PARIS, April 21, 2015 (GLOBE NEWSWIRE) --
Q1 2015 |
€
2,103 million |
% Change: +31.7% |
Q1 2014 |
€
1,597 million |
Organic growth: +0.9% |
Maurice Lévy, Chairman and CEO of Publicis
Groupe:
"Our revenue is up to slightly over 30%, partly due to the
positive impact of exchange rates, and partly to the inclusion of
Sapient since completing the acquisition. As we'll continue to see,
this is one of the important milestones of the Groupe's
transformation.
We expected organic growth to be slightly down this quarter,
but, on the contrary, it is up almost 1%. This isn't yet the
growth rate we expect to see out of Publicis Groupe, but is
nonetheless an encouraging return to growth.
The main event of this early part of the year has been the
completion of the Sapient acquisition, an event that gives Publicis
Groupe a new strategic dimension while excelling the Groupe's
transformation. The integration process is already underway
and the prevailing spirit is excellent.
Today's sudden, radical changes in lifestyle and consumption in
an unprecedentedly digital world leave all economic players facing
a new set of challenges. The blurring of boundaries can be found
everywhere - in longstanding industry sectors and even in the
shift to omni-channel - both have brought the advent of new
competitors forcing companies to transform themselves at the risk
of "uberisation". They have to rethink their processes, their
practice, their marketing, their customer relations and, more
fundamentally, their business model.
In this new environment, I think it would be fair to say that
our Groupe is ahead of the curve. With the acquisition of
Sapient, Publicis Groupe has become the only global group present
all along the value chain - from consulting to marketing, from
communications to commerce - brought to life through an outstanding
expertise in the most high-performing technologies. We are working
on commercial propositions that should enable us to achieve all our
medium-term goals.
For now, we are gradually implementing our growth program.
The second quarter will be better than the first, albeit with
modest growth, as announced, that of the Groupe should be
considerably stronger in the second half of the year."
I - Revenue
Publicis Groupe's consolidated revenue for the first quarter of
2015 was 2,103 million euro, a 31.7% increase on 1,597 million euro
for the corresponding period in 2014.
Exchange rates had a 215 million euro positive impact on
revenue, i.e. 13.5% of revenue in Q1 2014, as a result of over 50%
of the Groupe's revenue being in dollars and sterling, and due to
the weakening of the euro against these two currencies by 21.7% and
11.4% respectively. Expressed in dollars, the Groupe's
revenue in Q1 was 2,366 million dollars (+8.2%). When
exchange rates are factored out, revenue growth stands at
16.1%.
Acquisitions contributed 274 million euro or 17.2% of
revenue. The completion of the Sapient acquisition is one of
the highlights of the first quarter. This transaction is an
important milestone in the transformation of Publicis Groupe,
making it the undisputed leader of the digital era. Publicis
Groupe can now establish itself more rapidly as the leader in
corporate digital transformation, at the crossroads of
marketing, communications, omni-channel commerce and
technology.
Organic growth was +0.9%. Though global
economic growth has seen contrasting trends since the start of the
year, Publicis Groupe has achieved growth notably as a result of
its strong presence in digital which has become its main
activity. Digital activities progressed by +4.7% and now
account for 50.2% of total revenue. Healthcare also performed
well.
1. Revenue by region
Though Europe has benefitted from a combination of positive
factors (the strengthening of the dollar, the fall in oil prices,
the ECB's monetary policy), the growth outlook remains limited by
persistent unemployment. The US economy is still the world's
bastion of high growth and continued low interest rates should go
on shoring up growth throughout 2015. In the emerging
markets, the economic environment remained fragile in the first
quarter, particularly in Russia and Brazil due to the sharp
increases in interest rates to contain the weakening of the ruble
and real.
