IPG 'demonstrating strength' with 7.5% 2018 net revenue growth
The Interpublic Group of Companies (IPG) has reported a fourth-quarter net revenue increase of 13.3% to $2.41bn, topping off a year that saw the agency network deliver growth of 7.5% to post $8.03bn in net revenue. The growth comes as rivals like WPP and Publicis attempt to restructure their offerings.
IPG 'demonstrating strength' with 7.5% 2018 revenue growth
The New York-based holding company, which counts McCann, FCB and Mullen Lowe Group among its stable, delivered an organic net revenue increase of 6.3% in the US and 8.0% internationally in the quarter. This contrasts with Publicis Groupe's recent struggles in the United States. Its chief executive Arthur Sadoun last week told shareholders to expect a "bumpy ride" as it suffered "revenue attrition" from FMCG brands in the US.
For the year, IPG net revenue was $8.03bn, compared to $7.47bn in 2017. IPG chairman and chief executive Michael Roth, said: "Overall, 2018 was a very successful year, with outstanding financial results, coupled with a significant, future-facing acquisition. Our results again demonstrate the strength of our client-centric integrated offerings, and the quality of our people."
He outlined the group's commitment to increasing the diversity of staff, referring to a proposed bonus structure that is linked to diversity targets. He added: "This is what’s required in light of the significant changes taking place in our industry and the environment in which we operate."
It acknowledged the loss of the Fiat Chrysler Automobiles media accounts after 10 years, it mitigated this with laying off more than 200 staff in Detroit. The loss will affect the network's bottom line nonetheless, it said it expects 2019 organic growth of between 2%-3%.
Commenting on the coming year, Roth added: "As we turn to our outlook for 2019, we do so with a strong portfolio of agencies, across the full range of capabilities and marketing disciplines, competing successfully in the marketplace."
Late last year, IPG sealed the $2bn acquisition of data marketing business Acxiom. Roth had previously cited it as another source of optimism for the marcomms business. It has earned $181.7m from the group since the 1 October acquisition. It's part in IPG growth however will not be announced until the fourth quarter of the year.
Helping to steer its US business, IPG in December elevated its global chief marketing officer, Lynn Lewis, as its new US chief executive, a Johnson & Johnson veteran.