Havas 2012 Revs Rise 8%, NY Office To Consolidate
Havas reported Thursday that its net profit for 2012 climbed 5% to roughly $163 million. The company reported earlier that revenues for the year were up 8% to approximately
$2.4 billion, while organic growth was 2.1%, versus 5.9% organic growth for 2011.
By comparison, Publicis Groupe and WPP both reported that full-year 2012 organic growth climbed 2.9%. And Omnicom Group earlier said its full-year organic growth was 4%.
Havas said its operating income for the year was up about 11% to approximately $283 million, boosting its operating profit margin to 12.3% in 2012 from 12% in 2011. Havas CEO David Jones told analysts and investors on a conference call Thursday that the company was committed to further margin improvement in the coming years.
Jones also said the company currently believes the “overall market” in 2013 won’t be “dramatically better or worse” than 2012. He did note that North America has cooled down from the fourth quarter, when the company’s organic growth in the region exceeded 6%. He said North America was off to the “slowest start” among regions in the first quarter. Europe continues to struggle, but has shown some improvement.
“While European economies remain challenged, we are confident in our ability to continue to deliver strong results and grow shareholder value for the long term,” Jones said.
Jones also said the company would continue to integrate creative, digital and media facilities where it can. Last year, he noted that the company consolidated most of its operations in Paris in a single new location known as the Havas Village. Next month, the company is making a similar move in New York, consolidating some 2,000 staffers at 200 Hudson Street in Manhattan.
Jones said that company would continue to spend modestly on acquisitions -- roughly $50 million annually -- that focus on digital assets in emerging markets. “We’re not going to be writing big checks to create large digital silos,” he said, referring to a potential alternative strategy of acquiring huge and expensive stand-alone digital shops.
The company will also continue to build agencies from scratch. “From a shareholder perspective, that’s a good model,” he said. He cited BETC London, a recent agency startup that has already won the Diet Coke account for Europe and the global Bacardi assignment.