Q1 2015 revenue by region
EUR million |
Revenue |
Organic |
Reported |
|
Q1 2015 |
Q1 2014 |
growth |
growth |
Europe (1) |
575 |
474 |
+1.7% |
+21.3% |
North America |
1,152 |
795 |
+0.8% |
+44.9% |
BRIC+MISSAT (2) |
215 |
190 |
-2.6% |
+13.2% |
Rest of the world |
161 |
138 |
+4.0% |
+16.7% |
Total |
2,103 |
1,597 |
+0.9% |
+31.7% |
(1) Europe excluding Russia and Turkey (2) BRIC:
Brazil, Russia, India, China MISSAT: Mexico, Indonesia, Singapore,
South Africa, Turkey
Europe (excluding Russia and Turkey) saw its
revenue progress by 21.3%. When acquisitions and the impact of
exchange rates are factored out, organic growth stands at
1.7%. France and Germany posted 4.2% and 1.8% growth
respectively. Conversely, though the UK market continued to
be vibrant, Publicis has been experiencing challenges in several of
its businesses and recorded negative growth (-4.2%) in
Q1 2015. The southern European countries returned to positive
growth (+2.7%), though this growth was achieved against a weak
basis of comparison (especially in Greece). Digital posted
strong growth (+7.7%).
North America saw its revenue grow by
44.9%. When acquisitions and the impact of exchange rates are
factored out, organic growth stands at 0.8%, a modest increase
stemming from digital activities where growth was weak too
(+1.3%).
The BRIC and MISSAT countries recorded negative
organic growth of -2.6% (+13.2% reported growth). In
difficult economic environments, revenue fell sharply in both
Russia and Brazil (-10%). China dropped 1% due to a sluggish
luxury goods sector. India continues on the road to recovery
with growth of +5.7%. Mention should also be made of the
decline in South Africa (-5.6%) following on the trend observed in
2014.
The Rest of the world recorded growth of
4%.
2. Revenue growth by
activity
Publicis Groupe's growth has been driven by its strong presence
in digital. The table below shows the good performance of
digital activities (+4.7%), particularly in Europe and the
high-growth countries, which offsets the decline in analog
(-1.8%).
|
Europe (1) |
North America |
BRIC + MISSAT (2) |
Rest of the world |
Total |
Digital |
+7.7% |
+1.3% |
+24.8% |
+20.5% |
+4.7% |
Analog |
-1.5% |
+0.3% |
-8.4% |
-0.9% |
-1.8% |
Total |
+1.7% |
+0.8% |
-2.6% |
+4.0% |
+0.9% |
(1) Europe excluding Russia and Turkey (2) BRIC:
Brazil, Russia, India, China
MISSAT: Mexico, Indonesia, Singapore, South Africa, Turkey
Digital has become the Groupe's main activity and now accounts
for 50.2% of total revenue, thus confirming the raising of the
objective to 60% by 2018.
II - Cost control
With a view to improving its operating margin in
the medium-term, Publicis Groupe is integrating Sapient while
continuing to invest in (regionalization of its Shared Services
Centers, production platforms, ERP) and simplify its
organization.
III - External growth, new launch,
financial transactions
1. Acquisitions
- Expicient Inc., a leading global omni-channel
services firm with significant expertise in inventory and order
management systems (OMS).
- Epic Communications, South Africa's leading
independent integrated strategic communications agency.
- Relaxnews is a press agency (member of
Fédération Française des Agences de Presse and of the International
Press and Telecom Council) with global expertise in consulting,
production and management of content for the digital transformation
of media and firms (exclusive negotiations in process).
- Monkees, the agency of reference in France
for digital marketing and social media.
2. Blue 449 launch
ZenithOptimedia has launched a new global media network to drive
business growth and further develop new and innovative approaches
to communications. Called Blue 449, the new
network has its headquarters in London at the offices of Walker
Media, which has rebranded to become the founding office of
ZenithOptimedia's new global agency.
Blue 449 will have 17 city hubs by the end of this year and will
operate collaboratively with the other ZenithOptimedia brands:
Zenith, Optimedia, Performics, and Newcast. The new network will
also benefit from access to the extensive range of services within
the Publicis Groupe and VivaKi, in a new framework for clients
called 'Open Source'.
