Covid-19 hammered Omnicom harder than its rivals Interpublic and Publicis Groupe (WPP is still to report) with full year and Q4 organic growth down 11.1% and 9.6% respectively.
Full year net income (profit) fell $393.7 million to $945.4 million compared to $1.339 billion in the in 2019.
By discipline for the full year advertising decreased 12.2%, CRM consumer experience decreased 15.8%, CRM decreased 15.1%, public relations decreased 4.2% with healthcare increasing 3.3%.
By region the US fell 10.1%, other North America 10.0%, UK 11.5%, Europe 12.8%, Asia Pacific 8.5%, Latin America 15.1% and Middle East & Africa 32.3%.
These dismal results are on a par with Dentsu, which reported a $960m loss due to re-organization write-downs. No word from boss John Wren yet but why did Omnicom perform so badly? Interpublic and Publicis were both down between six and seven per cent in organic terms.
Partly bad luck: Omnicom with its high profile creative networks BBDO, DDB and TBWA has many clients in sectors like entertainment and travel which were blitzed by the pandemicc.
Omnicom says: “The COVID-19 pandemic has significantly impacted the global economy, our business and the results of operations…as a result, we experienced a reduction in our revenue beginning late in the first quarter of 2020, as compared to the same period in 2019.
“The reduction in our revenue continued through the remainder of 2020 and is expected to continue through the first half of 2021. Such reductions in revenue could adversely impact our ongoing results of operations and financial position and the effects could be material.”
Which isn’t very cheering either. As the anti-covid vaccines roll out around the world – especially in the US – Omnicom can be expected to bounce back strongly. If it doesn’t, questions will be asked of Wren and his team.