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Omnicom’s core revenue grows as Interpublic integration advances

Omnicom reported 7.2 per cent organic growth in core operations during the third quarter. The advertising group’s reported revenue expanded following its Interpublic acquisition, while its adjusted core earnings margin improved. Management said integration was nearing completion and retained its annual target of 900 million dollars in acquisition-related cost savings.

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Core operations grow as integration nears completion

US advertising and marketing group Omnicom reported 7.2 per cent organic revenue growth in core operations during the third quarter. Chief executive John Wren said integration with Interpublic Group, the advertising business acquired in the preceding year, was nearing completion.[1], [2]

Total revenue increased from 4,037.1 million dollars to 6,422.8 million dollars. Omnicom identified the acquisition as the principal reason for that reported increase. Revenue from disposed businesses and assets held for sale was 412.1 million dollars; excluding them, core operations generated approximately 6.0 billion dollars.[1]

Adjusted core margin rises to 18.2 per cent

The prior-year core comparison combines Omnicom and Interpublic results. Organic growth excludes currency and acquisition effects. Adjusted earnings before interest, tax and amortization for core operations reached approximately 1.1 billion dollars. The associated margin increased from 16.2 per cent to 18.2 per cent; management attributed improvement to savings and organic growth.[1]

Acquisition savings target remains unchanged

Wren retained the annual target of 900 million dollars in acquisition-related cost savings. Reported net income was 656.0 million dollars, and diluted earnings per share rose from 1.75 dollars to 2.38 dollars. Net interest expense increased by 61.0 million dollars to 104.2 million dollars, which the company linked to assumed debt and refinancing.[1]

References

  1. News sourceOmnicom Group Inc.Omnicom’s core operations grow 7.2 percent organically↩1↩2↩3↩4
  2. News sourceDigidayOmnicom posts organic revenue growth of 7.2 percent in the third quarter↩
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