The launch of Blue 449 follows the acquisition of Walker Media
in 2014 by Publicis Groupe.
Blue 449 will be led by Global Chairman, Sebastien Danet, and
Global Managing Director, James Shoreland. Sebastien Danet is a
Global Managing Partner at ZenithOptimedia and Chairman VivaKi
France. James Shoreland has been promoted from EVP, Director
Corporate Development, ZenithOptimedia US to the new MD position at
Blue 449.
3. Finance
- Share buyback
On March 17, 2015, before trading opened on the Paris stock
market, Publicis Groupe purchased 2,406,873 of its own shares in a
block transaction from the Badinter family for a total
consideration of 175.8 million euro, i.e. 73.03 euro per
share. This transaction is part of a broader framework
consisting of the share buyback program authorized by the AGM of
May 28, 2014 and the 2022 Orane bond early redemption approved by
the Supervisory Board at its meeting of September 15, 2014 and
announced on September 16, 2014. The early redemption will be
subject to approval by the shareholders at the Groupe's forthcoming
AGM on May 27, 2015.
The transaction was carried out at a discount of 2% to the
weighted average share price of the five previous days' trading,
and at a discount of 4.5% to the closing price on March 16,
2015.
The entire transaction was funded by Publicis Groupe's available
liquidities.
- Share buyback contract
Publicis Groupe has entered into a share buyback contract with
an investment services provider for the purposes of the Share
Buyback Program authorized by the Combined Annual General Meeting
of its shareholders on May 28, 2014.
This contract was signed on March 27, 2015 and relates to a
maximum of 3,935,000 shares at an average share price not exceeding
the limit imposed by the combined AGM of May 28, 2014. The
actual price of these shares will be calculated on the basis of the
arithmetical average of the average prices weighted by the volumes
traded each day during the buyback period, and shall not exceed
that arithmetical average.
Under the terms of the contract, the buyback period shall extend
from March 30, 2015 to July 31, 2015 at the latest.
This transaction falls within the framework of the early
redemption of the 2022 Orane bonds mentioned above.
- Redemption of the 4.25% Eurobond issue
Publicis Groupe redeemed its 4.25% Eurobond at maturity in March
2015 for a total of 253 million euro. This redemption was
fully funded out of Publicis Groupe's available liquidities.
Given the 3.85% effective rate of interest on this bond issue, the
redemption will help reduce the average cost of the Groupe's
outstanding gross debt.
IV - Net debt at March 31, 2015
At March 31, 2015, net debt totaled 2,966 million euro after 29
million euro at March 31, 2014. At year-end 2014, the Groupe
posted a cash-positive situation of 985 million euro.
V - Outlook
When updating its forecast on March 30, 2015, media observatory
ZenithOptimedia reduced its global advertising media expenditure
growth forecast to +4.4% for 2015, down from +4.9% in December
2014. This 50-basis point reduction stemmed from the crisis
in Russia, Ukraine and Belarus, in addition to the slowdown in
China. By region, its expects the USA to continue to post
sustained growth (+3.7%), with western Europe growing by a mere
3.1% while advertising expenditure in eastern and central Europe
declines by 5.2%. Asia-Pacific and Latin America are expected
to grow by 5.2% and 11.2% respectively.
Organic growth is expected to be higher in the second
half-year. The Groupe's high exposure to digital activities
will ensure its future growth and the continued improvement of its
margins between now and 2018.
Forthcoming event
Annual General Meeting of shareholders on
Wednesday, May 27, 2015 at 10 a.m. at Publicis Cinémas 129 Avenue
des Champs-Elysées, 75008 Paris
Disclaimer
This presentation contains forward-looking statements. The use
of the words "aim(s)," "expect(s)," "feel(s)," "will," "may,"
"believe(s)," "anticipate(s)" and similar expressions in this
presentation are intended to identify those statements as forward
looking. Forward-looking statements are subject to risks and
uncertainties that could cause actual results to differ materially
from those projected. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
presentation. Other than as required by applicable securities laws,
Publicis Groupe undertakes no obligation to publish revised
forward-looking statements to reflect events or circumstances after
the date of this presentation or to reflect the occurrence of
unanticipated events. Publicis Groupe urges you to review and
consider carefully the various disclosures it has made concerning
the factors that may affect its business, including the disclosures
made under the caption "Risk Factors" in the 2014 Registration
Document filed with the French financial markets authority
(AMF).
