Leading advertising agency Interpublic Group profits down 76% in second quarter

Interpublic Group of Companies Inc reported second-quarter net income available to IPG common stockholders of $20.9 million or $0.04 per share, compared to $88.1 million or $0.17 per share in the same quarter last year.

Reported revenue of $1.47 billion in the second quarter of 2009 was down 19.7% compared with the same period in 2008. During the quarter, the effect of foreign currency translation was negative 7.1%, the impact of net acquisitions was positive 1.9% and the resulting organic decrease in revenue was 14.5%.

For the first half of 2009, reported revenue was $2.80 billion, down 15.7% compared to the first half of last year. During the first half of 2009, the effect of foreign currency translation was negative 7.2%, the impact of net acquisitions was positive 2.0% and the resulting organic decrease in revenue was 10.5%.

At June 30, 2009, cash, cash equivalents and marketable securities totaled $1.77 billion, compared to $2.27 billion at the end of 2008 and $1.86 billion at the end of the second quarter of 2008. Total debt of $2.04 billion as of June 30, 2009 decreased from $2.12 billion as of December 31, 2008, primarily due to the purchase of our debt related to our tender offers.

Operating Results

* Operating income in the second quarter of 2009 was $96.9 million, compared to operating income of $200.6 million in 2008. For the first half of 2009, operating income was $15.0 million, compared to operating income of $142.8 million in 2008.

* Severance charges recorded in the second quarter of 2009 were $29.9 million, compared to $10.7 million in 2008. For the first half of 2009, severance charges recorded were $71.5 million, compared to $24.6 million in 2008.

* Operating margin was 6.6% and 0.5% for the three and six months ended June 30, 2009, respectively, compared to 10.9% and 4.3% for the three and six months ended June 30, 2008, respectively.

Net Results

* Second quarter 2009 net income attributable to IPG was $27.8 million and net income available to IPG common stockholders was $20.9 million, or $0.04 per basic and diluted share. This compares to net income attributable to IPG a year ago of $95.1 million and net income available to IPG common stockholders of $88.1 million, or $0.19 per basic and $0.17 per diluted share.

* Year-to-date 2009 net loss attributable to IPG was $39.2 million and net loss available to IPG common stockholders was $53.0 million, or ($0.11) per basic and diluted share. This compares to net income attributable to IPG a year ago of $32.3 million and net income available to IPG common stockholders of $18.2 million, or $0.04 per basic and diluted share.

Interpublic is one of the world’s leading organizations of advertising agencies and marketing services companies. Major global brands include Draftfcb, FutureBrand, GolinHarris International, Initiative, Jack Morton Worldwide, Lowe Worldwide, Magna, McCann Erickson, Momentum, MRM Worldwide, Octagon, UM and Weber Shandwick. Leading domestic brands include Campbell-Ewald, Campbell Mithun, Carmichael Lynch, Deutsch, Hill Holliday, Mullen, The Martin Agency and R/GA.

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Amarendra Bhushan

CEO and Editorial Director at CEOWORLD Magazine
Amarendra is the Chief Executive Officer and Editorial Director at CEOWORLD Magazine, and is responsible for all business management, company operations, finance, and social advertising operations.
Email- amar@ceoworld.biz
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By: Amarendra Bhushan

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Amarendra is the Chief Executive Officer and Editorial Director at CEOWORLD Magazine, and is responsible for all business management, company operations, finance, and social advertising operations. Email- amar@ceoworld.biz