q1 of ’09. The U.K.
slipped 1.5%
“Beginning of a good recovery”
Publicis Groupe, meanwhile, saw first
quarter revenue rise more than eight percent
to euro 1.2 billion, including a 10%
jump in North America. In U.S. dollars,
that was a nearly 15% rise to $1.6 billion.
The company said North America experienced
an “excellent recovery” in the first
quarter with a strong performance in digital,
as well as sectors like retail, financial
services and healthcare while the auto sector
stabilized.
Despite the upbeat performance,
Publicis said the economic environment
remains fragile and salary and recruitment
freezes are only being discontinued gradually.
Publicis said its key PR division, MS&L
Group, saw the “beginning of a good
recovery” and started the year particularly
well with new business with wins of
What’s On (India) and the World Gold
Council (China).
The company said digital now accounts
for 27% of its overall revenue.
Europe was the only region where
organic growth fell for Publicis as revenue
ticked up 3.4%.
Vocus beats street
PR software company Vocus posted a
nine percent rise in first quarter revenue to
$22.3M as its net loss from operations
grew slightly to $579,000 from $478,000
for Q1 of ’09.
The revenue results edged expectations
in the $21.8-22M range.
CEO Rick Rudman said he was “very
pleased with the overall business climate”
during the quarter.
The company also announced two
acquisitions — Data Presse SAS of
France and BDL Media Ltd. of China —
with its better-than-expected results.
Vocus said it added 396 net new subscription
customers during the quarter,
more than double the 179 gained for the
same period last year. New clients included
Nordstrom, FDIC and Honda UK.
Loss from operations was $549K for
Q1, compared with income of $296K for
Q1 of ’09.
Second quarter revenue is expected to
be in the $23.5-23.7M range.
BDL Media is a six-year-old PR services
company in the People’s Republic of
China providing software in a vein similar
to Vocus’ mission through
ChinaNewswire.com
and
Xinwengao.com. Its monitoring service is
MyRSS.cn.
Rudman said the Chinese market has a
rapidly emerging PR industry estimated at
more than $1 billion and growing at a
30% per year.
He called the deal a “launching pad” for
Vocus in the market.
The other deal announced was the
$10.8 million acquisition of Datapresse, a
21-year-old French PR software company
with about 2,000 customers and a
European media database that gives
Vocus broader reach into that continent.
The deal included $9.8 million in cash
paid at closing and up to $1.0 million in
cash on an earnout basis.
IPG sees revenues, executive pay fall
Interpublic CEO Michael Roth reported
a $70.3M first-quarter net loss on April 29,
down slightly from the $73.6M deficit in
last year’s period. Revenue slipped 1.2%
to $1.3B.
Harris Diamond, CEO of IPG’s constituency
management group, told
O’Dwyer’s that PR enjoyed a “good quarter”
as revenues jumped in the 6.5%
range.
Weber Shandwick and GolinHarris
were stand-outs in the PR group that
includes MWW Group, Rogers & Cowan
and DeVries PR.
Healthcare, corporate and consumer
clients stepped up spending in both digital
and traditional off-line sectors. Diamond
expects business to strengthen through the
year as PR is normally the “first-in and
last-out” of an economic downturn.
Roth’s buoyed by the “broader economic
stabilization” that helped IPG trim the
percent of organic revenue decline to
2.9%. U.S. organic revenues increased
three percent.
He’s pleased by “another quarter of significant
sequential improvement in our
organic revenue performance.” He
believes that “shows the economy is
recovering” and anticipates more progress
during the remainder of the 2010.
IPG reduced operating loss from
$81.9M to $59.4M. The company took a
$5 “hit” from Hugo Chavez's Venezuela,
an expense related to the transition to
inflationary accounting in that country.
The ad/PR firm, which shows $1.9B in
cash/marketable securities, launched a
tender offer to buy up to 370K shares of
its Series B stock, convertible into 27.1M
shares for $400M. It currently pays a
$19.4M dividend on those shares.
IPG registered $121M in ’09 full-year
net versus $295M for 2008.
Roth saw total 2009 compensation tumble
from $10.6 million to $6.4 million,
according to the ad/PR conglom’s proxy
released April 19. Roth showed $11.1M in
total comp in 2007.
Former CEO John Dooner ranked as
the No. 2 earner at IPG. As chief of IPG’s
McCann Worldgroup, Dooner earned
$2.8M, down from $4.9M in ’08. Dooner
now serves as Executive Chair of
McCann until the end of the year.
Executive VP and CFO Frank
Mergenthaler earned a package of $2.4
million, a decline from the $3.5M hauled
in for ’08 from Interpublic.
Philippe Krakowsky, Executive
VP/Strategy and Corporate Relations, collected
$1.9 million, off from $2.6 million.
Timothy Sompolski, Chief Human
Resources Officer, earned $1.3 million
last year vs. $2.1 million in ’08.
12 MAY 2010 WWW.ODWYERPR.COM