About Publicis Groupe
Publicis Groupe [Euronext Paris FR0000130577, CAC 40] is a
global leader in marketing, communication, and business
transformation. In a world marked by increased convergence and
consumer empowerment, Publicis Groupe offers a full range of
services and skills: digital, technology & consulting with
Publicis.Sapient (SapientNitro, Sapient Global Markets,
Sapient Government Services, Razorfish Global, DigitasLBi,
Rosetta) - the world's largest most forward-thinking digitally
centered platform focused exclusively on digital transformation in
an always-on world - as well as creative networks such as BBH, Leo
Burnett, Publicis Worldwide, Saatchi & Saatchi, public affairs,
corporate communications and events with MSLGROUP, ad tech
solutions with VivaKi, media strategy, planning and
buying through Starcom MediaVest Group and ZenithOptimedia,
healthcare communications, with Publicis Healthcare Communications
Group (PHCG), and finally, brand asset production with Prodigious.
Present in 108 countries, the Groupe employs more than 76,000
professionals.
www.publicisgroupe.com | Twitter: @PublicisGroupe |
Facebook: www.facebook.com/publicisgroupe | LinkedIn:
Publicis Groupe
| http://www.youtube.com/user/PublicisGroupe | Viva
la Difference !
Contacts
Publicis
Groupe |
|
|
|
Peggy Nahmany |
Corporate
Communications |
+ 33 (0)1 44 43 72
83 |
peggy.nahmany@publicisgroupe.com |
Jean-Michel Bonamy |
Investor Relations |
+ 33 (0)1 44 43 77
88 |
jean-michel.bonamy@publicisgroupe.com |
Stéphanie Constand |
Investor Relations |
+ 33 (0)1 44 43 74
44 |
stephanie.constand@publicisgroupe.com |
Appendices
New Business -1er quarter 2015
Mains Gains
BBH/NEOGAMA
Tesco (United Kingdom), Magnum Watches (Brazil),
Viva Channel (Brazil), Vale (Brazil).
Leo Burnett
Fererro Chocolates (Italy), Allergan Medical
Aesthetics (Singapore), OSN Cable & Network Provider (United
Arab Emirates).
MSLGROUP
Alcon (USA), 24 Hour Fitness (USA), Rover.com
(USA), AIG (France), Conforama (France), Elior (France), Michelin
(France), Cathay Pacific (Netherlands), Ranstad Holding
(Netherlands), Nivea (Poland), ThyssenKrupp AG (Poland), ING
(Poland), Mahanagar Gas Limited (India), Alstom (India), Belkin
International (Singapore, Hong Kong, China), Alibaba.com (China),
Orient Europharma (Taiwan).
Publicis Worldwide
Arla (Belgium), Mobistar (Belgium), Fédération
des Médecins Omnipraticiens du Québec (Canada), BASF (Brazil),
Henkel (Brazil), Metro_ Santiago (Chile), Sodimac (Chile),
Universidad de Piura (Peru), Tencent (China), Heinz ABC
(Indonesia), Tourism NT (Australia), Civil Engineering Institute
(Macedonia), Roche Macedonia (Macedonia).
Saatchi & Saatchi
HomeAway - integrated (c/o) (United Kingdom),
Benecol - Pan European (United Kingdom), Praktiker - digital
(Poland), Drinkworks/Monteith's Cider (Australia), Bank SA
(Australia), Bank of Melbourne (Australia), Berlitz (Japon), Acer
(Singapore), ADT (South Africa), Cadillac (United Arab Emirates /
Middle East & North Africa).
