Publicis Groupe CEO Maurice Levy (below) pulled a large and very welcome rabbit out of the hat this morning, revealing 2.8 per cent organic growth in the fourth quarter. This confounded expectations – including Publicis’ own forecasts. For the year organic growth was 1.5 per cent, ahead of forecasts of one per cent.
For 2015 as a whole Publicis reported a 25 per cent rise in net profit to €901 million, due in part to positive currency effects. Full-year revenue rose 32 per cent to €9.60bn, driven by North America and some emerging markets and helped by acquisitions. Tech consultancy Sapient, which it bought for $3.7bn, seems to be the main contributor but US clients are apparently spending again. UK revenue dropped by 4.4 per cent.
Publicis is currently undergoing a re-organisation into ‘client-centric hubs.’ It has also frozen pay across the company and seen the departures of a number of senior agency staff. But the drastic surgery seems to be working – in the short term anyway – and Publicis shares rose five per cent this morning in a falling market.
CEO Levy says: “We’re in an economy characterized by low growth and low inflation and we’ve given ourselves a certain handicap by asking our people to focus on our transformation.” Levy says he expects Publicis to be “firing on all cylinders by 2017.”
So pain to come, it seems. Publicis has come out on the wrong end of some of last year’s big media reviews, most notably losing Procter & Gamble in North America to Omnicom.