Omnicom reports 11% growth in Q2 organic revenue
Omnicom Group has once again raised its organic revenue forecast for the year while reporting an 11.3% increase in second-quarter organic revenue, with growth in every discipline and region. However, second-quarter organic revenue decreased in the Asia Pacific region due to COVID-19 lockdowns.
This marked the holding company’s fifth consecutive quarter of organic growth. Organic growth is a key financial measure that factors out acquisitions, divestitures and effects of exchange rates.
Despite the organic revenue growth, the advertising conglomerate’s revenue fell 0.1% from a year earlier, which it attributed to the negative impact of foreign exchange rates and its withdrawal from Russia.
Second-quarter net income increased 0.1% to $348.4 million.
Organic revenue increased across all of Omnicom’s fundamental disciplines from a year earlier: 8.2% for Advertising & Media, 21.0% for Precision Marketing, 11.2% for Commerce & Brand Consulting, 36.6% for Experiential, 9.3% for Execution & Support, 15.8% for Public Relations and 9.2% for Healthcare.
Organic revenue increased across all regions, except Asia Pacific, which the holding company says is due to the COVID-19 lockdowns in China. Organic growth came in at 10.7% for the U.S, 12.5% for other North America, 12% for the U.K, 15.1% for the rest of Europe, 4.7% for Asia Pacific, 14% for Latin America and 28.3% for the Middle East & Africa.
Omnicom now expects full-year organic revenue growth of 6.5% to 7%, with margin strength continuing, John Wren, chairman and CEO, said on a conference call. That’s up from an April forecast calling for 6% to 6.5% organic revenue growth. In February, it predicted 5% to 6% organic revenue growth for the year.
Publicis Groupe will report its second earnings on July 21. Stagwell will release its results on Aug. 4 and Dentsu Group will follow, releasing its results on Aug 10.
Omnicom shares rose 7.6% to $72.50 in after-hours trading following the release of the results.
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