Starcom MediaVest Group
TomTom (Global), Mars (USA), UNHCR (Italy),
Poczta Polska (Poland), Viacom (Poland), Liberty Insurance
(Poland),
ZenithOptimedia
eis.de (Allemagne), Pixmania (France), Toyota
(Slovakia, Czech Republic), Mercedes-Benz (Romania), BRD - Groupe
Société Générale (Romania), Bella Food (Romania), AXN Europe
Limited (Romania), L'Oréal (Bolivia), Viva (Bolivia), ABInBev
(Bolivia), Nestlé (Bolivia), NH Hotels (Colombia), Istanbul Cerrahi
Hospital (Turkey), The Euroepan Commission (Armenia), Alkaloid
(Armenia).
2015 press releases
08-01-2015
Publicis Groupe Extends Tender Offer to Acquire Sapient
15-01-2015 Publicis Groupe Names
Anthony Gazagne President of PublicisLive
23-01-2015 Publicis Groupe Extends
Tender Offer to Acquire Sapient
27-01-2015 Publicis Groupe Acquires
French Digital Marketing Agency Monkees to be aligned with Publicis
Activ 29-01-2015 Jean-Michel Bonamy
Joins Publicis Groupe as Vice-President Investor Relations &
Strategic Financial Planning
04-02-2015 Publicis Groupe and
Sapient Receive all Regulatory Approvals for Proposed Acquisition
06-02-2015 Publicis Groupe Completes
Acquisition of Sapient 12-02-2015
2014 annual results 16-02-2015
Publicis Groupe and Relaxnews Announce the Start of Exclusive
Negotiations in View of the Acquisition of Relaxnews, press agency
specialized in lifestyle content creation, at a valuation of €9.58
per share 26-02-2015 Publicis Groupe
Acquires Integrated Strategic Communications Agency, Epic
Communications. Agency to Join the MSLGROUP Network in South Africa
12-03-2015 Publicis Groupe
Strengthens Publicis.Sapient's Leadership in Omni-Channel and
Connected Commerce with Acquisition of Expicient Inc
17-03-2015 Share Buyback
25-03-2015 Update On Publicis Groupe
Always On Platform 30-03-2015 Share
Buyback Contract
Definitions
Net financial debt (or net debt): equals the
long and short term financial debt plus associated derivatives fair
value, less cash and cash equivalent
Average net debt: average of average monthly
net debt.
Operating margin: The operating margin is equal
to the revenue after deduction of personnel expenses, other
operating expenses (excluding non-current income and expenses),
depreciation and amortization (excluding intangible arising from
acquisitions).
Operating margin rate: operating
margin/revenue.
Organic growth calculation
(in million euros) |
Q1 2015 |
|
Impact of exchange rates by currency (EUR
million) Q1 |
2014
revenue |
1,597 |
|
GBP (2) |
16 |
Currency impact (2) |
215 |
|
USD (2) |
167 |
2014 revenue at 2015 exchange rates (a) |
1,812 |
|
Others (2) |
32 |
2015
revenue before impact of acquisitions (1) (b) |
1,829 |
|
Total |
215 |
Revenue from acquisitions (1) |
274 |
|
|
2015
revenue |
2,103 |
|
|
Organic growth (b/a) |
+0.9% |
|
|
(1) Acquisitions (L&K India, Hawkeye, Lead 2 Action,
Salter Baxter, Crown, Proximedia, Ambito 5, Liquorice, Nurun,
Turner Duckworth, Tangerine, Run, ZME, Machine, BrandsRock, 3Share,
Relevant 24, Monkees, ZO Puerto Rico, AKM3, Vivid, Epic, Spindrift,
Star Reacher, Sapient, Expicient, Practice iLeo Romania), net of
disposals.
(2) EUR = USD 1.125 in Q1 2015 vs. USD 1.370 in Q1 2014
EUR = GBP 0.743 in Q1 2015 vs. GBP 0.828 in Q1 2014
HUG#1912705